Cost concerns led the 1985 Air India flight to take off from Toronto despite credible information that a terrorist attack was imminent, an inquiry into the two-decade-old bombing heard.
A baggage screener testified on Wednesday that he overheard officials saying that keeping the plane on the tarmac was too costly to justify searching baggage already on board, even though three suspicious bags had been found among those being loaded onto the plane.
The testimony was the latest in a long list of shocking security lapses at Toronto's Pearson airport that have emerged during the often-delayed tribunal launched in September.
Air India flight 182 exploded mid-air off the coast of Ireland in 1985, killing 329 people in the worst mass-murder in Canadian history. Most of those on board were Canadian citizens of Indian descent.
Retired Supreme Court justice John Major, who is chairing the inquiry into whether Canadian police did enough to avert the bombing, has stopped proceedings twice since it began over disputes with security officials over access to documents relating to the case.
Daniel Lalonde, who was 18 at the time and employed by a private security firm responsible for screening baggage, testified on Wednesday that he overheard Canadian officials and an Air India representative discussing the security situation and that the decision was made to allow the plane to depart.
"The cost of keeping the plane on the tarmac was high and the decision to depart the plane was based on that factor," he testified. "The flight was going to go. The decision was that the plane was going to leave."
Lalonde also said that three bags, deemed suspect but later found to contain no explosives, were taken before they were placed on the plane during its Toronto stop-over, but that none of the bags already on the flight were searched.
Earlier testimony at the inquiry heard that Canadian officials were aware that Sikh extremists based in Canada were planning a terrorist attack on an Air India flight and that the security threat level had been raised.
Police allege that the bombers were part of a militant cell of the Sikh separatist group Babbar Khalsa based in the Canadian province of British Columbia.
Lalonde's testimony came a day after the inquiry heard that the bomb-sniffing dog normally on site at Pearson airport was away on a training exercise and unavailable to screen the luggage.
Security protocol dictated that, in the absence of the dog, luggage had to be hand searched. Instead, Lalonde recalled, the plane was allowed to depart without the bags on board being searched.
Earlier in the week, a policeman assigned to security at Montreal's Mirabel airport testified that that he arrived to check flight 182 only only after the plane had departed for its next scheduled stop at London's Heathrow airport - which it never reached.
Only one person has been convicted for the bombing. In 1991, Inderjit Singh Reyat was sentenced to ten years in a Canadian prison for supplying components for the bomb that exploded in Japan.
Ripudaman Singh Malik, a Sikh religious leader, and Ajaib Singh Bagri, a wealthy businessman, were acquitted after a sensational trial in 2005.