IndiGo chaos: Air India to refund differential amount for tickets booked at prices higher than govt-ordered cap

Air India has said that it has put in place the government-mandated ticket price capping following the IndiGo disruption that has led to the cancellation of thousands of flights. With a sudden increase in demand and weaker supply, flight fares had spiked, after which the government had to put a limit on airfares in the range of Rs 7,500 to Rs 18,000. 

“In compliance with the Ministry of Civil Aviation's (MoCA) directive issued on the evening of 6 December regarding the capping of Economy Class base fares, Air India Group commenced the rollout of the new prescribed fares across its reservation systems immediately. Air India Express completed the implementation across its systems, while Air India continues to progressively apply the fare caps, which will be fully effective in the next few hours,” said Air India in a statement. 

“As the process involves third-party system dependencies, a phased rollout is required to ensure accuracy and stability without disrupting guest bookings. Guests who may have booked Air India flights in Economy Class during the transition period, at base fares above the prescribed caps, are entitled to refunds of the differential amounts,” it said.

GOVT CAPS AIRFARES

The government set temporary caps on airfares, limiting prices for domestic flights to between Rs 7,500 and Rs 18,000 depending on the flight's distance. According to the civil aviation ministry, "the fare limits, excluding applicable charges, are not applicable for business class and UDAN flights.” 

The fare cap applies as follows: 

• Flights up to 500 km – Rs 7,500
• Flights of 500-1,000 km – Rs 12,000 
• Flights of 1,000-1,500 km – Rs 15,000
• Flights above 1,500 km – Rs 18,000 

For a typical Delhi-Mumbai flight, which covers over 1,300 kilometres, the limit for at least the economy class is set at Rs 18,000.

The ministry clarified that these limits exclude the User Development Fee (UDF), Passenger Service Fee (PSF), and taxes on air tickets. The ministry said in a statement that the fare limits will remain in place until the situation stabilises.