The Karnataka Transport Department has directed both Ola and Uber to immediately withdraw ride-sharing services from their applications, according to an Economic Times report. It quoted state transport commissioner VP Ikkeri as saying that ride sharing was not permitted under the Motor Vehicles Act and the Karnataka on-demand Transportation Technology Aggregators Rules. He said action would be taken against cab aggregators if they continued to offer ride-sharing. He added that the transport department would write to the government requesting it to take a final decision on ride-sharing, but that it would remain illegal till then. The companies were informed of the decision in a closed-door meeting with the representatives of cab aggregators and cab drivers, and were told to comply immediately. Taking to Twitter, Tanveer Pasha, founder-president of the Ola, Taxi For Sure, and Uber Drivers and Owners Association, welcomed the decision.

Karnataka’s tussle with cab aggregators

Ola has been facing trouble in Karnataka since the State Transport Department cancelled its aggregator license for 6 months in March for operating bike taxis, which are illegal in the state. However, the ban was taken back two days later and the company was fined Rs 15 lakh.

Following this, Ola had filed a petition in the Karnataka High Court against the State Transport Department for not issuing licenses for bike taxis. The petition sought an order for a regulatory framework for the issuance of bike taxi permits, as laid out in a 2016 notification from the Union Ministry of Road Transport and Highways. It also called for all other bike taxi services be stalled until permits were issued.

Last June, the State Transport Department had issued notices to cab aggregator companies for allegedly violating state rule by charging time-based fares. The state had issued fixed fares for cab aggregators and had barred them from charging fares based on the duration of the ride. However, Ola and Uber apparently did not implement the rules and continued charging riders an average of Re 1 a minute.

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This story was updated to correctly reflect the names of Acts the ban was ordered under.