May 23: Several airlines have been asked to unravel one of the frustrating mysteries of flying: how they decide how much to refund when cheap tickets are cancelled.

The national watchdog that busts monopolies, MRTPC, has found the refund policies of Indian, Air Deccan, Air Sahara (now JetLite), SpiceJet, GoAir and Alliance Air “unfair and prejudicial to public interest”.

Acting on a recommendation by its investigative arm, the MRTPC had started proceedings against the airlines and asked them to file an explanation. The exercise has been put on hold as a few airlines have sought more time to reply.

The initial inquiry concluded that unjustified costs were imposed on “gullible” passengers, who are attracted by low fares, if they were to cancel tickets.

The investigative arm recommended that the airlines should refund the money after deducting cancellation charges alone. The industry does not have a uniform refund policy. Neither has the government laid down any guideline.

The MRTPC had ordered the probe after getting complaints on the cancellation policy of several airlines offering low fares.

Sources said some airlines have defended their policy by saying that the terms and conditions had been explained to the passengers before they bought tickets.

An Indian spokesperson in Delhi declined to comment but a travel agent in Mumbai explained the state-run airline’s cancellation policy.

“Take the example of a Mumbai-Delhi flight by Indian. The lowest non-refundable check fare is around Rs 3,705. If you were to cancel, you will be refunded the tax, which amounts to about Rs 1,125. But a refundable ticket on the same route costs Rs 4,970, where only Rs 500 is deducted on cancellation,” the travel agent said.

SpiceJet spokesperson Ajay S. Jasra denied receiving any notice. “All our low-fare tickets are refundable at the time of cancellation,” he said.

But the travel agent said cancellation (at least 2 hours before scheduled departure) of a SpiceJet ticket would not yield any cash refund. Instead, Rs 500 will be deducted and a voucher with value equivalent to the ticket amount will be issued. The voucher can be redeemed within a year, failing which the money is forfeited.

For postponement, some airlines charge Rs 500 (sometimes more), plus the difference in check fares.

In the case of Air Deccan, most passengers pay by credit card. On cancellation, it will take at least 30 days for the amount to be refunded to the account. If you want to advance or postpone the journey, Rs 200 plus the difference in fare will have to be paid.