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Karnataka bans Ola cab service; Talks begin to end crisis
March 23, 2019
BENGALURU: The Karnataka Government has banned the Ola cab service in the State for a period of six months for violating the rules of licence. According to the State Transport Department, the licence Ola was granted was solely for app-operated cab service but the cab aggregator started two-wheeler taxi service in violation of the terms of licence. Moreover, two-wheeler taxis are banned in the State.

Ola serves millions of travellers and has thousands of drivers and vehicles under its banner. Ola's competitor Uber also had faced a similar situation in 2016. Uber had to pull back its two-wheelers and fall in line when the Government started seizing their vehicles.

The suspension will deplete the revenue of the ride-hailing service very popular in the State as also lead to inconvenience to its commuters. The large number of drivers working under the banner will lose their livelihood as well.

Talks have started between the Government and the aggregator to resolve the issue as early as possible as it is adversely affecting the public.

The Government order said, "We have received information that Ola has started motorbike service. Upon acting on information, we conducted a preliminary inquiry and found out that Ola is indulged [indulging] in unlawful activity. First, a notice has been served to Ani Technologies Pvt Ltd (Ola), which has been asked to explain within a week.

"The explanation was not sufficient, hence the department is initiating the action and cancelling the permit. For the next six months, Ola Cabs is banned from plying on Karnataka's roads and the original permission papers should be handed over to the transport department within three days of this order."

An Ola spokesperson is reported to have said that they are evaluating all options to find an amicable solution so that thousands of driver-partners in the State can continue to work and serve the commuters.

VP Ikkeri, State Commissioner for Transport and Road Safety, told reporters, “It’s a temporary suspension and if they give us a satisfactory response, then we won’t need to implement the ban.”

The order of suspension of Ola Cabs for six months in Karanataka was issued on March 18.

Ola’s permit was obtained in 2017 and is valid till 2021. It is allowed to run three and four-wheeler taxis in Karnataka. The company is backed by SoftBank Group Corp and Tencent Holdings Ltd.

Technology hub Bengaluru is among Ola’s top markets in India.

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