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Pravasi Legal Cell v. Union of India & Ors.

Writ Petition (Civil) · 2020 INSC 575Decided 1 Oct 2020
Writ Petition (Civil) No. 570 of 2020
Justice Ashok Bhushan · Justice R. Subhash Reddy · Justice M.R. Shah

Background

When India imposed a COVID-19 lockdown in March 2020, all domestic and international flights were suspended, leaving passengers whose tickets were cancelled unable to get a cash refund: airlines instead offered only a "credit shell" valid for future travel. Several petitioners, including a legal-aid group for migrant workers, an air passengers' association, a retired army officer and his wife, and a travel agents' federation, challenged this practice as illegal and contrary to the Civil Aviation Requirements, which (they argued) make refund the passenger's choice, not the airline's default.

Decision Breakdown

The Supreme Court did not strike down the airlines' credit-shell practice outright, but instead worked out a detailed, balanced set of directions after hearing the Ministry of Civil Aviation, airlines, travel agents, and passenger groups. It held that tickets booked and meant for travel during the lockdown period must be refunded in full and immediately; tickets for travel after the lockdown are governed by the ordinary Civil Aviation Requirements; and in other cases, if airlines cannot immediately refund due to financial distress, they must issue a transferable credit shell (redeemable until 31 March 2021) with built-in monthly interest-like enhancement to compensate passengers for the delay. The Court explicitly rejected the airlines' request to extend the credit-shell deadline to 2022, noting passengers had already parted with their own money in good faith.

Lesson Learnt

Even during a genuine national crisis, a business cannot simply withhold a consumer's money indefinitely: courts can step in to craft practical, time-bound solutions that balance real financial hardship on one side against the basic right of a consumer to get their money back (with compensation for delay) on the other.

Official source (sci.gov.in)View Judgment (PDF)

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