Is the country?s largest private carrier Jet Airways going the Kingfisher way? A week after the service tax department froze Vijay Mallya-led Kingfisher?s bank accounts, the department on Monday attached Jet Airway?s accounts for non-payment of around R69-crore dues, a charge that was denied by the airline.
?They have not paid us yet. That is why we have frozen their Iata (International Air Transport Association) account where the payments from travel agents and all come,? an official from the service tax wing of the Central Board of Excise and Customs told The Financial Express.
Allegedly, Naresh Goyal?s airline had not paid service tax worth R69 crore from January onwards. The tax authorities had sent a notice to the airline on last Friday. Monday was the deadline given by service tax department to the airline for clearing its dues.
The company officials, however, said that there was no freezing of accounts. ?The service tax department has asked Iata to deposit a part of the airline?s collections from its settlement systems directly to the government. The account has not been attached,? a company official said.
?Service tax department has been in touch with Iata with regards to having their proceeds remitted when the collections are remitted to Jet Airways,? the airline said in a statement.
The service tax payment was due since March 6. The carrier had assured that the payments would be cleared by Monday. The international body maintains accounts of every member to facilitate the business transactions among travel agents, airlines and other vendors in domestic as well as international markets.
There are mainly three platforms for that – clearing house, billing and settlement plan (BSP) and cargo accounts settlement system (CASS). The clearing house handles the payments made by airlines to other carriers, while BSP and CASS handle tickets sale and cargo bookings. According to service tax official, it is the BSP account that has been attached.
