‘VAT reduction on fuel, underwriting of seats by state government can bring airfares to desired levels’
The Union Ministry of Civil Aviation has passed the buck on expensive airfares to Jammu and Kashmir on the state government saying initiatives like decrease in Value Added Tax (VAT) on fuel and underwriting of seats can bring the ticket prices to the desired levels.
Responding to the notice issued by Jammu and Kashmir State Human Rights Commission (SHRC), the Directorate General of Civil Aviation (DGCA) has said the state governments are important stakeholders as far as airfare pricing is concerned.
“Initiative of the state government on reduction of charges under their control like VAT on fuel lifted from within the state, underwriting of seats etc. may bring the airfares to the desired levels,” DGCA writes in its response to SHRC notice.
In his letter to SHRC, Joint Director DGCA, Lalit Gupta writes that airlines are free to fix reasonable tariff under the provisions of sub-rule (I) of Rule 135 Aircraft Rules-1937 having regard to all relevant factors including the cost of operation, characteristics of service and reasonable profits.
“The aircraft pricing runs in multiple levels, which is in line with the practice followed globally. The lower fare in the fare bucket is available for advance booking much earlier. As time lapses and date of journey approaches close, the fare in higher side of fare bucket is made available as per the respective airline policy. Airlines remain compliant to the regulatory provisions of Rule 135 as long as fare charged by them does not exceed the fare established and displayed on their website,” the letter reads.
It states that with a view to achieve better regulation of air transport services and taking into account the need for air transport services of different regions and remote areas within country, the Central Government has issued policy on regional and remote areas comparatively vide order no: AV 1303/34/2013 dated: 4 March 2014.
DGCA however maintains that with regard to its responsibilities, it (DGCA) has not been delegated powers to control the airfare establishing mechanism of airlines.
In April this year, the general secretary Jammu and Kashmir Peoples Forum, MM Shuja filed a petition with SHRC complaining that exorbitant increase in airfare to J&K has hit the people particularly the patients, student community and lower business class.
Taking cognizance of the complaint, SHRC termed it violation of right to equality and human rights.
A division bench of SHRC comprising its acting chairperson RafiqFida and member Amalok Singh termed it as a move “to scuttle the flow of tourists to Kashmir.”
Besides, the bench observed the fare hike would hit the local patients and students going for treatment/studies outside the state.
The commission had sought report from DGCA and all airlines on the matter.