Overdue salaries are 'personal sorrow': Mallya's new letter

In an internal letter to Kingfisher Airlines' employees, chairman Vijay Mallya has said he has organized funding to be able to pay overdue salaries, adding that the delay in payments is a "source of great personal sorrow". (Read: 5 developments over the weekend)

In his letter sent early on Monday, the chairman of the debt-stricken airline said the company was handicapped because its bank accounts had been frozen by the tax authorities. (Read: Tax dept rejects Kingfisher's plea)

Mallya also took a dig at news reports of the airline’s woes, saying the “media and ‘paid’ media’’… are unscrupulous and .. will do whatever it takes, part fact or fiction, part true or untrue to achieve their sensationalist objectives.”

The so-called ‘King of Good Times’ claimed he has been ‘working tirelessly’ to resolve the impasse through negotiations and that his efforts will be successful by early next week.

“We fully intend to pay our taxes as much as we commit to paying your salaries,” Mallya noted.

Last week, the Central Board of Excise and Customs warned it would take legal action against the airline if it didn’t clear about Rs 35 crore in unpaid service tax dues by 31 March. (Read: CBEC threatens legal action if KFA does not pay)

He also cited as ‘light at the end of a long dark tunnel’ the recent government notification to allow direct import of aviation fuel. Mallya claimed this would save about 15 per cent of Kingfisher’s current fuel costs, adding that he was hoping for the government to notify investment of up to 49 per cent by foreign airlines in domestic carriers.

He also revealed that last week, the UB Group – one of the promoters of the airline -- and its associates had converted some loans for an additional 5 per cent stake in KFA, the maximum permissible under law in a given fiscal.

“(This) clearly demonstrates the faith that I have in all of you and in our Company.” Mallya said.

Mallya also called upon employees to “stay committed to our common cause” and that he would reward those who have stayed with the company through its ups and downs, calling it the “true test of loyalty dedication and commitment”.

Interestingly, in his sign-off to his employees, Mallya’s first designation is ‘Member of Parliament’ followed by that of ‘Chairman and Managing Director’ of Kingfisher Airlines.