Sometimes Social Activists Are Pushed By Business Interests: SC Rejects PIL Seeking Regulations Of App-Based Cabs

The Supreme Court today declined to entertain a Public Interest Litigation (PIL) seeking directions to the Union of India and State Governments to formulate rules and regulations for app-based cab/aggregator services in accordance with the provisions of Section 93 of the Motor Vehicles Act, 1989 to address issues such as the absence of security arrangements, overcharging, and arbitrary cancellation of cab rides.

The Bench of Chief Justice D.Y. Chandrachud, Justice J.B. Pardiwala and Justice Manoj Misra ordered, "We are not inclined to interfere under Article 32 of the Constitution at the behest of the Petitioner who claims to be a social activist. While we decline to exercise jurisdiction under Article 32 of the Constitution, we clarify that we have not expressed any opinions on the merits."

Appearing for the Petitioner, Advocate Umesh Sharma along with Advocate Akhil Rana submitted, "We seek rules for the aggregators which regulates the licensing." However, the CJI at the outset remarked, "Who are you by the way?". Clarifying the counsel replied, "I am a social activist."

Expressing his disclination in entertaining the matter, the CJI further remarked, "What social activist? Why should we entertain such a Petition?". The CJI also stated, "Sometimes the danger is you know, that these social activists are pushed by some business interests. Let some person who is directly aggrieved come here and say that you must frame rules for the aggregators."

"Aggregators are themselves not aggrieved, they are benefitted, so why shall they come", replied the counsel. However, the Court dismissed the PIL. The PIL stated that, to date, the State Governments have not succeeded in formulating regulations for aggregators in alignment with the amended Section 93 of the Motor Vehicles Act.

The PIL highlights various issues arising from the absence of regulations for app-based cab aggregators: 1. Security concerns persist due to the lack of defined rules. 2. Unfair practices include charging extra under the pretext of changing the pickup location multiple times. 3. Trips get cancelled if drivers don't find their preferred routes. 4. Instances of automatic cancellation after booking, overcharging, and altering routes, especially with women passengers, are routine. 5. Drivers often insist on cash payments, discouraging online transactions. 6. Complaints investigation reveals a lack of applicable rules, leading to impunity. 7. Non-implementation of regulations raises concerns about essential document verification for vehicles and drivers. 8. Drivers coerce passengers to cancel app bookings and pay in cash, incurring cancellation charges. 9. The Consumer Protection Authority received 2482 complaints last year and many other similar issues.

"Non-framing of these rules amounts to a violation of the Motor Vehicles Act as a result of which the aggregator companies are not able to provide services to the public at large properly resulting in the violation of the fundamental rights of the people. The framing of rules being a delegated legislation under the Motor Vehicles Act, the central government has already issued Rules and Regulations in November 2020 immediately after the notification issued for the modification of Section 93 of the Motor Vehicles Act but the majority of states have failed to frame the rules as applicable thereby leading to a chaotic situation and lawlessness", reads the PIL.

The PIL also stated that Section 93 was amended by the Amending Act to encompass the business of aggregators. Continuing, it stated that Sub-section (1) of Section 93, inter alia, stipulates that no person shall engage himself as an aggregator unless he has obtained a licence from such authority and is subject to such conditions as may be prescribed by the State Government.

The Petition further says that non-regulation of the sector has left the passengers at the mercy of the aggregators who are nothing more than intermediatory, collecting huge amounts of money from the passengers and vulnerable passenger vehicle drivers.

Cause Title: Harpal Singh Rana v. Union Of India & Ors. [Diary No. 32121-2023]