Why Has Delhi Govt Put the Brakes on Ola, Uber, and Rapido Bike Taxi Services?

Running bike taxis in Delhi without a proper commercial licence is a violation of the Motor Vehicles Act, 1988.

Any violation will result in a first offence penalty of Rs 5,000 under Section 192 of the MV Act. 

(Photo: PTI)

In a massive blow to ride sharing platforms Ola, Uber, and Rapido, the Delhi Transport Department on Monday, 20 February, issued a public notice to the companies to stop their bike taxi services in the capital effective immediately.

The decision comes weeks after the Supreme Court declined relief to Rapido, which challenged the Bombay High Court's order directing the firm to stop operation in Maharashtra immediately, as it does not have a license to operate bike, taxi, or rickshaw services.

Rapido, Ola, and Uber have now ceased bike taxi operations in Maharashtra after months of legal tussle.

So, why did the Delhi government decide to ban bike taxi services of these aggregators? Will violating the rule invoke any penal action? Read on.

Why Has Delhi Banned Bike Taxi Services?

The Delhi government said that running bike taxis – wherein private bikes are utilised by passengers for hire – in Delhi without a proper commercial licence would be considered a violation of the Motor Vehicles Act, 1988. 

The 2019 Amendment to the Act reiterated that aggregators cannot operate without a valid licence.

"It has been brought to the notice that two-wheelers having non-transport (private) registration mark/numbers are being used to carry passengers on hire which is purely commercial operation and a violation of Motor Vehicle Act, 1988," the transport department said in the notice.

What About Penalty?

• Any violation of the decision will result in a first offence penalty of Rs 5,000 under Section 192 of the Act

• Second or more offences will lead to fines of Rs 10,000, impounding of the vehicle and even imprisonment.

"In addition, the driving license of the driver will be suspended for a minimum period of three years," the notice said.

According to The Hindu, the department noted that digital platforms are facilitating taxi service operations through the medium of an app, and are thereby taking on the role of an aggregator which stands in contravention of Section 93 of the Act, making them liable to penalties up to Rs 1 lakh.

"Accordingly, it is directed to immediately stop such kind of activities to avoid prosecution and penalty, etc," the notice said.

Delhi Transport Minister Kailash Gahlot said in a tweet that the "aggregator policy for 2W (two-wheelers), 3W (three-wheelers) and 4W (four-wheelers) is in its final stage and will be rolled out soon, helping them to apply for grant of licence under the new scheme."

What Is Defined as a Taxi Service Then?

A transport department official told The Indian Express that in the current regulatory framework for vehicles in the capital, there is no provision to allow bikes to be used as commercial vehicles. 

As per the existing rules, taxi services are those in which there is a driver and more than one passenger. Under the rule, only four-wheeler National Capital Region (NCR) cabs, auto-rickshaws, and e-rickshaws are permitted, and not bikes, the official added.

The official said there are certain provisions to operate cab services:

• The vehicle should have a registration mark

• Yellow number plates

• PSV badge which is issued after police verification

• Drivers have to undergo behavioural sessions.

The official also added that women's safety is of utmost importance in such services where mandatory panic button provisions exist, but none of these things are available on bikes.

How Popular Are Bike Taxis?

Bike taxis often present as a cheaper alternative to cars, especially during surge pricing. As the bike taxi space is currently unregulated, the government lacks data on the exact number of bike taxis plying on the capital's streets.

However, estimates by different public transport unions in Delhi put the number of bike taxis operating in NCR via cab aggregators at 15,000-20,000. The demand for bike taxis has risen after the COVID pandemic.