US orders Air India to pay $121.5 Million in refunds & $1.4 million as fine, here’s why
Air India, which is owned by the Tata Group, has been ordered by the US Department of Transportation (DoT) to pay a fine of $1.4 million in addition to $121.5 million in refunds to passengers whose flights were canceled during the COVID pandemic.
The US Department of Transportation said that Air India is among the six airlines that have agreed to cough up a total of over $600 million as refunds. Besides Air India, other airlines that have been fined include TAP Portugal, Frontier, Aero Mexico, EI AI, and Avianca.
Air India
Airline
- Headquarters: New Delhi
- Founded: 1932, Mumbai
- Revenue: 26,430.59 crores INR (US$3.3 billion, 2019)
- Founder: J. R. D. Tata
- Alliance: Star Alliance
- Bag information: In economy, within India, 25kg free. To other destinations, 20kg free, additional allowance depending on the route. More Air India bag information
News agency PTI quoted officials as saying that Air India’s policy of “refund on request” is contrary to the Department of Transportation policy, which mandates air carriers to legally refund tickets in the case of cancellation or change in flight. However, these cases of delayed refunds predate the takeover of Air India by the Tata group.
What did the officials say?
The US Department of Transportation said that Air India is among the six airlines that have been directed to return a total of $600 million as refunds to passengers. Apart from Air India, Frontier, TAP Portugal, Aero Mexico, EI AI, and Avianca Airlines have also been fined by the US government.
According to an official investigation, Air India took more than 100 days to settle more than half of the 1,900 refund complaints filed with the transport department. This refund will have to be given for those flights which were either canceled by Air India or made major changes in their timing and schedule.
The US Department of Transportation (DOT) said canceling or changing flights without refund amounts to an unfair practice and warned Air India from repeating it. In response to the inquiry, Air India said that, unlike many other carriers, it maintained a policy of providing refunds upon request regardless of whether a passenger chose not to travel or the carrier canceled the flight and made a good faith effort to comply with its obligations to provide timely refunds during the Covid-19 pandemic.
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