Saket Court Orders Akasa Air To Pay Rs 1.08 Crore To Travel Agent In Seat Cancellation Case

Akasa Air has faced a legal setback after the Saket Court directed it to pay Rs 1.08 crore to a travel agent. The order was passed in connection with a commercial dispute.

District Judge (Commercial) Lalit Kumar delivered the ruling in the matter. He held that cancelling 640 confirmed group-booked seats during the peak festive season amounted to a clear breach of contract.

The court observed that in the travel industry, group reservations are usually secured well in advance. This practice allows businesses to capitalise on anticipated festive demand.

Cancelling such confirmed bookings, it noted, effectively deprives a party of a significant commercial opportunity.

Case Background

The dispute arose after ABS Tours and Travels reserved 640 seats in April 2023. The booking was made for flights operating between Delhi–Goa and Goa–Delhi from 23 December 2023 to 13 January 2024.

The agency paid 25 per cent of the total fare, amounting to Rs 4,82,640, as an advance. Following receipt of the payment, Passenger Name Records (PNRs) were generated.

However, in May 2023, the airline cancelled the reservation. It contended that a 50 per cent advance payment was mandatory for bookings exceeding 70 seats.

During the proceedings, the court found that the airline failed to demonstrate that the 50 per cent advance condition was applicable at the time of booking. It also failed to show that this condition had been properly communicated to the agent.

The judge held that once the airline accepted 25 per cent of the fare and issued the PNRs, a binding agreement had been formed. He stated that this agreement was enforceable under the Indian Contract Act of 1872. The unilateral cancellation was therefore deemed unlawful.

The court further clarified that merely refunding the advance would only restore the principal amount. It would not compensate for the loss of expected profits.

Nevertheless, it declined the travel agent’s request for 18 per cent interest on the compensation.

The claim for damages on grounds of mental harassment was also dismissed, with the court noting that the dispute involved two commercial entities and that such claims were not appropriate in this context.