DGCA gets the Rap From SC Over Transaction Fees, Price Volatility

The regulator of civil aviation in India, the DGCA, seems to have failed at regulating its own self by not bringing into effect the provisions of its own circular which does not permit the levy of transaction fees by the airlines on the passengers as a part of the air fare. The result of this violation was that the airlines began to charge this fee from the customers and included it in the prices of the air tickets.  On being petitioned, the Supreme Court has given a dressing down to the DGCA for not enforcing its own circular and has prohibited the airlines from charging this fee in any form or under any other name. The court has also taken a considered view of the wide fluctuations in tariff prices depending on the time of flight booking.

The explanation of Federation of Indian Airlines that these ‘extra’ charges were required for meeting the changing market dynamic in the Indian conditions but the court disregarded the same and contended that the levy collection be stopped. It is to be noted that the original scope of the petition to the SC was limited to UDF (User Development Fee) charges but the court itself increase the scope of petition to include all the charges and the price volatility in the air tickets and converted the petition into a public interest litigation.

The court sought information on the charge-category wise break up of air fares from the airlines and also asked DGCA what action has it taken against any airline if that has been found to be violating their tariff bands.

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