Kingfisher Airlines Tuesday reported a net loss of Rs. 7.55 billion ($142 million) for the third quarter ending Dec 31, 2012, a period in which all its flights remained grounded and the cash-strapped private air carrier in India struggled with the mounting debts and labor crisis.    

Kingfisher Airlines -- once India’s second largest air carrier -- lost its flying license last quarter as it failed to operate flights due to financial and labor crises. The company, promoted by liquor baron Vijay Mallya, owes about $2.5 billion to its various venders and employees.   

The prospect of the air carrier flying again remains uncertain as India’s Aviation Ministry has rejected the revival plan submitted by the company.

According to the Aviation Ministry officials, the management failed to detail out the funding strategy in its revival plan submitted to the Directorate General of Civil Aviation (DGCA).  The airline needs at least $186 million to resume services.

In its statement, the company said that it was taking the required measures to meet the DGCA regulations. “Kingfisher has made significant progress in complying with the DGCA requirement,” the airline said in a statement.

The company has reported a net loss of $142 million (Rs. 7.55 billion) for the third quarter. But Kingfisher’s auditors say in the quarterly review report that the accounting method used by the airline to calculate costs incurred for aircraft maintenance and repairs was "not in accordance with generally accepted accounting standards prevalent in India," Reuters reported.

The loss would have gone up to 10.90 billion rupees if the company had adapted the generally accepted accounting practices, according to the auditors.

Kingfisher spent 4.01 billion rupees on finance costs and 1.82 billion rupees on aircraft leasing charges during the quarter.

Shares of Kingfisher fell about 2 percent Monday ahead of the results release.

Meanwhile, the employees of Kingfisher Airlines, who have not been paid salaries since April, Monday decided to approach court seeking winding up of the company to recover their salary dues.

"All section of employees met at IGI Airport's terminal 2 on Monday to decide the future course of action. The meeting was held there as many employees have not got the airport entry pass now. The management has gone silent and there is just no word on what they plan to do for clearing our dues," said a senior employee who is spearheading the agitation now, according to the Times of India.

Employees have also decided to protest at the venue of the upcoming IPL cricket matches where the flamboyant Mallya’s Royal Challengers Bangalore team will be playing.