Dismissing complaints against private airlines, the Competition Commission of India (CCI) today said they did not indulge in anti-competitive practices by raising fares after Air India pilots went on strike in April-May last year.
In a 24-page order, the competition watchdog observed that like in any peak season, during April and May 2011 load factor on airlines had increased and in line with this trend, the percentage of tickets sold in the higher buckets of all the airlines had also gone up.
"To this extent, it may be said that there was a pattern in air fares going upwards together during the strike period and in general also during the period of high demand, fares of all airlines tend to move together."
"However, based on available evidence, the Commission holds that it cannot be concluded that the airlines had been carrying on any anti-competitive practice in violation of section 3[3] of the [Competition] Act," the CCI said.
Section 3 of the Act pertains to anti-competitive agreements by enterprises.
During the course of proceedings, CCI said it has also considered the Directorate General of Civil Aviation's (DGCA's) submission that increase in air fare was due to peak traffic season coupled with reduced capacities as a result of strike by Air India pilots.
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The Corporate Affairs Ministry had sent a reference in this regard to the CCI on May 6, 2011.
In the reference it was stated that due to the strike, with effect from midnight April 26, 2011, different airlines had started charging exorbitant fares for the tickets.
It was also mentioned in the said reference that in normal course also one could not buy tickets online, even though seats were available, and tickets had to be bought at higher prices near to the date of departure, it said.
Following the reference, and preliminary findings of cartelisation, the Director General (Investigations) of the CCI had been asked to investigate the matter and submit its report on the same.
About 800 pilots, belonging to the erstwhile Indian Airlines, had gone on strike between April 27 and May 6 demanding, among other things, pay parity with their Air India counterparts.
The 10-day strike saw disruptions in the services of the national carrier.