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“In continuation of the earlier letter received from the Central Consumer Protection Authority (“CCPA”), dated December 04, 2024, by Ola Electric Mobility Limited (the Company) we would like to inform you that the Company has received further request for information via email dated January 10, 2025,” according to a stock exchange filing.
This follows earlier notices issued in October and December 2024 as part of the ongoing probe into alleged service deficiencies and consumer rights violations.
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This week, the Karnataka High Court rejected a plea by Ola Electric to quash a notice issued by the CCPA. Justice R Devdas ruled that the notice was issued by a competent investigating officer and that Ola Electric is obligated to provide the requested documents.
The Court stated, “At this juncture, it is well within the Investigating Officer’s power to issue such communication, and the petitioner is obliged to furnish the additional documents and records asked for.” The investigation stems from 10,466 complaints filed with the National Consumer Helpline between July 2023 and August 2024.
The CCPA had conducted a preliminary inquiry into these complaints and found violations relating to consumer rights, misleading advertisements, and service deficiencies. Following this, the CCPA directed its Director General of Investigations to initiate a probe, as per Section 19(1) of the Consumer Protection Act, 2019.
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Ola Electric argued that the officer issuing the notice was not authorised under the Act, as he was not designated as a Director or Additional Director.
However, the Court clarified that the officer, holding the rank of Senior Director, had been legally authorised by the Director General to conduct the investigation. It also noted that the Act permits the central authority to order a probe if a prima facie case exists, even without a formal order stating so.
The Court addressed concerns raised by Ola’s counsel, Senior Advocate Udaya Holla, that submitting documents could harm the company’s reputation if news of the probe became public.
Dismissing this, the Court recorded an assurance from Additional Solicitor General Arvind Kamath, representing the CCPA, that no public statements would be made by the investigating authority or the CCPA regarding the matter. The CCPA’s investigation aims to scrutinise Ola’s terms of service, grievance redressal mechanisms, service centre standards, and infrastructure.
Also Read: Ola Electric Mobility shares slip below IPO price but just manage to close above it
The Court directed Ola Electric to submit the required documents within six weeks, affirming that the probe is lawful and necessary to address consumer grievances. It concluded, “Since a finding has been recorded on prima facie and an officer has been entrusted to probe, said the officer has called for documents to consider the grievances against the petitioner, it cannot be faulted.”
Shares of Ola Electric Mobility Ltd ended at ₹73.42, down by ₹2.23, or 2.95% on the BSE.
