Kingfisher and Air India Bank A/c's Frozen for Non-Payment of Service Tax

Sushil Solanki, Commissioner, Service Tax, Mumbai confirmed the action and said, "We have initiated action against Kingfisher(to the extent of 70 Crores) and Air India(to the extent of 100 Crores) for Non-Payment of Service Tax U/s 87 of the Finance Act 1994  and have frozen 6 bank accounts of Air India and 7 Kingfisher accounts in the last five days.
(This effectively means that while both the companies collected the service tax on the air tickets they sold from their customers, they did not deposit it with the department)
Also specific instructions have been given to the respective banks to ensure that no withdrawal transactions are allowed in any of the two airlines' accounts, until after getting a clearance from the department.

Read more at: http://www.ndtv.com/article/india/7-kingfisher-6-air-india-bank-accounts-frozen-156337&cp

Kingfisher, Air India make part-payment, accounts defreezed - Dec 13,2011

Kingfisher airline had paid about Rs 9 crore toward its service tax dues for the month of Novemberand has given a written "undertaking" that it will pay the remaining dues toward service tax by March 31, 2012.

Air India paid Rs 8 crore. 

"As they (Kingfisher and Air India) have made part-payments of service tax dues, the department has lifted the freeze on their accounts," a top Finance Ministry official said .