Airlines challenge Udan cess in Delhi high court

Delhi high court has sought replies by 21 December regarding the challenge to the levy, which comes into effect from Thursday


The levy would put a financial burden, estimated between Rs388 crore to Rs532 crore or more per annum on airlines. Photo: Ramesh Pathania/Mint
The levy would put a financial burden, estimated between Rs388 crore to Rs532 crore or more per annum on airlines. Photo: Ramesh Pathania/Mint

New Delhi: The proposal to levy Rs7,500 to Rs8,500 per flight operated by Indian airlines to create a fund to develop regional airports under its ude desh ka aam naagrik (Udan) scheme was on Wednesday challenged in Delhi High Court which sought to know the government’s stand on the matter.

A bench of Chief Justice G.Rohini and Justice Sangita Dhingra Sehgal issued notice to ministry of civil aviation, airports authority of India (AAI) and director general of civil aviation (DGCA) and sought their replies by 21 December regarding the challenge to the levy, which comes into effect from Thursday.

The order came on the petition by Federation of Indian Airlines (FIA) which has said that while the scheme allows it to pass on the levy to the passengers, it cannot do so as it is not a fee for which the carriers are rendering any service to the flyers.

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The FIA, which represents scheduled carriers like Indigo, GoAir, Spicejet and Jet Airways, has sought quashing of the 21 October notification inserting the rule for imposing the levy as well as the 9 November order declaring rates of levy and the categories of the scheduled flights on which they would be imposed.

FIA, represented by senior advocate Arvind P.Datar, said the levy would put an “immense financial burden”, estimated between Rs388 crore to Rs532 crore or more per annum, and sought orders prohibiting the AAI from collecting the levy. It said that if the financial burden was passed on to the flyers, it would lead to an increase in tariff which would run counter to objectives of the national civil aviation policy and the ude desh ka aam naagrik (Udan) scheme under it to bring airfares down to affordable rates. Udan, as per the Centre, seeks to connect small cities by air as well as make flying more affordable for the people.

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