Show cause notice for Jet, Kingfisher; fail to explain tax component in domestic tickets
21 December 2007
New Delhi: The Director General of Civil Aviation (DGCA) issued a show cause notice to Jet Airways and Kingfisher Airlines asking them as to why action should not be initiated against them under paragraph 15 of Schedule XI to the Aircraft Rules, 1937, for not furnishing the details of the charged tax components in their domestic airline tickets, as this was in violation of the conditions for operations annexed to the Permit to operate Scheduled Air Transport Services.
The Government had asked all airlines on 4th December 2007 to clarify as to what the charged tax components in their tickets were and had also asked them to provide confirmation whether all the taxes shown by them in their tickets/website had been deposited with the Government. The Airlines were asked to submit the record of the taxes thus deposited.
In a letter dated 4th December 2007 the Director General of Civil Aviation had said that perusal of the fare shown on the airlines website had revealed that the airfares had two components – the basic fare and the taxes. However, it was not clarified as to whether components like Passenger Service Fee and Fuel Surcharge were included in the basic fare or had been clubbed under the heading of ''taxes''.
The letter stated that a ''Tax'' was defined to be a fee levied by Government on a product, income or activity and such amounts were to be deposited with the Government and a record was required to be maintained for the same.
In view of the ambiguity in the airfares, the DGCA had sought a clarification from the airlines and through a letter, dated 11 December 2007, sent a reminder to all airlines advising them to furnish their reply, latest by 19th December 2007. The letter said that a failure to respond would be taken to mean that the airlines had nothing to say in the matter, and action as deemed fit, would be taken under the Aircraft Rules 1937.
Since the airlines had not replied to the DGCA by the due date a show cause notice was issued.
The airlines will now have to respond to the DGCA by 4 January 2008.