Welcome Aboard the Flight of Indifference

The coronavirus pandemic has changed our lives in more ways than one. With temporary or long lockdowns imposed by nations, all sectors have seen major disruptions. The aviation sector has also not been immune to the restrictions imposed globally in the wake of this deadly virus. India was one of many nations world-wide which took a call to suspend all flight operations. The decision taken on 23 March, 2020 by the Ministry of Civil Aviation, to restrict the spread of the virus, left many air travelers in the lurch.

 With flight operations suspended, passengers made frantic attempts to obtain refunds for their booked tickets. While the airlines were hesitant to promise refunds, customers took to social media to vent their frustration. The Ministry of Civil Aviation meanwhile, maintained a stoic silence on whether airlines were required to refund the entire ticket amount to passengers.

A few days into the spat, most airlines informed passengers that in the event of cancellation, the cancellation fee would not be waived (the cancellation fee in most cases, comprises a significant portion of the ticket value). Instead, the airlines agreed to waive the flight rescheduling fee and provided passengers the option to reschedule their travel (in the event the passenger exercised the option at least 72 hours prior to the flight departure) or issued travel vouchers of equivalent amount of the ticket value.

On account of the uncertainty regarding air travel, many passengers chose to cancel tickets despite being entitled to only a pittance of the ticket value. The idea of rescheduling travel has also not appealed to passengers who were scheduled to travel for a one-off event such as a wedding.

It is only this week on 16 April, that the Ministry of Civil Aviation issued an Office Memorandum regarding refund of airfare during the lockdown period. But the order seemingly intended to provide relief to passengers who were scheduled to fly during the lockdown period, does anything but that.

It has been widely reported that the Memorandum issued by the Ministry directs airlines to refund the full ticket amount to the passenger without levying any cancellation fee. However, a closer look at the Memorandum, suggests that the refund guidelines would only benefit a miniscule number of passengers.

Firstly, the Memorandum would not apply to any bookings made by a passenger prior to 25 March, 2020. Thus if a passenger planned and booked tickets well in advance for travel between 25 March to 3 May 2020, such a passenger is not covered by the Memorandum issued by the Ministry. If such a passenger would opt to cancel his ticket, the entire cancellation fee would still be levied by the airline concerned.

The Memorandum states that, “if a passenger has booked a ticket during the first lockdown period (from 25th of March to 14th of April 2020) and the airline has received payment for booking of the air ticket during the first lockdown period for travel during the same period, for both domestic and international air travel and refund is sought by the passenger against that booking being cancelled, the Airline shall refund the full amount collected without levy of cancellation charge. The refund shall be made within a period of three weeks from the date of request of cancellation.”

This part of the Memorandum is absurd to say the least as the operation of all flights was suspended by the Ministry in the first lockdown itself, i.e., from 25 March 2020 to 14 April 2020. Since the operation of flights was itself suspended during the entire first lockdown period, it seems highly improbable that any booking would have been permitted during the lockdown period by the airline concerned.

The Ministry could instead have directed the airline concerned to refund the full amount without levy of cancellation charge in the event that the booking was made for travel between 25 March to 14 April, 2020.

The second part of the Memorandum seeks to provide relief to passengers who were to travel during the period between 15th April and 3rd May 2020.

The Memorandum states that “if a passenger has booked a ticket during the first lockdown period and the airline has received the payment for booking of air ticket during the first lockdown period (from 25th of March to 14th of April 2020) for travel during the second lockdown period (from 15th of April to 3rd of May 2020) for both domestic and international air travel and the passenger seeks refund on cancellation of the ticket, the Airline shall refund the full amount collected without levy of cancellation charge. The refund shall be made within a period of three weeks from the date of request of cancellation.”

This part of the Advisory seeks to aid those passengers who booked between 25th March to 14th April for travel with effect from 15th April to 3rd May 2020 in the hope that the restrictions on air travel would be eased after 14th April 2020.

While the Memorandum seems to be well intentioned, the exclusion of passengers who had booked tickets well in advance for travel between 15th April and 3rd May 2020 is unfair. Such passengers would rightly feel penalized by the Memorandum issued by the Ministry.

Despite the advisory issued by the Ministry calling upon airlines to refund the amount within 3 weeks from the date of request of cancellation, the airlines are acting in stark violation of the Memorandum.

A glance at the website of any of the country’s leading carriers reveals that airlines have shown scant regard to the Memorandum issued by the Ministry. This is despite the Memorandum itself stating that the Director General of Civil Aviation was to monitor compliance of the advisory.

Instead of adhering to the Ministry’s guideline regarding refund, the airlines have announced creation of a credit shell in respect of the entire booking amount. A credit shell is a form of credit note, wherein the amount in question is credited by the airline and can be used by the passenger to make a future booking within a stipulated date. However, the additional cost towards the future travel, over and above the ticket value would have to be borne by the passenger.

With social distancing norms likely to be made applicable across the aviation sector, the price of tickets is likely to see a significant rise once the sector reopens. Passengers have been handed a totally raw deal as if they do not utilize the amount in the credit shell, within the specified period, it would automatically lapse.

The net effect is that passengers are still left high and dry on account of the unplanned Memorandum and the obdurate attitude of the airlines. The miniscule number of passengers who would stand to benefit on account of the Memorandum would also have to approach courts for a refund.

What further adds to the woe of the passenger is that on account of the lockdown extension, all airlines have themselves cancelled bookings of passengers till 3 May 2020. Since the passengers have been unable to cancel the tickets themselves, the question as to whether they can take the benefit of the Memorandum issued by the Ministry is highly doubtful.

The Memorandum in effect only benefits the airlines. The immediate need of the hour is that the Ministry withdraw the ill-planned Memorandum dated 16 April 2020 and issue a fresh Memorandum covering all passengers who were booked to travel between 25 March to 3 May 2020. Additionally, the processing of refund ought to be made mandatory; a small solace compared to the inconvenience inflicted on passengers in these already troubled times.