India tax authority mulling legal action against Kingfisher

Reuters: India’s Kingfisher Airlines has service tax dues of 500 million rupees ($9.1 million), and tax authorities are working to take “legal action” against the debt-laden carrier, a senior tax official said last week.

“The action is that, one, we issue them a show cause notice and tell them that this is their liability and this is their dues, and they pay along with interest,” the Central Board of Excise and Customs Chairman S.K. Goel told reporters.

“And then (we) also propose imposition of penalty,” Goel said.

The airline is already under immense pressure from lenders to work out a turnaround plan. Kingfisher has never made a profit. Its share of India’s domestic airline industry fallen from second to last among the six big carriers after it was forced to ground most of its fleet.