SpiceJet Ltd. v. Ranju Aery

SpiceJet cancelled a Kolkata to New Delhi flight on 30 June 2015, although 128 of the 129 flights that day left. It gave no refund and no alternative flight. The National Commission held that this was a deficiency in service (a fault or shortcoming in performing a service) and that the e-ticket terms could not shield the airline.

Quick Revision

Parties

Spicejet Ltd. — petitioner; the airline and opposite party (OP) before the District Forum. It filed the revision petition.

Ranju Aery — respondent; the complainant, who booked air tickets for herself and her family. She appeared in person.

Procedural History

1. Ranju Aery filed Consumer Complaint No. 588/2015 before the District Consumer Disputes Redressal Forum (para 1, para 2).
2. The District Forum noted on 20 November 2015 that the notice sent by registered post on 21 October 2015 was not received back. It presumed service and proceeded ex parte (without the airline appearing) (para 7).
3. The District Forum decided the complaint on 30 November 2015, ex parte (para 3).
4. The airline appealed. The U.T. State Consumer Disputes Redressal Commission, Chandigarh, dismissed Appeal No. 347/2015 at the preliminary stage by order dated 29 December 2015 (paras 1, 3).
5. The airline filed Revision Petition No. 1396 of 2016 under Section 21(b) of the Consumer Protection Act, 1986 (para 1, para 3).
6. The National Commission pronounced its order on 7 February 2017.

Facts

1. Ranju Aery booked air tickets online through the website Yatra.com. The tickets were for herself and her family members (para 2).
2. The outward travel was from New Delhi to Bagdogra on 23 June 2015. The return was from Bagdogra to Kolkata, with a connecting SpiceJet flight from Kolkata to New Delhi on 30 June 2015 (para 2).
3. She paid Rs. 70,900 through her debit card on 12 June 2015 (para 2).
4. On 30 June 2015 the family flew from Bagdogra to Kolkata by Indigo Airlines. They reached the Kolkata airport at 1.30 pm to board SpiceJet flight SG256 to New Delhi, scheduled for 20.40 hours (para 2).
5. The family members had boarding passes. They then learnt that the flight was cancelled (para 2).
6. SpiceJet made no alternative arrangement for the family (para 2).
7. The complainant bought tickets on a Jet Airways flight from Kolkata to Mumbai, with a connecting flight to New Delhi. It departed at 20.40 hours. She spent Rs. 80,885 on five tickets (para 2).
8. The family was due in New Delhi at 22.50 hours on 30 June 2015. They reached at 5 am on 1 July 2015, missed the Volvo bus to Chandigarh and reached Chandigarh late (para 2).
9. The complainant found that 128 of the 129 flights scheduled from Kolkata on 30 June 2015 had left. The only cancelled flight was SpiceJet's, for reasons not known to her (para 2).
10. SpiceJet neither refunded the fare nor arranged another flight (para 2).
11. She asked for these reliefs (para 2):
    • refund of the ticket amount of Rs. 20,000 with interest at 12% per annum;
    • the extra Rs. 80,885 paid for the alternative flight;
    • Rs. 1.5 lakhs as compensation for mental harassment;
    • Rs. 22,000 as litigation charges.

Issues Raised

1. Was the airline duly served in the District Forum proceedings, and was the ex parte order justified (para 7)?
2. Was there a deficiency in service on the part of the airline in cancelling flight SG256, under the Consumer Protection Act, 1986 (para 11)?
3. Could the airline rely on the e-ticket terms of carriage, framed under the Carriage by Air Act, 1972, to avoid liability (paras 10, 12-13)?
4. Did the State Commission at Chandigarh have territorial jurisdiction (para 14)?
5. Was there any ground to interfere with the concurrent findings of the two fora below in revisional jurisdiction (para 16)?

Arguments Contended

For the petitioner (SpiceJet Ltd.)

1. The District Forum passed its order behind the airline's back, because the airline was not properly served. The order, confirmed by the State Commission, was therefore bad in law (para 4).
2. The airline was ready to refund the cost of the tickets for the cancelled flight, if this was not already done (para 4).
3. The direction to pay compensation of Rs. 1.25 lakhs should be set aside (para 4).
4. Passengers are governed by the terms of carriage in the e-ticket, framed under the Carriage by Air Act, 1972 (para 10).
5. One clause says the airline will help passengers reach the destination if a flight is cancelled or delayed. It says the airline is not liable in any way for the delay or cancellation (para 10).
6. Another clause reserves the airline's right to cancel or delay any flight, without liability in damages or otherwise, on any ground (para 10).
7. The e-ticket was a concluded contract and bound the parties (para 10).
8. The flight was cancelled for operational and technical reasons beyond the airline's control. The complaint was therefore not maintainable (para 10).

No authorities are recorded for the petitioner.

For the respondent (Ranju Aery, in person)

1. The airline had not taken the plea of ex parte proceedings in the State Commission (para 5).
2. The complainant and her family went through much mental harassment because of the cancellation (para 5).
3. The orders of the consumer fora below were in accordance with law and should be upheld (para 5).

No authorities are recorded for the respondent.

Court's Reasoning

Dr. B.C. Gupta, Presiding Member (for the Commission)

1. Noted: the Commission examined the entire material on record and considered the arguments (para 6).
2. Noted: the first issue was whether the airline was duly served before the District Forum, and whether the ex parte order was justified. The Commission summoned and perused the District Forum record (para 7).
3. Noted: the District Forum's order of 20 November 2015 recorded that the notice sent by registered post on 21 October 2015 had not come back, served or unserved. It recorded that 30 days had passed, so the airline was presumed served under Regulation 10(2) of the Consumer Protection Regulations, 2005. It recorded that nobody appeared for the airline though it was called several times, so the airline was proceeded against ex parte. The next date was 27 November 2015 for the complainant's further evidence and arguments (para 7).
4. Noted: the notice was sent on 21 October 2015 and had not come back by 20 November 2015. More than 30 days had passed, and the District Forum relied on Regulation 10(2) to presume service (para 8).
5. Noted: the proviso to Section 28A(3) of the Consumer Protection Act, 1986 says this. Where the notice was properly addressed, pre-paid and duly sent by registered post acknowledgment due, a declaration of service is made. This is so even if the acknowledgment is lost or mislaid or not received within 30 days of issue of the notice (para 8).
6. Held: the District Forum rightly presumed proper service on the airline, because the registered notice was not returned within 30 days. It rightly proceeded ex parte, and its order cannot be faulted on this ground at all (para 9).
7. Noted: the main issue was the cancellation of flight SG256 from Kolkata to New Delhi on 30 June 2015. The airline pleaded that its e-ticket terms of carriage, under the Carriage by Air Act, 1972, excluded liability. It pleaded that the flight was cancelled for operational and technical reasons beyond its control (para 10).
8. Held: this contention is not tenable. The basic question is whether there was deficiency in service by the airline under the Consumer Protection Act, 1986 (para 11).
9. Noted: Section 2(o) of the Act defines service as service of any description made available to potential users. It includes facilities in connection with transport, banking, financing and insurance, among others. It excludes service rendered free of charge or under a contract of personal service. Section 2(g) defines deficiency as any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance. The performance must be required by law or undertaken by contract or otherwise in relation to a service (para 11).
10. Held: it is abundantly clear that the flight was cancelled although all other flights from Kolkata airport were operating. The airline did not explain whether there were genuine reasons for the cancellation (para 12).
11. Held: "Merely taking the plea that there were technical and operational defects, does not cut much ice". Other flights operated normally, so the general conditions at the airport and the weather suited flying (para 12).
12. Noted: the airline did not explain whether it took concrete steps to look after the passengers of the cancelled flight or to arrange their travel some other way (para 12).
13. Held: "The deficiency in service on the part of the OP Airlines is, therefore, writ large on the face of it". The airline is liable to compensate the complainant (para 12).
14. Noted: on the concluded-contract contention, the Commission cited LIC of India v. Consumer Education and Research Centre (1995) 5 SCC 482. That judgment says that where a contract or clause is unreasonable, unfair or irrational, one must look to the relative bargaining power of the parties. In dotted-line contracts the weaker party cannot bargain. He must accept the unfair terms or give up the service for ever (para 12).
15. Held: if a contract is found unreasonable, unfair or irrational, it cannot be given effect. Here there was clear deficiency in service, because the airline took no step to give the passengers an alternative (para 13).
16. Held: on territorial jurisdiction, the State Commission rightly said that part of the cause of action arose at Chandigarh. The tickets were booked on the internet, so the acceptance of the contract was received by the complainant online at her place of business or residence. The Commission agreed that the State Commission at Chandigarh had territorial jurisdiction (para 14).
17. Noted: the State Commission rightly observed that the complainant was lucky to have relatives in Kolkata, from whom she borrowed money. She paid Rs. 80,885 to another airline to reach New Delhi via Bombay, and then travelled by bus to Chandigarh (para 15).
18. Held: the harassment caused to the whole family by the cancellation is quite evident from the facts and circumstances on record (para 15).
19. Held: there was no valid ground to disagree with the concurrent findings of both fora below. In revisional jurisdiction, interference with concurrent findings is made only if there is a patent error or miscarriage of justice. The Supreme Court took this view in Ruby (Chandra) Dutta v. United India Insurance Co. Ltd. (2011) 11 SCC 269 (para 16).
20. Held: "there is no illegality, infirmity or jurisdictional error in the orders passed by the fora below". The orders are confirmed and the revision petition has no merit (para 16).

Authorities

• LIC of India v. The Consumer Education and Research Centre, (1995) 5 SCC 482 — cited for the rule on unreasonable, unfair or irrational contract terms and the relative bargaining power of the parties, which defeated the airline's concluded-contract plea (para 12, para 13).
• Ruby (Chandra) Dutta v. United India Insurance Co. Ltd., (2011) 11 SCC 269 — cited for the rule that concurrent findings are interfered with in revision only for patent error or miscarriage of justice (para 16).

Provisions mentioned

• Section 21(b), Consumer Protection Act, 1986 — the provision under which the revision petition was filed against the State Commission's order (para 1).
• Regulation 10(2), Consumer Protection Regulations, 2005 — lets the Forum presume service where the registered notice is not returned within 30 days (para 7, para 8).
• Proviso to Section 28A(3), Consumer Protection Act, 1986 — a declaration of service is made for a properly addressed, pre-paid registered notice, even if the acknowledgment is not received within 30 days (para 8).
• Section 2(o), Consumer Protection Act, 1986 — defines "service" (para 11).
• Section 2(g), Consumer Protection Act, 1986 — defines "deficiency" (para 11).
• Carriage by Air Act, 1972 — the airline said the e-ticket terms of carriage were framed under it (para 10).

Judgement

1. The Commission found no valid ground to disagree with the concurrent findings of the two fora below (para 16).
2. It held that there was no illegality, infirmity or jurisdictional error in their orders, and confirmed them (para 16).
3. It dismissed the revision petition as without merit (para 16).
4. There was no order as to costs (para 16).

The District Forum's order, as upheld by the State Commission, stood. That order, as recorded in para 3:

• directed the airline to refund Rs. 80,885 to the complainant after deducting the airfare from Kolkata to New Delhi for the cancelled flight;
• awarded interest at 9% per annum from the date of cancellation till realisation;
• awarded Rs. 1.25 lakhs as compensation for harassment and Rs. 10,000 as litigation cost.

Legal Principle / Ratio

An airline that cancels a flight without a genuine explanation, a refund or an alternative arrangement commits a deficiency in service. A clause in the e-ticket that excludes liability cannot be given effect if it is unreasonable or unfair. The key holding: "there is no illegality, infirmity or jurisdictional error in the orders passed by the fora below".

Critical Analysis

Analysis based on the judgment text.

• The Commission did not decide the validity of the e-ticket clauses clause by clause. It held that an unfair term cannot be given effect, using the LIC case on bargaining power (paras 12-13).
• The ruling rests on the airline's silence. It gave no genuine reason for the cancellation, and it did not show any step to help the passengers (para 12).
• The judgment does not say whether a proven operational or technical reason, with help to passengers, would have changed the result.
• The petitioner's offer to refund the ticket price (para 4) is not discussed in the reasoning.
• The judgment does not discuss the airline's ex parte plea beyond the service presumption (paras 7-9).

Significance

• It is a Commission-level order on an air-travel complaint, applying the Act's definitions of service and deficiency to a cancelled flight.
• It shows that a cancelled flight is not excused by a bare plea of operational or technical reasons when other flights operate.
• It shows that a standard e-ticket clause denying all liability does not bind a passenger where it is unreasonable or unfair.
• It shows that an online booking can give part of the cause of action where the complainant receives acceptance (para 14).

Exam-Important Points

• Rule: cancelling a flight with no genuine reason, refund or alternative is a deficiency in service under Section 2(g) (para 12).
• Rule: an unreasonable, unfair or irrational contract term cannot be given effect (para 13).
• Trap: the e-ticket clause denying liability for cancellation did not protect SpiceJet (paras 10, 12-13).
• Rule: service by registered post is presumed if the notice is not returned within 30 days, under the proviso to Section 28A(3) (paras 8-9).
• Rule: the Chandigarh State Commission had territorial jurisdiction, as acceptance of the online booking was received there (para 14).
• Trap: revision under Section 21(b) is not a rehearing. Concurrent findings are touched only for patent error or miscarriage of justice (para 16).
• Amounts: ticket Rs. 70,900 paid; Rs. 80,885 spent on the alternative route; District Forum awarded Rs. 1.25 lakhs compensation and Rs. 10,000 costs (paras 2-3).

Prepared from the full text of the judgment. Paragraph numbers follow the official judgment text; law reports may number the same paragraph differently.