The decision comes after a recent notification of the union road transport ministry which made installation of speed governors in commercial vehicles compulsory.
The move is intended to reduce road accidents by limiting the maximum speed of taxis and cabs at 80 kmph.
According to a Delhi Traffic Police data, 1,622 and 1,671 people were killed in 2015 and 2014, respectively, in road accidents in the city, while over 16,000 people were left injured in the two years.
"The city transport department has made installation of speed governors in cabs and taxis mandatory following the Union transport ministry's recent notification," an official said.
However, taxis unions have opposed the decision and threatened to launch a stir if it is not rolled back immediately.
Taxi drivers cannot afford the cost of speed governors and hence, the Centre should withdraw the notification, said Rajender Soni, general secretary of Delhi Pradesh Taxi Union.
"A speed governor is installed at a cost of around Rs 10,000. If the decision is not withdrawn, taxi drivers will launch a serious of protest against the Delhi government and Centre," Soni said.
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