Kingfisher Airlines got some relief on Tuesday after banks gave some guarantees and working capital loans and the income tax department indicated that itmay defreeze the airline's bank accounts.

The State Bank of India threw in a lifeline of around Rs 1,200 crore to the troubled airline, including working capital of Rs 400 crore, bank guarantee of Rs 500 crore and loan repayment extension worth Rs 250-300 crore. Besides, either SBI or Punjab National Bank will issue another guarantee of Rs 160-200 crore on Wednesday to the IT department to defreeze Kingfisher's account.

The airline has also committed to the DGCA to clear all December salary dues by end of this month. The airline has faced strike threats several times from its employees in the past few months over non-payment of salaries.

Kingfisher Airlines, which has massively pruned its operations, on Wednesday submitted a fresh flight schedule to the Directorate General of Civil Aviation. The DGCA has estimated Kingfisher should be able to run 175 flights daily, but chances of that appear slim. The airline’s bank accounts, frozen by the income tax department over statutory dues, remain attached. 

DGCA chief EK Bharat Bhushan submitted a report on Kingfisher’s operations to the civil aviation ministry and briefed minister Ajit Singh. “The government won’t bail it out. We hope Kingfisher can mobilise resources because if it can’t, there will be more problems for fliers,” Singh said, rejecting comparisons with Air India.