The Punjab State Consumer Disputes Redressal Commission recently affirmed a ₹15,000 penalty against Uber India for causing mental agony and harassment when an Uber driver forced a passenger to vacate the vehicle before completing the trip.

A coram of Presiding Member HPS Mahal and Member Kiran Sibal noted that in an employer-employee relationship, the employer is liable for the actions of third parties.

"It is established that the Uber App is managed and controlled by the appellant/OP No.2 and also all transactions and services provided via said App is managed by the appellant. It is a settled principle of law that in an employer-employee relationship, the employer is liable for the acts of the third party and is also responsible to provide the social security benefits," the order dated June 4 stated.

The case stemmed from a complaint filed by a consumer who had booked an Uber-X cab for a journey from Zirakpur to Kalka on March 7, 2017. The customer alleged that the driver misbehaved and compelled him to exit the cab after traveling a short distance. Additionally, the driver insisted on a fare of ₹105 for the incomplete trip.

The complainant further stated that despite Uber's assurance of refunding the fare, no refund was received. Consequently, a complaint was filed with the Mohali District Commission. After reviewing the evidence and submissions, the District Commission directed Uber to compensate ₹15,000 for mental agony, harassment, and litigation costs.

Uber, feeling aggrieved, appealed to the State Commission, arguing that the District Commission had issued its order without granting Uber a fair chance to present its case, citing constraints related to COVID-19 during the hearing.

Uber emphasized that it operates solely as a technological platform connecting drivers and passengers, and therefore should not bear liability for the actions of drivers. It underscored that drivers are independent contractors, not employees of Uber.

The State Commission observed that Uber had sufficient opportunities to defend its position before the District Commission but failed to avail itself of those opportunities.

The State Commission further determined that Uber's active involvement in the booking and payment processes demonstrated its significant intermediary role, which, under the Consumer Protection Act, meant Uber could not evade liability for service deficiencies.

Consequently, the State Commission dismissed Uber's appeal and upheld the District Commission's order. Uber India was represented by advocate SS Joshan during the proceedings.

Case Title: Uber India Systems Pvt. Ltd v Mohit Bansal and Anr