The Supreme Court today rejected a request of grounded Kingfisher Airlines for interim protection for a month against any action by the income-tax department for not depositing tax deduction at source from its employees.
However, the court allowed the airline to present a plan on paying the dues at the next hearing. Senior counsel Harish Salve, representing the airline, said the company was in serious financial difficulties. Its licence had been cancelled and there was a winding-up decree in England. Meanwhile, the Vijay Mallya-led carrier is negotiating with potential investors to resume operations. It might take two months. The bank guarantee should not be executed, he said. When the court asked the counsel how much was due, he said that out of Rs 370 crore, the company had paid Rs 135 crore.
The bench, headed by justice D K Jain, observed deducting tax from the employees’ salary and not paying it to the government could invite criminal action.
Salve said it should be stated “candidly” that the finance of the airline was “in a mess”.
The airline has appealed against the Karnataka High Court order last month, directing it to deposit around Rs 185 crore with the I-T Department as TDS. The company has contended that the amount due is less.
