State-owned oil firms on Wednesday halted jet fuel supplies to cash-strapped
Air India for non-payment of dues leading to disruption of some of its flights after cheques of the national carrier bounced.
The Aviation Turbine Fuel(ATF) supplies were resumed after Air India agreed to make the payments on Thursday to the oil companies following hectic parleys by Civil Aviation and Petroleum ministries to find a solution.
Oil industry officials said cheques issued by Air India for its daily fuel purchases, which total about Rs 16.5 crore, bounced, prompting their companies to take such action.
The airline is understood to be negotiating with some foreign banks to help make the payments Thursday.
The departure of a couple of flights originating from Kolkata and Chennai were delayed by 30 to 45 minutes.
The supplies were stopped at some stations including major ones like Delhi, Mumbai, Chennai and Kolkata, but were later resumed.
"Indian Oil, Bharat Petroleum and Hindustan Petroleum have from 16.00 hours stopped aviation turbine fuel (or jet fuel) supplies to AI," a senior industry official said.
Air India was put on cash-and-carry mode of debit from December last year on account of non-payment of Rs 2,200 crore dues to the three state-run oil companies. Under cash-and- carry, supplies are made only when cash is paid.
The oil companies are understood to have been informed that the airline would be paying its daily dues from Thursday.
Severe cash crunch has led Air India to previously default on payments, affecting its flight schedules.
The officials said that the oil companies had together decided to curtail supplies by 20 units, which would have hit flights from the major metros. Air India officials heaved a sigh of relief after the supplies were restored.
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