One month after becoming India’s first licensed app-based cab aggregator, Ola has been slapped with a show-cause notice by the Karnataka Transport Department for surged pricing.
Ola has been asked it to explain why its licence for running its services should not be cancelled on grounds of violating the licence conditions. The aggregator had got the licence only on June 19 under Karnataka’s new regulations for technology based taxi aggregators notified on April 2.
It was recent that Ola has re-introduced peak pricing in Bangalore, which informs the commuters of the revised tariff per kilometre. The Transport Department has told Ola in its notice that it has been found to have been charging a peak price (surge price) from customers in violation of the rules.
The notice also told Ola that it has also been offering “shuttle” services with maxi cabs of 12+1 seating capacity in Bengaluru. This service, the transport officials said, are in gross violation of not only the new regulations but also of Karnataka’s transport norms because only the Bangalore Metropolitan Transport Corporation (BMTC) can ferry intra-city commuters in view of the fact that city transport has been nationalised.
It might come as a surprise to Uber who were at the receiving end of criticism from both Ola and the transport government indicating the transport department to be on favourable terms with the India-based aggregator.
It was mentioned that the department has received complaints from users regarding Ola collecting a surge pricing as well as offering shuttle services. The notice issued last week, has given the cab aggregator a week’s time to send in its reply.
Ola’s shuttle service, launched in January this year, is operational from Manyata Tech Park, EGL and the surrounding areas. It has also relaunched its bus shuttle services earlier this month and can be used to customise daily routes for corporate clients.
Transport commissioner Rame Gowda told ET that the department is yet to receive Ola’s reply while additional commissioner of transport (enforcement) HG Kumar also notified that Ola cabs shouldn’t exceed the fare cap of Rs 19
.50 per km for AC cabs and Rs 14.50 per km for non-AC cabs.
Ironically, just two weeks ago, Ola heaped praise on the Karnataka government in its affidavit before the High Court saying the April 2 regulations had been framed with the primary object “to promote and ensure the safety of the user-riders availing the services of aggregators.”
The Transport Department also said that Ola was not surge-pricing when the license was issued. Kumar said, “They were not charging peak pricing when they have issued the licence. They had ceased surge pricing at the time. But they have started this concept of ‘peak pricing’ now and it is not within the limits set out by us.”
