J&K HC Dismisses Plea Complaining Of Arbitrary Pricing Of Air Tickets By Private Airlines [Read Judgment]

A Bench comprising of Chief Justice Gita Mittal and Justice Rajesh Bindal observed that it is trite that judicial review is not concerned with matters of economic policy or price fixation.

The bench further said,

"It is not open to a writ court to supplant its views with those taken by the private bodies over which, as herein, the private airlines whose actions are being challenged."

The Background of the case

The present petition was filed by two residents of Jammu. The petitioner no. 1 was thrice elected the President of Chamber of Commerce and Industries in Jammu, while the petitioner no. 2 is a practicing advocate.

In support of their grievance, reliance was placed on newspaper reports highlighting opinions of Parliamentary panels, the Corporate Affairs Ministry and other persons.

The grievance, therefore, was that passengers are being compelled to pay amounts for air services which are absolutely illogical, irrational and illegal as a result of arbitrary exercise of authority.

Significantly, during the pendency of the above writ petition, one Zulikha Bano, teacher in a private school in Leh also filed a writ petition (WPPIL No. 24/2016), complaining that exorbitant airfare for plying to and from Ladakh were charged by the airlines creating tremendous difficulties for the common man of the remote region.

This writ petitioner (Zulikha Bano) contended that airlines were adopting the unfair practice of sharp increases in the air ticket prices raising it from Rs. 30,000/- to Rs. 35,000/- making it difficult for the common man to travel to and from Ladakh.

In this background, by way of the writ petition filed in the public interest, the petitioners sought for "issuance of directions to the respondents to subsidize airfare, especially for the local tribal population and to contain the illegal fare practice of unreasonably raising the cost of the tickets. The petitioner also prayed for a direction to the respondents to bring uniformity in the price of the air tickets by the airlines."

Notably, in the writ petition, WPPIL No. 24/2016, an order was passed on 8th February 2017 directing that this petition be listed along with PIL No. 27/2015. In this background, both the writ petitions were taken up for consideration and were heard together.

The Court's order in WP (C) no. 26/2013

It may be noted that a similar grievance was made by the writ petitioner, by way of WP (C) no. 26/2013, which was disposed of by an order dated 1st April 2015 with the liberty to the petitioner to make a representation to the Director General, Civil Aviation regarding their grievance.

The petitioners stated that the said representation was made. However, the grievance was neither considered nor redressed, necessitating the present writ petition

In response to this, the Ministry of Civil Aviation stated before the court that the Ministry considered the representation of the petitioner and disposed of the same (in July 2015) with the observation that "in case the petitioner was not satisfied with the said order, he may file an appeal with the Secretary, Ministry of Civil Aviation as per Rule 3 (B) of Aircraft Rules, 1937."

Consequently, the High Court came to the conclusion that the petitioners were informed of the availability of the remedy of an appeal in terms of Rule 3 (B) of the Aircraft Rules, 1937 in the Ministry's order dated July 2015, as above. However, the petitioners did not file such an appeal.

To this, the court said,

"Clearly the instant writ petition is not maintainable as the petitioners have an efficacious alternative remedy available to them."

Final observations of the High Court

While referring to the Judgment of the Supreme Court in the case of Union of India and another v. Cyanamide India Ltd. and another etc. (1987) 2 SCC 720 , the bench observed,

"It is well settled that price fixation is not the function of the court and only a limited examination as to whether the authority fixing the prices had considered the relevant factors, can be conducted."

[Note: In the aforesaid Judgment, the Supreme Court had laid down the scope of permissible inquiry by a court into the issues of price fixation.]

In the present case, the bench also observed that the Counsel appearing for the petitioners was unable to point out the violation of any statutory provisions or any delegated legislation or even of any binding circular by the Government or by the Director-General of Civil Aviation.

Further, the bench remarked,

"The Director-General of Civil Aviation has no power on the economic regulations of civil aviation and air transport services, including the approval, disapproval or revision of tariff of air transport services."

While appearing before the court, Private Airlines also rendered individual explanations justifying the pricing of air tickets.

The Court's attention was also drawn to sub-rule (1) of Rule 135 of Aircraft Rules, 1937. Further, the bench observed that the prices of the air tickets depend upon the date of travel, how much in advance, the air ticket is booked and the number of seats available on a flight.

Consequently, the court took note of the fact that Fixation of the airfare depends on various factors such as:

1. Fuel cost which is subject to variation;

2. Present market conditions;

3. Cost of operation and maintenance;

4. Seasonal pattern and demand;

5. Govt. taxes and levies;

6. Commercial viability examined keeping in mind the aforesaid factors thereby, accounting for some margins for reasonable profits for the sustenance of the Airlines etc.

It may be noted that sub-rule (4) of Rule 135 of Aircraft Rules 1937 provides that if the Director-General, Civil Aviation is satisfied that any Air Transport Undertaking has established excessive or predatory tariff under sub rule (1) or has indulged in oligopolistic practice, he shall, by an order, issue directions to such Air Transport Undertaking, which directions of Director-General Civil Aviation are required to be complied with by the Air Transport Undertaking.

In this context the court said,

"The petitioners have also not made any complaint to the Director-General, Civil Aviation in accordance with Rule 135 of the Aircraft Rules, 1937 and have approached this Court without having taken recourse to the statutory remedy available to them."

The court also took of the fact that the petitioners did not make any specific allegations in their petitions, but they had premised the writ petitions only on newspaper reports and had made vague and general submissions.

Further, the court said that even if the writ petition is maintainable, this Court does not have the expertise or jurisdiction to undertake the exercise of price fixation.

Lastly, while observing that the respondents have explained the circumstances in which there is price fluctuation, the bench remarked,

"The writ petitions must therefore fail for several reasons. The petitioners had available an efficacious alternative remedy in the nature of the appeal to the Secretary, Ministry of Civil Aviation under Rule 3 (B) of Aircraft Rules, 1937, which the petitioners have failed to exhaust. The petitioners also have the remedy under Rule 135 (4) of the Aircraft Rules, 1937 for making specific complaint to the Director-General, Civil Aviation, which has not been done."

For all these reasons, the court was of the view that the writ petitions were completely misconceived and was thereby dismissed.

Case Details:

Case Title: Y. V. Sharma and another v. Union of India and others

Case No.: PIL No. 27/2015

Quorum: Chief Justice Gita Mittal and Justice Rajesh Bindal

Appearance: Advocate B. S. Salathia, Advocate Pulkit Chrungoo (for the Petitioners); Advocate Inderjeet Gupta, Advocate Anuj Dewan Raina, Advocate Rahul Pant (for the respondents).

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