The Telegraph
Friday , May 9 , 2014
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Rivals challenge AirAsia entry

New Delhi, May 8: Indian carriers have filed a plea in the Delhi high court against the entry of AirAsia India, which received a flying licence from the government yesterday.

In an interim application before the court, the carriers questioned the authority of the government’s Directorate General of Civil Aviation (DGCA) to issue the licence at a time a case is being heard in the very same court against AirAsia’s entry.

A bench of Chief Justices G. Rohini and Rajiv Sahai Endlaw posted the matter for hearing tomorrow.

Promoted by flamboyant Malaysian entrepreneur Tony Fernandes, AirAsia, with its aggressive low fare offers, is expected to trigger a churn in the Indian market.

The petition of the Federation of Indian Airlines (FIA) alleged that the DGCA’s grant of the flying licence to AirAsia was in “complete defiance of this court’s order as the matter is sub judice”.

The plea, moved by senior advocate Mukul Rohatgi, also sought “to restrain the Centre from granting any decision or grant of any further approvals/permissions/NOC/permits in favour of AirAsia India”.

It submitted a direction be issued to the DGCA to restrain AirAsia India from scheduling flights and selling tickets to the passengers.

Indian carriers, under the FIA, have been engaged in a bitter legal squabble with the government over the entry of not only AirAsia but also the proposed Tata-Singapore Airlines venture.

A case was filed in the Delhi court against AirAsia in February that led to the court deciding to form a special bench earlier this month to hear the pleas that sought to quash the approvals to AirAsia. The FIA had questioned the DGCA’s rationale to grant the permit during the pendency of this petition.

Meanwhile, BJP leader Subramanian Swamy has urged the Election Commission to put on hold the grant of the licence till the next government is formed. Swamy has earlier filed a PIL against AirAsia’s entry.

Both Swamy’s and the FIA’s objections are based on the grounds that rules permit foreign direct investment only in existing carriers and not in new entities.

AirAsia India is a joint venture among Tata Sons, AirAsia and Arun Bhatia’s Telestra Tradeplace.

AirAsia submitted an application to India’s Foreign Investment Promotion Board in February 2013 and received formal approval in April followed by a no-objection certificate from the aviation ministry in September.