Supreme Court prohibition on the use Two-Wheelers

Introduction

The case of “Government of the National Capital Territory of Delhi & Ors. vs. Roppen Transportation Services Pvt. Ltd.& Ors”. is a legal challenge to the Delhi government’s prohibition on the use of two-wheelers for bike taxi operational processes. The prohibition went into effect on February 19th, 2023 and the Respondent (Roppen Transportation Services Pvt. Ltd.& Ors) alleges it to be illegal and unconstitutional.

The Respondents are an accumulation of bike taxi aggregators and individual operators/ bike drivers who work for these aggregators. They assert that the restriction infringes on their fundamental right to a living as well as their right to free trade and commerce as enshrined under Article 19(1)(g) of the Indian Constitution. They also contended that the restriction imposed is arbitrary and discriminatory because it directly threatens the livelihood of millions of personals associated with the Respondents. The Delhi government vide public notice dated February 19th, 2023 and the Hon’ble Supreme Court vide order dated June 12th, 2023, has issued the order in question with the sole intention of enhancing the safety and regulating the usage of unauthorized or unlicensed vehicles within the territory of NCT of Delhi. The order is based on the provisions outlined under Section 93 of the Motor Vehicles Act-1988 (“The 1988 Act”). According to Section 93, no individual can operate as an aggregator without obtaining a license from the duly authorized authority, as specified by the State Government. Additionally, every aggregator must adhere to the provisions stated in the IT Act-2000.

The matter is currently pending adjudication and is expected to be heard by the Hon’ble Supreme Court in the coming months. This case’s outcome will have a significant impact on the future of bike taxi operations in India. If the restriction is upheld, the bike-taxi service-providing industry will permanently shut down.

Background

The case originated when the Government of NCT of Delhi released a public notice on February 19th, imposing restrictions on the use of two-wheelers for commercial purposes by aggregators. The notice stated that using privately registered two-wheelers to carry passengers for hire or reward was in violation of the Motor Vehicles Act of 1988. In response, the Respondent (Roppen Transportation Services Pvt. Ltd. and Ors.) approached the Hon’ble Delhi High Court under Article 226, seeking relief. On May 26th, the Hon’ble High Court allowed popular bike-taxi aggregators like Rapido and Uber to continue operating in Delhi until a comprehensive new policy was formulated. The Hon’ble High Court ordered the Delhi government not to take strict action against these aggregators until the policy was finalized.

The Delhi government then filed a Special Leave Appeal before the Hon’ble Supreme Court, challenging the Delhi High Court’s order. The government argued that two-wheelers facilitated by aggregators were operating without proper licenses or permits, which violated registration conditions. The government stated that it was in the process of formulating a policy to grant licenses to aggregators for both four-wheelers and two-wheelers. Until such a policy was developed, the operation of two-wheelers through aggregators would be impermissible under the Motor Vehicles Act of 1988.

The Respondents (Roppen Transportation Services Pvt. Ltd. and others) countered that the central government had already formulated a policy for aggregators in the transport sector in 2020, but the Delhi government had not yet introduced its own policy. They argued that many two-wheeler owners were currently relying on aggregators for their livelihoods and that reinstating the ban would infringe on their constitutional rights under Article 19(1)(g). They also cited Section 41(4) of the 1988 Act, which permitted the use of two-wheelers as transport vehicles, claiming that it would not harm the public.

Order of the Supreme Court

The Hon’ble Supreme Court considered the Delhi government’s appeals against the High Court’s decision and temporarily suspended the High Court’s order. The court acknowledged the government’s commitment to notify the final policy before the end of July. Consequently, the implementation of the High Court’s order was halted until the final policy was officially announced. However, the Petitioners were granted the option to seek legal recourse if they remained unsatisfied even after the policy’s issuance.

Impact of banning/ restricting bike taxi industry to operate.

The legal ramifications of outlawing two-wheeled taxi services in India are complicated and have generated a lot of discussion. Key legal problems that have been brought up include:

  • The Motor Vehicles Act of 1988’s legitimacy of the bike taxi ban. Although the Motor Vehicles Act does not specifically forbid the use of motorbike taxis, it does mandate that all vehicles used for commercial purposes be registered as “contract carriages.” Motorbike taxis are not sufficiently sized to qualify as “contract carriages,” according to others, therefore this criterion practically forbids their operation. Others contend, however, that the Motor Vehicles Act does not expressly forbid the operation of motorbike taxis and that the government has the ability to regulate their prohibition.
  • The Indian Constitution recognises the right to a living as a basic freedom. Some contend that prohibiting bike taxis would be a violation of this right because it would take away many people’s source of income. Others contend that prohibiting bike taxis is an acceptable method to further the government’s legitimate interest in regulating transportation safety.
  • The prohibition of bike taxis would have dire consequences, particularly in terms of unemployment, as a significant portion of the lower-income population relies on these services for their daily livelihood. The potential impact of such a restriction cannot be understated, and it would likely create a state of chaos and upheaval.
  • One of the major implications of banning bike taxis will be seen on the GDP as it is a complex issue that depends on a number of factors, including the size of the bike taxi industry, the availability of alternative transportation, and the impact of the ban on consumer spending. The Bike taxi industry contributes a significant amount towards GDP. Recent studies shows that bike taxis provide a vital transportation option for low-income people, and that banning them would have a negative impact on their livelihoods.
  • In addition to the impact on GDP, a ban on bike taxis could also have a negative impact on consumer spending. Bike taxis are a relatively inexpensive form of transportation and banning them could force people to spend more money on other forms of transportation, such as taxis or private cars. This could lead to a decrease in consumer spending, which would have a negative impact on the economy.
  • Some contend that outlawing bike taxis would instead result in more people using larger, more polluting vehicles, which would result in higher levels of congestion and pollution. Others contend that since bike taxis make up such a minor portion of overall traffic, their prohibition would have little effect on pollution and traffic congestion.

Conclusion

The regulation of two-wheeler taxi services can be a subject of debate, with differing perspectives regarding the necessity of imposing restrictions on such services. The paramount reason supporting the regulation is the concern for safety. Furthermore, there remains a lack of clarity among the general public regarding the course of action and remedies available in the event of an accident involving two-wheeler taxi services. Motorcycles or motorized scooters, being less stable compared to automobiles or larger vehicles, may pose a greater risk, particularly in congested urban areas. The inherent instability of these vehicles increases the likelihood of accidents, resulting in a higher probability of injuries for both riders and passengers. Despite efforts to implement precautions, it is undeniable that two-wheelers present a higher level of danger and risk when compared to other available modes of transportation.

The legal implications surrounding the prohibition of two-wheeler taxi services are currently a subject of ongoing discussion, and it is expected that these matters will be resolved through legal proceedings. The Government of NCT Delhi is taking proactive measures to develop a policy that aligns with the provisions of the Motor Vehicle Act, which allows for the utilization of two-wheelers as taxi services. This policy is slated to be formulated by July 31st, 2023, demonstrating the government’s commitment to addressing the issue in a timely manner.

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