New aviation rules require airlines to disclose cancellation fees, refund terms upfront

Airlines will continue to set ticket prices under normal circumstances, but a new regulatory framework will require them to provide passengers with a more detailed breakdown of fares and submit tariff information to the aviation regulator.

The Bharatiya Vayuyan Niyam, 2026, notified by the Ministry of Civil Aviation on October 26 and published in the Gazette of India on October 31, will come into force on January 1, 2027. The rules will replace the Aircraft Rules, 1937, and introduce specific disclosure requirements for cancellation charges and refund conditions.

What passengers will see while booking tickets

Under Rule 192, airlines must display the total amount payable by a passenger on their booking websites and the booked ticket. The breakdown must separately specify the basic fare, taxes, fees, cancellation charges, refund conditions and any other applicable charges.

The requirement covers Indian airlines operating scheduled services as well as foreign carriers running scheduled flights to, from or across India.

Airlines will also have to publish their tariffs on their websites or other digital platforms in the format and manner prescribed by the Directorate General of Civil Aviation (DGCA). The stated aim is to improve transparency and ensure that tariff information is more widely accessible to the public.

DGCA to monitor domestic airline tariffs

The new framework also formalises the submission and monitoring of fares. Indian airlines operating scheduled services will have to submit their tariffs to the DGCA in the form, manner and at the intervals specified by the regulator. The DGCA will monitor the tariffs established by these domestic carriers.

All airlines covered by the provisions must establish tariffs taking into account factors including their cost of operation. However, the rules do not introduce a routine cap on airfares or make government approval mandatory for every ticket price. Airlines will therefore retain the ability to determine fares under normal circumstances.

The Central government can, however, issue written directions to airlines in the public interest if an extraordinary situation arises. Any such intervention must be proportionate to the circumstances and remain in force only for a specified period.

How the new rules differ from the existing framework

The 2026 provisions expand disclosure requirements that were already part of the Aircraft Rules, 1937. The earlier framework required airlines to display the total amount payable by passengers, along with a breakdown of the fare, taxes, fees and other charges.

The new rules specifically add cancellation charges and refund conditions to the particulars that airlines must disclose. They also provide for tariff publication across digital platforms and formal submission of tariffs by Indian scheduled airlines to the DGCA for monitoring.

The changes come alongside a separate revision to the DGCA's ticket-refund framework, which took effect on March 26, 2026. Under those revised provisions, passengers booking directly through an airline's website have a 48-hour window to cancel or amend eligible tickets without cancellation charges, subject to specified conditions. The refund framework also requires credit-card refunds to be processed within seven days of cancellation.

New rules follow scrutiny of airfares

The notification comes amid scrutiny of airline pricing and concerns over steep fare increases in certain circumstances. The Supreme Court had earlier been informed by Solicitor General Tushar Mehta that the new rules had received administrative approval and would be published. The court subsequently directed the Centre to place the notified rules before it by November 16.

India deregulated airline fare fixation in 1994, allowing carriers to determine ticket prices based on market conditions. Airlines typically use multiple fare categories, with prices varying according to factors such as demand and the time of booking.

The Bharatiya Vayuyan Niyam, 2026, have been framed under the Bharatiya Vayuyan Adhiniyam, 2024, which replaced the Aircraft Act, 1934. The legislation was passed by the Lok Sabha on August 9, 2024, and the Rajya Sabha on December 5, 2024. It received presidential assent on December 11, 2024, and came into force on January 1, 2025.

The new rules will take effect on January 1, 2027. Until then, the Aircraft Rules, 1937, will continue to govern the relevant provisions.