Doing business in India is still tough; if not customer acquisition and VC money, it’s the Government rules which are sufficiently capable to kill any startup dream.

In yet another instance of insensitivity and hardcore stand on new businesses, Karnataka Government has seized bike-taxis of Ola and Uber and have issued a stern warning to all users that these are illegal.

Last week, Uber had launched their unique bike-taxis in Bangalore, after launching the same in Bangkok last month; and Ola too launched their bike-taxis on that same very day. However, Karnataka Govt. wasn’t impressed it seems.

As per the officials, these app-based cab companies have clearly violated Motor Vehicle Act by not ‘seeking permission’ from them. Around 5 such bike-taxis were seized, just to drive home a point.

Karnataka transport commissioner Ramegowda said, “They (uberMOTO and Ola Bike) did not make any application so it is a violation of the Motor Vehicles Act. That’s why we have taken action against them. We have seized some vehicles — four to five,”

Another issue is the number plate of these vehicles – as per the Govt. rules, taxis of any nature should have yellow number plates, but bike-taxis of Uber and Ola are using white number plate, which terms them illegal.

Making his stand clear, Ramegowda said, “Anybody cannot indulge in earning money for livelihood just like that. It has to be governed by some laws. If anything goes wrong, who is responsible. If the pillion rider meets with an accident, who is responsible,”

However, both Uber and Ola have said that they haven’t received any such complain or notification from the Karnataka Govt.

The day UberMoto and Ola Bikes were launched, Karnataka Govt. had issued a warning for all citizens against using these services, as they hadn’t obtained the desired permission from the local authorities. In that warning, Karnataka Govt. said that under Motor Vehicles Act 1988, two wheelers are considered as private transport, and thus, they cannot be used for commercial activities.

Uber had responded that it’s a pilot service (under trial), and hence there are no Government rules which terms them as illegal.

Interestingly, tourists in Goa are known to use such bike-taxis frequently, all over the state. Bike-taxis are available at airport, railway stations, beaches and everywhere; and as of now, there have been no such legal issues.

Despite India’s first ‘startup council’ in the state, no wonder Chhattisgarh was able to beat Karnataka in ‘ease of doing business’ ranking. In 2014, Karnataka had banned Uber/Ola as well, which was put on hold till legal issues sorted out.

Be it either UP, Uttrakhand or Karnataka; it seems doing business is a hard nut to crack in India.