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Roppen Transportation Services Pvt. Ltd. vs Union of India & Ors.

Special Leave Petition (Civil) · 2023 INSC 102Decided 7 Feb 2023
Special Leave Petition (Civil) No. 3006 of 2023
Dr. Dhananjaya Y. Chandrachud · Pamidighantam Sri Narasimha · J.B. Pardiwala

Background

Roppen Transportation (the company behind the Rapido app) applied to the Pune Regional Transport Officer for a licence to run two-wheeler and three-wheeler taxi aggregation across Maharashtra. Since a 2019 amendment, Section 93 of the Motor Vehicles Act requires every aggregator to hold a licence from the State Government, which "may follow" the Central Government's Motor Vehicle Aggregator Guidelines 2020 when issuing one. The RTO rejected the application in December 2022 for non-compliance with numerous guideline requirements and because Maharashtra had no bike-taxi scheme at all. While the company's challenge was pending in the Bombay High Court, the State issued a notification on 19 January 2023 prohibiting the use of non-transport (private) vehicles for aggregation and ride-pooling, citing passenger safety, and set up an expert committee to study the issue. The High Court ruled against the company, which then came to the Supreme Court, also filing fresh Article 32 petitions against the January notification.

Decision Breakdown

The Court declined to entertain the direct Article 32 challenge to the State's January 2023 notification, holding that the petitioners should pursue that before the High Court under Article 226. It clarified the legal framework: the Central Guidelines of 2020 are persuasive, not mandatory, and the final decision on licensing conditions and on whether private vehicles may be pooled rests with the State Government, which may also frame its own rules under Section 96. The correctness of the RTO's rejection order was held to be overtaken by the State's decision to refer the whole question to a committee. The Court gave the petitioners liberty to challenge the notification before the High Court, directed that the High Court should decide any such challenge uninfluenced by its earlier observations (in particular paragraph 59 of its judgment), and fixed timelines: the committee to report by 15 March 2023 and the State Government to take a final decision by 31 March 2023, after which the petitioners could apply afresh in compliance with whatever conditions the State prescribes.

Lesson Learnt

App-based bike-taxi and ride-pooling services are not a free-for-all. They need a State licence, and each State can decide whether and on what conditions private vehicles may be used for hire, with the Centre's guidelines serving only as a model. A party unhappy with a State policy notification should ordinarily go to the High Court first rather than straight to the Supreme Court.

Official source (sci.gov.in)View Judgment (PDF)

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