Ola, Uber Face Class Action Suit: NGOs Seek Rs 9,239 Crore In Damages For Surge Pricing

In fresh trouble for taxi aggregators Ola and Uber, two Delhi-based non-governmental organisations filed a class action suit against them seeking damages worth more than Rs 9,000 crore for imposing surge pricing in the last three years across India.

The suit has been filed by the NGOs - Nyaybhoomi and Pariwar Unity Road Safety Life Safety - before the National Consumer Disputes Redressal Forum (NCDRC) and is likely to be taken up for consideration by the consumer forum on October 5.

“The complainants are seeking refund to and on behalf of all passengers across the country of an estimated sum of Rs.9,239 crore being the excess amount collected by the Ola and Uber in the past three years. The two companies started collecting excess fare in the form of surge pricing. Delhi High Court passed an order directing the companies not to charge in excess of notified fares but the practice continues till date. Hence this complaint,” said the class action suit accessed by BloombergQuint.

In August this year, the Delhi High Court directed all app-based cab aggregrators like Ola and Uber not to resort to surge pricing and abide by Delhi government’s notified rates in the National Capital Region. This class action suit, filed on behalf of citizens, alleged that the two companies - Ola and Uber - are still overpricing and charging money towards State or Municipal Corporation Development taxes that “are not payable to the state governments”.

The group arrived at the figure of Rs 9,239 crore across India by calculating the following, based on data available through media and other sources:

• Excess amount charged per vehicle per trip due to surge
  
• Average number of rides per day per vehicle with surge pricing
  
• Average fleet size India over the 3-year period
  

The suit further alleged that consumers are being forced to pay more than the amount notified under Section 67 of the Motor Vehicles Act, 1988 by various state governments. The NGOs urged the Consumer Forum to direct both companies to deposit 20 percent of the amount with the NCDRC till final orders.

The aggregators had argued in Delhi High Court that they are neither in violation of any norms, nor in a position to cap fares as they do not employ the drivers or own the cabs. Striking down these arguments, the high court directed both to abide by Delhi government’s notification on fares.