Concerns Paramount in the southern skies

With a single aircraft the airline struggle to stay alive

AH Correspondent

According to airport authorities, Paramount had been operating its services with a single Embraer aircraft VT-PAC to destinations like Madurai,Coimbatore and Trivandrum for quite some time

On July 07, an official of Paramount Airways, the all business class airline from the south, told news persons that the airline was to induct ten aircraft to its fleet by December 2010.

The carrier had recently received government permission to import 22 aircraft and the acquisition plan was made to beef up its service which include flights to metros, the official said.

The expansion plans of any airline is of course a good news story but the Paramount officials announcement of rapid fleet acquisition and expansion was perplexing, to say the least.

It was just three days prior to the press meet that the license of the airline to operate scheduled service was suspended by the Directorate-General of Civil Aviation (DGCA).

DGCA was adamant that the airline have to meet the minimum fleet requirement and address pending safety issues for the regulator to consider reviving the airline’s license. An airline must have a fleet of at least five aircraft to be considered a scheduled airline. As of July 04, Paramount had just one operational aircraft.

According to airport authorities, Paramount had been operating its services with that single Embraer aircraft VT-PAC to destinations like Madurai, Coimbatore and Trivandrum for quite some time after three of its other aircraft were deregistered following a dispute with its lessor GE Capital Aviation Service Ltd (GECAS).

However, the airline moved quickly and by July 06, they earned an interim order from Madras High Court allowing them to operate flights with the single plane, for the time being. It turned out that the airline had succeeded in convincing the court that they were in talks with a supplier to procure four aircraft.

Getting an interim relief thus from the court might not have been that difficult. But winning back the confidence of the passengers could turn out to be much a difficult task for the airline. Because the uncertainty regarding the future of the airline was hanging in the air for quite some time.

The airlines’ operations had almost come to a standstill as early as December last year with the Directorate General of Civil Aviation (DGCA) de-registering three of its aircraft following the dispute with GECA. Paramount officials had then informed the media that they had submitted relevant documents to DGCA and hoped to return normalcy in their operations.

“We (Paramount) have been awarded a positive judgment by the London High Court against GECAS over the pending dispute on maintenance reserves and deposit refund thus putting an end to months of speculation,” a release said explaining the causes for the DGCA directive to de-register its aircraft.

“Paramount had made a $15 million deposit to GECAS – $5 urn as deposit and $10 mn as maintenance reserves. The dispute had arisen as Paramount asked for a reimbursement of the maintenance reserves created on various checks carried out. The lack of response from GECAS led to the dispute. GECAS in its capacity of a leasing company was de-register de-register the aircraft due to the dispute….”, thus went the airlines lengthy explanation.

But why the airline could not sort out the problem even after seven months? If they indeed were that sound financially to import as many as 22 brand new aircraft, why they still struggle to settle the deposit issues with the lessor?

Though no answers seem convincing enough at the moment, let us hope the Madhurai based airline fly out again like the proverbial Phoenix bird. Because it is always sad to witness a venture to wither away.