Home BIG STORY Govt serves notice to Air Odisha over suspension of services

Govt serves notice to Air Odisha over suspension of services


Odisha Sun Times Bureau
Bhubaneswar, Mar 21:

Taking a tough stand against the chartered air carrier Air Odisha Aviation Pvt Ltd for discontinuing its intra-state air services, the state government today issued show cause notice to the private carrier for its unilateral decision to suspend services from today over non-payment of subsidy to it.

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According to sources, the state government has served show cause notice to Air Odisha Aviation Pvt Ltd for withdrawing services without informing it which violates the conditions of the memorandum of understanding (MoU) signed between the two.

The private carrier has been asked to reply to the notice by March 26.

“Air Odisha Aviation Pvt Ltd has been issued notice for suspending air services. The carrier has been asked to reply by March 26 as to why it has suspended the services without informing the government. Of the pending dues, 75% of subsidy has been paid,” RS Gopalan, Additional Secretary of General Administration Department said.

Hours later, the carrier announced to resume its services.

“Today we received our pending subsidy dues from the state government. We resumed the flight operation from today,” Air Odisha Aviation Pvt Ltd Operations Manager Joseph Nayak said.

It may be recalled that the carrier had stopped it services to Sambalpur and Rourkela last Saturday and had announced to stop the flights to Jeypore from Monday over non-payment of subsidy. Notably, the carrier had stopped its services to Jharsuguda on January 22, three days after it began its operations from here as runway repair work was underway there.

The carrier had claimed that Rs 60 lakh was due towards payment of subsidy to it.

“We will stop our intra-state operations temporarily from Monday due to non-payment of Rs 60 lakh due on account of subsidy. The board of directors have decided to suspend the flight operations on all routes until the pending amount is sanctioned to us. Subsidy amount for February is due despite submission of the bills on March 3,” Air Odisha Aviation Pvt Ltd CMD Radhakanta Pani had said yesterday.

According to sources, the airline was getting subsidy from the state government on the basis of nautical miles it flies in a month. The price was fixed at Rs 222 per nautical miles with a cap on total subsidy of Rs 8 crore annually.

Besides, it was claiming a refund on VAT on the ATF imposed by the state government.

The nine-seater Air Odisha had started its operations from the Biju Patnaik International Airport (BPIA), Bhubaneswar to four cities – Jharsuguda, Rourkela, Sambalpur and Jeypore on January 19.