It is anticipated that Uber and Ola auto rides will now become more expensive as a result of the most recent Delhi High Court judgment regarding GST rates, despite the fact that auto rickshaw rides are the most popular and convenient mode of transportation for residents of the national capital.
The Delhi High Court upheld the central government’s decision to impose GST fees on auto rickshaw rides booked by commuters through ride-sharing apps, which was a setback for ride-sharing companies like Uber and Ola.
The Delhi High Court stated, “Classification as a class of service providers separate and distinct is recognised in the provisions of the Act,” stating that the order did not violate any fundamental rights. The classification has a rational connection to the goal that is being pursued.
Uber India challenged the order that was issued by the Centre in 2021 because it could cause a significant market hit and raise auto prices on the app. In addition, the court has rejected Uber’s petition in this regard.
After receiving these notifications, the argument asserts, if an auto-driver registers with an app-based aggregator and provides passenger transportation services to customers located on such platforms, GST at 5% or 12% will be added to the fare.
In the meantime, Uber argued that it was discriminatory and violated Article 14 of the Constitution because the Centre did not intend to charge GST on offline auto rides, despite the low prices of local auto rides.
It was argued that the tax treatment of passenger transportation services provided by auto drivers offline and those provided by auto drivers facilitated through mobile platforms cannot be different.
