City had been expected to unveil the 24-year-old forward today (July 9) after agreeing a fee with the Clarets over the weekend.
But in a sensational 11th hour development yesterday evening, the Tigers were forced to pull the plug on the deal - amid fears about a problematic shoulder problem that the striker had previously suffered from - with Austin having dislocated his shoulder three times in the past four years.
It seems unlikely the deal will be revived, with frustrated boss Steve Bruce now set to switch transfer tack again about working so laboriously to get the Austin transfer over the line.
Bruce said: “It looks like a bit of a problem with his medical. It’s an awful situation we find ourselves in. It’s a blow for him and for us.”
One piece of good news did arrive at the KC Stadium last night with defender Paul McShane agreeing a new two-year deal.