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DGCA should have issued notice to Kingfisher 4 months ago: experts

Press Trust of India
Oct 07, 2012 at 10:04am IST

New Delhi: With DGCA serving a show-cause notice to beleaguered Kingfisher Airlines asking why its license should not be taken away, industry experts on Saturday said it could have been issued four months ago when the then aviation regulator chief had made a similar recommendation to avoid the present situation. "The government should have taken forward the recommendations made by then DGCA chief EK Bharat Bhushan who had recommended issuance of a similar notice to the airline on the same grounds as the DGCA has done now," the experts, who refused to be named, said in NEw Delhi.

Bhushan was abruptly shunted out mid-July to Steel Ministry for taking a tough stand against Kingfisher, a charge that was denied by the government. Bhushan had then recommended that a notice be served on Kingfisher indicating that the DGCA would be constrained to suspend their operations as operational safety was being compromised, the airline had huge liabilities regarding salaries and the dues of its vendors, oil companies and airport operators.

The experts compared the notice sent by the incumbent DGCA Chief Arun Mishra and the recommendation made by Bhushan and said both had referred to the abrupt cancellation of flights and the airline not adhering to its flight schedule, causing great inconvenience to the travelling public.

DGCA should've issued notice to KFA earlier

Experts says the notice could have been issued four months ago when the then aviation regulator chief had made a similar recommendation to avoid the present situation.

Both of them had referred to the problems of safety of Kingfisher's air operations, apart from its severe financial problems, the industry insiders said. "The current critical situation could have been averted, had the government taken such a step earlier," they said.

In the show-cause notice, Mishra has also taken note of the lockout declared by the airline management which led to "suspension of all their flights". It said the airline had "failed to establish a safe, efficient and reliable services as required" under the rules and asked it to reply within 15 days to the charges that it had violated the provisions of the Aircraft Rules 1937.

Kingfisher had declared a lockout on September 28, cancelling its entire flight schedule, and later extended it till October 12 later. The move came after the management failed to resolve the deadlock with its striking employees, including engineers and pilots, over non-payment of salaries for last seven months.

Global aviation consultancy firm, Centre for Asia Pacific Aviation (CAPA), in a latest report on the Kingfisher crisis, said "while speculation continues on whether the airline will resume operations tomorrow or next week, CAPA believes that instead the airline should voluntarily shut down in order to reorganise and restructure. "This will surely provide the airline with a greater chance of an orderly recovery, even if that remains an outside chance."

CAPA said it did not expect any foreign airline to invest in Kingfisher in its current state with its massive debt burden, crippled fleet and poor employee morale. "In order to become a prospective investment target, Kingfisher will first require significant recapitalisation of at least $600 million, restructuring of its debt, operationalisation of some of its grounded fleet, development of a new business case, resolution of outstanding employee issues and induction of a new management team," it said.

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