Tickets of flights cancelled during lockdown to be refunded; Supreme Court nod to DGCA plan

The Supreme Court on Thursday put its stamp of approval on a proposal by the Directorate General of Civil Aviation (DGCA) for the airlines to refund the air tickets booked for domestic and international flights cancelled due to Covid-19 lockdown.

The decision contained a mixture of immediate refund to grant of credit shell for utilisation till March 31, 2021.

"We feel that such formulations are workable solutions in the peculiar circumstances, prevailing in the country," a bench presided over by Justice Ashok Bhushan said.

Also read — Airlines to make full refund of tickets booked during lockdown period: DGCA proposes in SC

According to the formulations, tickets booked during the period of lockdown for domestic and international travel in such time would be refunded without any cancellation charges. Such tickets booked through agents would be refunded immediately. "In all other cases, the airlines shall make all endeavours to refund the collected amount to the passenger within 15 days. If on account of financial distress, any airline is not able to do so, they shall provide credit shell, equal to the fare in the name of passenger (which would be transferable) so as to consume on or before March 31, 2021," the bench said.

Disposing of a batch of PILs filed by NGO Pravasi Legal Cell and others, the bench, also comprising Justices R Subhash Reddy and M R Shah, noted in ordinary course, modalities for refund of tickets would have been governed by Civil Aviation Requirements under the Aircraft Act but its strict enforcement at this moment may not yield any meaningful result for any stake holder.

"We cannot lose sight of the present situation prevailing in the country and across the globe, i.e., the effect of pandemic Covid-19. It cannot be disputed that the civil aviation sector, which is one of the important sectors, is seriously affected in view of the ban imposed for operating flights," the bench said.

The court also said air passenger traffic has come down heavily.

"At this moment any strict enforcement action of the CARs would further restrict or reduce their operations and such enforcement action may further jeopardise the possibilities of generation of cash by airlines which can further adversely affect or delay the refund cycle," the bench added.