The Karnataka government on Monday gave Uber and Ola three days to withdraw their ride-sharing services in the state. The decision was made following a meeting between the state Transport Department and representatives and drivers of both taxi-hailing companies, Mint reported.

Transport Commissioner MK Aiyappa said his department had intimated the firms on the legality of offering ride-sharing services and given them till Thursday to comply with the order. “We explained the matter to them, and they also agreed that what they are doing now is illegal. They will make the changes,” Aiyappa said, acknowledging that ride sharing did indeed help bring down traffic and offer commuters a cheaper option to travel.

He added that Uber and Ola could submit a petition to his Transport Department elaborating on why they believe ride-sharing should be allowed, after which they will forward the plea to the government, the Mint report said.

According to the Karnataka government, taxi aggregation services Ola and Uber only had contract carriage permits that do not allow them to pick up and drop passengers during the course of a ride. Aiyappa had explained that their contracts only allowed for “point-to-point drops and not picking up customers in between”, while only the Bangalore Metropolitan Transport Corp and school and college buses had stage carriage permits.

The move is likely to affect the businesses of both Uber and Ola as Karnataka capital Bengaluru is one of their biggest markets, besides Delhi and Mumbai. Uber had tried to defend its uberPOOL service, saying ride-sharing was the “future of urban mobility”. “Over 25% of our total trips in Bengaluru are shared. In one year, UberPOOL users in the city have saved around...4,40623 litres of fuel and over 10,37,000 kg of carbon emissions,” it had said in a statement.