Aniket PujariCCI has observed that passengers were “left with no real choice but to accept last-minute cancellations” and were forced to seek alternatives “at significantly higher prices”. Given IndiGo’s dominant position, consumers were “effectively locked in and lacked viable alternatives.”
In a 16-page order dated 4 February, the CCI has directed the Director General (DG), the watchdog’s investigative arm, to examine whether IndiGo violated provisions of the Competition Act by cancelling thousands of flights across its network and subsequently charging significantly higher fares to stranded passengers.
This marks the beginning of the investigation.
“….the CCI directs the DG to cause an investigation to be made into the matter and submit an investigation report within a period of 90 days from the date of receipt of this order,” the order by CCI chairperson, Ravneet Kaur and three members, Anil Agarwal, Sweta Kakkad and Deepak Anurag, read.
The anti-trust agency further said IndiGo created an ‘artificial scarcity’.
Queries sent to the airline were not answered till print time. IndiGo has received the order.
It held that by cancelling thousands of flights that constituted a significant portion of the scheduled capacity, “IndiGo effectively withheld its service from the market, creating an artificial scarcity, limiting consumer access to air travel during peak demand. Such conduct by a dominant enterprise may be viewed as restricting the provision of services under Section 4(2)(b)(i) of the Act (relating to abuse of dominant position).”
Dominant position
“The aforesaid conduct of the OP (IndiGo) seems to be prima facie causing an appreciable adverse effect on competition in India. Thus, the Commission is of the opinion that a prima facie case of contravention of the provisions of Sections 4(2)(a)(i) and 4(2)(b)(i) of the Act by the OP (IndiGo) is made out in the present matter,” it also observed in its order.
Section 4 of the Competition Act 2002 deals with abuse of dominant position.
For context, IndiGo suffered an operational meltdown in the first week of December, cancelling over 4,500 flights and leaving thousands of passengers stranded at airports across India. The airline told DGCA in December that the disruption was due to minor technical glitches, winter schedule changes, bad weather, increased congestion and the rollout of flight duty time limitations (FDTL) Phase II norms.
The revised rules mandate stricter night-flying limits and longer pilot rest periods, thereby raising crew requirements.
However, in its 17 January probe, DGCA investigation found that over-optimised operations and inadequate regulatory preparedness led to the disruptions. It also flagged deficiencies in system software support.
The regulator said the airline failed to plan adequate buffers and to properly implement FDTL norms, resulting in widespread delays and cancellations.
One such aggrieved passenger, Kartikeya Rawal, moved the CCI, claiming that his return flight on IndiGo was cancelled just hours before departure, without any alternative arrangements, forcing him to rebook with the same airline at a much higher price. The informant had initially paid ₹7,173 for his return ticket but eventually travelled two days later at a fare of ₹17,000.
CCI noted that this was not an isolated incident. “The issue has also been widely reported in the public domain,” the regulator observed in its order, adding that passengers across the country were left stranded. Between 3 and 5 December, there were 2,507 flights, of which 1,852 were delayed, affecting more than three lakh passengers, it was noted.
Power over the market
“The harm is no longer confined to this route versus that route; rather, the conduct constrains the overall ability of consumers to use domestic air travel as a mode of transport,” it said.
Pointing out to IndiGo’s dominance, the Commission relied on data submitted by the Directorate General of Civil Aviation (DGCA), the country’s aviation regulator. CCI observed that the data showed that IndiGo accounted for around 60–61% of domestic passenger volumes and capacity in the past two financial years. In FY25, IndiGo carried over 104 million passengers.
The CCI also noted IndiGo’s extensive network. Out of approximately 835 domestic city-pair routes, IndiGo operated on 643, and was the sole operator on more than 330 routes in recent months, it was observed. “Such structural presence on a large number of monopoly routes constitutes a relevant indicator of market power,” CCI said.
In addition, the Commission noted that IndiGo operates the largest fleet in India, with over 400 aircraft, and is the only major airline reporting sustained profits while most competitors remain loss-making.
“On the basis of substantial and sustained market share, wide network reach with exclusive operations on a significant number of city-pair routes, comparatively larger fleet and strong financial performance, the Commission is of the prima facie view that (IndiGo) enjoys a position of dominance,” the order said.
It also noted that IndiGo “is a significant market player not only in terms of absolute passenger numbers carried, but also in terms of Available Seat Kilometres (ASKM) passenger capacity, reflecting its substantial scale of operations and capacity deployment in the domestic aviation market.”
DGCA’s observation
IndiGo consistently accounts for about 60–61% of total domestic ASKM, reflecting not only passenger volumes but also effective control over market capacity and supply-side conditions, CCI said. “The domestic passenger aviation market exhibits very high and increasing concentration, exhibiting that leading firms possess the ability to operate independently of competitive forces, as the presence of effective rivals is materially constrained,” the anti-trust agency said.
While ordering the probe, the Commission clarified that its findings were preliminary. “Nothing stated in this order shall be tantamount to a final expression of opinion on the merits of the case,” it said.
Significantly, DGCA itself informed the Commission that it does not possess economic regulatory powers over airfares. In its submission, the aviation regulator stated that “airfares are not regulated by DGCA” and that it has not been vested with powers to conduct competition analysis, such as market definition, dominance assessment, or examination of coordinated conduct.
“By rejecting the argument that DGCA’s oversight under the new Bhartiya Vayuyan Adhiniyam (BVA), 2024 precludes antitrust scrutiny, the Commission has asserted its mandate over economic conduct in the skies,” said Rohit Jain, managing partner at Singhania & Co., a legal advisory firm.
“The finding that IndiGo, holding over 60% market share, is prima facie dominant and may have abused this position through artificial scarcity and unfair pricing, places its operational strategies under intense legal lens. The order sets a critical precedent that the aviation sector is not immune to antitrust scrutiny, even with the new BVA 2024 in place, and it also holds that any airline cannot rely solely on DGCA compliance to avoid competition liability,” he added.
Another lawyer said this is a big win for the passengers affected by flight cancellations.
“CCI’s order is a timely reminder that market leadership comes with heightened responsibility. Competition law does not selectively penalize success, but it does require dominant players to operate within clear legal boundaries to preserve fair choice in the market. A big win for the passengers affected by the disrupted flight services,” said Bharat Kumar, associate partner at Saikrishna & Associates.
According to Anish E. Raveendran, Advocate at the Bombay High Court, it is evident that the Commission has found sufficient prima facie material to conclude that IndiGo, a dominant enterprise in the relevant market with 60% market share in domestic air passenger services, may have contravened sections of the Competition Act.
“The direction for a detailed investigation significantly elevates the airline’s legal exposure from regulatory non-compliance to potential antitrust liability. The matter also carries precedential significance for the aviation sector, particularly in relation to obligations of dominant market participants during periods of peak demand,” said Raveendran.
