SpiceJet pays a principal amount of 4.53 to AAI; looking for time to pay interest

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SpiceJet made partial dues payments to the Airports Authority of India to avoid cashing in on its bank guarantee. He paid 4.31 crore in cash up front, partial interest payment of 14 lakh, 20 crore TDS until December 2020.

The debt-strapped airline also offered to pay the remainder of the TDS amount in two installments by June 30 and requested interest relief.

According to a letter submitted by SpiceJet to AAI on April 1, the low-cost carrier said it had paid 4.53 crore as of March 31, bringing the current outstanding principle amount from 115.41 crore to 75% of guarantees. banking. and 100 percent of the deposit in cash for total security coverage of 153.63 crore in accordance with the proposed regulation.

AAI’s credit policy states that if an airline’s total dues are more than 75% of the bank guarantees provided by the airline, AAI can cash it. “We would like to reiterate that the recent increase in Covid infections across the country and the world has again resulted in lost income, lower passenger traffic, lower load factor and lower travel feelings for passengers. passengers beyond SpiceJet control, such as force majeure conditions, ”the airline said. In its recent financial results announcement, SpiceJet auditors expressed concerns about its survival.

Refund contributions

In this regard, in a letter dated February 3, SpiceJet had requested to consider an interest waiver for late payments during the period from March 2020 to March 2021.

As of March 30, 2021, the principal unpaid amount owed by SpiceJet is Rs 133.52 crore, but “this also includes the TDS amount of Rs 18.58 crore that SpiceJet would be depositing soon,” he said.

In accordance with the Income Tax Act, SpiceJet is responsible for deducting income tax at the specified rate and for filing the amount of tax with the Authority within a specified time. Therefore, SpiceJet would deposit the TDS amount and this should be excluded from the principal amount.

Thus, the actual principal amount of 119.94 crore that SpiceJet owes the IAA has now been reduced to 115.41 crore after making recent payments, the airline said in the letter.

A copy of the letter has been reviewed by Activity area.

The cash-strapped airline further stated that it had already provided the TDS 20.52 crore certificate of deposit in December 2020. SpiceJet “will deposit the TDS amount in two installments: the first installment of 5.30 crore by April 07, 2021 and the second payment of 13.28 crore by June 30, 2021.

Cash & Carry Mode

Since June 2020, SpiceJet has been put in cash-and-carry mode to use the airport facilities. This means that SpiceJet will have to pay daily to fly. “SpiceJet continues to make a daily payment of 1.51 crore under the cash and carry program,” he said.

It comes even as SpiceJet signed a memorandum of understanding with Avenue Capital to sell and lease 50 planes. The airline has also bid for Air India and is among the shortlisted entities to bid for the national airline.

Spicejet had requested a one-time debt restructuring and also requested working capital of 500 crore to overcome the Covid-19 pandemic from private sector lender Yes Bank.

Now Activity area has learned that the proposal submitted to Yes Bank has also stalled.


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