Ola Cabs Banned

First thing first; Ola Cabs banned in Karnataka for six months.

The eight-year-old cab aggregator startup is banned from operating in the Karnataka. According to the latest directive by the Transport Department of Karnataka, the license of ANI Technologies Pvt Ltd, a legal entity behind Ola Cabs, has been revoked for a duration of six months due to the violation of norms.

Simply put, no more Ola cabs plying on the road of Karnataka and people in the state, mostly in Bangalore and Mysore, are going to be affected due to the suspension.

The government has explained that the decision has been taken due to the violation of license conditions and government rules by Ola Cabs in relation to its bike taxi service started recently. Ola is accused of operating bike taxi service in the state without obtaining approval from the Transport Department.

In the notice served to ANI technologies aka Ola Cabs, the Karnataka government has stated that the authorities have seized many bikes which were operating as a bike Taxi for Ola. While it is not immediately clear what rules exactly Ola Cabs has violated, but the government has sought Section 11(1), the Karanatak On Deman Aggregator Rules 2016, Transport Department of Karnataka has decided to temporarily cancel the license of Ola Cabs for six months.

It is also not a sudden move by the Karnataka Government and Ola is solely responsible for putting itself in the hot water, apparently. On February 15, 2019, a notice was sent by the Transport Department of Karnaa to Ola seeking clarification on the findings of the probe in regards to bike taxi service offered by Ola. However, the company failed to give a satisfactory answer to the notice and on March 18 the official finally decided to put Ola Cabs off from the roads.

Ola is directed to surrender the original copy of the license within three days.

Ola Ban: Blame To Bike Taxi

“Aggregator means a person who is an aggregator or operator or an intermediary/market place who canvasses or solicits or facilitates passengers for travel by taxi and who connects the passenger/intending passenger to a driver of a taxi through phone calls, internet, web-based services or GPS/GPRS based services whether or not any fare, fee, commission, brokerage or other charges are collected for providing such services,” explains Karnataka Government.

Ola has got about 10,000 taxis on the roads in Karnataka. The ban will directly impact the daily commute and benefit its competitor Uber and Auto drivers as well.

Ols is not the only company facing the heat for allegedly violating norms for bike taxi. The notice to served to Rapido, another bike taxi aggregator, as well.

Responding to the Government’s decision to suspended the licence, Ola Cabs has said that the company is working closely with the Transport Department to find an amicable solution to the unprecedented situation.

“This notification is unfortunate, and we look forward to an opportunity to address these concerns directly with state officials to find a solution for our driver-partners and millions of Ola users in Karnataka.”

Ola Cabs is India’s largest car aggregator and the ban would impact the livelihood of thousands of drivers associated with the company. Experts believe that it appears to be a hush-hush decision and the government must take the state of drivers into consideration if they decide to stick with their decision.

Ola Cabs is one of the leading startup unicorns in India, with valuation hovering $5.7 billion after the recent investment received from Flipkart founder Sachin Bansal.

Updated: 24 March 2019: The  Transport Authority of Karnata has lifted the ban imposed on Ola Cabs today. The tug of war between the authority and Ola Cabs has finally ended.

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