Delhi HC upholds notifications imposing GST on Ola, Uber auto rides

The Delhi High Court on Wednesday upheld government notifications imposing the Goods and Services Tax (GST) on auto-rickshaws booked through app-based aggregators like Ola and Uber.

Uber India has challenged the notifications issued by the Central government in November 2021.

A division bench of Justices Manmohan and Manmeet Pritam Singh Arora held that the classification of e-commerce operators was recognised by the statute, preventing discrimination from being caused by the notifications in question.

"Classification as a class of service providers separate and distinct is recognised in the provisions of the Act. The classification has a rational nexus with the object sought to be achieved," the court reasoned finding that the orders did not violate fundamental rights.

According to the argument, after receiving these notifications, if an auto-driver registers with an app-based aggregator and offers passenger transportation services to customers located using such platforms, GST at 5 per cent or 12 per cent will become applicable on the fare received.

Uber said that the notifications violated Article 14 of the Constitution because the government did not intend to levy any such tax on auto rides taken using offline methods like street hailing.

It was argued that there cannot be any distinction in tax treatment between passenger transport services provided by auto drivers facilitated through mobile platforms and passenger transport services provided by auto drivers offline. This is because the government's directives do not pass the test of reasonable classification.

--IANS

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