IndiGo fiasco: Airline's compensation bill to customers pegged at over ₹500 crore

IndiGo Airlines today said it will provide compensation worth over ₹500 crore to customers who faced cancellation within 24 hours of departure, remained stranded between December 3 to December 5, 2025.

"We are currently in the process of identifying flights where customers were severely impacted and stranded at the airports (on 3, 4, 5 December 2025. We will be reaching out to all such customers in January so that the compensations can be extended smoothly," the airline said in a tweet.

"We will be providing compensation, which in our current estimation, will be in excess of ₹500 crore to customers whose flights were cancelled withing 24 hours of departure time and/or to customers severely stranded at certain airports," the airline added.

It may be noted that the parliamentary standing committee on transport has summoned IndiGo along with DGCA and AAI on December 17 to make a submission on the developments of that led to the major disruption.

Earlier today, the company also said that its board has approved the appointment of Chief Aviation LLC, led by Captian John Illson, to conduct an independent expert review and assessment of the recent operational disruption, and the contributing factors.

Captain Illson brings more than four decades of aviation experience across FAA (federal aviation administration), ICAO (international civil aviation organisation), IATA (international air transport association), and major global carriers.

"The objective is to conduct an independent root cause analysis of the recent operational disruption, besides opportunities for improvement," the airline said.

IndiGo also added that with the board's approval now in place, the review will begin at the earliest, and the independent reviewer will submit a comprehensive report to the board upon completion.

IndiGo seeks ₹900 crore custom duty refund

In a separate incident, IndiGo has moved Delhi high court seeking a refund of over ₹900 crore paid as customs duty on re-import of aircraft engines and parts to India after overseas repairs.

As per IndiGo's counsel, at the time of re-import of aircraft engines and parts after repairs, the company paid basic customs duty without dispute. In addition to that, the company also had to pay Goods and Services Tax (GST) on a reverse charge basis because repair constitutes a service. According to IndiGo, the customs officials insisted on levying customs duty again by treating the same transaction as import of goods.

The airline said that the issue had earlier been settled by the customs tribunal, which held that customs duty could not be levied again on re-imports following repairs. Even as the government introduced Notification No 36/2021-Customs in July 2021 effectively taxing re-imports, the amendment was later challenged, and the Delhi high court in March 2025 declared such customs duty on re-imports unconstitutional, and struck down the relevant portion of the notification.

Despite this, according to IndiGo, customs authorities allegedly compelled the carrier to pay the duty to secure clearance of aircraft engines, and other critical components. The airline said that unlike GST, which is self-assessed, customs clearance depends on approval of the officers, and because the aircraft could not be grounded indefinitely, it "under protest" paid the duty across over 4,000 bills of entry, amounting to over ₹900 crore.