Jet, Sahara tax liability case hearing put off to July 15

03 Jul 2009

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The ongoing tax liability dispute case between Jet Airways and Sahara India has again been adjourned by the the Bombay High Court to July 15. The court expects this to be the last adjournment.

An out-of-court settlement is being sought by both the parties and they had asked for more time being granted for the same in the last hearing. Yet the two companies have been unable to reach a settlement.

In March this year, Sahara had claimed a default on Jet's part on its payment commitment. Jet had clarified that there was a deduction of Rs87.50 crore from two payment installments due to a tax demand from the IT department for the period prior to its takeover of Sahara's air business. (See:  Sahara takes Jet to court over tax dues)

The I-T department had disclosed tax dues of Rs107 crore due from Sahara Airlines for the period prior to its acquisition, which Jet refused to pay.

The demand amounted to Rs1,032 crore on JetLite which Jet is now liable to pay, the company said, of which Rs908 crore was undisclosed and therefore not taken into consideration at the time of the deal. The company is thus seeking a reimbursement of the balance Rs821 crore as well.

Sahara claims that the agreement does not allow for any deductions, and that the installments have to be paid in full.

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