Ola Consumer Banned In Chandigarh For Six Months

The State Transport Authority (STA) of Chandigarh has suspended the cab aggregator licence of ANI Technologies, the parent company of Ola Consumer, for a period of six months following its repeated failures to comply with regulatory guidelines. 

The order, dated June 17, said that the decision was enforced against Ola after the regulatory body received numerous complaints alleging that it was operating in direct violation of the Chandigarh Administration Motor Vehicles Aggregators Rules, 2025. 

The STA also issued a public notice advising commuters not to book rides through the Ola app to avoid inconvenience. It further warned cab and bike-taxi operators to stop using the platform immediately, noting that those violating the order will be fined and their vehicles will be impounded. 

According to the STA’s order, cab drivers had complained that Ola allegedly failed to provide them with mandatory health insurance, term insurance, and digital training. The platform also violated notified fare structures by requiring operators to make prepaid recharges to receive bookings. 

Furthermore, the regulatory body noted that Ola failed to reply to a show-cause notice issued in October 2025 despite requesting an extension of the 15-day deadline for responding. A further show-cause notice issued in May 2026 also went unanswered. 

In addition, the company’s representatives did not appear at a meeting held in May 2026 to discuss compliance with the aggregator rules. 

Ola also declined to comment on Inc42’s queries regarding the matter. 

As per the order, an inspection committee from the STA further visited Ola’s registered office address in Chandigarh on three occasions in May and found that the company had vacated the office a year earlier without notifying the administration. The committee consequently recommended strict action against Ola for non-compliance despite repeated opportunities, resulting in the suspension of Ola’s aggregator licence.

Notably, Ola had earlier faced a six-month suspension of its aggregator licence in Karnataka back in 2019 after violating bike taxi regulations. Around the same time, it also faced scrutiny from the Karnataka government over convenience fees charged for value-added services. 

The latest restriction for Ola Consumer comes at a time when its business is going through turbulence to say the least. Recently, Ola’s early backer Vanguard marked down the value of its investment, valuing the startup at just $70 Mn. This represents a near 99% cut from its peak $7.3 Bn valuation.

While sources told Inc42 earlier this month that Ola Consumer is up for acquisition, the startup denied this fact.

Meanwhile, as per a PTI report, Ola Consumer is said to have turned free cash-flow positive and achieved profitability in the fourth quarter of FY26. The report added that Ola undertook a series of cost-cutting and operational-efficiency measures over the past year to achieve this. It is looking to achieve EBITDA breakeven in FY27.

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