MV Act | Blanket Ban on Bike Taxis Unconstitutional; Motorcycles are ‘Contract Carriages’: Karnataka High Court

“In our view, a blanket prohibition on issuing contract carriage permits to motorcycles cannot be considered as a reasonable restriction within the meaning of Article 19(6) of the Constitution of India.” — In a seminal ruling, the High Court of Karnataka, comprising Chief Justice Vibhu Bakhru and Justice C.M. Joshi, has allowed the appeals filed by aggregators (Ola, Uber, Rapido) and bike taxi unions, effectively dismantling the State’s prohibition on non-electric bike taxis.

The Controversy: Innovation vs. Regulation

The Division Bench was seized of a batch of Writ Appeals challenging a Single Judge’s order dated April 2, 2025. The core dispute revolved around the State Government’s refusal to register motorcycles as "transport vehicles" or grant "contract carriage permits" for bike taxi operations. The State argued that under the Karnataka On-Demand Transport Technology Aggregator Rules, 2016 (KODTTA Rules), licenses were only meant for motor cabs (four-wheelers) and that policy considerations regarding safety and pollution justified the exclusion of fuel-based motorcycles.

The Appellants, including ANI Technologies (Ola), Uber India, and Roppen Transportation (Rapido), contended that the Motor Vehicles Act, 1988 (MV Act)—a Central legislation—expressly recognizes motorcycles as transport vehicles. They argued that the State’s refusal amounted to an unreasonable restriction on their fundamental right to trade under Article 19(1)(g) of the Constitution.

Judicial Reasoning: The Statutory Matrix

The Court undertook a granular analysis of the definitions under the MV Act. The Bench rejected the State's contention that a motorcycle falls outside the definition of a ‘contract carriage’.

The Court traced the legislative scheme:

1. Section 2(27) defines a "motor cycle."

2. Section 2(25) defines a "motorcab" as a vehicle adapted to carry not more than six passengers.

3. Section 2(7) defines "contract carriage" to include a "motorcab."

The Bench held that a motorcycle, capable of carrying a pillion rider for hire, fits squarely within the definition of a motorcab and, consequently, a contract carriage. The Court further relied on a Central Government Notification (S.O. 1248(E) dated 05.11.2004) and a clarification issued by the Ministry of Road Transport and Highways (MoRTH) in January 2024, which explicitly stated that motorcycles fall within the definition of contract carriages.

“It is implicit on a plain reading of Section 66(1) that the State Transport Authority... is required to issue permits... it is difficult to accept that Section 66(1) of the MV Act contains any power of the State Government to issue a blanket ban for use of a transport vehicle by refraining from issuing any permits at all.”

State Policy Cannot Override Central Legislation

The Court addressed the State's argument that it had a "policy" not to register bike taxis. The Bench observed that the MV Act occupies the legislative field under Entry 35 of List III (Concurrent List). Therefore, the State Government cannot enact a policy or practice repugnant to the Central Act.

While Section 67 of the MV Act empowers the State to issue directions regarding road transport, the Court noted that such power must be exercised through official gazette notifications and must be guided by specific factors like passenger convenience and road safety. The Court found that there was no statutory rule or notification explicitly prohibiting bike taxis. An "unwritten edict" or executive inaction cannot curtail fundamental rights.

Article 19(1)(g) and Reasonable Restrictions

The judgment heavily relied on the principle that any restriction on the fundamental right to trade must be "reasonable" and imposed "by law" under Article 19(6). The Court held that a total prohibition on a legitimate business activity (plying taxis) requires strict scrutiny. Since the State failed to produce any valid law or notification imposing such a ban, the refusal to grant permits was unconstitutional.

“The business of plying taxis is a legitimate business, and the right to engage in such activity is protected under Article 19(1)(g) of the Constitution of India. The said business is not inherently dangerous, illegal or immoral.”

Aggregator Rules Apply to Bikes

The State contended that the KODTTA Rules, 2016, did not mention two-wheelers. The Court dismantled this interpretation by pointing out that the Rules define "Taxi" as a "motor cab." Since the MV Act defines a motorcycle as a motor cab (when used for hire), the KODTTA Rules automatically extend to bike taxis.

The Bench clarified that while the Rules might require compliance (such as displaying driver details), the physical impossibility of displaying a board inside a bike simply means the details must be displayed in a manner accessible to the passenger (e.g., on the driver's person or the vehicle body).

The Verdict

The Court set aside the Single Judge's order and issued the following directions:

1. Registration: The State must consider applications for registering motorcycles as transport vehicles (yellow board).

2. Permits: The Regional Transport Authorities (RTAs) must consider applications for contract carriage permits for motorcycles.

3. Aggregator Licenses: The State must process pending applications from aggregators to include bike taxis in their licenses.

The Court clarified that while the State can impose reasonable conditions for safety (under Section 74(2) of the MV Act), it cannot enforce a blanket ban.

Date of Decision: 23rd January, 2026