EXCISE: 1. Deemed Credit on Melting Scrap of Bicycle & its Parts: At present, Cenvat credit is not permissible/available on the melting scrap being generated from the manufacturing of bicycle & its parts, as the raw material purchased is duty paid. The melting scrap generated, ultimately goes to the Induction Furnace, after melting become the raw material in the shape of Ingot (kulfi). It is suggested that deemed credit on melting scrap may be allowed, as the raw material from which this scrap is generated, if duty paid. We have been given to understand that Commissioner, Central Excise & Customs, Chandigarh has also recommended. 2. Rationalization of Excise Duty: The offset printing industry is manufacturing intermediate products i.e. packing material for other industries. The industry is manufacturing two types of items i.e corrugated cartoons/boxes/cases attracting concessional rate of duty of 5% advalurem vide Notification No. 4/2006 dated 1.3.2006.The second is duplex cartoons/corrugated. At present, the input excise duty is 5%, whereas, the output excise duty vary from 5% to 10% on various products. The balance can't be maintained due to vast
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EXCISE: 1. Deemed Credit on Melting Scrap of Bicycle & its Parts:
At present, Cenvat credit is not permissible/available on the melting scrap
being generated from the manufacturing of bicycle & its parts, as the
raw material purchased is duty paid.
The melting scrap generated, ultimately goes to the Induction Furnace, after
melting become the raw material in the shape of Ingot (kulfi).
It is suggested that deemed credit on melting scrap may be allowed, as
the raw material from which this scrap is generated, if duty paid.
We have been given to understand that Commissioner, Central Excise &
Customs, Chandigarh has also recommended.
2. Rationalization of Excise Duty:
The offset printing industry is manufacturing intermediate products i.e.
packing material for other industries. The industry is manufacturing two
types of items i.e corrugated cartoons/boxes/cases attracting
concessional rate of duty of 5% advalurem vide Notification No.
4/2006 dated 1.3.2006.The second is duplex cartoons/corrugated.
At present, the input excise duty is 5%, whereas, the output excise duty
vary from 5% to 10% on various products. The balance can't be
maintained due to vast differential rate of input/output excise duty.
Thus, it is suggested that input and output excise duty should be 5%.
There is loss of revenue to the Govt., as the industry is an intermediary
industry.
Central Excise Duty : At present, the excise duty is 12%.
It is an admitted fact that mostly all the industries get CENVAT on the
excise duty paid on the basic raw materials/inputs.
Whereas, bicycle/its parts, sewing machine industry pay Excise duty on
inputs and can't get CENVAT as such industries enjoy NIL rate of duty or
exemptions.
It is high time that excise duty should be brought down to 8% from 12%,
so as to make the sector internationally competitive, till GST comes into
force.
B) POINTS RELATING TO CUSTOMS:
1. Increase in Custom Duty on import of Bicycle parts and fixation of Minimum floor price/Cap on import from China :It is a well known fact that China is our main competitor. The custom duty
on import on bicycle parts from China has been raised to 20% only from
10%, which is quite inadequate in view of the percentage of domestic
Bicycle industry, as announced by Hon'ble Union Finance Minister on
16.03.2012.
It is pertinent to point out that bicycle parts are being imported at hefty
under invoicing, even upto 25% of the actual price, as a result of which
both the domestic industry as well as the Govt. are the worst sufferers. The
Govt. is deprived of revenue. The import duty on bicycle parts should be raised to 40%, in order to save the domestic bicycle parts manufacturing
industry in the Micro & Small Enterprises Sector.
The exports have gone down drastically due to W.T.O. w.e.f. 1.1.2005, as a
result of which 85% supporting manufacturers in MSEs sector had to
suffer and are on the verge of closure.
The replacement market, which is over 50%, had also adversely been
effected, as containers of bicycle parts are being imported from China in
almost all major market/states in the country under invoicing.
It has also been brought to our notice that Tyres & Tubes have not been
included in the list of Bicycle parts, which is a major part of bicycle.
Tyres & Tubes may be included in the list of Bicycle parts.
It has been brought to our notice that though the custom duty on bicycle
has been increased to 30% instead of 10% and on parts 20% from 10% in
2012. Though, the duty has been increased yet the bicycles / parts are
being imported from China under Free Trade Agreement APTA/SAPTA
@4% in which the Govt. is loosing revenue and the industry is adversely
affected.
It is suggested that in case the free trade agreements cannot be re-looked into it is
suggested that bicycle / its parts should be placed under negative list, to avoid import.
2. Floor Price: We would also suggest that Cap/minimum floor price should be fixed at Rs.80/- per
kg. for bicvcle parts manufactured from Mild steel Raw materials i.e. H.R. Coil/MS
Rounds, Rs.100/- per kg. Heat treated for tempered/electroplating/zinc plating /
painting etc, bicvcle parts & Rs. 1507- per kg. for parts manufactured from EN Series /
Alloy Steels/ Steel Balls etc., in order to contain under invoicing/heavy imports from
China, to safeguard the interest of domestic industry, which is suffering badly due to
evasion of custom duty by importing the parts at upto 25% value of the actual price.
It has also brought to our notice that children bicycle / parts are being imported at
under invoicing, which should be stopped forthwith.
It is high time that Custom duty on import of Bicycle parts from China should be raised
to 40% instead of 20%, so as to protect the domestic industry.
B) POINTS RELATING TO DIRECT TAXES
1) TAX RATES:
It is suggested that the tax rates should be made tax payer friendly, as tax
exemptions have been stated to be cut down DTC 20% upto Rs 15 Lacs for Micro
Enterprises. It should be fixed, as the Equity base of these Enterprises is very
weak.
Whereas, the corporate sector also demand lower tax rates from 30% to 25%
despite of the fact that the corporate sector enjoy various exemptions & perks It is
an admitted fact that reduction in tax rate increases more compliance and revenue
increased manifolds. It is suggested that the tax rate should be as under:
TAX SLABS
Upto Rs.3 Lacs NIL
From Rs.3 Lacs to 10 Lacs 10%
From Rs. 10 Lacs to 15 Lacs 15%
From Rs.15 Lacs to'^,3 Lacs 20%
Above Rs^p lacs 30%
Comparative chart is as under: -
US MEXICO THAILAND KOREA
5.20% 5.30% 10% 11.80%
SPAIN TAIWAN BANGLADESH SWITZERLAND
13% 15% 16%
CANADA JAPAN NEW ZEALAND PAKISTAN
16.20% 16.30% 18.50% 20%
AUSTRALIA .ERMANY FRANCE UK
20% 20.80% 21.60% 22%
4
2) STANDARD DEDUCTION U/S 16(1) :
The Standard Deduction u/s 16(1) of the act should be restored back to salaried
employees and the computation of pre-requisites should be liberalized.
3) STANDARD DEDUCTION IN RESPECT OF RENTAL INCOME U/S 24(1):
0
The Standard deduction in respect of rental income should be increased from 30%
to 50% for senior citizens.
4) DEDUCTION UNDER 80 (C):
It has been brought to our notice that deduction u/s 80C has been increased to 1.5
lacs from 1 lac by the NDA Govt.
It is suggested that deduction u/s 80C should be raised to Rs. 3 lacs and Rs. 5
lacs for Senior citizens/Super senior citizens.
5) SUPER SENIOR CITIZENS:
The age for Super Senior citizen should be uniform at 70. It is suggested that more
opportunities for investment should be made available for senior citizens to enable
them to enjoy comfortable life without any dependency. It is further suggested that
the age limit of the Super Senior citizen should be reduced to 75 years against 80
years of age because the average age in India is 65 to 70 years.
6) RENTAL INCOME OF SR. CITIZENS:
At present, deduction is allowed @1/3rd of the rent collected, as per the Income
Tax Act, 1961.
It is suggested that atleast 50% deduction should be allowed to Senior citizens, as
this step will encourage Senior citizens to invest their savings, which would give
boost to the construction activities. It would also generate employment.
Moreover, rent rates are under pressure due to easy availability at lower rate of
interest on housing loans etc.
7) TAX AUDIT U/S 44(AB):
The Tax Audit Limit was Rs 40 Lacs for the last more than 20 years, which had
been increased to Rs 60 Lacs in the Budget of 2010-2011, is quite inadequate,
looking to the prices index/inflation. Therefore, it is, suggested that it should be
raised to Rs 200 Lacs.
8) DEPRECIATION:
Depreciation rates for machinery is pegged at 15% for the past so many years. In
today's World of modern and changing technology, the machinery becomes
obsolete within 5-6 Years and hence, revision in depreciation rates in required and
it should be minimum 25% , if not 30 %, for Micro Enterprises.
9) MEDICAL EXPENSES:
As there is no social security scheme available in India, it is demanded that
medical expenses incurred during the year by the individual on his/family health,
should be allowed as deduction from returned income on the production of the
medical bills.
10) RESIDENTIAL HOUSE:
The construction of one Residential house should not be subjected to
investigation. It will give boost to cement and steel Industries and generate more
employment. Fair value of the registered deed should be taken for wealth tax to
avoid corruption. It is further suggested that the house constructed on the land
area measuring under 250 Sq Yards and/or if flat in Metropolitan cities ranging
1000 to 2500 Sq feet should be exempted from any enquiry/investigation.
11) AMENDMENT TO SEC 40A(3) READ WITH RULE 6DD OF THE INCOME TAX
RULES. 1962:
The existing provisions of the section 40A(3) r.w.r. 6DD where, a payment or
aggregate payments made to a person in a day, otherwise than by an account
payee cheque drawn on a bank or account payee bank draft, exceeds twenty
thousand rupees in the cases and circumstances specified clause (a) to (i).
It is suggested that an amendment should be made, where, the relation of the
payer & payees exist e.g. in the case of a colonizer, he is compelled to make
payment in cash, if he has to take the possession of land against cheque or draft.
Since, in the instant case, the payment has been made in front of the Sub-
Registrar, who is an Govt. official, the payment made by the colonizer to the
agriculturist can't be denied.
Therefore, it is suggested that cash payment made in front of the Sub-registrar,
the expenditure made by the assesses for purchase of agriculture land should not
be dis- allowed with retrospective effect, as hundred of cases are pending before
The Appellate Authorities on this issue, throughout in India.
12) HIGH HANDEDNESS OF INSURANCE COMPANIES/SECTOR:
At present, there are 24 companies Govt. as well as private companies, which are
in operation. There is no transparency whatsoever in the insurance sector.
It has also been brought to our notice that quite a good number of customer
complaints have been received by IRDA. But, unfortunately the regulator can't
settle the complaints reasons best know n to IRDA officials.
The agents, who are selling the products of 24 companies don't apprise the Small
investors about the term of policies & KYC. As a result of which the small
investors hav eto suffer and put to loss. Their main aim is to garner the
.commission etc. only and public is put to loss.
Moreover, a number of agencies are in operation, which instead of resolving the
complaints of the Small investors are being exploited under the garb of bonuses,
festival bonuses etc.
Your kind attention is invited to Harshad Mehta Scam of 1993, wherein, a whole lot
of small investors were deceived and put to loss.
It is high time that the redressal mechanism should try to contain of such mal
practices. IT is suggested that some concrete steps should be taken by the Govt.
It is incumbent on the part of the Govt. to ensure that safety of Small investors and
ensure that no fraud is played with small investors as well as Senior citizens, who
have put in their saving for rainy days in the insurance sector.
C) Points Relating to Banks
1. Timely & adequate availability of credit:
The perception of the Public Sector banks is that lending to MSE Sector is a high
risk area and costly is totally false/baseless. Whereas as per %age of NPAs of
micro/Small enterprises has been steadily declining. The major concern of MSEs
has always been the availability of timely and adequate bank finance.
Whereas the lenders prefer to lend to other sectors than the MSEs reasons best
known to the banks. It is easy to get loan of Rs. 2 crores than Rs. 2 lacs. Though
Govt. has introduced credit guarantee scheme since 2000 through SIDBI, yet the
lending has not improved to the extent it should have to be.
The budgetary provisions are being provided by the Govt. to SIDBI every year to
cover the risk. The banks were supposed to provide 60% to Micro Enterprises
sector by March, 2014, as per the recommendations of the Task Force, but, by
March, 2014, the banks have not achieved the target.
It has been brought to our notice that the credit to SME sector during 2009-2010
has increased from Rs. 2,56,12,807/- crore to Rs.3,64,00,101/- crores. Whereas,
the erstwhile SSI sector now Micro Sector needed the most timely & adequate
credit.
RBI had wrongly included Micro Enterprises under the umbrella of Small
Enterprises, which has caused greatest damage to this sector as the banks have
soft options to lend to the higher end. The Micro Enterprises have got a legal
lexicon.
However, now on the recommendations of high level Task Force, RBI has clarified
that in Section-Ill of their Master
Circular
RRCD/SME&NFS/BC/No.9/06.02.31/2010-11 dated July 1, 2010, Banks have
been advised to ensure that 60% of their MSE advances are made to the Micro
Enterprises, which is to be achieved in stages viz. 50% in the year 2010-11, 55%
.in the year 2011-12 & 60% in the year 2012-13, which is the need of hour.
It has been brought to our notice that only 43% has been achieved by the banks
instead of 60% till date.
We do hope that if the recommendations are implemented in letter & spirit, the
long standing demand of Micro Sector with an investment in Plant & Machinery
upto Rs. 5 lacs & Rs. 2 lacs both manufacturing as well as service Enterprises.
. Bank service charges:
At present, the Public sector Banks charge hefty service charges for each &
every service provided by the banks such as processing/recital charges etc. No
doubt, RBI has de-regulated the service charges and it was learnt that a working
group was constituted by RBI, wherein, users representatives were not
represented in the working group. It is only "the wearer who knows where the shoe
pinches."
It is also learnt that the commercial banks used to charge on the minimum
balance of Rs. 10,0007- in the current account & Rs.1000/- in the saving account, if
there as a shortfall in any quarter.
We have been given to understand that IDBI will be the first bank to do away with
the minimum balance requirement and simultaneously waiving off service charges,
as no interest is being paid on the current account by any public sector banks.
We suggest that he other public sector bank should follow IDBI.
It is high time that the bank service charges should be rationalized as it adds to the
cost of funds.
3. Securitization Act. 2002 :The Act was enacted to bring around defaulters/big fishes, but, unfortunately, the
banks have exploited clause 13(2) as limit was Rs. 1 lac and the banks issue 60
day's notices under 13(2). It is high time that limit should be raised to Rs.10 lacs
instead of Rs. One lac at present.
4. Representation of the Boards of Public Sector Banks/SIDBI:
The long standing demand of this vital sector has been that at least one/two non
official Directors of Public Sector Banks, who are real entrepreneurs having their
own units.
5. Grievance Redressal Mechanism:
At present, there is no grievance redressal mechanism for redressal of issues
relating to Banking sector.
It is suggested that a mechanism at par with Board for Industrial & Financial
reconstruction for Micro/Small Enterprises upto Rs. One crore.
6. SARFAESI Act. 2002:
The Act was actually meant for the corporates defaulting companies, wherein, the
NPA was higher than SSI Sector running to over lac crores. Corporates have the
option of going to BIFR.
As per section 31 (h) of the Act, the limit is one lac implying that even the Small
loans taken by Micro Enterprises after becoming NPA attract the provisions of this
act.
But, it is most unfortunate that the commercial Banks have exploited the stipulation &
issue 60 days notices to the Micro Enterprises u/s 13(b). The Act is detrimental to
the development & growth of Micro Sector. There is no distinction between willful
and non-willful defaulters. The Act puts onus entirely on the borrowers. The
sweeping powers given to the banks under this Act has a cascading effect on the
growth of the Micro Sector.
We suggest that the limit should be raised from Rs. One lac to Rs. 25 lacs. We
don't concur with the views of Finance Ministry that if MSE is excluded from the
purview of this Act, the lenders will be increased risk in lending to this sector. We
have instances wherein crores of the money has been sacrified by the Banks in
order to help the influential persons. The commercial Banks reject genuine cases
of Micro Enterprises, the Banks quote that their hands are tight.
There is no redressal mechanism for the Micro Enterprises. We suggest that the
mechanism should be evolved for Micro Enterprises at par with BIFR.
7. N.P.A. A/C
The MSE sector is considered to be a high risk area by commercial banks, which
means the sector's NPA must be high. Whereas the NPA MSEs sector were Rs.
20,067 crores in March, 2010, Rs. 21000 crores in March, 2011, Rs. 26000 crores
in March, 2012 and Rs. 31000 crores in March, 2013, as per RBIs statics.
Whereas, on the other hand, gross NPAs in other than MSEs sector stood at
.Rs.61,741 crores in March, 2010, which rose to Rs. 71,862 crores in March, 2011.
It went upto Rs. 1,10,000 crores in March, 2012, Rs. 1,52,000 crores in March,
2013. The NPAs rose to whopping Rs. 2,38,000 crores in 2014, as per reliable
sources.
Thus, it is evident that NPAs is much more than the NPAs of MSEs. It is
earnestly requested that the murmur of the banks of NPAs is Glister clear and they
are crying foul of NPAs of MSEs rather banks should control the NPAs of other
than MSEs sector.
8 Interest subvention:
We have been given to understand that the govt. is providing interest subvention
@2% upto 31.03.2010 to the Agriculture Sector.
The Govt. has further provided 2% interest subvention in the budget 2010-11 to
the Agriculture Sector. Thus, the agriculture sector is getting loan @5%.
Needless to mention that erstwhile SSI Sector now Micro Sector is the largest
employment generator next to Agriculture.
National Commission on Enterprises in the un-orqanised sector had submitted its
report on credit to Dr. Man Mohan Singh, then Hon'ble Prime Minister of India and
had demanded that the interest subvention should be provided to the Micro & the
rate of interest should be charged at par with Agriculture sector.
It is high time that the interest subvention of 4% should be provided to Micro
Sector in view of its enormous potential.
9. RoleofSIDBI:We have to reiterate that SIDBI was set up on 2.4.1990 as a Principal institution
exclusively for SSI, to cater to the needs of this vital sector of economy.
But, unfortunately, it has shifted its focus since 2005 on SMEs only and its logo is
'We empower SMEs, which is contrary to the interests of erstwhile SSI Sector now
Micro.
SIDBI was supposed to scale up and strengthen its credit operation for Micro
Enterprises, as per package dated 3.10.2007. It was supposed to cover 50 lacs
additional beneficiaries over 5 years new Micro Enterprises. SIDBI was also
supposed to provide directly or through its intermediaries demand based Small
loans to Micro Enterprises under a pilot scheme.
Budgetary allocations are made every year in the Budget. SIDBI must bear the
risk element / service charges, as has been done by SBI under CGST SME
Scheme.
It is suggested that Govt. should direct SIDBI to meet with the credit needs of
Micro Sector. It is also suggested that major portion should be earmarked for
Micro Sector for which SIDBI was set up in 1990.
10. CGTMSE Scheme:
It has been brought to our notice that credit guarantee fund trust for MSE was
mooted in 2000 and 27 banks had signed MOUs and SIDBI was the nodal agency.
The processing fee was stipulated to be 2.5%, which was reduced with the
passage of time. It was stipulated to charge interest on the balance as and on 31st
March, every year.
It was brought to our notice in the Advisory Committee meeting of RBI held at
Mumbai in Feb., 2012, which the undersigned attended that SBI has decided to
bear the processing fee. It is high time that other banks should also follow SBI, so
that the Micro Enterprises should not have to bear the additional cost ( processing
fee)
11. Separate Pre-Budget meeting:
We would like to draw your kind attention that separate pre-budget meeting were
being held with SSI Sector since 1991 by the Ministry of Finance in consultation
with Additional Secretary & DC (SSI).
But, unfortunately, Sh. P. Chitambram, Hon'ble Union Finance Minister, dispensed
with separate pre-budget with SSI and only representative of FASH and Laghu
Udyog Bharti were included with corporate sector, but in 2009 FOTSII was
represented along with FASH and Laghu Udyog Bharti and attended upto 2013.We
have been demanding that separate pre-budget meeting should be held with the
representative of MSMEs, but unfortunately not acceded to.
Thus, it is earnestly requested that separate pre-budget meeting with MSME
sectors should be held in the ensuing pre-budget meeting.
As a result of the investigations that 1 undertook, it was ascertained and
confirmed that during 1951, certain of the transactions, as recorded in the
books of the various Jute M i l l s Companies, Baling Companies and in the
books of McLeod & Co., Ltd., were irregular. Some of these
transactions were fictitious in that no actual transactions took place,
while in other cases, although there were actual transactions, the dates on
which they took place had not been cor rectly shown, thereby transfer-
ring profits by charging incorrect prices."-
According to the auditors, either some of the transactions were not
entered in the Company's Register of Contracts maintained under
section 91(a) of the Indian Companies Act, or false entries were made in
the books of account and provisions of the Indian Companies Act
contravened.
Fortunately, because of the keen interest taken by Mr A. J. Peppercorn, the
present Chairman of the Company, in reorganising its affairs, matters have
now been set right and the accounts of the managing agency firm and
of the industries under its control as shown now, represent the position
as it would have been, had the irregular transactions referred to by the
auditors never taken place. This is no doubt a satisfactory position
but the fact that a British firm of such a long standing and reputation
as that of McLeod & Co.. should also have stooped to practices which
have been associated generally with financiers who have captured a
number of industrial enterprises in this country in the post-war period
and used them to their own personal ends, augurs i l l for the future of
the managing agency system.
Sen-Raleigh Bicycle Factory to go into Production
HE Sen-Raleigh bicycle factory, to be formally declared open in
June at Kanyapur, near Asansol in West Bengal, has a capacity for
manufacturing 200.000 machines per year.
TIn the first stage the output target is fixed at 100,000 units and, with the
installation of machinery in the different " shops " all but complete, production is due
to begin in June, Some the small firm of Sen and Pandit was started w i t h a
capital of Rs 400 for the import of bicycles and parts. The firm crowned its long
association with Raleighs by jointly sponsoring with them the new enterprise, Sen-
Raleigh Industries of India Ltd. The authorised capital of the new company is Rs
1,00,00,000, half this amount being fully subscribed.A few miles out of Asansol. the
new township of Kanyapur site of the new factory is rapidly taking shape The
extensive (125,000 sq, ft) modern factory building and the neat, handsome living
quarters spreading out alongside will, from June, become the home of Sen-Raleigh
Industries. Workmen's quarters are in the blueprint stage, and building w i l l
commence soon. The administrative block which will house the offices of the con-
cern is under construction.
The factory, now fed with elect r i c i t y from a neighbouring colliery, w i l l
ultimately draw i t s power from the Darnodar Valley grid.
The Oil of Contention
HER AN reported last Monday that a five-year agreement had been
signed by Iran with an American firm for the sale of 3 million tons of
oil and aviation spirit annuall y . If the report is true, it w i l l mean not
only a breach in the year old Iranian oil blockade but also some friction
between the UK and the US. For, the blockade has at all been possible
because the US Government preferred not to embarrass its ally by
strengthening the bands of Dr Mossadeq, and despite his pilgrimage to
Washington, he could not drive a wedge between the two.
r
Dr Mossadeq's position became even less comfortable when the matter
was referred to the International Court, so that anybody buying Iranian oil
could be proceeded against legally by the Anglo-Iranian Oil Company, who
stil l claim the oil as their property. It is therefore not surprising that the
news of the deal should have caused a considerable flutter both in the
UK and in America. Britain has made her intention of suing anybody
receiving the " stolen " oil clear; and-unless The Hague Court decides in Iran's
favour, she can make nonsense of any agreement entered into by Iran. It
might even be that the International Court will itself declare the agreement
void, since the matter of ownership of the o i l is s ti l l sub judice.
To add to the complications, it is not clear whether any of the major oil
companies of the USA is involved in the deal. Should it be so, Britain's fight
to have the contract annulled w i l l not be easy. She will have to procure
the support of the State Department; and the State Department might find it
difficult to restrain openly a powerful o i l concern to satisfy Britain,
especially in an election year. If the Teheran report is true, Dr Mossadeq
will have added yet another factor straining the Anglo American trade
relations.
Japanese Reparations Plants
THE J a p a n e s e Reparations Agency recently announced that, under
a SCAP memorandum of March 1 8 , privately owned plants and
facilities in Japan, which had been designated for dismantl ing and
distribution as reparations would be released simultaneously w i t h the
coming into effect of the Japanese Peace Treaty, unless they were being
used by the Occupation Forces for producing materials essential for
the Korean war. Almost 900 " reparations" plants and facilities were
under the control and custody of the Occupation Authorities; 724 of them
were p r i vate property and 154 government property. Except for some 20
privately-owned plants and the state-owned plants that were being
used by the Occupation Forces (and would continue to be used by
the US Garrison Forces), all privately-owned reparations plants and faci-
lities would, in principle, be returned to the Japanese owners.
Moscow Conference
In Moscow economic conference issue it hs been spoken disparagingly of
the business deals concluded at the conference, on the ground that since
the delegates who handled them did not have governmental status.
Speaking of the trade agreements with which the British Delegation were
concerned, it is quite true that these were provisional in character;
In the sense that (like all trade agreements) they dealt with commodities
in general categories, and places stated in the agreements. But to call
them exploratory is quite an understatement. Acting on the British side
were Business representatives authorized to speak not only for their own
firms but also on behalf of others; and in the course of the negotiations at
Moscow a great deal of cabling took place between these representatives
and chambers of commerce in England, Whereby firms in England were
invited to take part in the trading offers that were the subject of
negotiation. After the end of the conference a large quantity of
samples(mainly clothing and textiles) was flown to Moscow. On the side of
countries like china, USSR, etc., the negotiators were of course,the
representatives of governmental import and export organizations.
From the last two lines of paragraph in question, your stress on the
exploratory nature of these talks seems likely to have arisen from a
misunderstanding which has been common in England as well as
elsewhere; namely that the commodities concerned were on the so-called
“ restricted list” , requiring specific governmental authorization. All
imports into Britain require of course a license. But the caes of soviet
purchases, at least these were to be paid out of sterling balances held by
the soviet Government London, and hence did not need to be matched by
equivalent sales in order to “clear” these transactions. It is true that each
trading agreement contained a clause to the effect that “ this agreement
and all contracts made in pursuance of it shall be subject to government
license wherever necessary on either side.But as Mr. Sidney Silverman,
M.P. (who was closely associated with the negotiations) said that he is
aware, none of the commodities referred to in the agreements, which
were all the subject of very hard bargaining, are on the restricted list.”It is
worth adding that the figure cited by Mr. Silverman in this letter as the
“global sum” of all the British agreements concluded and immediately
after was 56,500,000 Euros a far from negligible sum!
Memorandum
Before we express our views we would like to kindly accept our heartiest well
wishes on behalf of the 2300 MSME industrial unit's members. Our association
is one of the most leading reputed and prestigious one in Asia in a single trade
including exporters earning foreign exchange for the country. We are very much
oblidge for the patronage provided to the small scale industry by the
Government and have ample confidence that the Punjab Government will
continue to keep the welfare of the small scale units in future also. Further we
would like to have your sympathetic view on following points to protest the
reeling bicycle industry.
1. Regarding VAT refund:
The VAT refund of the members of the association is lying pending inspite of
repeated written and verbal requests though they have completed all the
formalities required by the Departments. Every time the members have been
given assurance by the departments that the refund will be released without
further loss of time but sorry to point out, that this cases remain pending with 1
pertax or the other, locking up previous working capital of the industry as it is
understood that the liquid cash is the need of the hour as the industry is already
reeling under global economics crisis. The department imposed condition that
the applicants should not be defaulter in this respect upto fourth stage of the
transaction between the buyer and seller which Is very cumbersome for the
members to prove themselves free of these conditions. So it humbly requested
to please abolish the fourth stage verification while deciding the VAT refund
cases of the units and release the VAT amount soon so that the industries can
run smoothly.
2. Vat on Bicycles:
Previously VAT on Bicycles costing less than Rs 3500/- was abolished in Delhi. Now
this year in Uttar Pradesh the Government has abolished VAT on the bicycles
costing upto Rs 3500/-. So it kind request to Punjab Government that please
remove the VAT on the Bicycles so that the sale of bicycle will grow here and the
economy of Punjab will rise. As Punjab (Ludhiana) is the hub of cycle manufacturer
but the rates here are more than Utter Pradesh and Delhi because of VAT, We
specially request you to reduce Vat on Bicycle Spare parts from 6.05% to 3.00%.
Regarding Mix Land Use Areas:
In the Ludhiana Master Plan more than 72 areas/pockets which have been
identified as Mix Land Use Zone where industry co-exist with the residential
activity. In order to develop these areas it is our humble request that Mix Land
use Zones be declared as "Industrial area" so that the units located in these areas
may get facilities and benefits as being provided to other industrial areas l,e