Uber Directed to Comply with MV Act in Maharashtra

In an order dated February 13, 2023, the Supreme Court directed the petitioners, Uber India Systems Private Limited and Uber India Technology Private Limited to apply for a licence by March 6, 2023, to continue operating in the state of Maharashtra in accordance with the provisions of the Motor Vehicles (Amendment) Act, 2019.

In 2019, the Motor Vehicles Act, 1988 was amended and through this amendment, the term aggregator was defined as a “digital intermediary or market place for a passenger to connect with a driver for the purpose of transportation”. Further, it was expressly laid down that aggregators must obtain licences in order to operate. In this regard, the Act confers State Government with powers to make rules. However, the State Government has not issued any such rules as of date (apart from the draft rules).

Considering said circumstances, the Division Bench of the Bombay High Court relied on the proviso to Section 93(1) of the said Act which specifies that in issuing licences to aggregators, the State Government may adhere to the guidelines formulated by the Central Government. The court opined that the Guidelines released by the Central Government in the year 2019 would be applicable until the State Government finalizes the draft rules. The permission granted by the Ministry of Road Transport and Highways (the second respondent herein) to the petitioners along with other aggregators to operate in the state of Maharashtra without obtaining the requisite licence was taken into account. With this, the court directed the petitioners to apply for a licence under Section 93(1) of the said Act. Challenging this order, the petitioners filed a Special Leave Petition (SLP) before the Supreme Court.

Upon hearing all the parties and after due perusal of the statutory provisions, the Supreme Court upheld the order of the Division Bench of the Bombay High Court and gave three weeks’ time to the petitioners to apply for a licence. The court added that the State Government has to take its decision expeditiously and formulate an appropriate policy to “avoid litigation and uncertainty”.