NEW DELHI: A Delhi court has directed Akasa Air to pay Rs 1.08 crore to a city-based travel agency for cancelling 640 seats booked for travel between Delhi and Goa during the peak Christmas and New Year season of 2023–24.
The court held that loss of expected profits was recoverable where the performance of a contract was “wrongfully prevented”.
The court ordered SNV Aviation Pvt Ltd, which operates as Akasa Air, to pay the amount to ABS Tour & Travels. The agency contended that once Passenger Name Records (PNRs) were generated, a binding contract had come into existence. It argued that the abrupt cancellation deprived it of the opportunity to sell tickets during the festive season, when airfares typically surge.
The lawsuit was filed after the cancellation of eight group PNRs comprising 640 seats booked in April 2023 for travel between December 23, 2023 and January 13, 2024. The bookings covered flights from Delhi to Goa and return during the high-demand Christmas and New Year period.
According to the travel agency, it had paid 25 per cent of the total booking amount—`4,82,280—through the airline’s agent portal, following which the PNRs were generated. However, on May 29, 2023, the airline cancelled all eight PNRs. The advance amount was subsequently refunded in August 2023.
The agency argued that once the PNRs were issued upon receipt of the advance payment, a binding contract had been formed. “The abrupt cancellation, months before the balance payment was due, deprived it (agency) of the opportunity to sell the tickets during the festive season when fares typically surge,” the suit stated.
It further submitted that, based on fare data for the relevant period, ticket prices had risen to approximately ` 17,000 per seat. This, it claimed, resulted in a total loss of profit amounting to `1.08 crore.
In its order, the court observed that the PNRs were generated after receipt of the 25 per cent advance and that no notice demanding any shortfall in payment was issued before the cancellation. “In the absence of proof of a binding contractual stipulation permitting such cancellation, the airline’s action amounted to breach of contract,” the judge held.
The airline defended its decision, contending that for group bookings exceeding 70 passengers, a 50 per cent advance payment was required at the time of booking, whereas the plaintiff had paid only 25 per cent. It also argued that the claim for damages was speculative, as no tickets had actually been sold, and pointed out that the advance amount had already been refunded.
However, the court rejected the airline’s defence, noting that no document was produced to establish that a 50 per cent advance condition was applicable at the time of booking. At the same time, the court declined the agency’s claim for interest at 18 per cent per annum, observing that there was no contractual stipulation supporting such a rate and that the claim related to unliquidated damages. It also rejected the claim for damages on account of mental agony and harassment.