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SC reserves order in plea seeking refund of flight tickets booked during Covid-19 lockdown

A three judge bench of Supreme today reserve order in plea seeking refund of airfare for the tickets booked during lockdown period.

Solicitor General Tushar Mehta today told the Court that “Credit Shell” facility could not be availed by travel agents who booked tickets during the period of Covid-19 pandemic lockdown.

"So far as travel agents are concerned, we cannot regulate them. We don't have control over it. But suggestion is that a passenger can use the credit shell only through the agent."

Justice Subhash Reddy asked Mehta on this point; "If the voucher (credit shell) is not used till the deadline, will the money go to the account of the agent?"

Mehta replied that it’s a contractual obligation between agent and passenger and government could not control contractual obligation between them.

“We can only know the passenger who has been allotted the seat. But if he has paid the travel agent, that is the inter-se contract between the travel agent and the passenger. The DGCA cannot give direction to travel agents and therefore asking My Lords to do so."
"We can recognise two agencies because they are recognisable - passengers and airlines. We have done our best to ensure that the passenger either gets the money back or gets the voucher which is transferable."
On the last occasion, one of My lords concern was if a passenger buys a ticket from a travel agent, whether the Credit share voucher for credit refunds shall accrue to passenger. We can't regulate travel agents,"

Senior Advocate Pallav Sisodia appearing for travel agents argued that passengers have paid the money not to carrier, but to agents and in majority of bookings it was travel agents who had made advance payments for tickets.

Senior Advocate Sanjay Hegde argued that all those individuals who had booked Indian airline flights in international jurisdictions should be liable for refunds, as the Civil Aviation Requirements (CAR) had authority in those regions also.

Senior Advocate Arvind Datar appearing for Go air seeks extension of time for payment of refunds to passengers by at least 6 months after the stipulated date of March 31.

"My Lords may kindly balance their equities. I have to repay 260 crores, I have already paid 40 crores. I am only seeking time to be extended to 31st March 2022 or at least till September, 2022. I have 6400 employees, all will lose their jobs,"
"We are not saying we won't refund, but March 31, 2021 is an unrealistic deadline. We are only seeking some relaxation." Datar stated.

The Directorate General of Civil Aviation (DGCA) had filed an affidavit in the Supreme Court earlier this week, in which it informed the court about the credit shells for tickets booked during the lockdown period would only be applicable to passengers and not to travel agents.

The DGCA in its affidavit has categorized the passengers in three categories:

· For those who made bookings prior to lockdown for a period up till May 24, the refund would be governed by the credit shell scheme and the incentives thereunder;

· For bookings made during lockdown for travelling during lockdown, refund shall be made by airlines immediately "as the airlines were not supposed to book such tickets";

· For bookings that were made for travelling in dates after May 24, the refund would be governed by the Civil Aviation Requirements (CAR).

The DGCA also clarifies the credit shell scheme in its affidavit:

...if the Tour operator has already paid the money to the airline for purchasing the ticket for the client but the client is yet to pay that money to the agents, then on cancellation of ticket and converting it in to credit shell, the ticket will remain in the name of passenger and in case passenger utilizes the credit shell he will pay to the agent and not to the airline.
However, in case the passenger does not utilise the credit shell till 31st Mar 2021, then the airline will have to refund the amount as per proposed formulation and money will go back to same account of the agent from which the ticket amount was paid to the airline."

On September 9, a three judge bench of Supreme Court also sought clarification from Centre on the issue of refund of airfare of flights cancelled after lockdown.

Today the three judge bench comprising of Justice Ashok bhushan, Justice Subhash Reddy, Justice MR Shah after hearing the arguments at length of all the parties concerned reserve the order on the issue of refund of airfare for tickets booked during lockdown.







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