SpiceJet in talks with tax authorities

Mumbai: Budget airline SpiceJet Ltd said it was in talks with authorities to resolve tax-related issues after its shares tumbled on a newspaper report that the company had left employees unable to fill in tax returns on time.

"We are aware of our obligations under the applicable law," the company said in a statement after trading hours on Wednesday. SpiceJet shares fell 16.2 per cent, the most since June 2006, to close at 14 rupees, in a Mumbai market that edged up 0.4 per cent. The stock fell as much as 18.6 percent at one point during trading.

The Times of India report said SpiceJet had not yet given its employees the information they needed to file tax returns, a day before the July 31 deadline. bit.ly/1oaC715

SpiceJet, India's fourth-biggest airline by local market share, reported a record annual loss for the year to March. High fuel prices and taxes have hurt the Indian airlines industry, where most carriers are losing money. Separately, the Economic Times newspaper cited an unnamed government official saying the civil aviation regulator would conduct an engineering audit of SpiceJet and that the carrier was finding it difficult to provide equipment to operate some flights.

SpiceJet said all but three of its 52 aircraft was operational and that it was fully compliant with safety rules. SpiceJet said it was subject to regular audits by the regulator from time to time, like any other airline.