Ministries advised by the Government to purchase air tickets through cash and to clear Air India dues.
On Wednesday, the government ordered ministries and departments to buy tickets only in cash and clear all Air India’s dues. Earlier this month, Talace Private Limited, a unit of holding company of salt-to-software conglomerate Tata Group, agreed to buy Air India from the government for Rs. 2700 crore cash and take over the airlines debt of rupees 15,300 crores.
In 2009, an order given by the Department of Expenditure under the Finance Ministry had said that for air travel in both domestic and international, the officials may travel only by Air India. It also included LTC (leave travel concession), which the Government of India pays.
It was further said by the Expenditure Department that disinvestment of Air India is in process and that credit facilities have been stopped from extending the airlines debt.
In an office memorandum, the department said that all departments and ministries are directed to clear Air India dues immediately. Officials may purchase tickets from Air India through cash only till further instruction.
On 25th October, the government signed the agreement for share purchase with Tata Sons to sell Air India Airlines. Tatas will now do the other regulatory clearance process by December before the complete handover of the airlines.
Spicejet promoter Ajay Singh had offered a total amount of Rs. 15,100 crores. But the Tatas earned this agreement for their offering amount. The government initially set the reserve price of Rs. 12,906 crores for the sale of Air India.