Well, in this case, it seems like King Fisher's responsible for the problem, not KE... unless KE is lying. But given the current state of King Fisher, it's more likely that King Fisher sold a seat on KE's flight, but didn't fulfill their financial agreement to KE on that ticket; thus, KE has right to cancel PAX's KE segment.

These PAX had a 'confirmed' ticket only for HKG-India and that must have not been clearly reflect on the website (instead it erroneously showed as confirmed for all flights).

I feel sorry for the PAX, but I cannot see why KE is getting a 'bad' publicity for this. It should have been written that "King Fisher strands pax in Seoul by not..." It's also odd to see that King Fisher rep contacted his 'friend' in Seoul to put these PAX up for the night. This sounds so un-corporate like and clearly shows how serious the financial problem is there at King Fisher.