Ola ordered to stop app-based taxi services immediately in Karnataka

The Karnataka transport department Friday suspended the licence of taxi aggregator Ola for the next six months with immediate effect, saying it was running bike taxis without permission. The licence has to be surrendered by the company to the authority which issued it within three days from the day of receipt of the department order and the aggregator has to stop app-based taxi services immediately, the department said.

"As Ani Technologies Pvt Ltd (Ola Cabs), Bangalore, has violated the Karnataka On-demand Transport Technology Aggregators Rules, 2016, and in the backdrop of the report submitted by the Deputy Transport Commissioner and senior Regional Transport Officer, Bangalore (South), the aggregator licence issued to it till June 19, 2021 has been suspended for 6 months under the rules," the order dated March 18 read. Ola said it is a law-abiding company that has always worked with the government to develop livelihood, improve mobility, and enable a new technology industry.

"We are evaluating all options to find an amicable solution, wherein hundreds of thousands of driver-partners in the state of Karnataka can continue to work and serve the mobility needs of our citizens," a company statement said. "We have been closely working with the authorities on this topic, responding to queries and making proactive representations to the ministry," it said.

Describing the notification as "unfortunate", it said "We look forward to an opportunity to address these concerns directly with state officials to find a solution for our driver-partners and millions of Ola-users in Karnataka." Noting that the Karnataka On-demand TransportTechnology Aggregators Rules, 2016, has come into effect from April 2016, the department said the licence issued to OlaCabs under rules was only for app-based taxi service (motor cabs), and not for bike taxi services. It said on coming to know about the violation of terms of licence, Deputy Transport Commissioner and senior Regional Transport Officer, Bangalore (South), have submitted a report about Ola providing app-based two-wheeler service unauthorised and illegally, following which a few motorcycles were seizedafter inquiry.

Further on confirmation that the app-based two-wheeler taxi services were being provided illegally inthe city in violation of the aggregator licence, ashow cause notice was issued to the company on February 15 as to why itslicence should not be suspended, asking it to respond in aweek or to face a unilateral action, it said. It said, "Ola responded to the notice on March 5, and the explanation was not satisfactory, and as it is not according to rules, so it cannot be considered."

Hence the State Transport Authority has taken the decision in accordance with the Karnataka On-demand Transport Technology Aggregators Rules, 2016, the department added. However, noting that despite other companies continuing to operate illegally, Ola halted bike taxi experiment weeks ago, the company said, "Instead we sought the states cooperation to develop a legal framework for a pilot that will continue to take advantage of emerging opportunities in the mobility economy."