Big Blow For IndiGo As DGCA Imposes Fine Of ₹22.2 Crore, Warns CEO

New Delhi: The Directorate General of Civil Aviation (DGCA) has imposed a fine of ₹22.2 crore on IndiGo airline for the large-scale flight cancellations in December. The company's CEO, Pieter Elbers, has also been served a warning.

An order has also been issued to remove a senior IndiGo official. This information was released by the regulator in a statement on Saturday. The DGCA took this action more than a month after constituting a four-member committee to investigate the widespread disruptions between December 3-5.

What led the DGCA action against IndiGo?

In early December, IndiGo cancelled 2,507 flights and delayed 1,852 flights which prompted the DGCA to initiate disciplinary action. 

"The DGCA has directed IndiGo to relieve the Senior Vice-President of the Operations Control Center from his current operational responsibilities. IndiGo CEO Pieter Elbers has been warned for inadequate overall oversight of flight operations and crisis management," the DGCA said in a statement.

What were the reasons for the December fiasco?

The matter was also investigated, and according to the DGCA, the main reasons for the disruption were over-optimization of operations, lack of regulatory preparedness, deficiencies in system software support, flaws in the management structure, and a lack of operational control on the part of the airline. The DGCA's ₹22.2 crore fine includes a daily penalty of ₹30 lakh for 68 days of non-compliance with regulations. The total fine also includes a one-time systemic penalty of ₹1.8 crore.

What about refunds for passengers?

Earlier, the DGCA said on Friday that the domestic airline, IndiGo, has refunded all passengers affected by the flight cancellations between December 3 and 5. 

“The DGCA is in constant communication with domestic airline IndiGo regarding refunds and compensation for passengers affected by operational disruptions between December 3 and 5,” the DGCA said.

“IndiGo has informed that the refund process for passengers affected by IndiGo flight cancellations between December 3 and 5 has been completed,” he statement added.

What other steps has IndiGo taken?

In addition, the airline has taken another step to help affected passengers. Under this, IndiGo is offering two travel vouchers worth Rs 5,000 with a validity period of 12 months. According to DGCA rules, passengers should be compensated for the ‘amenities’ that airlines provide to passengers due to ‘denial of boarding, flight cancellations and flight delays’. Union Civil Aviation Minister K Rammohan Naidu had told Parliament on December 9 that ‘IndiGo was ordered to issue refunds immediately and more than Rs 750 crore has already reached the passengers.’