HIGH COURT OF KERALA
P.R. RAMACHANDRA MENON, J.
IATA Agents Association of India, (IAAI), Represented by its President Biji Eapen & Another
Versus
Union of India, Represented by its Secretary & Others
WP(C). Nos. 21908 of 2011 (K) & 17408 of 2012
Decided on : 27-11-2012
1. Whether the amendment of Air Craft Rules 1937, by virtue of the introduction of Rule 3(54 A) with effect from 12.1.2009, makes it obligatory/mandatory for every Air Transport Undertaking to establish 'Tariff' which should include commission payable to the travel agents, is the question to be answered in this writ petition.
2. The practice of payment of commission showing it as part of 'Tariff' as provided under the Rules, was put an end to by many of the Air Transport Undertakings having principal place of business situated outside India, providing 'zero commission', with liberty to the travel agents to realize separate processing charges in the form of 'Transaction Fee' from the passengers; which is under challenge in W.P.(C).No.21908/2011. Subsequently, similar course was adopted by the domestic Air Transport Undertakings like Air India as well as Jet Airways. The direction given by the Director General of Civil Aviation (DGCA) vide Ext.P5 order dated 05.03.2010 in W.P. (C). No.21908/2011 in favour of the petitioners came to be watered down vide Ext.P11 order dated 28.07.2011 passed by another officer who assumed the office of the DGCA later. The petitioners seek to set aside Ext.P11 and to enforce/implement Ext.P5 (in W.P. (C).No.21908/2011) in these cases. In W.P.(C).No.17408/2012, the subsequent proceedings by way of Exts. P13 and P14 issued by the Air India Ltd. and Jet Airways India Ltd. are also under challenge. Parties and documents are referred to herein, as arrayed/given in W.P.(C).No.21908/2011, unless it is separately pointed out, or discernible from the circumstance.
3. The 1st petitioner in W.P.(C).No.21908/2011 (who is the sole petitioner in the other case) is a registered Association of the IATA accredited Travel Agents in India, having as many as 700 members, including the 2nd petitioner. The members of the 1st petitioner are engaged in the sale of air tickets and other incidental matters relating to air travel, both domestic and international. The Air Craft Rules 1937 (hereinafter called the 'Rules') formulated by the Central Government, invoking the power under Section 5 of the Air Craft Act, 1934 (hereinafter called the 'Act'), provide among other things, for fixation of 'Tariff' for carrying passengers and cargo. Though the term 'Tariff' used in the Rules means the amounts to be collected from the passengers or the cargo owners as the charge for the service rendered, there was no clear statutory definition for the same. Rule 135(2A) stipulates that 'Tariff' has to be published and it shall show the complete break up figures as to the total amount, indicating the fare, tax, fee or such other charges, if any, separately.
4. Absence of clear definition to the term 'Tariff', but for some 'inclusive mention' at some places projected the obscurity with regard to the right of accredited travel agents to receive commission as part of the air fare, which led to various representations preferred before the Government by the Air Travel Agents' Association, including the petitioners. It is stated that, this led to amendment of the Air Craft Rules 1937, incorporating Rule 3(54 A) with effect from 9.1.2009, which defines the term 'Tariff', as it means any fare, rate or charge collected by the air transporting undertaking for the carriage of passengers, baggage or cargo including the commission payable to the agents and the conditions governing such fare, rate or charge.
5. According to the petitioners, by virtue of introduction of Rule 3(54 A), it became mandatory for every Air Transport Undertaking to establish 'Tariff', which should include the 'commission' payable to the travel agents. It is contended that the Airlines in India were paying commission at the rate of 9% to travel agents, which was subsequently reduced to 5% of the air fare. Later, some of the Airlines unilaterally decided to stop payment of commission and the travel agents were required to collect 'Transaction Fee' from the passengers, on
Login now and unlock free premium legal research
Login to SupremeToday AI and access free legal analysis, AI highlights, and smart tools.
Login
now!
India’s Legal research and Law Firm App, Download now!
Copyright © 2023 Vikas Info Solution Pvt Ltd. All Rights Reserved.