Karnataka revokes ban on Ola Cabs; slaps Rs 15 lakh fine

Bengaluru: Karnataka government has revoked it's recent decision to ban Ola Cabs from operating in the state. It came just two days after a notice was put out by the transport department which suspended Ola from running its services for six months for violating existing provisions.

It, however, slapped a fine of 15 lakh Rupees on ride-hailing service on Monday for running motorcycle taxis without permission.

Bengaluru, the capital of Karnataka, is considered India's Silicon Valley and is one of its most populated cities where Ola and San Francisco-based Uber compete for millions of riders.

The ban was apparently taken without the consultation of the state's IT ministry or the government. Ola, run by ANI technologies, had reached out to Kharge and was working closely with other authorities to find “an amicable solution”, it had announced in a statement on Friday.

Those meetings have proved to bear fruit as Kharge took to Twitter to announce that Ola would run their businesses as usual on Saturday. He also called technology companies to work more closely with the government so as to evolve existing policies which have not been able to keep up with changing disruptions brought upon by technology.

Ola was banned after the transport department said that the company violated existing provisions and operated two-wheeler taxis in Bengaluru. "Despite repeated warnings, Ola was misusing the license granted by the authorities. Bike taxis are not allowed in Karnataka according to government policy," a senior official with the state's transport department said on condition of anonymity.

"So the decision was taken to suspend its license for six months."

Ola announced in a statement on Tuesday that it “is glad that the issue stands resolved” now and that they “regret any inconvenience caused to our driver-partners and passengers.”

Several users in Bengaluru reported that they were still able to book an auto-rickshaw or taxi through Ola's app late on Friday.

Ola, backed by SoftBank Group Corp and Tencent Holdings Ltd and Uber's main rival in India, has a licence to operate taxis in the state from June 2016 to June 19, 2021, local media reported.

Ola informed that it had stopped bike-taxi service for a while now and have sought the state's cooperation to develop a legal framework for a pilot.

Ola has invested $100 million in Vogo, a domestic scooter sharing start-up that provides services in Bengaluru and Hyderabad.