US imposes $1.4 mn fine on Air India over delay in refunds

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US imposes $1.4 mn fine on Air India

Tata Group-owned Air India has been fined $1.4 million in penalties for delayed refunds amounting to $121.5 million for delayed or cancelled flights, under an order from the US Department of Transportation.

Important facts

  • Under US law, airlines and ticket agents have a legal obligation to refund consumers in the event of a flight cancellation or a passenger not accepting the option offered.

  • According to US regulations, it is illegal for an airline to deny refunds and instead provide vouchers to such consumers.

  • The US Department of Transportation received a large number of complaints from air travellers that airlines had failed to provide timely refunds after cancellations or significant changes to flights.

  • The US Department of State has fined six airlines over delayed refunds, in what has been called a "historic" enforcement action.

  • The fine imposed on Air India is the third highest after Denver-based Frontier and TAP Portugal.

  • Apart from Air India, Frontier, TAP Portugal, Aero Mexico, EI AI and Avianca Airlines have also been fined by the US government.

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