Karnataka HC Directs OLA Cabs To Pay Rs 5 Lakh Compensation To Woman Allegedly Harassed By Their Driver, Hold Inquiry Under POSH Act

The Karnataka High Court today directed ANI technologies, which owns and operates OLA Cabs, to pay a sum of Rs 5 lakh towards compensation to a woman who allegedly faced sexual harassment at the hands of their driver, during a trip in 2019.

A single judge bench of Justice M G S Kamal also directed the Internal Complaints Committee of the company to hold an inquiry into the complaint in accordance with provisions of the Sexual Harassment of Woman At Workplace (Prevention, Prohibition and Redressal) Act, 2013 [POSH Act]. The process is to be completed within 90 days and a report is to be submitted to the District Officer.

Court has also cautioned the stakeholders to ensure compliance of Section 16 of POSH Act and see that identity of persons involved in the matter is not disclosed.

The Court had on August 20, reserved its order on the woman's plea. ANI Technologies has also been directed to pay additional Rs 50,000 towards litigation expenses.

The petitioner was allegedly subjected to sexual harassment in 2019 and her complaint to ANI Technologies, seeking action against the driver was not entertained. The Internal Complaints Committee had declined to hold an enquiry in the matter upon the advice given by 'external legal counsel' that it did not have jurisdiction to enquire into the matter.

Following this, she approached the high court seeking direction on the company to inquire into the complaint. She also sought a directions to the Union Ministry of Women and Child Development to ensure that OLA strictly complies with POSH Act. Further, she sought the State government to issue such rules as may be necessary to protect women and children availing taxi services and ensure their safety and security.

Court has now directed the Karnataka State Road Transport authority, which had issued notice seeking explanation from ANI Technologies, to proceed with the matter and complete the process within 90 days, after affording the opportunity of hearing. Further, it imposed Rs. 1 lakh cost on the State, purportedly for failure to respond to the petition.

Detailed order is awaited.

During the hearing, the counsel for the petitioner referred to the clauses of the terms of the agreement between OLA and the cabs and argued that OLA is not only a platform but acts like a transport company. "There is no privity of contract between the company and the driver and not me and the driver," the counsel said.

Pressing the point that the company was responsible for the actions of the driver the counsel said, “If there was a disclaimer by OLA that we were not responsible for you, then I (petitioner) would not have taken the cab”. He claimed that the POSH Act was applicable to the company and the internal committee of the company should have not dismissed her complaint.

Meanwhile, Senior Advocate Dhyan Chinnappa appearing for the company (OLA) had sought dismissal of the petition. He said that Labour legislation cannot be applied in cases where these drivers are independent contractors and OLA cannot be raised to the status of an employer who has employed the driver.

The court had questioned the counsel whether OLA would be responsible since the complainant (customer) contacted OLA for a cab and the cab driver, against whom the allegation has been levelled was sent by OLA.

In responding to this query, the senior counsel said, “When I book on Amazon i don't know where the delivery is coming from, the seller's name is there on the bill in small, can it be then said the intermediary has control. The leaseholder has the right over the cab. If I train a driver on how to perform duty during a ride, it does not take away that I am an intermediary.”

Submitting that the action had been taken against the driver, the senior counsel sought dismissal of the petition contending that holding the driver as an employee of OLA would be an extreme stretch. He also contended that no punitive damages could be ordered against the company.

Meanwhile, the high court had expressed displeasure at the affidavit filed by the state government and said that it would deal with the same in its order.

Case Title: ABC AND Internal Complaints Committee & Others

Case No: WP 8127/2019

Citation: 2024 LiveLaw (Kar) 420