By P PREM KUMAR / Graphic by TMR

Malindo Airways Sdn Bhd has made an initial payment of RM20 million of the outstanding RM70 million passenger service charge (PSC) it owed to Malaysia Airports Holdings Bhd (MAHB).

The hybrid carrier made headlines following claims that it had accumulated RM70 million in unpaid PSC arrears to the airport operator and certain quarters wanted the authority to take action on the carrier that is majority owned by CEO Chandran Rama Muthy.

Deputy Transport Minister Datuk Ab Aziz Kaprawi confirmed that Malindo has made the RM20 million payment this week.

He said the carrier, which is also owned by Indonesia’s PT Lion Group, was taking the necessary steps to repay the outstanding PSC on a monthly basis.

“The airline has taken steps to settle the outstanding amount. Firstly, they have paid the RM20 million,” he told The Malaysian Reserve when met at the Parliament yesterday.

“Anyway, it is a matter between the airline and the airport operator (to resolve),” Ab Aziz said, adding that such outstanding payment is not unusual in the local aviation industry.

He said similar incidents had taken place in the past and had been resolved within the stipulated guidelines.

“There was once an airline that owed MAHB more than RM150 million. This is not a new issue,” the deputy minister said.

MAHB stresses that it continuously strives to maintain good relationship with all partner airlines (Pic: TMRpic)

Ab Aziz said that the Transport Ministry did not find any wrongdoings committed by Malindo, describing the whole episode as a technical glitch. On July 30, Department of Special Affairs DG Datuk Dr Mohd Puad Zarkashi was reported as saying that Malindo Air has an outstanding PSC of RM70 million owed to MAHB.

Mohd Puad had asked MAHB to clarify if the airline had been given a special treatment over the PSC.

MAHB said that the standard operating procedure for the PSC collection is to extend a 30-day credit term facility to all partner airlines.

“Nevertheless, it is not uncommon for airlines to exceed this period. As such, we are continuously monitoring the late payments and are engaging closely with the airlines to resolve these late payment issues.

“This may include identifying and resolving any arising matters with regards to payment details,” MAHB said in a statement.

MAHB stressed that it continuously strives to maintain good relationship with all partner airlines, and that it ensures all airlines are treated equally.

Malindo Air commenced operations on March 22, 2013, and currently makes over 800 weekly flights to 40 cities in 12 countries in the Indian subcontinent, South India, Asean, China and Australia.