Ola remained largely unaffected by the ban imposed by the Karnataka government on Friday evening, according to industry observers and users. (Mint)
Ola remained largely unaffected by the ban imposed by the Karnataka government on Friday evening, according to industry observers and users. (Mint)

Karnataka fines Ola 15 lakh, 3 days after revoking licence

  • Ola used two-wheelers with white number plates for a pilot run of its bike-taxi service, compelling Karnataka govt to levy fine
  • Ola’s operations in the state will continue to remain illegal until it settles the fine in full, 6,000 each for a total of 250 bikes

Bengaluru: The Karnataka government on Monday ordered Ola cabs (ANI Technologies Pvt. Ltd) to pay 15 lakh in fines, three days after the licence of India’s largest ride-hailing startup was revoked by the state’s transport department.

Ola’s operations in the state will continue to remain illegal until it settles the fine in full, 6,000 each for a total of 250 bikes, V.P. Ikkeri, commissioner for transport and road safety, Bengaluru, said at a press conference.

“We are glad that the issue stands resolved and we regret any inconvenience caused to our driver-partners and passengers since Friday. We look forward to continue working with the state, to help address the challenges of mobility," Ola said in a statement.

However, Ola remained largely unaffected by the ban imposed on Friday evening, according to industry observers and users.

Ola violated its licence condition by using two-wheelers with white number plates for its bike taxi pilot, compelling Karnataka’s transport department to impose the fine, said a person aware of the matter, seeking anonymity.

“ANI Technologies entity encompasses all types of vehicles, including two- and four-wheelers and auto rickshaws...and as Ola doesn’t have different subsidiaries to operate different kind of vehicles (two- and three-wheelers), the order was applicable on the entire operations," the person mentioned above said.

Ola was aware of the Motor Vehicles Act, 1989, which deems it illegal for companies and individuals to use white-plate bikes for commercial purposes but “didn’t expect the authorities to take stern action like this as it was just a pilot", according to the person. “Carpooling apps and delivery companies such as Zomato, and Swiggy all use white-plate vehicles...," the person said.

“In case of an accident or anything with (white-plate) bike taxis, nobody is held liable for insurance payouts, to the user under the law. The government’s fine on Ola is not just based on white (number) plate usage, but on liability issues as well," said Priyank Kharge, social welfare minister, Karnataka. The state is not against bike-taxi usage and it intends to help mobility startups such as Ola to flourish, Kharge said.

Ikkeri said the Karnataka transport department has also issued a show cause notice to Bengaluru-based bike-taxi startup Rapido. Rapido chief executive Aravind Sanka did not respond to phone calls and text messages.

The transport department in Karnataka has been cracking down on app-based shuttle services, bike taxis and even carpooling solutions. Bike taxis were initially banned in 2016 by the Karnataka government on grounds that a user will not be able to make insurance claims in case of injury or damage during a ride.

The state has held several rounds of consultations with market players on whether or not bike taxis can operate legally in Karnataka.

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