Suit for refund of air ticket charges and punitive damages - Dispute held to be non-commercial
Delhi High Court Declines Commercial Dispute Status in British Airways Refund Case. The Court Determines Air Travel Services Dispute Lacks Business Elements, Directs Plaintiffs to File in Appropriate Jurisdiction
In a significant judgment delivered by the Delhi High Court, the bench comprising Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela has ruled that disputes arising from transactions that do not involve elements of trade, commerce, or business do not qualify as "commercial disputes" under the Commercial Courts Act, 2015. This decision was made in the case of Chand Mehra & Anr v. British Airways Plc, where the appellants sought recovery of air ticket charges and punitive damages from the airline.
The appellants, Chand Mehra and another, had filed a suit against British Airways for refunding Rs. 5,09,918, along with interest and punitive damages, after cancelling their business class tickets due to a family medical emergency. However, the airline converted the refund into a Future Travel Voucher, leading to the legal dispute.
The Delhi High Court upheld the decision of the Commercial Court, which had previously ordered the return of the plaint under Order VII Rule 10 of the Civil Procedure Code, 1908, citing lack of jurisdiction. The court emphasized that the mere existence of a service contract does not automatically classify a dispute as commercial. For a dispute to qualify under the Commercial Courts Act, the transaction must involve elements of trade, commerce, or business.
The judgment referenced several cases, including the Supreme Court's decision in Ambalal Sarabhai Enterprises Ltd. v. K.S. Infraspace LLP, underscoring the need for strict interpretation of the Commercial Courts Act to prevent clogging of the system with non-commercial disputes. The court concluded that the transaction between the appellants and British Airways was a simple contract of service provision, devoid of any business or commercial considerations.
This ruling directs the plaintiffs to pursue their claims in a court with appropriate jurisdiction, marking a significant moment in delineating the scope of commercial disputes under Indian law.
Bottom Line:
Disputes arising from transactions that lack elements of trade, commerce, or business do not qualify as "commercial disputes" under the Commercial Courts Act, 2015.
Statutory provision(s): Commercial Courts Act, 2015 Section 2(1)(c), Civil Procedure Code, 1908 Order VII Rule 10
Chand Mehra v. British Airways Plc, (Delhi)(DB) : Law Finder Doc Id # 2782726
