App-based cab service provider Ola has been suspended from operating in Bengaluru for the next six months by the Regional Transport Office for violating the LAW, according to an official notice. The action is being taken after the cab aggregator operated illegal bike taxis, as per the Karnataka On Demand Transportation Technology Aggregators Rules 2016. According to the suspension order, Ola cannot run its aggregator service for any vehicles including cars, autos, and bikes in the city for 6 months.
Ola Cabs is an Indian origin online transportation network company developed by ANI Technologies Pvt. Ltd. As of December 2018, Ola was valued at about $5.7 billion. A variety of venture capitalists including Softbank have large stakes in the company. Ola offers different levels of service, ranging from economic to luxury travel. The cabs are reserved through a mobile app and also through their website and the service accepts both cash and cashless payments with Ola money. It claims to clock an average of more than 1,500,000 bookings per day and commands 60% of the market share in India.
Due to lack of policy frameworks, bike taxis in Karnataka are illegal and is also strongly opposed by the Ola and Uber Drivers’ due to loss occurrence in business. This move came after, Ola and other cab aggregators which operate bike taxis faced heat from the Transport Department, as in February, transport officials seized close to 500+ bike taxis for operating unfairly and illegally. Ola and Rapido, a bike taxi aggregator service, have been directed to stop services instantly.
However, it was unclear whether Ola and Rapido would appeal against the order in court.
The official notice said that the suspension order was given as the company’s reply to the RTO’s notice was unsatisfactory.
On February 15, 2019, the Transport Department had sent Ola a notice, asking the company to respond to the findings of the probe. Ola sent its reply on March 3, 2019. As the company’s reply was not satisfactory and did not provide any evidence which proved it did not violate norms, the Transport Department, as on March 18, 2019, has decided to suspend the license of Ola for a period of six months. Ola will have to submit the original copy of the license within three days of receiving a copy of this order,” the notice added.
A statement from Ola is yet to arrive.
The information source ( The News Minute )