Home Associations TAAI: A Status quo verdict by Supreme Court on airline refunds

TAAI: A Status quo verdict by Supreme Court on airline refunds

The Hon’ble Supreme Court of India has issued a Judgement on October 01, with regard to a Writ Petition filed for Airline refunds, due to the global pandemic lockdown.

In its order, the Supreme Court directed refund of air tickets (domestic and international) for travel during the COVID-19 lockdown period from March 25 to May 24 within three weeks from the date of the cancellation of flights.

Accepting the Centre”s proposal, the top court directed that if the tickets have been booked through an agent for travel within the lockdown period, in all such cases, full refund shall be given by the airlines immediately and the amount shall be passed on immediately by the agent to the passengers.

All commercial passenger services both on domestic and international routes were suspended in late March to combat the coronavirus pandemic. While flight services on domestic routes resumed from May 25 in a graded manner, commercial international operations by airlines remain suspended as of now.

“We respect the judgement of the Supreme Court but feel that the judgement is status quo to what DGCA has previously directed the airlines on. Nothing really to appease our challenges and multiple

communications and meetings had with MoCA and the airlines in the matter, stated TAAI President, Jyoti Mayal.

Mayal further stated, “The airlines mostly were giving credit shells. If they were struggling with cash and they will continue to do so stating their inability. The only respite from the earlier direction is that the credit shells will be given to agents if booked through them and not the customer as some airlines were doing. During our meeting with MoCA we had demanded interest on delayed refunds.” 

“The only respite from the earlier direction is that the credit shells will be given to agents if booked through them and not the customer as some airlines were doing,” said the association.

The Hon Supreme Court has directed 0.5 per cent extra top-up every month on the face value of the ticket, up to June 30, 2020, and thereafter 0.75 per cent up to March 31, 2021. TAAI feels that this is much below the standard bank interest rates. Agents and customers are struggling with a cash crunch and basic interest paid to banks are at much higher rates. The agent fraternity needed total cash refunds. According to TAAI, it seems that the travel agents have become financiers for the airlines.

“We are deeply concerned about the submissions of certain airlines, that they shall shutdown in-case pressured for refunds. What if airline/s defaults before 31st March 2021 and who is going to be responsible? The Government needs to ensure appropriate assurances/guarantee from the airline/s concerned so as to secure the monies,” told Jay Bhatia, Vice President TAAI. 

Agents pay advances into float accounts of the airlines and it is their right to claim the monies back for un-utilised funds/non ticketed balances lying with the airlines. “It is also important to note that there is an ambiguity on the credit shell through agents to remain up to 31st March 2021, thereafter refund needs to be paid. The date for complying with refunds post that is not given,” he added.

Further, Mayal said, “DGCA has washed hands on the SOTO ticket refunds by airline/s. There has been no direction on the refunds for groups and series bookings done by the agents with the airlines. The Hon’able Supreme Court has not commented on that aspect at all.”