The Court found that the complete stay imposed by the Delhi High Court on the notification prohibiting bike taxi operations was unjustified. On Monday, the Supreme Court intervened and stayed two decisions of the Delhi High Court.
The High Court had directed the Delhi government not to take any coercive action against bike taxi aggregators, specifically Rapido and Uber, until guidelines for issuing licenses to such aggregators were published. The vacation bench of Justices Aniruddha Bose and Rajesh Bindal effectively halted the operations of these bike taxis until the government established regulations for them.
Considering that the Delhi government was in the process of formulating a policy for granting licenses to bike taxi aggregators, the apex court concluded that a complete stay on the High Court’s notification was unwarranted. Consequently, the Court stayed the High Court’s orders and instructed it to expedite the hearing on the challenge to the notification. The Court also allowed the parties to file requests for an early hearing with the High Court.
According to Senior Advocate Manish Vashisht, representing the Delhi government, the aggregators were operating two-wheelers without the necessary licenses or permits, which violated Section 93 of the Motor Vehicles Act. It was argued that non-transport two-wheelers should not function as taxis in the absence of a policy. The government stated that the policy would be in place and the licensing system would be operational by July 31, 2023.
Uber’s Senior Counsel Neeraj Kishan Kaul contended that the company relied on notifications permitting two-wheelers to operate in several states since 2019. He emphasized that the government’s failure to formulate a policy should not result in a ban on the existing 35,000 bike taxi operators.
The compatibility of motorcycles with the current taxi aggregator policy was also brought up. Uber argued that two-wheelers, except those with engines larger than 25 cc, should be allowed to operate as commercial vehicles based on a notification issued by the Central government.
Additional Solicitor General (ASG) Sanjay Jain, representing the Central government, stated that the Centre’s guidelines were intended to assist State governments in formulating a policy for aggregator licenses.
Last month, the Delhi High Court ordered the Delhi government to refrain from taking coercive action against Rapido and Uber and allow them to operate until guidelines for such aggregators were published. This led to the current appeal.
In February, the Delhi government issued a public notice stating that bike taxis were not permitted in the capital city. Additionally, two-wheelers with non-transport (private) registration engaged in commercial activities would violate the Motor Vehicles Act and its regulations.
The transport department announced that app-based aggregators must cease operations immediately or face a fine of 1 lakh rupees. Rapido challenged the notices and the constitutionality of the Delhi Motor Vehicle Rules in the High Court. Previously, the Maharashtra government had denied Rapido a license as a two-wheeler bike taxi aggregator.
Subsequently, the Bombay High Court rejected Rapido’s appeal against the decision. The High Court’s order was challenged before the Supreme Court, which also denied relief to Rapido.
