The booking of Uber and Ola auto rides is set to get more expensive for the riders, as the Delhi High Court has directed that GST charges will be applied on these rides.
While auto rickshaw rides are the most popular and convenient form of travel for the people of the national capital, it is expected that Uber and Ola auto rides will now get more expensive due to the latest Delhi High Court judgment regarding GST rates.
In a setback for ride-sharing companies like Uber and Ola, the Delhi High Court upheld the decision of the Central government to levy GST charges on auto rickshaw rides that are booked through ride-sharing applications by commuters.
Stating that the order did not violate any fundamental rights, the Delhi HC said, “Classification as a class of service providers separate and distinct is recognised in the provisions of the Act. The classification has a rational nexus with the object sought to be achieved.”
Uber India challenged the order issued by the Centre in 2021, since it can raise the auto prices on the app and lead to a significant hit on the market. Further, the petition of Uber in this regard has now been dismissed by the court.
According to the argument, after receiving these notifications, if an auto-driver registers with an app-based aggregator and offers passenger transportation services to customers located using such platforms, GST at 5 per cent or 12 per cent will become applicable on the fare received.
Meanwhile, Uber argued that it violate Article 14 of the constitution and was discriminatory as the Centre did not have any plans to charge GST on auto rides booked through offline methods, with the prices of local auto rides still remaining low.
It was argued that there cannot be any distinction in tax treatment between passenger transport services provided by auto drivers facilitated through mobile platforms and passenger transport services provided by auto drivers offline.
(With IANS inputs)
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