Air India, a company ranked among the 50 most prominent airlines in the world by fleet size, has been condemned with hefty charges by the U.S. Department of Transportation due to violation of rules in passenger refunds, leaving them with a penalty of $121.5 million.
Air India is one of the largest operating airlines in India and was previously managed by the Indian government. It is the third-largest Indian airline, with a wide range of aircraft services across various countries. It was founded in 1932 by J.R.D. Tata an Indian aviator, as Tata Airlines, and was later acquired by the Indian government post-independence and was renamed Air India. In January 2022, Tata had the pleasure of owning back Air India after servicing the nation and its people as a public sector for quite some time.
The sudden outbreak of COVID created chaos in airline services, as most countries had closed borders due to the pandemic, which resulted in ticket cancellation or postponement of trips. Despite having confirmed tickets and boarding passes to onboard the flight, the government permitted very limited customers with a valid reason to travel overseas. So most of the customers had to request ticket refunds as the duration of the pandemic became uncertain with the increasing number of cases.
The policy of Air India, which mandates a refund on request in case of flight cancellation or change in flights, had not been implemented correctly in the past few years. As a result, it over-delayed the process of refunds and had barely completed 1,900 refunds over a span of 100 days. Hence, the untimely response of Air India has significantly harmed the customers.
U.S. laws state that airlines and travel agencies are responsible for refunding the customers in case of canceled flights. Replacing refunds in the form of points and rewards is strictly not entertained at any cost, as it may compel the customers to fly with the same airlines and majorly affect those who require funds for other purposes. It is essential to practice healthy law and abide by the policies to continue a trusted long-term relationship with the customers. Poor responses and feeble excuses will definitely result in bad experiences.
Air India has been unresponsive to customers, and its negligence has resulted in a $121.5 million penalty for ignoring the customer’s refunds. Although most of these issues arose when it was under the control of the government, Air India, led by Tata, currently has to bear the charges and take action. A few other airlines, like Frontier, T.A.P. Portugal, and Avianca, have also been charged with penalties by the Department of Transportation.
The Directorate General of Civil Aviation has levied a penalty of $1.4 million along with the refund charges due to their negligence in handling passenger refunds and failure to abide by the policies. It looks like the frequent follow-ups and tireless calls from the customers are now fairly paid off.
