The Madras High Court has banned Roppen Transportation Services from operating its bike taxi service Rapido in Tamil Nadu.
Rapido, Justice G Jayachandran said in a ruling, has been operating in violation of Section 66 of the Motor Vehicles Act, which prohibits anyone from using two-wheelers as transportation vehicles.
The court has directed the state government to frame regulations regarding bike taxis in four months. It has also asked both Google and Apple to remove the mobile application from their app stores.
Founded in 2015 by Rishikesh SR, Pavan Guntupalli and Aravind Sanka, Rapido allows users to book bike rides for solo trips via a mobile app that can be accessed in multiple languages such as Kannada, Telugu, Tamil, Hindi and English.
Last month, The Economic Times reported that Rapido was in the final stages of closing a $50 million investment round led by private equity firm WestBridge Capital.
In April, the company said it was raising up to $11.19 million (Rs.78.23 crore then) in fresh funding from a clutch of new and existing investors.
In 2017, the urban mobility startup had raised $750,000 from investors including Hero MotoCorp chairman Pawan Munjal, former Google India managing director Rajan Anandan and Astarc Ventures, according to Edge, the data research platform of Mosaic Digital, which owns TechCircle.
The company had also acquired Hyderabad rival Getbike to enter the business-to-business segment in May last year.
Dozens of bike taxi startups had launched operations across various states in the past two years but many of them shut down owing to lack of funding, operational challenges and regulatory hurdles.
In March, Rapido’s bike taxis were impounded for allegedly flouting the Karnataka transport department’s rules. The department confiscated nearly 200 bike taxis in Bengaluru connected to Ola and Rapido. Also, the department had issued notices to the companies for allegedly violating licence rules.