New air ticket refund rules come into effect today: 48-hour free cancellation, charge limits; all you need to know about DGCA’s changes

Air passengers in India now have more flexibility when it comes to cancelling their tickets, thanks to a revised set of air ticket refund rules issued by the aviation regulator.

As per a Directorate General of Civil Aviation (DGCA) order dated February 24, 2026, new refund rules come into effect from today (Thursday, March 26, 2026). The new framework is aimed at making the refund process quicker and more transparent, while also giving travellers a short window to correct booking mistakes without losing money.

• Refund to credit card must be completed within 7 days
• Rules for air tickets booked through credit card
• In case of air ticket bookings done through credit card payments, refunds shall be made by airlines within seven days of the cancellation to the account of the credit card holder.
• Rules for air tickets booked through cash transactions
• In case of cash transactions, refund shall be made immediately by the airline's office from where the ticket was purchased.
• Rules for air tickets booked through travel agent
• Many passengers book tickets through travel agents or online portals, and confusion often arises about who is responsible for refunds. The revised rules clarify that airlines remain accountable for completing the refund process, even when tickets are sold through agents.

As stated in the rules:
"In case of purchase of tickets through a travel agent/portal, the onus of refund shall lie with the airlines… The airlines shall ensure that the refund process is completed within 14 working days."

Rules for refunds of user development fee

In the event of a cancellation, non-use of a ticket, or no-show, the airlines must reimburse all statutory taxes as well as the User Development Fee (UDF)/Airport Development Fee (ADF)/Passenger Service Fee (PSF). This clause shall also apply to all types of fares given, including promotional/special fares, where the fundamental fare is non-refundable.

48-hour look-in option

One of the most passenger-friendly changes is the introduction of a 48-hour window after booking. During this period, passengers can cancel or modify their tickets without paying any additional cancellation charges.

However, this facility comes with certain conditions. It is available only when tickets are booked directly through airline websites and when the travel date is sufficiently far away.

"The airline shall provide a 'look-in option' for a period of 48 hours after booking a ticket… passengers can cancel or amend the ticket without any additional charges."

This service is not accessible for flights departing within 7 days for domestic flights and 15 days for international flights from the booking date, when booked directly through the airline's website. This option is not accessible beyond 48 hours from the initial booking time, and the passenger must pay the applicable cancellation fees for change.

Rule for holding refund in credit

The option of holding the refund amount in a credit shell by the airlines shall be the prerogative of the passenger and not a default practice of the airline, as per the revised rules.

Cancellation charges limit

To prevent excessive deductions, the regulator has placed limits on cancellation charges. Airlines and their agents are not allowed to levy cancellation fees beyond the basic fare and fuel surcharge component.

Under no circumstances should the airline or its agent demand a cancellation fee greater than the basic fare + fuel cost. This excludes any charges assessed by the travel agent that were fully disclosed at the time of booking. It is the airline's responsibility to assure this through their contracts with travel brokers and portals.
DGCA further says an airline should indicate in an unambiguous manner the amount of refund of money admissible on the cancellation of a ticket.

For this purpose, the amount and its break-up may be indicated on the ticket itself or through a separate form used for the purpose, and the policy and amount of refund shall also be displayed by airlines on their respective websites, says the watchdog.
DGCA also says cancellation charges of an air ticket must be indicated prominently at the time of booking.