The guidelines issued by the government also ban surge pricing.

Uber Ola will have to bow to rules Ktaka HC rules govt can control pricing
news Business Thursday, November 10, 2016 - 16:30

The Karnataka High Court on Thursday held that the state government has the power to regulate cab-aggregator services like Uber and Ola. Uber had gone to court challenging the rules brought out by the state government for these services. 

While the court said that the government can impose a price ceiling on cab-aggregators, it struck down other rules of the government.

Unless the ruling is further challenged in higher courts, the cab aggregators will now have to charge fares as prescribed by the government. They will now have to install a panic button in their apps, and also ask drivers to display taxi boards inside the car. 

According to a Mint report earlier, “The fare mandated by the Karnataka transport department is Rs.19.50 per km for air-conditioned cabs and Rs.14.50 for ones without air conditioning. Incidentally, the cap mandated by the state government allows both Ola and Uber to charge multiples of their fares.”

The guidelines issued by the government also ban surge pricing and mandate installation of digital meters. 

The Hindu reports that “Justice Raghvendra S. Chauhan, while partly allowing Uber’s plea against the Karnataka On demand Transportation Technology Aggregators Rules, said that all India tourist permit vehicles cannot be used for service under the aggregators.” 

It is also reported that cab aggregators license cannot be cancelled just because a driver is booked in a criminal case. 

The court has meanwhile asked the government to take it easy on the cab aggregators for a month. 

Earlier this year, the Karnataka government had come out with the Karnataka On-demand Transportation Technology Aggregators Rules, 2016.

While Uber was opposed to these rules, Ola has endorsed these rules.

Also read: Ola’s endorsement of license raj and jingoism is an embarrassment to startup ecosystem

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