On January 10, 1995, about 1445 central standard time, a Douglas DC-9-32, N922VV, collided with the tug during the push-back for taxi at Memphis, Tennessee. The airplane was operated by Valujet Airlines, as Flight 147, under 14 CFR Part 121, and instrument flight rules. Visual meteorological conditions prevailed. An instrument flight rules flight plan was filed for the scheduled, domestic, passenger flight. There were no injuries to the occupants, and the airplane was substantially damaged. The flight was originating at the time. According to the station manager, the aircraft had been pushed back for taxi, when the gate agent advised the ramp that four last minute passengers were at the gate waiting to board the aircraft. The driver of the push back tug stated that he was ready to unhook the tug when the call came in that they needed to return to the gate. The captain was informed, and his response was to "go-ahead". The driver called out "ready to pull" and the captain responded "OK". The tug began pulling the aircraft back to the gate area. Both engines were running, as was normal procedure on a push back after the plane is stopped and unhooked. As the plane gained momentum, the tug driver attempted to apply the brakes slightly, and the tug "jackknifed". Witnesses on the ramp stated that after the tug jackknifed, it swung around and collided with the first officer's side of the aircraft. The tow bar broke off at the connector ring. The station manager examined the aircraft after the collision and recalled that there were 2 tears in the aircraft fuselage on the first officer's side of the aircraft. The strut was cracked, and the front nose gear tire was deflated where the tow bar had punctured it. The push back tug had the attachment ring broken off at the point where it slides into the receptacle sleeve, and the yoke pins were both sheared. The operator has issued a bulletin to all flight crews prohibiting forward towing of the airplane with engines operating.