Airline ticket refund: Supreme Court okays DGCA plan for full refund on cancelled flights due to lockdown

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Airlines will have to refund tickets booked prior to the Covid-19 lockdown for travel up to May 24, the Supreme Court ordered on Thursday, approving the formulation drafted by civil aviation regulator Directorate General of Civil Aviation to deal with refunds for canceled tickets due to restrictions imposed due to the lockdown that started on March 25 this year.

The airlines will also have the option to create a credit shell in the name of the passenger which can be availed for travel on any route before March 31, 2021.

The credit shell shall be transferable and interest will accrue on the money in the credit shell: 0.5 percent from the date of cancellation till June 30 and thereafter 0.75 percent till March 31, 2021, a three-judge bench of the top court ruled.

The bench of justices Ashok Bhushan, RS Reddy, and MR Shah said tickets booked through travel agents will be refunded through travel agents.

Already, the DGCA had issued a notification on April 16 ordering immediate refund for tickets booked during lockdown (March 25-April 14). This order stays intact.

The top court’s order came on a petition by Pravasi Legal Cell and Air Passengers Association who demanded a refund for tickets booked prior to the lockdown.

During the hearings, the government-backed transferable refund vouchers to be given to the passengers in lieu of the tickets booked for the canceled flights.

Vistara and AirAsia had opposed the government’s proposal, made during a Supreme Court hearing in a plea seeking a full refund, saying most customers prefer credit shells. IndiGo said it has fully refunded the booking amount. GoAir had pleaded that many airlines are on the brink of collapse and may shut if the situation doesn’t improve.

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