SpiceJet has been given time till Monday to clear its dues to the Airports Authority of India (AAI). Earlier, the airline was told that it would be put on ‘cash and carry’ from midnight Wednesday unless it cleared dues of over ₹190 crore.
SpiceJet deposited a bank guarantee of ₹5 crore following which the airport operator decided to let the present system for the airline’s operations continue. The development comes a day after a high-level delegation comprising Sun Group CFO SL Narayanan, SpiceJet COO Sanjiv Kapoor and other senior officials met the AAI Chairman to plead their case for not putting them on cash and carry.
If it had been switched to a cash and carry mode, SpiceJet would have to pay upfront for using airport infrastructure before each flight.
At the moment, SpiceJet, like other carriers, is allowed to use these facilities on a credit-basis with payments being made towards the end of the month. SpiceJet is scheduled to convey a definite proposal to the Directorate General of Civil Aviation (DGCA) also on Monday with regard to the issue of repaying arrears that stand at ₹1,600 crore. The DGCA has emphasised that the Government requires a concrete plan by that date.
Sources say that the airline is working on a long term solution to the problems facing the airline. At a press conference here late last month, Kapoor had said that until the airline is able to recapitalise, SpiceJet will not have the ability to take out costs.
Recapitalisation“The recapitalisation activity is ongoing,” he added. The current woes of the airline started last Friday when the Directorate General of Civil Aviation put the airline under “heightened surveillance” and stopped it from taking booking before 30 days. Union Minister of Civil Aviation Ashok Gajapathi Raju told newspersons that the heightened surveillance was more of a safety requirement as safety cannot be compromised on.