Karnataka High Court Rejects Uber’s Plea; Rules In Favour Of State Government

In a new development, in the ongoing clash between online cab aggregator Uber and the Karnataka State Government, the former’s request to scuttle the Karnataka On-demand Transportation Technology Aggregators Rule, 2016 suffered a setback when the Karnataka High Court upholding the government’s rights and ruled in favour of the State Government.

As per the rules dictated by the State Government, it was mandatory for ride-hailing apps to secure a permit before operating in the state. Uber questioned the government’s authority to frame these rules and took the matter to the court.

After a long-standing showdown between the aggregators and the transport authorities, as per a notification by the Karnataka Transport Department in May 2016, Ola and Uber, were asked to shut down their services in Karnataka.

Following that, both Uber and Ola registered themselves with the Karnataka On Demand Transportation Technology Aggregators Rule, 2016 and, while Ola received the license, Uber didn’t.

Uber had alleged that the officials of Karnataka Transport department did accept its documents to support its claim for a license to operate as app-based taxi aggregator in the state.

Putting an end to the affair, the High Court stated that it was within the State’s right to frame such rules and also supported the government’s demands such as the drivers should be residents of Karnataka for at least two years and possess working knowledge of Kannada language, all vehicles should be fitted with panic buttons and drivers need not work beyond eight hours a day.

The court also stated that vehicles with an all India tourist permit should not associate themselves with the online platforms. Uber has been given a month’s time by the court to comply with its judgment and get a license.

Uber has not clearly responded to the development and, in an email sent to Inc42, stated, “We are yet to receive a copy of the judgment and will decide on the next steps after studying the same.”

Cab aggregators in India have had a thorny journey so far. In July, the Delhi Autorickshaw Sangh and Delhi Pradesh Taxi Union called for an indefinite strike against app-based taxi services in New Delhi. In August, the Delhi High Court issued a notice to Ola and Uber to stop surge pricing and follow government prescribed fares. It had set August 22 as the deadline for app-based cab aggregators to completely withdraw surge pricing.

In September, this year reports surfaced that the Indian Government is reportedly planning to establish a maximum limit on fares to monitor surge pricing by online cab aggregators like Uber and Ola.

Earlier last month, the Maharashtra government released the draft of Maharashtra City Taxi Rules, 2016. In this regard, cab aggregator Uber raised an objection to Maharashtra’s draft rules to regulate ride-hailing apps on three fronts, the proposed restrictions on engine capacity, price tags for permits, and pricing.

The development was reported by Mint.