Supreme Court Halts Bike Taxi Operations of Rapido and Uber in Delhi

Supreme Court Puts a Halt to Bike Taxi Operations of Rapido and Uber in Delhi

The Supreme Court has stayed the operations of bike taxi aggregators Rapido and Uber in Delhi. This decision comes after the Delhi High Court had directed the Delhi government not to take any coercive action against these aggregators until guidelines for granting licences to such services are established.

A vacation bench of Justices Aniruddha Bose and Rajesh Bindal issued the order, effectively putting a stop to the operations of bike taxis until the government notifies guidelines governing their functioning. The apex court noted that a complete stay by the High Court on the notification that banned the operation of bike taxis was unnecessary, considering that the Delhi government was in the process of formulating a policy for granting licenses to such aggregators.

The Supreme Court's order stays the Delhi High Court’s decisions and instructs the court to promptly hear the challenge to the notification. Parties involved were given the liberty to file early hearing applications before the High Court.

The Delhi government argued that Rapido and Uber were operating two-wheelers without proper licenses or permits, which is required under Section 93 of the Motor Vehicles Act. The government contended that non-transport two-wheelers should not be used as taxis without a policy in place. It assured that the policy would be established, and the licensing regime would become operational by July 31, 2023.

Uber’s counsel, Senior Advocate Neeraj Kishan Kaul, argued that the company had relied on notifications allowing two-wheelers to operate as commercial vehicles in many states since 2019. Kaul emphasized that the absence of a policy should not result in a ban on the existing 35,000 bike taxi operators.

The issue of whether two-wheelers can be included in the existing taxi aggregator policy was also raised. Uber contended that two-wheelers, excluding those with engine capacities of 25CC, should be permitted to operate as commercial vehicles based on a notification issued by the Central government.

The Delhi High Court had previously directed the Delhi government not to take any coercive action against Rapido and Uber, allowing them to continue operating until guidelines for such aggregators were notified. This order prompted the appeal to the Supreme Court.

The issue arose after the Delhi government issued a public notice in February, stating that bike taxis were not allowed in the national capital. Two-wheelers with non-transport registrations engaging in commercial operations were deemed in violation of the Motor Vehicles Act and the corresponding rules. The transport department warned that app-based aggregators would have to cease their services immediately or face a fine of ₹1 lakh.

Rapido had approached the High Court, challenging the notices and questioning the constitutional validity of the Delhi Motor Vehicle Rules. Earlier, the Maharashtra government had denied Rapido a two-wheeler bike taxi aggregator license, a decision that was upheld by the Bombay High Court. The Supreme Court also refused to grant relief to Rapido in its appeal against the High Court’s decision.

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