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Government takes convenient stand where required about Air India – denies ownership of liabilities




The Government has always had ownership of the national carriers, Air India, and Indian Airlines, and after their merger, the combined entity. In all this time, while private airlines (some of them) have been going from strength to strength, the national airline has been run down to such a condition that if the airline was a private company, it would have been closed down a long time back. So, from time to time, the Government has been pumping in money into what has essentially been a loss making concern, and that too, with a huge quantum of losses. In fact, in some of the Nira Radia tapes, it has been alleged that the effort to ensure that the airline does not recover is part of a deal made with private airlines and the former minister Praful Patel. If that was the case, then one can say that the Minister has succeeded tremendously. Right now, the National Carrier is in such a condition that unless it is given funds by the Government, it cannot run even on an operating level, forget about its plans for spending huge sums of money to buy new planes.
However, at a time when the Government has total control of the airline and has been the primary reason for the terrible condition that the airline is in, it is conveniently shirking its responsibility when it comes to some of the liability that the airline has. This is especially bad when it is considered that these are liabilities in the area of back wages and wage arrears. So, when there is a court case filed by retired cabin crew asking for their wage arrears, the Government has declined to take any responsibility for these liabilities (link to article):

The high court was hearing a petition filed by retired cabin crew of Air India (AI) stating that they have not received arrears of their wage revision for a long time. The petitioners have claimed dues worth Rs 73 crore. Vinay Masurkar, advocate for the Centre, informed the high court on Monday that according to the court’s directives, in January 2011, the government disbursed Rs 1,200 crore to AI. “Their (AI) liability is not the liability of the government. It’s now between the AI and the petitioners,” Masurkar told the court. He also informed the court that AI will have to pay up wages and other dues of petitioners from their own funds.
Talsania also argued that it is difficult for AI to clear petitioners’ dues at this stage because the premiere airline has not ‘earned profits’. “There is a problem in paying up salaries of the present employees. Regular salaries are delayed by seven days. This month, too, full salary has not been paid to the staff. We have stated in an earlier affidavit that the petitioner’s arrears will be paid only if the financial crisis is sorted out,” argued Talsania.

In a typical case, when a company has dues outstanding and is unable to pay up or come to some sort of agreement with its creditors, it can be wound up in order to pay off its dues to its creditors. Will the Government also agree to this sort of decision if it refuses to pay the dues owed to the former employees of the national airline ?




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