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App-based cabs’ licence to drive in Delhi: How far does it go?

The Delhi government has been impounding Uber and Ola cabs for ‘overcharging’, and has told the High Court that the operators are ‘unlicensed’ and ‘operating illegally’. SARAH HAFEEZ explains the licensing system for the capital’s app-based cabs.

Written by Sarah Hafeez | Updated: April 25, 2016 2:17:01 am
odd-even, odd-even II, odd-even delhi, app-based taxis, taxi surge pricing, taxi surge pricing delhi, delhi surge pricing, cabs surge pricing, arvind kejriwal, surge pricing odd-even, odd even phase 2, phase 2 odd even, delhi high court surge pricing, delhi news, india news, indian express The announcement by Chief Minister Arvind Kejriwal came after complaints that Ola and Uber were charging ‘surge’ fares up to five times the base fare during the April 15-30 odd-even road rationing scheme.

On Saturday, the Delhi government told the Delhi High Court that Ola and Uber were “operating illegally as their applications for licence were rejected… vide order dated June 28, 2015”. The government also said that “not only (were) the app-based companies unlicensed, but they (were) also not allowed to charge more… (as) ‘surge price’ or ‘peak-time charge’…”. A week ago, the government had threatened “strict action” against the companies for charging fares higher than the rates prescribed in the New City Taxi Scheme, 2015. Though Uber and Ola have suspended ‘surge pricing’, the crackdown continues, and 119 vehicles have so far been impounded in the capital.

The Argument

The announcement by Chief Minister Arvind Kejriwal came after complaints that Ola and Uber were charging ‘surge’ fares up to five times the base fare during the April 15-30 odd-even road rationing scheme. On April 18, he threatened this could attract cancellation of permits and impounding of vehicles and, two days later, referred to surge pricing as “daylight robbery” and “loot”, and announced it would not be allowed even after the odd-even scheme ends.


The Background

In the uproar over the alleged rape of a 27-year-old passenger by an Uber cabbie in 2014, it came to light that the app-based providers were running without licences. In June 2016, the government banned Uber and the other aggregators for not complying with the amended Radio Taxi Scheme, 2006, which specifies mandatory compliance points such as CNG fuel, prefixed calibrated meters, GPS, etc. The High Court, however, quashed the government’s right to “coercive action” against Uber and two other companies that same month.

The companies have been arguing that the rules did not apply to them because they were not “cab companies”, but “cab aggregators” who only acted as an interface between drivers and customers. While the case remains pending in court, the government has been looking for a chance to make these firms fall in line. Complaints of exorbitant peak time charges during odd-even provided it the opportunity.

A Transport Department official argued, “Irrespective of the suspension of surge pricing, companies like Ola and Uber charge bases fares which are much higher than the government-prescribed rates. So, technically, we have the power to impound all vehicles which are part of the Uber and Ola fleet. We are not doing so only because we do not want the people of Delhi to suffer.”

The Rules

Notified rates for Economy Radio Taxis is Rs 12.50 per km. Ola charges Rs 40 at the start of every trip, and Rs 6 per km thereafter. Uber charges Rs 100 as meter down rates for anywhere up to 4 km. Most cabs have been impounded at points less than 4 km into their journeys, at which time they are most likely to be “overcharging” as per the Radio Taxi Scheme, 2015. Cabs with All India Permits are also being impounded. These cabs are for tourists who travel at least 200 km, and are not allowed for local commercial use within city limits.

Road ahead

The High Court has asked the government what it was doing to solve the problem of soaring taxi fares. Transport Minister Gopal Rai told The Indian Express, “We are formulating a policy for regulating private cabs in the city to produce in court. It will take some time.” The next hearing is on Monday.

On Friday, Rai announced the launch of an app-based premium AC bus service from June as “a long-term solution to get car users to shift to buses and public transport”.

Ola and Uber have protested that the ban on surge pricing is disrupting the demand-supply market equilibrium and reducing availability of cabs, to the detriment of commuters. Ola has said it is trying to increase the number of cabs on the road.

Price ceiling in Karnataka too

According to the Karnataka On-demand Transportation Technology Aggregators Rules, 2016, which came into force on April 2:

FARE will not be higher than that fixed by the government from time to time.

CHARGES will be only from the point of boarding to alighting; not for dead mileage.

CURRENT maximum fares in Bengaluru: Rs 19.50 for AC cabs; Rs 14.50 for non-AC.

NO EXTRA charges during peak hours or other high-demand times.

INTEGRATED GPS with vehicle tracking, display panel and a digital fare meter capable of generating a receipt in the cab.

PANIC BUTTON to discreetly alert local police without hindrance or interference by the driver.

AGGREGATORS must send driver and vehicle details with picture of driver to customer’s mobile before boarding – ENS Bengaluru


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