Supreme Court Seeks Centre’s Response Regarding Insurance Coverage in Plea Against Bike-Taxi Aggregators Like Rapido & Uber

Supreme Court Seeks Centre’s Response Regarding Insurance Coverage in Plea Against Bike-Taxi Aggregators Like Rapido & Uber

The Supreme Court has sought Centre’s response on the plea filed against the Delhi High Court’s order which permitted the bike-aggregators Rapido and Uber to operate bike-taxis without aggregator licenses till a final policy regarding it, is notified.

The two-judges vacation bench comprising of Justices Aniruddha Bose and Rajesh Bindal were hearing a special leave petition filed by the Delhi Government challenging the High Court's order which stayed the notices issued against Rapido and Uber.

The order read, “Let the copy of both petitions be served upon the Solicitor General so that views of the Union of India can be taken into account. List on Monday.”

In the plea filed before the Supreme Court, the Delhi government said that owing to the High Court’s interim order, Uber and Rapido are continuing the use of non-transport vehicles including two-wheelers for the purpose of aggregation and ride pooling, which is impermissible under the Motor Vehicles Act read with the Motor Vehicle Aggregator Guidelines, 2020 without obtaining valid permits.

During the hearing, Senior Advocate Manish Vashisht, representing Delhi government argued that the High Court's decision to stay the government’s notice till the final policy is notified ‘virtually allowing’ the writ petition by Rapido.

The Counsel asserted that there is no way to offend the provisions of the Motor Vehicles Act on a daily basis and drew Court’s to the speaking order passed by the High Court.

Previously, on 26th May, the Delhi High Court had directed that no coercive action be taken against the bike-taxi aggregator till a final policy has been notified, while issuing notice to the Delhi government on Rapido's plea.

The dispute arose, when the Delhi Transport Department had issued a public notice in February, 2023, to stop plying their bike taxi services effective immediately.

The bench had questioned the Delhi government whether the plying bike taxis have private number plates.

“Is this for the two-wheeler? They have been allowed to operate on private number plate?” asked the bench.

Answering to the bench, Vashisht said that under the Motor Vehicles Rules, aggregators must obtain a license to do so.

He replied, “They have not been allowed to operate for any purposes which covers commercial usage or...They are all having private number plates”.

Following which, the Counsel also placed reliance on the definition of motor cycle under Section 2 (27) and obtaining a license under Section 93 of the Act.

Thereafter, the Court asked, “Have you started a licensing regime for the aggregators?”

To which the Counsel informed the Court that the Government has drafted the policy (Delhi Motor Vehicle Aggregator Scheme, 2023) and public notices have been invited to participate and give objections. The process would be completed in a month. The Limitation period for submitting objections is expiring on 24th June.

However, the bench highlighted that a higher risk exists for bike-taxis and said, “But there is a ramification. If there's an accident, then no one will get insurance.”

Representing on behalf of Uber, Senior Advocate NK Kaul stated that the insurance cover is there for the drivers and that Uber is only an aggregator.

He argued, “Should your Lordships interfere with this interim order? What is the challenge pending before the High Court? These are important questions…. These People are operating across the country as aggregators, they do not own the vehicle; it just brings a person who has two wheelers or taxi on a platform. It is a great facilitator all over the world.”

He further submitted that the aggregators have been operating since 2019 and pointed out, “The law is this, the Government of India came up with guidelines, in 2004, it said aggregators can use two wheelers and four wheelers, both.”

To which Counsel for the Delhi government retaliated, those were only guidelines and not a policy.