The failure of Air India to surrender leased premises at Heathrow airport in London without usage for the past nine years ended March 2012 resulted in wasteful expenditure of Rs 14.30 crore towards lease rent, council tax and utility charges.
This has been brought out in a report by the Comptroller and Auditor General (CAG) on the functioning of various Central Ministries, including Civil Aviation.
The report states that the airlines’ Washington office spent an extra Rs 75.26 lakh by accepting an “abnormally higher rate” for hiring transport for the teams accompanying special charter flights of the Prime Minister on visits to the US.
The report points out that the Indian Embassy in the US was able to hire transport from the same company that the airline was hiring at lower rates than Air India during the Prime Minister’s visits in 2009, 2010 and 2011, which led to the extra expenditure.
The Government auditor report points out that Air India overpaid New York and Newark airports Rs 63.22 lakh as it paid a port fee higher than what was being charged by the Port Authority of New York and New Jersey.
The CAG report also states that Airline Allied Services Ltd was unable to operate in a cost-effective manner its fleet of six vintage freighter aircraft and took some imprudent decisions that resulted in a loss of Rs 48.36 crore between May and November 2010.