Jet, Kingfisher get notices for unclear tax break-up on tickets | india | Hindustan Times
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Jet, Kingfisher get notices for unclear tax break-up on tickets

india Updated: Dec 22, 2007 02:42 IST
Soubhik Mitra

Chartered Accountant Dinesh Malwani was ecstatic when he heard that he got a Rs 500-air ticket of a low-cost carrier this holiday season. But his happiness was short-lived.

The 21-year-old, working for a Malad accounting firm, was told to pay the tax added to the discounted price — and the ticket cost five times more.

Malwani did not know that with all airlines recently hiking fuel surcharge by Rs 300, fliers bear the cost as tax. Even the ticket did not mention the charged tax components.

On Thursday, the Directorate General of Civil Aviation issued show-cause notices to Jet Airways and Kingfisher Airlines for failing to furnish the details of the charged tax components, such as fuel surcharge and passenger service fee, on tickets.

The two airlines had violated conditions of operation under the Aircraft Rules, 1937, said a ministry release.

“I am not surprised. Airlines are scared to furnish details because it will expose their wrongdoings,” said Sudhakar Reddy, president of the Air Passenger Association of India.

“Till November, we used to receive five to six complaints about escalating air ticket prices every month. But this month we have been bombarded with e-mails after all airlines hiked fuel surcharge by Rs 300. The airlines must offer a break-up of the entire tax structure. They are not authorised to levy taxes.”

While Jet Airways spokesperson said the airline had already replied to the show-cause notice, a Kingfisher spokesperson said: “We will file a response on Monday.”

Interestingly, even the Union Civil Aviation Ministry is unsure about the tax structure.

On December 4, the Centre asked all airlines to clarify what were the charged tax components on tickets and their websites and also deposit the amount shown as tax with them.