The British Civil Aviation Authority's decision to allocate 21 additional flights to India was supposed to settle the row between British Airways and Richard Branson's Virgin Atlantic.

Instead, it has set off a fresh spat, with Virgin threatening to appeal against the decision and British Airways saying it might "well continue to argue the case for more capacity to India".

The CAA on Thursday allocated 10 flights to Virgin (seven to Delhi and three to Mumbai), seven to British Airways (four to Chennai and three to Bangalore) and four to British Midland Airways (all to Mumbai).

The irrepressible Branson was quick to issue a statement expressing his disappointment on the routes allocated to it.

"We are disappointed and surprised that we have not been granted a daily service to Mumbai and will appeal to the Secretary of State for Transport against that element of the decision. We are also disappointed to have been denied the chance to launch new services to Bangalore and will appeal on that decision," Branson said.

In another statement, British Airways said it was disappointed it had not been awarded more flights to India. The airline's chief executive, Rod Eddington, said: "While we look forward to increasing flights to Chennai and starting new services to Bangalore, we would like to operate more flights to India. The CAA's remit was to award the frequencies to the airline that could bring maximum benefits to consumers and the UK economy. We believe we were best placed to do that."

The three carriers were locked in a bitter battle over the past few months for more flights to India -- one of the fastest growing markets worldwide for airlines.

Currently, all the flights -- a total of 19 -- permitted to the UK carriers by the Indian government are used by British Airways, which has seven flights a week each to Delhi and to Mumbai, three to Kolkata, and two to Chennai.

Virgin flies three times a week to Delhi by taking three of Air-India's unused slots under a code sharing agreement with the Maharaja, which ends in early December.

British Midland does not operate any flights to India currently. Even though it is planning to appeal against today's decision, Virgin will commence three of the Delhi services immediately and plan to launch daily services from February 1, 2005.