MUMBAI: Umapathy Pinaghapani, the founder of Premier Airways, a Chennai-based low fare airline project which is stalled for a year, has been arrested on charges of illegally withholding the licence of an employed pilot. Premier had taken the licence in July for endorsement by the regulator, but did not return it, the complainant and father of the pilot M Bhaskar told ET. “We went to his office premises and seized the licence,” said S Jaya kumar, the deputy commissioner of the Central Crime Branch, Chennai, confirming the arrest to ET. Ravichandran Subramanian, the head of HR at Premier, has also been arrested. Pinaghapani couldn’t be reached. Premier had received a no objection certificate from the ministry of civil aviation in July 2014 to fly a low-cost airline. The NOC has expired and Premier has not received a flying permit yet from the DGCA. Bhaskar claimed that Premier had taken about Rs 25 lakh from his son to facilitate type-rated simulator training at the Flight Simulation Technique Centre (FSTC) at Gurgaon. However, FSTC never released the training papers of the pilots brought in by Premier as it had not been paid, two people in the know said. “Premier gave FSTC a post-dated cheque which bounced. The management kept telling FSTC the payment will come but it never did. It owes FSTC more than Rs 1 crore,” said a source close to the development. The licences remained with Premier, and the endorsements never happened, the sources said. Premier has stopped training pilots since June and hasn’t paid its staff since May, three sources in the know said. It had opened an office in Delhi for liaisoning with the government, but shut it down in November when it could no more pay the rentals. However, Pinaghapani had been, until as late as January, promising Premier’s top employees of an imminent investment. In an email sent in January, he said an investor group has completed its due diligence for investment and that the first tranche will come by the last week of January. ET had seen the email. Sources said that even on Thursday, Pinaghapani reached out to some of the top management and cre ditors and spoke of an impending investment, post which everyone would be paid. A senior Premier executive took Pinaghapani’s side. “I stand by him and I am sure Premier will fly. I have heard of the arrest, but I am sure his name will be cleared,” he said. India’s aviation ministry granted 16 NOCs to airlines between 2009 and 2014, nine of which were given between 2012 and 2014. Most of the new NOC holders, including Premier, have been struggling to raise cash and have not yet been able to take off.