The Karnataka High Court on Thursday upheld rules framed by the state government to regulate fares by taxi aggregators such as Ola and Uber, which includes a ban on surge pricing by these platforms.
The ruling is a setback to both Uber and Ola as several states, including Maharashtra, Delhi and West Bengal have framed similar rules to regulate these aggregators.
In June, Uber had filed a petition seeking quashing of new rules by the state government that mandate licenses and ban surge pricing. Uber had questioned the legality of Karnataka to frame the rules calling it "anti-constitutional". Ola had secured a license.
Ola and the Radio Taxi Operators Association with members such as Meru Cabs have supported the government rules, while Uber, which opposes the new rules has called it anti-constitutional.
Ola in its submission to the court said that Uber's petition is motivated in an "attempt to bypass the laws of the land by foreign companies who run their operations in this country for profit without due regard for the applicable laws".
Karnataka, whose capital Bengaluru is one of the largest markets for both Uber and Ola, had brought out Karnataka On-Demand Transportation Technology Aggregators Rules, 2016, that mandated these aggregators to comply with physical meters, taxi boards, emergency buttons and GPS on 100 cabs.