Paytm told to pay over Rs 20,000 after flight ticket refund failed to reach customer

A district consumer commission in Himachal Pradesh has directed Paytm to refund the amount of a cancelled flight ticket to a customer, along with compensation and litigation costs, holding that the company failed to ensure the refund reached the passenger even after the airline had transferred the money to the platform, reported TOI.
The Bilaspur District Consumer Disputes Redressal Commission, in its July 18 order, held Paytm liable for deficiency in service and dismissed the complaint against the airline.

How did the flight ticket refund dispute begin?

According to the commission's order, the complainant had booked return flight tickets between Chandigarh and Srinagar through Paytm for himself and a friend. The return flight was scheduled for April 7, 2020, but was cancelled due to the nationwide COVID-19 lockdown, reported TOI.


The complainant told the commission that despite sending several emails to both the airline and Paytm seeking a refund, the money was never returned. He subsequently approached the consumer commission, alleging deficiency in service.

The airline submitted that it had introduced a scheme called "Protect Your PNR," under which passengers could retain the ticket value and use it to book another flight instead of seeking an immediate refund. It said that after the validity of the scheme expired, it processed the refund and transferred Rs 6,437 to Paytm, the travel agent through which the booking had been made.

Paytm, however, argued that it had attempted to refund the amount twice by sending refund links to the complainant. According to the company, the customer failed to claim the money before the links expired, and therefore the refund could not be completed.

Why did the commission hold Paytm liable?

The bench, comprising President Purender Vaidya and members Manchali and Jagdish Thakur, held that once Go Airlines had transferred the refund to Paytm, it became Paytm's responsibility to ensure the amount reached the customer.

The commission noted that Paytm's own records confirmed it had received the refund from the airline and rejected the company's contention that the complainant was at fault merely because the refund links had expired.

The commission also observed that Paytm could have obtained the complainant's bank account details and transferred the refund directly. It further noted that even after the consumer complaint was filed, the company chose to contest the case instead of simply refunding the amount.

Responding to Paytm's claim that a technical glitch had prevented the refund from being processed, the commission said such a reason did not absolve the company of its responsibility to complete the refund.

The commission further held that the complainant was forced to undergo unnecessary litigation because Paytm failed to complete the refund process despite having already received the money from the airline.

"Since complainant was unnecessarily harassed by the opposite party No.2 and he was forced to file the present complaint, therefore, the opposite party No.2 is further directed to pay compensation of Rs 10,000 and litigation cost to the tune of Rs 5,000 to complainant," the commission concluded.
Accordingly, the commission directed Paytm to refund Rs 6,437 to the complainant with 6 per cent annual interest from the date of filing of the complaint until payment. It also ordered the company to pay Rs 10,000 as compensation for harassment and Rs 5,000 towards litigation costs, taking the total amount payable to Rs 21,437, excluding interest.

The complaint against Go Airlines was dismissed after the commission found that the airline had fulfilled its obligation by transferring the refund amount to Paytm.