India’s competition regulator, the Competition Commission of India (CCI), has ordered a detailed probe into IndiGo over alleged unfair business practices linked to mass flight cancellations in December. The order comes a little over two months after the airline cancelled thousands of flights due to operational disruptions, affecting more than 10 lakh passengers nationwide.

In a 16-page order issued on Wednesday, the CCI said it had formed a prima facie view that IndiGo, which holds a dominant position in India’s domestic aviation market, may have abused its market strength by cancelling a substantial portion of its scheduled capacity. The regulator noted that the cancellations may have created an artificial shortage of seats during a period of high demand, limiting consumer access to air travel.

IndiGo currently controls over 65% of India’s domestic air travel market, giving it significant influence over capacity and pricing. The CCI observed that such conduct by a dominant enterprise could fall under Section 4(2)(b)(i) of the Competition Act, which deals with restricting the provision of services. Based on this assessment, the regulator directed its Director General to carry out a detailed investigation into the matter.

Market share data cited in the order showed that while IndiGo remained the clear market leader, rival airlines saw marginal gains during the disruption period. In December, the Air India Group’s market share rose to 29.6%, Akasa Air’s to 5.2%, and SpiceJet’s to 4.3%, while Alliance Air remained unchanged at 0.4%.

The investigation follows severe operational disruptions in early December, after which the Directorate General of Civil Aviation (DGCA) curtailed IndiGo’s winter schedule by 10% until February 10. According to aviation regulator data, more than 10.4 lakh passengers were affected by flight cancellations in December, with over 93% of them impacted by IndiGo alone.

Airlines paid more than ₹24.27 crore towards compensation and passenger facilities for cancellations during the month, of which IndiGo accounted for ₹22.74 crore. Additionally, flight delays affected around 8.34 lakh passengers, with airlines spending ₹4.50 crore on passenger amenities.

On January 17, the DGCA imposed fines totalling ₹22.20 crore on IndiGo for the disruptions and issued warnings to CEO Pieter Elbers and two other senior executives. The regulator also directed the airline to submit a ₹50 crore bank guarantee to ensure long-term operational improvements.

Shares of IndiGo’s parent company, InterGlobe Aviation Ltd, traded lower following the development. The stock fell nearly 2% on Wednesday to ₹4,869.30, reflecting investor caution as regulatory scrutiny intensifies.

The CCI’s investigation will now assess whether IndiGo’s conduct amounted to an abuse of dominance and whether it caused harm to competition and consumers in India’s domestic aviation sector.