Refund, credit shell available on air tickets booked before lockdown: Centre tells SC

Several passengers had booked their tickets in advance and failed to get refunds from airlines after a travel ban during lockdown led to cancellation of their flights.

Domestic carriers will be required to give full refund on air tickets booked prior to lockdown for travel up to May 24 on national and international routes. This was clarified by the Centre in a fresh affidavit filed in Supreme Court on Tuesday. The affidavit came on the eve of a scheduled hearing on a bunch of PILs before the top court where the Centre’s scheme for refund of flights cancelled during lockdown is expected to be taken up for consideration.

The affidavit came on the eve of a scheduled hearing on a bunch of PILs before the top court where the Centre’s scheme for refund of flights cancelled during lockdown is expected to be taken up for consideration. (HT PHOTO.)

This is the second affidavit jointly filed by the Ministry of Civil Aviation and Directorate General of Civil Aviation (DGCA). On September 9, the top court had asked the Centre to file an additional affidavit to clarify whether the credit shell and incentive scheme formulated by Centre extended just to tickets booked during lockdown or the period prior to it. Several passengers had booked their tickets in advance and failed to get refunds from airlines after a travel ban during lockdown led to cancellation of their flights.

Clarifying its stand, the latest affidavit by Amit Gupta, Director with DGCA said, “Passengers who have booked tickets prior to lockdown for travel up to May 24, 2020 (as the calibrated domestic operation recommenced from May 25, 2020), refund of fares to the passengers covered under this category shall be governed by the proposed formulation related to credit shell and incentive scheme.

Under this proposed formulation, if the airline is not in a financial position to refund within 15 days, a credit shell will be created in the name of the passenger that he/she can avail while flying next with the airline on any route on or before March 31, 2021. This credit shell will be transferrable and if the money is kept idle in the credit shell, the passengers will be entitled to 0.5 per cent interest from the date of cancellation till June 30 and thereafter, 0.75 per cent interest till March 31, 2021. The airline will be liable to return the credit shell amount with interest to the passenger after March 31, 2021.

The scheme will apply to all passengers who booked their tickets on domestic airline either individually or through travel agent for travel on domestic and international routes (provided flight originates from India). As regards foreign carriers, the credit shell scheme will not apply and passengers will be entitled to refund of fare within 15 days.

For passengers who booked tickets during the lockdown, the DGCA came out with a notification on April 16, 2020 providing for immediate refund. This notification clearly specified that airlines were not supposed to book tickets knowing about the travel ban in place. The latest affidavit also catered to tickets booked for travel after May 24. It said, “Passengers who booked tickets at any period of time but for travel after May 24, 2020, refund of fares to the passengers covered under this category shall be governed by the provisions of Civil Aviation Requirements (CAR).”

Advocate Jose Abraham appearing for one of the petitioners before the Court – Pravasi Legal Cell expressed satisfaction with the clarification issued by Centre. Speaking to HT, he said, “We are happy that the Centre has accepted that those who booked tickets prior to the lockdown will get full refund within 15 days or credit shell facility and incentive scheme. Their earlier affidavit of Centre dated September 5 did not state so.”

The Centre in its earlier affidavit referred to two categories of passengers – those who booked tickets from March 25 to April 14 (lockdown period) and those falling under “any other cases” without specifying the period of travel.

One grey area still remains as the scheme does not extend to international flights (both domestic and foreign carriers) where the flight originated outside India. For international air tickets to avail the proposed refund scheme, the booking must be “ex-India”, states the affidavit. This term is not defined in the Aircraft Act, 1934 or the Aircraft Rules, 1937, but the affidavit states, “In aviation industry, this term denotes the flights which are originating from India.”

Pravasi Legal Cell will challenge this aspect as several Indians arriving from foreign destinations could not arrive in the country as their flights stood cancelled during lockdown. “This is a grey area still in the affidavit and we will seek clarification from Centre when the matter comes before the Court,” said advocate Jose Abraham.

The scheme has largely found approval from all airline operators and travel agents. Some tour operators had on the previous date of hearing objected to the creation of credit shell in the name of passengers. The tour operators informed the Court that tickets are booked in advance without collecting money from passengers and hence the credit shell should not be in the name of the passenger.

The Centre clarified in its latest affidavit that the ticket will remain in the name of the passenger and in case the credit shell is utilized by the passenger, he/she has to pay to the agent and not the airline. But in case if the amount is not utilized, the money will go back to the same account of the agent from which the ticket amount was paid to the airline.