Govt proposes full refund on airline tickets booked during lockdown

<p id="content">The Centre has proposed that a full refund should be given by the airlines within 15 days for tickets booked during the lockdown, and if any airline is in financial distress then a credit shell should be provided up to March 31, 2021 on any route of passengers choice. The full refund has been proposed for tickets booked during the lockdown on domestic, international and foreign airlines.

In an affidavit in the Supreme Court, O.K. Gupta, Director, Directorate General of Civil Aviation, said for the domestic airlines if the tickets were booked directly with the airline or through an agent, during the first lockdown period, – March 25 – April 14 – for the journeys to be undertaken in both first and second lockdown period, March 25 – May 3 – in all such cases, full refund shall be given by the airlines immediately.

"For all other cases, the airlines shall make all endeavors to refund the collected amount to the passenger within 15 days. If on account of financial distress, if the airlines are not able to do so they shall provide a credit shell equal to the amount of fare collected. This credit shell shall be issued in the name of the passenger who has booked the ticket. The passenger shall be able to consume the credit shell up to March 31, 2021 on any route of his choice", said the affidavit.

The Centre said there shall be an incentive mechanism to compensate the passenger if there is a delay in consuming the credit shell – from the date of cancellation up to June 30, 2020, the value of credit shell shall be enhanced by 0.5 per cent of the face value (the amount of fare collected) for every month or part thereof between the date of cancellation and 30th June, 2020.

"Thereafter, the value of the credit shell shall be enhanced by 0.75 per cent of the face value per month, up to March 2021. The credit shell shall be transferable. The passenger can transfer the credit shell to any person, and the airlines shall honour such a transfer. The airlines shall devise a mechanism to facilitate such a transfer. By the end of March 2021, the airline shall refund cash to the holder of the credit shell", said the affidavit.

The Centre said this solution is workable, as it balances the interest of both the passengers as well as airlines, and urged the top court to pass a suitable order for its implementation.

Advocate Jose Abraham, representing petitioner Pravasi Legal Cell, said: "Petitioner happily welcomes the stand of the central government directing full refund for all tickets (domestic, international and foreign carriers). The government approach is very balanced, as even the time for credit shell is extended up to March 31, 2021, and passengers can use it for ticket booking and unutilized credit shells will get the full refund with slight interest and it is really a welcome step."

On September 1, Solicitor General Tushar Mehta submitted before a bench of Justices Ashok Bhushan, R Subhash Reddy and M R Shah, that a meeting has been convened and some solution has already been arrived at and sought time to bring on record such material. The top court had given a week to file an affidavit.

The petitioner had moved the top court highlighting the action of non-refund by airlines of the full amount collected for tickets due to cancellation is "arbitrary and in violation of the Civil Aviation Requirement issued by the Directorate General of Civil Aviation."</p>.