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  • Delhi HC: Ola, Uber can't charge more than Govt-set fares

    August 12, 2016

    Rapping the cab aggregators such as Uber and Ola cab for their practice of surge – pricing, the Delhi High Court ruled on Thursday that all taxi operators will have to follow the fare chart fixed by the Delhi government from August 22.

    Justice Manmohan ruled that August 22 will be the dead line, after Uber said it needs 10 days to make changes to its software to ensure compliance with the court’s order. Ola said it has already stopped charging passengers more than the notified rates.

    The Delhi government had set rates for different forms of taxis in 2013, before Uber and Ola launched their service, allowing people to use their smartphones to book a ride, agree to the fare and pay it, all from an app.

    However, one of the features of their service is that prospective passengers are often faced with surge-pricing in multiples of the usual fare, with Uber or Ola claiming that the surge is required to induce more of their drivers to hit the road to meet demand. The passenger has to agree to the higher fare.

    The Delhi government’s chart notified that the fare for Economy Radio Taxi would be Rs 12.50 per km, for non-air-conditioned black & yellow taxi at Rs 14 per km and for AC black & yellow top taxi at Rs 16 per km.

    The notified fare of Radio Taxi cabs, which have an LCD display Radio Taxi on top, is Rs 23 per km. Additional night charge (25 per cent of the fare) is applicable between 11pm and 5am.

    The Court observed that, while taxi aggregators such as Ola and Uber reduce the pressure on public transport, “a uniform policy must be devised” for regulating them.

    It directed a special committee, set up by the Centre to examine all issues related to existing permits given to taxis and cab aggregators, to also include one senior official each from the Ministry of Information Technology, Central Pollution Control Board and Delhi Traffic Police apart from obtaining advise of a transport expert from Niti Aayog.

    The direction came after central government standing counsel Manish Mohan and Kirtimaan Singh submitted that the Ministry of Transport had set up the panel on May 25 this year to address licence issues of taxis and aggregators across India.

     

    OUR TAKE

    This issue of Surge – price has become a bone of contention between the cab aggregators and Delhi government. Surge –  pricing is a simple mechanics of demand and supply, which raises the prices when the demand is more than the supply, so that the supply increases, and the price comes down again. Although it is useful in reducing the congestion during peak hours, but their practice of charging their customers a whopping 3 times or 5 times from the original price is completely over board and unfair and since taxis are an essential public utility, there should be an upper cap to the prices.


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