Relief for Rapido, Uber: Delhi HC stays AAP government's notice of halting bike taxi services

The Delhi High Court on Friday stayed the public notice and show cause notice issued by the Delhi Transport Department against ride-sharing platforms, such as Uber, and Rapido. In February 2023, the Delhi Transport Department issued a public notice to stop plying their bike taxi services effective immediately.

The app-based aggregators were prevented from plying bike taxis on the road without commercial permits. The transport department had warned that any violation will result in penal action.

The public notice by the transport department said that the companies defying the orders will be fined up to Rs 1 lakh, as the use of bikes for commercial purposes violated the Motor Vehicles Act, 1988.

On Friday, a division bench comprising Justices Suresh Kumar Kait and Neena Bansal Krishna directed the Delhi Transport Department not to take any coercive steps against Rapido and others till such time policy is framed.

“We welcome the Hon’ble High Court’s order to give Uber protection from coercive action on bike taxis in Delhi. This will bring relief to drivers on our platform whose livelihoods had been impacted by the ban as also to the hundreds and thousands of riders who choose to ride on Moto for affordability and last-mile connectivity. We are committed to serving the city and being the platform of choice for riders and drivers alike,” an Uber spokesperson said. 

“We welcome the Hon'ble Delhi High Court's order, which declares that no coercive measures shall be taken against bike taxi operators and their riders by the concerned authorities in the Delhi NCT until the government notifies the necessary regulations to govern bike taxi operations. It is a resounding victory and powerful testament to the immense impact bike taxis have on millions of people in our national capital," a Rapido spokesperson said after the order.

He added: "Bike taxis represent a transformative innovation for a thriving metropolis and a progressive nation like India, addressing the crippling challenges of traffic congestion, unemployment, affordability, last-mile connectivity, and environmental pollution head-on.”

The Delhi transport department notice said: “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 a purely commercial operation and a violation of the Motor Vehicle Act, 1988,” the transport department said.

“In addition, the driving license of the driver will be suspended for a minimum period of three years,” the notice added.

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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.

The app-based aggregators like Uber and Rapido have faced similar bans in other states.

In January, the Bombay High Court asked Rapido to suspend its services in Maharashtra or face cancellation of its license permanently, in a case related to the illegal plying of bike taxis in the state.

Rapido challenged the appeal. Following that, even the Supreme Court refused to grant relief to Rapido against the Maharashtra government's refusal to grant licence to it.

The apex court noted that amendments made to the Motor Vehicles Act in 2019 made it clear that aggregators cannot operate without a valid licence. A bench of Chief Justice DY Chandrachud and Justices PS Narasimha and Justice JB Pardiwala noted that Pune's Regional Transport Office had rejected its plea for licence on December 21.

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