Delhi HC asks panel to frame national policy for taxi services

The directive sets in motion a process to end acrimony and confusion over taxi services triggered by the entry of app-based taxi service providers like Uber, Ola


Technology-powered taxi services have disrupted established transport models, putting them in the cross-hairs of radio taxi businesses and traditional taxi companies. Photo: Indranil Bhoumik/Mint
Technology-powered taxi services have disrupted established transport models, putting them in the cross-hairs of radio taxi businesses and traditional taxi companies. Photo: Indranil Bhoumik/Mint

New Delhi: The Delhi high court on Thursday set in motion a process to end the acrimony and confusion over taxi services in the country triggered by the entry of app-based taxi service providers such as Uber and Ola.

While hearing a batch of petitions, including one filed by a radio taxi association (which comprises taxi companies such as Meru Cabs, Mega Cabs and Easy Cabs), the high court directed a panel appointed by the central government to come up with a policy to govern all cab services nationwide.

The court directed the Union roads ministry, which has formed the committee, to include experts from law enforcement, traffic and environment management and technology.

The committee will get three months to submit its report. This report will be non-binding in nature and help resolve issues arising out of recent advancements in the field of taxi services.

Technology-powered taxi services, which allow customers to book taxis through a mobile app, have disrupted established transport models in India and across the world, putting them in the cross-hairs of radio taxi businesses and traditional taxi companies and triggering lawsuits. Taxi unions in several states have resisted their entry. Their use of diesel taxis and the practice of surge pricing—which incentivises drivers to operate at peak times by automatically raising fares—have also prompted state governments to clamp down in various ways.

A single central scheme for various categories of taxi services, such as radio taxis and app-based taxi aggregators, will help bring uniformity and end the confusion. All stakeholders can make their case before the committee.

“There is an urgent need to have a seamless and uniform policy for taxi services in the country. This will also offer a level playing field to all taxi operators,” said justice Manmohan while passing the order.

A secretary level officer from the IT department, environment secretary from the Delhi government, a secretary level officer from the Central Pollution Control Board and a senior official from the Delhi traffic police were among those the court recommended for the committee. The panel can also take suggestions on traffic decongestion from the ministry of urban development and advice from NITI Aayog while formulating the scheme.

Rajiv Nayyar, counsel for ride-hailing service Uber, told the court that the Motor Vehicles Act, 1988 is currently being amended to include provisions covering app-based aggregators.

The Delhi government agreed to submit its draft scheme on taxi service providers to the central committee for its consideration.

The court said app-based taxi service providers such as Ola and Uber must comply with the price cap notified by the Delhi government.

The court was hearing a batch of cases, including one by the Association of Radio Taxis, which have repeatedly complained that Ola was plying diesel vehicles in Delhi in violation of Supreme Court orders, the Radio Taxi Scheme, 2006, and City Taxi Scheme of 2015. The petitioners have also pointed to surge pricing.

“The earlier the government comes with a law for all cab services, the better it is, for the consumers and for the industry promoting level playing field. It should also address crucial issues such as CNG, surge pricing and mandatory PSV (public service vehicle) badge across the country to have uniformity in the system,” said Rahul Kapani, director, Meru Cabs, in an email.

Representatives of Uber and Ola did not respond to emails.

Rates for radio cabs are set at Rs.23 per km in Delhi with the night charges (between 11pm and 5am) being set at a hike of 25% of the fare.

On 29 July 2015, justice Manmohan ordered strict enforcement of the 1 January Delhi government order that banned app-based cab services until they complied with the guidelines.

Uber and Ola have maintained before the court that the ban was sought to be imposed on radio taxi services and being aggregators, they do not fall under the ban.

On 14 October 2015, the court extended a breather to the app based companies, allowing them to ply point-to-point diesel taxis in the national capital till 1 March 2016, by when they were required to shift completely to compressed natural gas.

Priyanka Sahay contributed to this story.

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