Air India awaits ruling for payouts

DUBAI // Air India will wait to hear a verdict by the country's supreme court before deciding if relatives of those killed in the Mangalore crash will be compensated according to the Montreal Convention, its new chief says.

The airline's chairman and managing director, Rohit Nandan, said the government-owned carrier would only pay Montreal Convention compensation amounts if the court ruled in favour of the relatives this year.

"Whatever is decided by the Supreme Court, we will abide by it," Mr Nandan said at a gathering of Indian expatriates, travel agents and aviation authorities in Dubai on Monday evening.

"We will honour the decision happily," he said, adding the payout expense would be borne by the carrier's insurance companies.

The Montreal Convention requires airlines to pay compensation to families of 100,000 Special Drawing Rights (SDR) for each passenger. SDR is a mixture of currency values established by the International Monetary Fund – equal to 7.5 million rupees (Dh535,295).

The chairman's comments come a week after 10 families in the UAE said they intended to file suits against Air India by the end of next month for compensation under the Montreal Convention before its two-year statute of limitation ends.

Only eight people survived when Air India Express flight 812 from Dubai overshot the runway in Mangalore on May 22, 2010.

At least 118 compensation cases have been settled so far, said H?D Nanavati, a partner at Mulla & Mulla & Craigie Blunt & Caroe in Mumbai, representing the airline and the insurers.

"In addition, seven cases have been partly settled due to disputes within the family," Mr Nanavati said. "Thus a balance of 35 cases remain to be settled."

The airline chief said he hoped the supreme court's October judgment – the first of its kind since India signed the convention in 2009 – would rule in favour of the carrier.

Last July, a court in Kerala ordered the airline to follow the convention but this was overruled a month later in favour of Air India, with victims asked to show "proof of loss".

Mangalore airport is "under close watch" after the Directorate General of Civil Aviation in New Delhi listed it and 11 others as the country's most unsafe, the airline says.

Mr Nandan said Indian nationals travelling from the UAE and elsewhere could expect better services from Air India and its low-cost arm, Air India Express, after the cabinet announced a huge financial package last week to help the struggling carrier.

"Our [punctuality] has to improve, ease of transaction has to improve," he said. "We have to provide the best experience. We can't depend on just nostalgia and nationalism."

The airline has about 250 flights from the Gulf to India every week, of which 140 are from Dubai and Sharjah.

pkannan@thenational.ae

* With additional reporting by Ramola Talwar Badam