People's Education Society's Siddharth College of Commerce ...

People’s Education Society’s

Siddharth College of Commerce &

Economics, Mumbai

A One Day National Conference

On

'Intellectual Property Rights and GST'

Date of Conference: 22nd February, 2020

Published Edition: 22nd February, 2020

Organized by:

People’s Education Society’s

Siddharth College of Commerce & Economics, Mumbai

Published by: Aarhat Publication & Aarhat Journal’s

Mobile No: 9822307164/8355852142

Aarhat Multidisciplinary International Education

Research Journal (AMIERJ)

SJIF Impact Factor 6.236

Peer Reviewed Journal

ISSN 2278-5655,

Volume–IX Special Issue–I

EDITORS:

Disclaimer:

The views expressed herein are those of the authors. The editors, publishers and printers do not

guarantee the correctness of facts, and do not accept any liability with respect to the matter published in

the book. However editors and publishers can be informed about any error or omission for the sake of

improvement. All rights reserved.

All views expressed in the journal are those of the individual contributors. Any issues with reference to

the research paper, the individual author/s are responsible. The editor and Publisher are not responsible

for the statements made or the opinions expressed by the authors.

No part of the publication be reproduced, stored in a retrieval system or transmitted in any form or by

any means electronic, mechanical, photocopying, recording and or otherwise without the prior written

permission of the publisher and authors.

PREFACE

The Siddharth College of Commerce and Economics is delighted in presenting before you,

research papers on two themes viz. “Intellectual Property Rights and GST” at the National

Conference which is jointly organized by Siddharth College of Commerce and Economics in

association with the University of Mumbai,on 22nd February, 2020.

The modern economy is essentially a knowledge economy. When knowledge leads to income,

profits and growth, protecting knowledge becomes important. This can be done only if intellectual

property is protected. So, Intellectual Property Rights (IPR) is an increasingly important aspect of

any modern economy. In fact, protecting such rights and allowing the owners to commercially

exploit them, are the drivers of growth. This is why IPR is one of the themes of this National

Conference. Researchers have submitted papers on various issues related to IPR.

“One Country, One Tax” is the goal of GST which seeks to integrate the entire nation into a

common market in the true sense. The Government of India has an ambitious mission to have 360-

degree coverage to track payments of indirect taxes. GST is the second theme of this Conference

and researchers have submitted papers on a wide range of sub-themes like legal implications of

GST, Input Tax Credits, accounting procedures etc.

This conference proceeding is an outcome of the researchers, academicians and students who have

harnessed their creativity and exchanged their ideas, in order to broaden the horizons and explore

new research areas concerning IPR and GST. Students aiming for a career in research or in

academia learn that success depends not only on getting academic credentials but also on the

quality of their contributions to such events.

We take this opportunity to express our deep sense of gratitude to the University of Mumbai for

associating with our College in organizing this National Conference. We also express our gratitude

to all the Members of Advisory Committee, Editorial Committee for providing us with strong

support and encouragement for organizing this National Conference. We are obliged to all the

authors of research papers for their overwhelming response for the conference.

We extend special thanks to our patrons Mr. Anandraj Ambedkar (Chairman, P.E. Society and Mr.

V. M. Pradhan (Deputy Chairman, P. E. Society) for encouraging us in all our endeavours.

Dr. V. J. Bhandare Dr. U. M. Maske

(Co-ordinator) (I/C Principal)

MESSAGE

It gives me immense pleasure that the University of Mumbai is jointly organizing this One-Day

National Conference on “Intellectual Property Rights and GST” in Association with Siddharth

College of Commerce and Economics on Saturday, 22nd February, 2020.

This is a positive step by the College and seminars/conferences on both these contemporary topics

are the need of the times. Intellectual Property Rights (IPR) are now an increasingly important

factor in the growth of corporates, as well as nations. The introduction of GST has not only created

a dramatic change in the indirect tax system, but also changed the way commercial activities are

carried out in India. Events like this Conference will not only provide a platform to researchers in

these areas to present their work to a discerning and responsive audience, which will lead to fruitful

discussions and further research.

I wish the organisers of the Conference and the delegates all the best, in making this event

successful, as well as informative and thought-provoking.

22nd February, 2020 Dr. Ravindra Kulkarni

Mumbai Pro Vice Chancellor,

University of Mumbai

MESSAGE FROM THE CHAIRMAN

It gives me immense pleasure to share my views on the first National Conference on Intellectual

Property Rights and GST which is being hosted by our People’s Education Society’s, Siddharth

College of Commerce and Economics, situated in the heart of the Mumbai city, which is founded

in 1953 by India’s great educationist and social reformer, Bharat Ratna Dr. Babasaheb Ambedkar.

India, being one the rapidly developing Asian countries, youth empowerment through creativity,

innovation is a need of the hour. Therefore, properties created through individual’s intelligence

and creative minds needs to be protected through proper legislation. Similarly, young educated

minds need to be motivated for ethical practices in business and their employment for which IPR

is required to be protected and discussed among the budding entrepreneurs and students through

such conferences and seminars.

The earlier complex and multiple tax system were giving huge scope for tax evasion and corruption

to the companies and individuals. It was also pinching to consumers in a different manner. Hence,

introduction of Good and Services Tax by the government of India has made an entire tax structure

simple and business & consumers friendly. The present conference is indeed a wonderful step

initiated by the academicians of this great commerce college. I congratulate all the delegates,

organizing committee members and all the teachers and non-teaching staff of the college for their

wholehearted efforts for organizing this National Conference on Intellectual Property Rights and

GST.

Mr. Anandraj Ambedkar

(Chairman, People’s Education Society, Mumbai)

Patrons

Mr.Anandraj Ambedkar

Chairman- People’s Education Society

Mr.Vinayak Pradhan

Vice Chairman- People’s Education Society

Editorial Committee

Dr. U. M. Maske

(Conference Chairman)

Dr. S. S. Kamble

(Vice-Principal)

Dr. Latika Bonde

(Chairperson, WDC)

Prof. K. V. Thomas

(NAAC Steering Committee)

Prof. V. B. Peethala

(Head, Commerce Department)

Prof. S. D. Ovhal

(Head, Accountancy Department)

Dr. S. G. Thakur

(Chairman, IQAC)

Dr. V. J. Bhandare

(Conference Co-ordinator)

I

AMIERJ Volume–IX, Issues–I ISSN–2278-5655

Special Issues I

February 2020

SJIF Impact Factor 6.236 Peer Reviewed Journal

INDEX

Sr.No Title of the Research Paper Author Page No

1 GST: The Non-Cascading Effect Dr. Sameer G. Thakur 1

2 Impact of GST on Business of Beauty-Products With

Reference to Women Entrepreneurs

Dr. Darshana D.

Kadwadkar 6

3 GST And It’s Impact On Trade & Investment Dr. E. J. Jagtap &

Pradnya V.Dhamankar 8

4 A Study Of Impact Of GST On Real Estate

Transactions Under New Scheme (01-04-2019)

Dr. Prachi Avinash

Rode 13

5 Impact Of GST On SMEs

Dr.Balasaheb P.

Kamable & Mr. Vijay

Botalji

17

6

The Impact Of Goods And Service Tax (GST) On

Food Industry Under New Panvel Municipal

Corporation Area In Maharashtra

Mr. Kailas Dharma

Landge 21

7 GST And Its Impact On Various Business Sectors Ms. Kinjal Jishaan

Jain 26

8 Changes In Accounting Procedure Due To GST Mr. Murli N Rohra 30

9 Study On Change In Revenue Of Practicing Chartered

Accountant, Pre And Post Adoption Of GST.

Mr. Pawan Kumar

Sharma 35

10 An Empirical Study On General Awareness About

GST Among The Consumers Mr. Shahu D. Ovhal 40

11 Impact Of GST On Mutual Fund Distributors’

Commission

Dr. Janardan Hotkar

& CA Reshmi M.

Gurnani

46

12

The Impact Of Goods And Service Tax on Indian

Agriculture Trade

Ms. Sushma S. Ahire

& Dr. Shivanand

Suryawanshi

50

13 Comparative Advertising And Trademark Law:

Insights From Case Analyses

Ms. Alisha Francis

And Ms. Srishti

Yadav

54

14 A Study Of Impact Of GST On Personal Finance CA Neeta Vaidya 60

15 A Study On Role Of NABARD In Micro Finance And

Self Help Groups Dr. Raj Ankush Soshte 68

16 Goods And Services Tax Networking (GSTN) Dr. Suvaiba Pirani 74

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17 Impact Of GST On MSMEs Mr. Manohar Borkar 79

18 To Study: “Impact Of Goods And Service Tax On

Small And Medium Enterprises”

Ms.Sadhana Prakash

Ambre Chavan 83

19 Protection Of Movies Through Intellectual Property

Laws In India

Ms. Kavita N. Hedaoo

86

20 Taxes Subsumed Under Goods And Service Tax Ms.Shahnoor Sayyed 90

21 Study On Growth Rate Of Goods And Services Tax Ms. Maria Ruby 99

22 Increasing Grip Of Agricultural Patents Activity In

India Mr.Sonwane Rajesh S. 104

23 Impact Of Goods And Service Tax (GST) On Indian

Economy

Mr. Sohil Suleman

Jiwani 107

24 A Study Of The Role Played By Digitalisation In The

Investment Of Mutual Funds In Vasai Region CMA Alwin Menezes 110

25 Impact Of GST On Micro, Small And Medium

Enterprises In India

Mr. Gautam Dilip

Maske 115

26 Insight Into Reformation Of Municipal Taxes: The

Approach Of Bombay Municipal Act III Of 1888 Dr.Swapna H. Samel 119

27 Software Piracy And IPR Ms. Chhaya Pawaskar 123

28 Trademark Under The Pattern Act Dr. Rekha Vijay Gore 127

29 A Study on Awareness of Ipr Among The Teenagers

In Mumbai Colleges. Ms. Jyoti R. Singh 131

30 Intellectual Property Rights And Economic

Development Mr.Namdev Doke 138

31 An Empirical Study on Awareness About IPR Among

Post- Graduate Students Of Commerce

Mr. Pankaj Pittambar

Sarawade 141

32 Artificial Intelligence And Patents Ms. Poonam Shah 147

33 Comparative Advertising And Infringement Of

Trademark – Legal Perspective In India

Mr. Sagar Raghunath

Kotkar 152

34

Study Of Intellectual Property Rights (IPRS) As An

Economic Incentive That Stimulate Innovation And

Technological Progress Of A Country

Mr. Shashikant V.

Mundhe

156

35 A Study Of National Intellectual Property Rights Of

India Policy And Innovation

Dr. Usha Vishnu

Bhandare 161

36 Intellectual Property Rights And Pharmaceutical

Industry Ms. Vaishali Bankar 165

37 An Empirical Study On Intellectual Property

Rights And Its Importance For The Industry Dr. Vaishali Nadkarni 169

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February 2020


38 Ethical Issues Of Copyrights Regarding Book

Publishing, Research Papers And Articles

Mr. Vishal R.

Karanjavkar 173

39 Laws And Conventions Related To IPR In India

Adv. Deepak S.

Pagare 177

40 Awareness Of IPRS Among UG Commerce Learners:

A Study

Dr. Hema Pranav

Mehta 182

41 Impact Of Patent Law On Economic Growth Of India Dr. Rama

Dayashankar Varma 190

42 Intellectual Property Rights And The Indian

Pharmaceutical Industry Dr. Sunil Y. Gaikwad 195

43 TRIPS Agreement And Protection Of Intellectual

Property Rights

Dr. Vishnu J.

Bhandare 199

44 Examination Of Jurisdiction In Disputes Related To

Trade Marks And Copyright

Mr. Krishna Manhar

Mistry 204

45 Intellectual Property Rights & The Entertainment

Industry

Ms. Khushboo Ashok

Lala 208

46 Infringement Of Trademark by Comparative

Advertising

Ms. Qureshi Farzin &

Ms.Mandavkar Swati 212

47 IPR and Pharmaceuticals Companies In India Ms. Zakira R.

Matwankar 214

48 बौदधिक सपदा अदधिकाराच सवरप आदधि समसया डॉ. मरलीिर गायकवाड 220

49 Intellectual Property Rights Mr. Borse

Sanjaykumar 225

50 बौदधिक सपदा अदधिकारात समादधवषट असिारी नदधतक मलय डॉ. इ.ज.जगताप व क.वशाली जािव

235

51 Infringement Of Trademark By Comparative

Advertising Mrs. Gandhali C.

Abhyankar 239

52 Expectations on GST Compensation to the States and

Indian Fiscal Federalism Mr. Sachin D. Bansode 244

53 Impact Of GST On Residential Property Prices In

Mumbai CA Nishant U. Parikh 249

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February 2020


GST: THE NON-CASCADING EFFECT

Dr. Sameer G. Thakur

HoD, of Economics,

Siddharth College of Commerce and Economics

Abstract:

This paper discusses the GST and mainly focusses on the non-cascading effect. It first discusses the advantages

and disadvantages of GST. It then discusses the Input Tax Credit (ITC) and the compliance rating system and

shows how the non-cascading effect works. It then shows that the non-cascading effect is not necessarily

experienced by the final consumers. Finally it suggests changes, whereby end consumers may also benefit from

the GST.

Key-words: GST (Goods and Services Tax), ITC (Input Tax Credits), Compliance Rating, Non-Cascading Effect

I. Introduction

After the GST Roll-out, the system of doing business has undergone a change. This paper discusses different

aspects of the GST. It is divided into 7 sections, the first being the introduction. Section II outlines the major

advantages and disadvantages of the GST. Section III explains the system of Input Tax Credit and its

importance. Section IV is concerned with the compliance rating system and blacklisting of suppliers. Section III

and IV are taken from the Central Goods and Services Act, 2017. Section IV also explains the importance of the

blacklisting system in the general scheme of GST.

Section V explains the working of the non-cascading effect. It also shows how the non-cascading effect does not

exist for the end consumer. Section VI suggests possible solutions for the problem and section VII presents the

conclusions.

II. GST: Advantages and Disadvantages

Dani (2016) has outlined some pros and cons of the GST regime while Kumar and Sarkar (2016) have also

analysed various issues with the GST. These and some other advantages and disadvantages are given below.

Advantages of GST

1. Increased transparency.

2. Reduced number of indirect taxes.

3. Point of Consumption tax (not taxes at every point of supply chain) will create a common market.

4. Non-Cascading effect through Input Tax Credits (ITC).

5. It imposes no hidden cost to registered retailers. In fact, the cost of doing business will reduce.

6. Prices can come downwhich will benefit consumers and increase demand for companies.

7. Does not require a complex bifurcation of the total value of any sale or transaction into the value of goods and

value of services for purposes of taxation.

8. There can be a more equitable split of the tax burden between manufacturing and services.

Disadvantages of GST

1. Could adversely impact the real estate market.

2. Highest tax slab in the world at 28%.

3. Cess increased to 25% on luxury and hybrid cars.

4. Higher Service tax rate.

5. Non-cascading effect may not be felt by consumers.

6. Non-profiteering clause does not have 360 degree coverage.

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7. Tax neutrality issue has ensured that GST rates are much higher to compensate for reduced taxes. Dhanda

(2015) has discussed the revenue neutrality in detail. The fears of state governments are discussed in

www.gstindia.com/basics-of-gst-implementation-in-india/ (2015).

8. Complex compliance: Minimum 37 returns in a year.

9. Evasion by businesses: Splitting the business in the name of a family member.

10. Excise on existing stocks has already been paid.

III. Input Tax Credit (ITC)

Input Tax Credit allows one to reduce the tax already paid on inputs and pay the balance amount while paying

GST. If a manufacturer has to pay GST of Rs. 600, but GST of Rs. 350 has already been paid on the inputs

(purchases) by the suppliers. Then the manufacturer only has to pay the balance amount (600-350= Rs. 250) as

GST if ITC of Rs. 350 can be claimed.

A registered person can get ITC under GST, if and only if all the following conditions are fulfilled:

1. The dealer is in possession of tax invoice.

2. The said goods/services have been received.

3. He/she has filed returns.

4. The supplier has paid the amount claimed as ITC to the government.

5. ITC will be credited only after the last instalment of goods is received.

6. ITC cannot be claimed if depreciation on tax component of a capital good has already been claimed.

IV. Compliance Rating and Blacklisting of Suppliers

A Compliance Rating system has been introduced in the GST Act, 2017. Registered taxable persons will be

given a compliance rating (out of 10), based on the extent that they have complied with GST rules. This will

encourage honest dealers and dissuade the tax evaders and dealers indulging in frauds. The authorities will

regularly update these scores and inform the taxable person, as well as, make the information available in the

public domain.

Factors for calculation of Compliance Rating Scores

1. Making regular GST payments.

2. Filing GSTR-1 and GSTR-2 in time.

3. Transactions of outward supplies should match with those of inward supplies

4. Reconciliations should be transparent.

5. Co-operation with the authorities in all GST related matters.

Higher compliance ratings could give the holder certain privileges. But a low rating could lead to greater

surveillance, increase possibility of scrutiny assessment and even black-listing of dealers.

Factors leading to Black-Listing

1. Default for a continuous period of 3 months in paying ITC which has been reversed.

2. Default for a continuous period of 3 months in filing GSTR-1, GSTR-2 etc. or delayed uploading of sales

details which lead to reversal of ITC for others ( in excess of 3 months).

3. Short reporting of sales for a continuous period of 6 months beyond the permitted limit (5% of total sales)

4. Compliance ratings would be available in the public domain. This will provide information about less

compliant or black-listed persons/businesses to others. One would prefer to do business with a highly rated

person/business. Dealing with blacklisted persons/businesses could cause loss of input credit from purchases

from them.

http://www.gstindia.com/basics-of-gst-implementation-in-india/

https://cleartax.in/s/what-is-input-credit-and-how-to-claim-it/

https://cleartax.in/s/input-tax-credit-under-gst/

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V. Non-Cascading Effect

The most important advantage of the GST is the non-cascading effect. The ITC, Compliance ratings, GST

registration, and regular filing of returns are basically to ensure a non-cascading effect. In earlier taxes, there

would be tax on the entire amount at each stage of the production/transport process. The VAT allowed for

credits, but there was still a cascading effect for other indirect taxes. The following example shows the

difference between cascading and non-cascading effect.

Business A (in Gujarat) makes and sells a part to Business B (in Haryana). B uses it in assembly and sells his

product to dealer C (in Haryana) who sells it to D in Delhi. D uses it for further assembly and sells the finished

product to the consumer in Delhi. For simplicity, we have not used multiple manufacturing stages. Nor have we

introduced taxes like octroi which existed for entry into Mumbai. We have also not used lower basic selling

price, due to lower tax. The first table shows the taxation under the older system, while the second table shows

the taxes under GST. In reality, production/ supply chains are longer. The basic examples have been taken from

https://cleartax.in/s/cascading-effect-under-current-indirect-tax-regime under GST regime and modified to some

extent in Tables 1 and 2. Table 3in Section VI is developed by the author using Table 2.

Table1: Under the old system (With Cascading effect)

A B C D Total

Selling price (Basic) 5000 7000 9000 13000

Excise (12.5%) 625 NA NA NA

CST (2%) 112.5 NA 180 NA

VAT (5.5%) NA 385 NA 715

Selling price (with taxes) 5737.5 7385 9180 13715

Credit Available - - 385 -

Total tax paid to the authorities 737.5 385 0 715 1837.5 (14.13%)

Table 2: Under GST (With Non- Cascading effect)

A B C D Total


GST (12%) collected from the

buyers

600 840 1080 1560 4080(31.385%)

Selling price (with taxes) 5600 7840 10080 14560

Credit Available 0 600 840 1080

Total tax paid to the authorities 600 240 240 480 1560 (12%)

GST for Consumers

In the above example, total GST collected from buyers over all the stages is Rs. 4080. The original supplier A

collects Rs. 600, B collects Rs. 840, C collects Rs. 1080 and D collects Rs 1560. However, only Rs. 1560 is to

be paid to the authorities, due to the ITC credit of Rs. 600, Rs. 840 and Rs. 1080 enjoyed by Suppliers B, C and

D respectively. The sellers receive ITC. However, businesses may not pass on the benefits of ITC to the final

consumers. Consumers would have to complain about this to the authorities and get redressal from the Anti-

Profiteering body under Clause 171, if applicable. However, consumers may not know enough about the exact

costs, taxes etc. to complain. The body can take suo moto action, but tracking dealings with final consumers is

the blind spot of the GST, despite claims of360 degree coverage.

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Consider an example: Mc Donald’s buys its chicken from Venkateshwara Hatcheries and its buns from

Cremica. These companies pay GST and Mc Donald’s gets the ITC on the GST paid by them (before the

changes in GST rates for restaurants). Yet it charges full 18% GST on its price from the customers. Does Mc

Donald’s show 18% GST in its bills to customers, but pay a lesser amount to the government? Who would

investigate this? How would the Anti-Profiteering body realise any problem? Customers are not GST registered

persons who will claim any further ITC.

VI. Possible Solutions

1. Asking sellers to subtract the ITC (which can be assigned per unit of output sold)from the price:

Table 3: Comparison of GST rates and GST rates after ITC is subtracted for the end consumer

A B C D Total


GST (12%) collected from the

buyers

600 840 1080 1560 1560 (12%)

Price (with taxes) 5600 7840 10080 14560

Credit Available 0 600 840 1080

Total tax paid to the authorities 600 240 240 480 1560 (12%)

Selling Price (with taxes and

deduction of ITC)

5600 7240 9240 13480

However, this will only be possible, it the sellers are sure that they will not have to pay the full GST. So the

responsibility for paying GST should lie with every seller in the manufacturing chain for his/her liability of the

chain. If trader A does not pay GST on good X, then the Government should recover the dues from him and not

from Trader B who buys it and uses it in further production. Trader B’s liability should be his, but trader A’s

liability should not be recovered from him, if trader A acts dishonestly.

2. Income Tax Rebates on Expenditures:

If the government introduces a minor income tax rebate on bills of expenditures for all individuals, it would

increase the coverage of GST since there would be tracking from the consumers’ point of view also. Every

consumer would save bills and submit them with income tax returns in order to get the rebate. This would give a

true 360 degree view and complete coverage to the GST. The exact quantum of rebate would have to be decided

after careful consideration, but the concept is workable.

VII. Conclusion

In conclusion, I would say that the GST is a revolution in the indirect tax system in India. It will definitely

reduce evasion of indirect taxes and change the very nature of how business is carried out. However, end

consumers may get short-changed, despite the anti-profiteering clause. Possible solutions include asking sellers

to subtract the ITC received by them from the price and to introduce minor income tax rebates for individuals

who can show bills of all their expenditure to get the rebate. Such an incentive would improve the surveillance

as well as ensure that consumers do not get short-changed by profiteering businesses.

References:

1. Dani, S. (2016) “A Research Paper on an Impact of Goods and Service Tax (GST) on Indian Economy”

Business and Economics Journal, Vol. 7, issue 4, pp. 1-2.

2. Kumar, P. and Sarkar, S. S. (2016) “Goods and Service Tax in India: Problems and Prospects” Asian Journal

of Management Research, Volume 6 Issue 3, pp. 504-513

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3. Sehrawat M., Dhanda, U.(2015)“GST in India: A Key Tax Reform” International Journal of Research-

Granthalaayah, Vol.3 (Iss.12): December, pp.133-141.

4. (April 14, 2015) “Basics of GST Implementation in India” Retrieved from www.gstindia.com/basics-of-gst-

implementation-in-india/

5. Ministry of Law and Justice, (Legislative Department) (April, 12, 2017) “The Central Goods and Services

Tax Act, 2017” The Gazette of India Retrieved from

http://gstcouncil.gov.in/sites/default/files/CGST.pdf

6. (July 25, 2017) Simplification of Indirect Taxes under GST Regime Retrieved from

https://cleartax.in/s/cascading-effect-under-current-indirect-tax-regime



http://gstcouncil.gov.in/sites/default/files/CGST.pdf%206

http://gstcouncil.gov.in/sites/default/files/CGST.pdf%206

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IMPACT OF GST ON BUSINESS OF BEAUTY-PRODUCTS WITH REFERENCE

TO WOMEN ENTREPRENEURS

Dr. Darshana D. Kadwadkar

K.B. College of Arts and Commerce, Thane (E)

Abstract:

GST aims to create “One Country One Tax One Market” by removing economic barriers between states. It will

eliminate the present complex multi-layered indirect taxation system, making it possible for manufacturers to

produce in one state and supply seamlessly across states without barriers.

Due to the development of new policies, programmes and even projects, the status of women has totally been

changed as they provide assistance to the low income women. This concern for low-income women’s needs has

coincided historically with recognition of their important role in development.

Keywords: Women empowerment, Economic Policy, GST etc.

Introduction:

The Goods and Services Tax (GST) was implemented in India to make the country a unified common national

market. Under GST, all products and services are classified under only four tax slabs nationally, a shift from the

earlier scenario of numerous tax brackets in different states. Implementation of GST would result in

consumption of some products taking a hit in the short term due to higher GST rates, while consumption of

products with comparatively lower GST rates are expected to pick up.

Pricier alternatives to necessity products and discretionary products such as body wash/shower gel, facial

moisturisers, eye make-up, deodorants pumps, colourants and styling agents which are generally consumed by

urban consumers have higher price sensitivity, hence will be impacted by even marginal price hikes due to

higher taxes under GST.

Indian society is mostly male controlled. Women were not allowed to think freely and could never identify an

independent identity within or outside the family. It is a common thing to observe that women are unable to

complete their studies or do not get proper jobs or lack in skills, which lead to their declining financial

condition, they are dependent on others or they are unable to support their families. So many women

entrepreneurs engaged in beauty product business. They run parlours in their home place or the separate

parlours. But due to the hike in tax rate it may be disturbed at some extent. Many women who are dealing with

this kind of business finding difficult to manage their customers. E.g. suppose before GST one has to pay Rs. 40

and now they have to pay Rs. 52 it means client can think before going for threading. This will make a pinch to

the customers.

Rationale of the study:

The rationale behind the present research study is to study the impact of GST on women SHGs business

especially in beauty-care products.

Need of the study:

In today’s world there is a need to study logically women empowerment schemes. Then through this research

find out the reasons behind that through various problems and suggest some remedial measures to reduce such

problems.

Research Methodology:

Primary Sources:

Personal Interview, Questionnaires, Discussion with women respondents.

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Secondary Sources:

Secondary data is collected through various sources like Books, Journals, Newspapers, Websites, Research

studies etc.

Data processing

Data Analysis:

The data is critically analysed and information collected from primary sources as well as from published sources

were made keeping the objectives of the study in mind.

Findings of the study:

1. Oral care products such as toothpastes and toothbrushes have been classified as necessity products under GST

and tax rate have been fixed at 18% from previous 28%.

2. This move is expected to boost consumption of toothpastes by an additional 1.6 million litres and toothbrush

consumption expected to increase by additional 6.5 million units in 2018.

3. Many women who deal with beauty product business could suffer due to GST as they lack presence in the

lucrative and now cheaper, hair oils category, where local companies reign.

4. In order to capitalise on lower tax for hair oils, women who deal with the beauty product business could look

to tap into the premium segment of this market by targeting urban consumers with oils formulated from

sophisticated ingredients.

5. Before GST, makeup artistes used to charge 15% service tax and now GST is 18%. However, now the tax is

being nullified as clients insist on cash dealing. With a tax on services is going up to 18% and 28%

cosmetics, beauty salons are also struggling to maintain their customers.

Conclusion:

According to industry reports, most of the companies in the Indian Business industry do not have natural

exposure or access to information of updated GST tax structure or its benefits in a user-friendly way. This lack

of data has left many salon owners incapable of taking advantages of the tax scheme available for them. Another

factor is that the contributions to their woes lies in the fact that salon owners are ending up with the increases in

the tax his from 125 to 28% on their cost of goods just with the limited understanding of the system, by not

collecting GST on their sold services.

References:

1. https://www.momspresso.com/parenting/mrbb-diary/article/role-of-gst-on-beauty-products

2.https://economictimes.indiatimes.com/small-biz/policy-trends/gst-impact-on-fmcg-beneficial-but-contentious-

issues-remain/articleshow/64504831.cms?from=mdr

3. https://www.euromonitor.com/impact-of-the-2017-goods-and-services-tax-gst-on-beauty-and-personal-care-

in-india/report

https://www.momspresso.com/parenting/mrbb-diary/article/role-of-gst-on-beauty-products

https://economictimes.indiatimes.com/small-biz/policy-trends/gst-impact-on-fmcg-beneficial-but-contentious-issues-remain/articleshow/64504831.cms?from=mdr

https://economictimes.indiatimes.com/small-biz/policy-trends/gst-impact-on-fmcg-beneficial-but-contentious-issues-remain/articleshow/64504831.cms?from=mdr

https://www.euromonitor.com/impact-of-the-2017-goods-and-services-tax-gst-on-beauty-and-personal-care-in-india/report

https://www.euromonitor.com/impact-of-the-2017-goods-and-services-tax-gst-on-beauty-and-personal-care-in-india/report

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GST AND IT’S IMPACT ON TRADE & INVESTMENT

Dr. E. J. Jagtap Pradnya V. Dhamankar

Research Centre - Annasaheb Magar College, Hadapsar, Pune 411028.

Abstract :

For any country, policies of tax perform a substantial role on the economy through their influence on both

competence and impartiality. An effective tax system should keep in view issues of income circulation and also

attempt to produce tax incomes to sustain government spending. Cascading tax revenues have differential

impacts on firms in the economy with comparatively high burden on those not getting full offsets.

A developing economy like must practice taxation policies that maximize its economic competence and reduce

biases and obstacles to efficient allocation of resources, specialization, capital formation and international

trade.

GST - instituted on the belief of “One Nation, One Market, One Tax” is the single biggest indirect tax reform. It

has been enforced, dismantling all the inter-state barriers with respect to trade. The GST rollout attempts to

convert India into a unified market of 1.3 billion citizens. Fundamentally, the economy is attempting to do away

with internal tax barriers and subsuming central, state and local taxes into a merged GST.

The rollout has renewed the hope of India’s financial reform program regaining momentum and widening the

economy. Then again, there are fears of disruption, embedded in what’s perceived as a rushed transition. While

GST is supposed to improve business in theory, ground realities, as we all know, vary. This paper tries to

analyse how the GST has really impacted India.

Keywords: Goods and Services Tax, Value Added Tax , Central State Tax, Central Goods & Services Tax, State

Goods & Services Tax, Interstate Goods & Services Tax, revenue neutral rate.

Introduction :

Before GST, there were many indirect taxes imposed by both state and centre. States mainly collected taxes in

the form of Value Added Tax (VAT), wherein every state had a different set of rules and regulations. Interstate

sale of goods was taxed by the Centre. CST (Central State Tax) was applicable in case of interstate sale of

goods.

Apart from VAT & CST, there were many indirect taxes like Central Excise Duty, Duties of Excise, Additional

Duties of Excise, Additional Duties of Customs, Special Additional Duty of Customs, Cess, State VAT, Central

Sales Tax, Purchase Tax, Luxury Tax, Entertainment Tax, Entry Tax, Taxes on advertisements, Taxes on

lotteries, betting, and gambling, octroi, local tax that was imposed by state and centre. This led to tax on a tax,

which is called the cascading effect of taxes.

GST has replaced most Indirect Taxes in India. The GST Act was passed on 29th March 2017 and came into

effect on 1st July 2017. The GST Law in India is a comprehensive, multi-stage, destination-based tax that is

levied on every value addition.

GST mainly technologically driven. All activities like registration, returns filing, application for refund and

response to notice needs to be done online on the GST Portal; this accelerates the processes. GST has mainly

removed the Cascading effect on the sale of goods and services. Removal of cascading effect has impacted the

cost of goods. Since the GST regime eliminates the tax on tax, the cost of goods decreases.

However, the chargeability of GST for Inter-state purchase at a concessional rate of 2%, by issue and utilisation

of c-Form is still prevalent for certain Non-GST goods such as Petroleum crude; High-speed diesel; Motor spirit

(commonly known as petrol); Natural gas; Aviation turbine fuel; and Alcoholic liquor for human consumption,

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in respect of following transactions only: Resale; Use in manufacturing or processing; Use in the

telecommunication network or in mining or in the generation or distribution of electricity or any other power

There are 3 taxes applicable under this system: CGST, SGST & IGST.

CGST: Collected by the Central Government on an intra-state sale (Eg: transaction happening within

Maharashtra)

SGST: Collected by the State Government on an intra-state sale (Eg: transaction happening within

Maharashtra)

IGST: Collected by the Central Government for inter-state sale (Eg: Maharashtra to Tamil Nadu)

Goods and services are divided into five different tax slabs for collection of tax - 0%, 5%, 12%, 18% and 28%.

However, petroleum products, alcoholic drinks and electricity are not taxed under GST and instead are taxed

separately by the individual state governments, as per the previous tax system.

There is a special rate of 0.25% on rough precious and semi-precious stones and 3% on gold. In addition

a cess of 22% or other rates on top of 28% GST applies on few items like aerated drinks, luxury cars and

tobacco products. Pre-GST, the statutory tax rate for most goods was about 26.5%, Post-GST, most goods are

expected to be in the 18% tax range.

Objectives of Study :

The objective of this research paper is to understand the GST & its impact on India’s Foreign Trade &

Investments.

Research Methodology :

This study is based on secondary data. The data is collected from different newspapers, articles in magazines

and websites. The study is exploratory in nature.

Findings & Discussions :

The GST opens up more opportunities for doing business in India, as the business-operation environment will

be enhanced in the following aspects:

Removing cascading tax effect

Higher threshold for registration

Online procedure for GST

Lesser compliances

Increased efficiency in logistics

Regulating the unorganized sector

An introduction of GST would change the way of doing business in India and would have significant impact on

international trade of goods through the change in customs duty computation, possible withdrawal of various

duty exemptions and change in terms of the foreign trade policy (‘FTP’).

Table 1 : GST rates in High Income Countries and Emerging Economies

https://cleartax.in/s/what-is-sgst-cgst-igst

https://en.wikipedia.org/wiki/Gold

https://en.wikipedia.org/wiki/Cess

https://en.wikipedia.org/wiki/Luxury_cars

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In the past, countries (like Malaysia and New Zealand) which have opted for GST have faced high inflation and

slowdown in consumption initially. Whether history will be repeated in India depends on a host of factors, the

most important being the standard rate of GST finally agreed upon. (Refer Table 1)

From the viewpoint of the consumer, they would now have pay more tax for most of the goods and services they

consume. The majority of everyday consumables now draw the same or a slightly higher rate of tax.

Furthermore, the GST implementation has a cost of compliance attached to it. It seems that this cost of

compliance will be prohibitive and high for the small scale manufacturers and traders, who have protested

against the same. They may end up pricing their goods at higher rates.

1. What the Future Looks Like -

Talking about the long-term benefits, it is expected that GST would not just mean a lower rate of taxes, but also

minimum tax slabs. Countries where the Goods and Service Tax has helped in reforming the economy, apply

only 2 or 3 rates – one being the mean rate, a lower rate for essential commodities, and a higher tax rate for the

luxurious commodities.

Currently, in India, we have 5 slabs, with as many as 3 rates – an integrated rate, a central rate, and a state rate.

In addition to these, cess is also levied. The fear of losing out on revenue has kept the government from

gambling on fewer or lower rates. This is very unlikely to see a shift anytime soon; though the government has

said that rates may be revisited once the RNR (revenue neutral rate) is reached.

The impact of GST on macroeconomic indicators is likely to be very positive in the medium-term. Inflation

would be reduced as the cascading (tax on tax) effect of taxes would be eliminated. The revenue from the taxes

for the government is very likely to increase with an extended tax net, and the fiscal deficit is expected to

remain under the checks. Moreover, exports would grow, while FDI (Foreign Direct Investment) would also

increase. The industry leaders believe that the country would climb several ladders in the ease of doing business

with the implementation of the most important tax reform ever in the history of the country.

Briefed below Impact of GST on few areas related to foreign trade

Business made easy –

The country has become one common market. There will be a very strong positive impact on the logistics

sector. The serpentine queues of goods vehicles standing at inter-state check posts for inspection and payment of

taxes will reduce. GST will revolutionise logistics, lower inventories and working capital, reduce

documentation, improve asset utilisation, ensure higher turnaround time and efficiencies.

Exports to climb –

With uniform taxation and cost efficiencies owing to reduced time and costs in transportation, one obvious

effect would be that ‘Made in India’ products would now be more cost competitive in the global markets. In the

previous tax regime, indigenous manufacturers failed to capitalise owing to cascading taxes.

Fate of Foreign Trade Policy Schemes –

A bigger cause of worry is that exporters, who are allowed to claim refunds on certain taxes may face problems

in encashing the export incentives.

The pre-GST regime provides for low or no Customs Duty on imports used in producing export-orienteed

goods. Under GST, imports would be subject to IGST (CGST plus SGST) and any exemptions or additional

levy will not exist. This would provide level-playing field to domestic manufacturers against importers.

In case of special economic zones (SEZs), the various exemptions provided under different schemes would be

limited in their applicability to export duty only. Exports or deemed exports would be zero rated, but sale to

domestic tariff area (DTA) would be taxable. Exports from these special zones though will becomer more cost

competitive, owing to reduced logistics costs.

https://cleartax.in/s/gst-rates

https://cleartax.in/s/rnr-and-rates-under-gst

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Custom Duties

The Constitutional Amendment Bill prescribes that import of goods into the territory of India would be deemed

to be an inter-state supply, thereby triggering levy of IGST.

This has also been incorporated in the Model GST (IGST) Law. As a consequence, the computation of customs

duty under the GST regime would have two components, ie, basic customs duty and IGST.

The proposed levy of IGST would subsume the current levy of countervailing duty (‘CVD’) and additional duty

of customs (‘SAD’).

The levy of IGST is likely to be collected by the Customs at the time of import into India and should be payable

for each transaction, as against the monthly payment in case of IGST payable on domestic transactions.

The importer is likely to report the import transactions and IGST paid on such imports in its monthly returns.

Currently, the import related information is captured in multiple returns, where VAT return captures the import

purchases while the excise/ service return captures the credit taken on countervailing duties paid on imported

goods.

All this information should form part of the IGST return. The customs function of companies/ importers will

need to be integrated with the tax function, while thus far, the integration of the customs and tax function was

limited to availment of credit of the custom duties. However, under the GST regime, the integration should be

more than mere credit linkage; for instance, classification for customs purposes may also apply for GST law as

well.

As per the Model GST Law, the GST should be payable on the transaction value of imported goods plus any

duties/ taxes, etc, levied under any statute other than the GST laws. This should mean that while paying IGST

on the imported goods, basic customs duty (‘BCD’) should be added to the transaction value of the imported

goods.

On the Fast Lane -

GST has the potential to revolutionize the logistics industry. India’s trucking and logistics sector will realize its

worth once GST is implemented at the ground level. Experts believe that the tax procedure will get reduced

dramatically and the cost of holding inventory will fall by 50%, since stock would no longer need to be piled up

in various warehouses. Analysts estimate that the logistics sector will witness up to $200 billion in savings

annually with GST, thanks to faster movement of goods and minimum idling, which have troubled the industry

for long now.

Explaining the issue of idling, Harpreet Singh Malhotra, CMD, Tiger Logistics says, “Prolonged delays at toll

booths and extra fuel usage due to regular idling were resulting in annual losses of more than Rs.1,00,000 crore.

Criticism –

Technicalities of GST implementation in India have been criticized by global financial institutions/industries,

sections of Indian media and opposition political parties in India. World Bank's 2018 version of India

Development Update described India's version of GST as too complex, noticing various flaws compared to GST

systems prevalent in other countries; most significantly, the second highest tax rate among a sample of 115

countries at 28%.

GST's implementation in India has been further criticized by Indian businessmen for problems including tax

refund delays and too much documentation and administrative effort needed. According to a partner at PwC

India, when the first GST returns were filed in August 2017, the system crashed under the weight of filings.

Conclusion –

On priority, it is up to the government to address the capacity building amongst the lesser-endowed

participants, such as the small-scale manufacturers and traders.

https://en.wikipedia.org/wiki/World_Bank

https://en.wikipedia.org/wiki/PricewaterhouseCoopers

https://en.wikipedia.org/wiki/PricewaterhouseCoopers

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Ways have to be found for lowering the overall compliance cost, and necessary changes may have to be

made for the good of the masses. GST will become good and simple, only when the entire country

works as a whole towards making it successful.

GST would be positive for certain sectors while negative for others.

However, only time will tell whether the forecast made in the paper will actually become reality or not.

Bibliography –

Goods & Services Tax GST ( India ) What is GST ? Indirect Tax Law Explained - Jan 17, 2020 – 11:39:58 AM

Cleartax

Goods and Services Tax ( India ) – Wikipedia

Impact of GST on the Indian Economy Updated on Nov 28, 2019

GST and Indian trade Updated: 28 Sep 2016, Pravin Krishna

What Effect Will the GST have on Business? R Jayaraman , Mon, 2016-09-26.

Goods and Services Tax: How will it impact Foreign Direct Investments strategy in India? Pratima Singh.

"All your queries on GST answered". The Hindu. Retrieved 30 June 2017.

"Goods and Services Tax: History of India's biggest tax reform and people who made it possible", India TV, 29

June 2017

"GST: Meet the men behind India's biggest tax reform that's been in making for 17 years", India Today, 29 June

2017.

"What is GST, how is it different from now: Decoding the indirect tax regime", Business Standard, 17 April

2017, retrieved 18 August 2019.

"About Us – GSTN". gstn.org. Retrieved 6 February 2018.

https://www.livemint.com/Search/Link/Author/Pravin%20Krishna

http://www.thehindu.com/news/resources/all-your-queries-on-gst-answered/article14585151.ece1

http://www.indiatvnews.com/business/india-goods-and-services-tax-history-of-india-s-biggest-tax-reform-and-people-who-made-it-possible-388702

https://en.wikipedia.org/wiki/India_TV

http://indiatoday.intoday.in/story/goods-and-services-gst-reformers-Atal-Bihari-Asim-Dasgupta-Chidambaram-Arun-Jaitley/1/989930.html

https://en.wikipedia.org/wiki/India_Today

http://www.business-standard.com/article/economy-policy/what-is-gst-how-is-it-different-from-now-decoding-the-indirect-tax-regime-117041700033_1.html

https://en.wikipedia.org/wiki/Business_Standard

http://www.gstn.org/about-us/

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A STUDY OF IMPACT OF GST ON REAL ESTATE TRANSACTIONS UNDER NEW

SCHEME (01-04-2019)

Dr. Prachi Avinash Rode

Associate Professor,

Department of Commerce Santaji Mahavidyalaya, Nagpur

ABSTRACT

Taxation of Real Estate Transactions has always been a problematic issue. The major reason is that the real

estate sector is still unorganized. The complications started after introduction of State tax on works contract.

The problem aggravated after introduction of Service tax on works contract. The tax regime before the

introduction of GST stated that buyers had to pay State Tax (VAT), Service tax, Registration charges & Stamp

duty mostly on the purchase of properties that are currently under construction. VAT, Registration charges &

Stamp duty all came under taxes that were state levied and eventually, prices of real estate differed from state to

state. It wasn’t only the buyer that these taxes impacted in the process. Developers also had to compensate for

duties like sales tax (CST), customs duty, OCTROI, etc. Input Tax Credit was however not available in these

circumstances. The State tax and Service tax were merged on introduction of GST w.e.f. 01-07-2017. However,

many issues were still unresolved. Hence, the Goods and Services Tax structure on real estate transactions

relating to residential and commercial apartments has been thoroughly altered w.e.f. 01-04-2019.

KEYWORDS:GST, Real Estate Transactions, Input Tax Credit.

INTRODUCTION

The world has moved towards common Goods and Services Tax (GST) a long time ago. However, as far as

India is concerned, GST is the tax for 21st century. India has moved to GST on 01-07-2017. It is a one way

street – now there is no going back. We have to face the challenges of GST. There is no other way.

Tax on real estate transactions has always been a complex and a litigation prone issue. The issue was more

complex prior to 01-07-2017 as there were two taxes – one State sales tax on goods portion and Services tax on

service portion of the works contracts. This distinction has been abolished w.e.f. 01-07-2017 and now there is

only one tax i.e. GST on real estate transactions.

However, the complexity continues w.r.t. real estate transactions. Hence, in case of real estate projects, a new

scheme has been devised and introduced w.e.f. 01-04-2019. The new scheme is comparatively simple to

operate. However, the new scheme does away with the concept of Input Tax Credit (ITC) in respect of real

estate projects. Thus, in principle, the scheme is against the basic concept of GST law which is based on

allowing ITC of GST paid on inputs to avoid cascading effect of taxes.

Though the scheme is simple, there are still many issues relating to ITC on ongoing projects, reversal of ITC,

taxability of Development Rights, reverse charge mechanism etc. and this paper addresses some of these issues.

OBJECTIVES OF STUDY

1. To study the impact of GST on real estate projects.

2. To study the impact of changes made to the GST law w.e.f. 01-04-2019 w.r.t. real estate projects.

RESEARCH METHODOLOGY

The research paper is based on secondary data sourced from GST Act, Rules and Regulations, Notifications,

Circulars and Clarifications and FAQ’s issued by the Government. Journals, Research papers, Books, Websites

and Articles have also been referred.

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LIMITATIONS

The study is based on secondary data which may have its inherent limitations.

Real Estate Transactions:

To better understand the impact of GST on Real Estate Transactions the taxability scenario before and after 01-

04-2019 for residential buyers is presented below in tabular form followed by its impact.

Real Estate Transactions under GST (Before and after 1stApril, 2019) (Comparison of Taxability)

Particulars

On or Before 31/03/2019 On or After 01/04/2019

Residential

Buyers (Other

than

Affordable

Housing

Scheme)

Residential

Buyers

(Affordable

Housing

Scheme)

Residential

Buyers (Other

than Affordable

Housing

Scheme)

Residential

Buyers

(Affordable

Housing

Scheme)

Effective rate of GST 12% 8% 5% 1%

Whether ITC available Yes Yes No No

Cost of Land (A) 25.00 25.00 25.00 25.00

Cost of Construction (B) 14.40 14.40 14.40 14.40

GST on Inputs (at the rate of 18%)

(C)

2.60 2.60 2.60 2.60

ITC Available (D) (2.60) (2.60) Nil Nil

Total cost to the Builder (E) 39.40 39.40 42.00 42.00

Profit Margin (F) 0.79 0.79 0.84 0.84

Sale Price of Flat (G= E+F) 40.19 40.19 42.83 42.83

GST on Sale Price of Flat (H=

G*Effective Rate)

4.82 3.22 2.14 0.43

NET Cost to the Buyer (G+H) 45.01 43.41 44.97 43.27

From the above comparison we observe, that, Net cost to the buyer decreases in the new scheme. It is mainly

due to decrease in the GST rate.

Impact of GST on Real Estate Transactions

(i) No GST is payable where the entire consideration is received after issuance of completion certificate,

where required by the competent authority or after its 1St occupation, whichever is earlier. The scenario

was same in pre-GST era. The impact of this provision will be that, there will be higher demand for

completed properties in comparison to under construction properties. As a result, the promoters’

dependency on the advance amounts received from buyers will decrease and dependency on

own/borrowed funds will increase.

(ii) As per new scheme all cement must be purchased from registered supplier only. If not so done, the

promoter is required to pay GST @ 28% under reverse charge (even if total value of supplies received

from unregistered suppliers is less than 80%). The impact of this provision will be regularization of

cement as well as real estate industry and increase in transparency in the transactions leading to less

evasion of taxes.

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(iii) As per the new scheme, after considering payment of GST on cement under reverse charge, at least 80%

of procurement of inputs and input services (except a few) used in supplying the real estate project service

shall be received from registered suppliers only. If not so done, then GST @ 18% is payable on the value

to the extent of the shortfall at the end of the financial year. The impact of this provision shall be

regularization of real estate industry and increase in the transparency of transactions leading to less

evasion of taxes.

(iv) As per new scheme, in case of capital goods procured from unregistered person, the promoter is liable to

pay GST under reverse charge. The impact of this provision shall be regularization of real estate and

heavy equipments industry and increase in the transparency of transactions leading to less evasion of

taxes.

(v) As per new scheme, all accounts are to be maintained project-wise. Each project can be treated differently

e.g. for some projects, promoter may opt for 1%/5% scheme and for some projects 8%/12% scheme. The

promoter may opt for different scheme even within the same building. The impact of this provision will

be better costing of the real estate projects thereby resulting in better pricing of the real estate projects.

(vi) As per new scheme, in case of commercial apartments constructed in residential real estate projects,

where carpet area of commercial apartments is not more than 15% of the total carpet area of real estate

project, then concessional GST rate of 5% applies (without ITC). In case of commercial apartments

constructed in real estate projects other than residential real estate projects, there is no concession and

GST rate of 12% applies (with ITC). The impact of this provision will be better utilization of carpet area

and better pricing to the buyers.

(vii) Works contract as defined in section 2(119) of CGST Act is ‘supply of service’ – para 6(a) of Schedule II

of CGST Act.

1. A tax on the transfer of property in goods (whether as goods or in some other form) involved in the

execution of works contract is deemed sale of goods under Article 366(29A) of constitution of India.

2. Thus, the Constitution states that ‘works contract’ is deemed sale of goods, while GST Law states that it

is supply of services.

3. This may lead to litigations and impact the issues like rate, place of supply, time of supply etc.

(viii) As per GST Law, leasing or renting of land and building are ‘supply of services’.

a. Leasing of residential building for purpose of business will attract GST @ 18%.

b. Leasing of residential building for purpose other than of business will not attract GST.

c. Leasing of non-residential building for any purpose will attract GST @ 18%.

d. Renting or leasing of vacant land with or without structure incidental to its use for agricultural

produce is exempt.

e. Renting of precincts of a religious place meant for general public, owned by charitable or religious

trust is exempt from GST.

f. In case of service of renting of immovable property supplied by government to a person registered

under GST Act, such other person is liable to pay GST under reverse charge.

4. There is no change in the provisions of GST Act w.r.t supply of service of renting of immovable property.

Hence, there is no change in its impact as such.

Conclusion:

The revised scheme of tax on real estate projects is comparatively simple, though against the basic concept of

GST of Input Tax Credit to avoid cascading effect of taxes.

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As the rates of GST have reduced in the new scheme, there will be pressure from buyers on promoters to lower

prices. However, one should understand that, the reduced GST rates have come at the cost of restriction on

utilization of ITC.

However, many issues are yet to be resolved. The government needs to address such issues in the near future by

taking all the stakeholders into confidence. This will truly make GST, one nation, one tax.

SUGGESTIONS

1. As of now, mode of calculation of GST on transferable development rights as given in Sr. No. 41 and 41B

of Notification No. 12/2017-CT(Rate) dated 28-06-2017 is unworkable as per the provisions presently

worded, though principle can be understood. The government needs to issue clarification on the same.

2. As per the current provisions, if land-owner promoter makes sale of apartments independently before

completion certificate, the person is required to charge GST. However, the person can take ITC of GST

charged by promoter developer. However, there is time mismatch as the liability of land-owner to pay GST

arises first while liability of promoter builder to charge and pay GST arises later. Thus, the land owner may

not be able to utilize credit of GST charged by promoter developer. The government needs to issue

clarification on the same.

REFERENCES

Taxmann’s, GST on Works Contract & Real Estate Transactions by V.S. Datey, 3rd Edition, 2020.

Research Paper - A Study of Impact GST on Real Estate Sector in India, by Rajkumar Kankariya and Dr. Anil

Dongre, published in Volume 9, Special Issue, March 2019, 6th National Conference on Technology and

Innovation: Disrupting Businesses, Transforming Market; G H Raisoni Institute of Business

Management, Jalgaon, India.

F. No. 354/32/2019-TRU, Government of India, Ministry of Finance, Department of Revenue, (Tax Research

Unit), FAQs on real estate- reg., dated the 7th May, 2019, New Delhi.

Impact of GST - Real Estate, https://www.pwc.in/assets/pdfs/trs/indirect-tax/sectoral-updates/impact-of-gst-

real-estate-sector.pdf

https://taxguru.in/goods-and-service-tax/gst-real-estate-ready-reckoner.html

https://www.pwc.in/assets/pdfs/trs/indirect-tax/sectoral-updates/impact-of-gst-real-estate-sector.pdf

https://www.pwc.in/assets/pdfs/trs/indirect-tax/sectoral-updates/impact-of-gst-real-estate-sector.pdf

https://taxguru.in/goods-and-service-tax/gst-real-estate-ready-reckoner.html

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IMPACT OF GST ON SME

Mr. Dr.Balasaheb P.Kamable Mr. Vijay Botalji

Asst. Prof. Department of Accountancy, Asst. Prof. Department of Accountanc y,

Elphinstone Government College, Mumbai K.P.B. Hinduja College, Churni road, Mumbai

Abstract

As per the report of IBEF, the share of SMEs in industrial facilities in India, is around 90 percent. Launch of

GST in India is promoted by the campaign of “Make in India” initiated by Government of India. This paper

gives detailed knowledge on the impact of GST on SMEs in India. The focus of the paper will be the problems

associated with GST and its implementation. The most important thing noted here was that majority of the

people engaged in SMEs are not able to properly understand the concept of GST, thus implementation of the

same becomes difficult. Another problem faced by the SMEs is to explain the concept of GST to the consumers.

Key words: Small and Medium Enterprises, GST, VAT, Indirect Taxes

INTRODUCTION:

Goods and Services Tax or GST, is defined as the giant indirect tax structure designed to support and enhance

the economic growth of a country. More than 150 countries have implemented GST so far. However, the idea of

GST in India was mooted by Vajpayee government in 2000 and the constitutional amendment for the same was

passed by parliament. However, there is a huge hue and cry against its implementation. Today the total tax

collection in India stands at nearly 14.5 lakh crore, out of which nearly 34 percent tax collected is Indirect tax.

This includes the taxes collected from services sectors, stamp duty tax, customs, Value Added Tax, etc. These

taxes are collected by the Indian Government. In many of the developing countries it was noted that the share of

Indirect tax to the Government’s revenue is higher than the share of direct taxes. This phenomenon is reversed

in case of developed countries of the world. This system of Goods and Service Tax (GST) will have a better

control on the tax payers of the nation and mobile the income accordingly. However, it requires careful

monitoring.

1. ROLE OF GST IN MOBILISING THE SMES

GST enables the processing of indirect taxes under one roof. In case of SMEs, the business owners need to deal

with various taxes and have to approach various departments for fulfilling the tax related documentations. The

tax payers sometimes file the taxes either biannually, annually, or half yearly. The tax payers find it difficult to

the file the taxes, because of the large number of departments present. However, the situation has changed

recently. Earlier the business owners have to pay a tax of around 32 percent to the Government, however, the

situation have changed the tax rate have dropped down drastically to just 18 to 22 percent. Now they are

excluded from paying various forms of taxes to different departments. The accountability structure of the

businesses has been made quite easy by the new system of GST.

2. POSITIVE IMPACT OF GST ON SMES

i. GST has enabled quite easy techniques for doing business in India. VAT registrations which

were different from state to state, had to be followed earlier by the business owners, but with

the implementation of the GST, this confusing procedure has been stopped. Presently, if the

business person needs to start with the business, he has to register himself only with GST,

which will be the same throughout the nation.

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ii. VAT payment is collected if the annual turnover is more than 5 lakhs in some states and more

than 10 lakhs in other. However, with implementation of GST this VAT payments need to be

done if the annual turnover is up to 10 lakhs. This process is applicable to all the states of the

nation. With these SMEs having the annual turnover ranging between 5 to 10 lakhs will be

exempted from paying the GST return.

iii. GST is not at all complex, it is possible to do the business without much complexity.

iv. GST will enhance the taxpayer base by bringing more SMEs under its ambit, and will

definitely pass on the burden of compliance and associated costs to them.

v. Eventually GST will turn these SMEs more competitive, and level the playing field between

large enterprises and them. Further, these Indian SMEs would be able to compete with foreign

competitors from cheap cost centres such as China, Philippines, and Bangladesh.

vi. GST ensures that there is no ambiguity about what constitutes goods and services. This will

simplify various legal proceedings related to packaged products. As a result, there will no

longer be a distinction between the material and the service component, which will greatly

reduce tax evasion.

vii. SMEs limit their customers within states as they will bear the ultimate burden of tax on

interstate sales, which reduces their customer base. With implementation of GST, this will be

nullified as tax credit will be transferred, irrespective of the location of the buyer and seller.

This will allow start-ups, SMEs and MSMEs to expand their reach across borders.

viii. Under GST, no entry tax will be charged for goods manufactured or sold in any part of India.

As a result, delivery of goods at interstate points and toll check posts will be expedited.

According to a CRISIL estimate, the logistics cost for manufacturers of bulk goods will get

reduced significantly by about 20 percent. This is expected to boost e-commerce across the

nation

3. NEGATIVE IMPACT OF GST ON SMES

i. It’s mandatory to go for GST registration to all the SMEs if the annual turnover is more than Rs. 20

lakhs.

ii. If a small businessman supplies goods or services to a customer who is registered under the GST Act,

the customer (buyer) is liable to pay the GST on such a purchase. Not only this, but the buyer also must

self- invoice. In other words, the buyer must issue an invoice for the purchase made by him from the

unregistered seller. This invoice is to be uploaded onto the GST system.

iii. Composition levy mechanism is very restrictive is an alternative method of levy of tax designed for

small taxpayers whose turnover is up to Rs 50 lakh. Those who opt for this mechanism are not allowed

to take input tax credit, or collect any tax from the recipient. To such an extent, it seems fair.

iv. Since GST requires businesses to maintain funds in the form of electronic credit ledger with the tax

department, it may result in liquidity crunch. Also, the harsh ‘input tax credit’ mechanism will also lead

to working capital blockage.

v. Input Tax Credit is available to a buyer only if the supplier has paid tax inside a given window. This is

one problem which a reasonable percentage of small businesses will face in their life-cycle. Most (if not

all), will have no bad ‘intent’ of evasion or not paying. Sometimes, the choice of ‘paying salary to the

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workers on time’ and ‘paying a penalty to the government for delayed payment’ is a conscious call

which small businesses invariably must take.

vi. Another interesting provision is the ‘Compliance Rating’, a system which assigns ratings to businesses

based on their discipline, so you will know whether your supplier has a ‘good or poor’ rating before

buying from them. Thus, businesses will try to avoid buying from people with ‘poor’ rating, which

means that people will do everything they can to avoid a poor rating. And the rating becomes ‘poor’ not

just due to a delay in filing data, but also due to delays in payments.

vii. Not all the SMEs have technical expertise to deal with online systems, thus most of them will need

intermediaries to obtain registration for them. This will add to their registration cost.

viii. Refunds can be claimed only after filing of relevant returns. Also it depends on the compliances done by

the supplier and his rating.

ix. Minimum of thirty-seven returns are required to be filed by every registered taxpayer during a financial

year. Thus SMEs will have to deploy additional resources and eventual cost of compliance will

increase.

x. Under the implementation of Goods and Services tax, all goods and services will have to pay same tax

which will lead to rich becoming richer and poor becoming poorer. This is not ideal situation for

MSMEs competing against large businesses.

xi. Under Goods and Services tax, there will be around 36 returns in fiscal year. It requires businesses to

close books on monthly basis. Therefore the business owners spend lots of time to file these returns.

xii. Taxation of stock impact the working capital requirement. Higher capital requirement will increase

interest cost which ultimately.

4. CONCLUSION

Goods and Service Tax (GST) has benefited SMEs on a large scale. More than any negative outcomes, positive

outcomes of GST on SMEs are greater. GST has increased output of the firms, led to higher employment

opportunities and overall economic development. GST has reduced the tax burden of both producers and

consumers by helping them to have appropriate tax credits. Financial strength will be imposed in SMEs due to

implementation of GST.

References

Gupta Nishita (2014)CASIRJ Volume 5 Issue 3 ISSN 2319 – 9202,Goods and service tax: it‟s impact on Indian

economy”.

Goods and Services Tax (GST) - A step forward (2013) available at

www.articles.economictimes.indiatimes.com

Dr. Ambrish” International journal of Arts ,Humanities and management studies, Goods and Service Tax and

Its Impact on start-ups

CASadukiaRajkumar,' A Study On Proposed Goods And Services Tax [GST] Framework In India” available at

www.taxclubindia.com 6. Articles from parliament library and reference research ,Documentation and

information service(LARRDIS]

Shankar S. (2017) “Impact of GST on Small Medium Enterprises (SME) sector” International Journal of

Research in Management & Social Science, volume 5, issue 4.

Jacob R (2017) “The impact of Goods and Services tax on the Micro, Small and Medium Enterprises” Imperial

Journal of Interdisciplinary Research (IJIR) Vol-3, issue-10, 2017.

Pandit, S. (2017) “GST: Opportunities and challenges for Indian MSME's. Journal of Commerce, Economics &

Computer Science (JCECS) volume 03, issue 03.

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Kumari L.R. (2017) “Impact of Goods and Services Tax (GST) on Indian MSME's” International Journal of

Research in Economics and Social Science (IJRESS), volume 7, issue 7.

Siddiq I. and Parsad K.S. , (2017) “ Impact of GST on Micro , Small and Medium Enterprises” Journal of

Management and Science , ISSN: 2240-1260, Special Issue . No.1.

Venkatesh J. and Kumari L.R (2018) “Effectiveness of R&D: Analysis of Indian MSME's with specific

Reference to Manufacturing sector” International Journal of Innovative Research Explorer, volume 5.

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THE IMPACT OF GOODS AND SERVICE TAX (GST) ON FOOD INDUSTRY UNDER NEW

PANVEL MUNICIPAL CORPORATION AREA IN MAHARASHTRA.

Kailas Dharma Landge

Associate Professor in Economics,

Chetana’s H.S. College of Commerce and Economics, and

Smt. Kusumtai Chaudhari College of Arts Bandra east, Mumbai-400051.

Introduction:

Indian taxes are of two major types, Direct and Indirect Taxes. Goods and Service Tax is regarded as a

remarkable attempt in the history of Indirect Tax regime. It is based on the idea of ‘One Nation One Tax’. GST

governing council decides the tax rates, rules & regulations. New Article 366(12A) of the Indian Constitution

defines Goods and Service Tax means any tax on supply of goods or services or both except taxes on supply of

the alcoholic liquor for human consumption. Goods and Service Tax may be defined as a tax on goods and

services which is leviable at each point of sale or provision of service, in which at the time of sale of goods or

providing the services the seller or service provider may claim the input credit of tax which he has paid while

purchasing the goods or procuring the service. It is basically a tax on final consumption.

There are 5 categories of tax rates (0%, 5%,12%,18%, and 28%). The Indian food industry is currently an

important important industry in India. This study focuses on the impact of various GST rates on the customers

of food industries under New Panvel Municipal Corporation.

Key words: Goods and Service Tax, Indirect Tax, Food Industry, Food processing, Impact, India

Background:

Indirect tax reforms started in1986 when Modified Value Added Tax (MODVAT) was introduced by FM V .P.

Singh. Finance Minister Mr. Manmohan Singh initiated discussion on common and single tax policy for the

country i.e. ‘Goods and Service Tax’. In 1999 then Prime Minister Atal Bihari Vajpayee gave a green signal to

design GST Model under the Dasgupta committee.

In 2005, the Kelkar committee also recommended rolling out GST as suggested by the 12th Finance

Commission. In 2006, Finance Minister P. Chidambaram proposed a GST rollout by 1st April 2010. Under

Finance Minister Arun Jaitley the GST Act was passed, which came into effect from July1, 2017. GST Council

approved the ‘Central Goods and Services Tax Bill 2017’, The Integrated Goods and Service Tax Bill 2017, The

Union Territory Goods and Service Tax Bill 2017, The Goods and Service Tax (The Compensation to the

States) Bill 2017, these Bills were passed in 2017. Thereafter, State Legislatures of different States have passed

respective State Goods and Service Tax Bills. After the enactment of various GST laws Goods and Service Tax

was launched all over India with the effect from July2017.

Need:

The proposed research study is significant from several points of view. India has already adopted Goods and

Service Tax regime on 1st September 2017. This is regarded one of the significant reform in Indian taxation

system since the Independence. These bold changes in the Indian tax regimes would have far reaching positive

and negative impacts in near future. This tax regime is going to affect all major sectors of the economy in

coming years. The sectors which will experience far reaching changes includes, industry & manufacturing,

trade, Food, banking and finance, real estate, small and medium enterprises, travel & tourism, hospitality,

hotels and restaurants, logistics, retail business, agriculture, pharmaceutical, automobile, construction etc.

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Looking at the overall impact GST measures, it offers several new avenues to study the impact of GST. Hotel

and Restaurants have grown enormously during the post – reform period. It would be interesting to the study the

upcoming changes in the small restaurants under New Panvel Municipal Corporation. Food market plays key

role in the highly urbanize economy. Therefore, we believe that this aspect needs to be studied scientifically.

Review of literature:

As mentioned by Ehtisham Ahmad and Satya Poddar (2009) in their study called ‘Goods and Service Tax

Reform and Intergovernmental Consideration in India’, believes that GST is likely to provide simple and

transparent tax system that would enhance an output and productivity in India. But for this success, we need to

design a rational structure of GST.

According to Jonathan (2017) title ‘Impact of GST on Hotels and Restaurants’ shows that under the present tax

regime hotel and restaurants had to pay 21 % per cent of indirect taxes as against the newly implemented GST.

Initially GST tax wais 28 % (14% CGST & 14% SGST) which was higher than earlier indirect taxes. This study

aimed to find out the impact of GST on end users / customers. The study notes that the new GST Tax has

increased the sacrifice of the final consumer.

Vijay Kelkar, Chairman of Finance Commission He believed that GST will be most important economic

reform like – the way Indian economy started in year 1991. A flawless GST structure and proper

implementation of it would result in increasing GDP by 2 to 2.5 percent.

Nishita Guptha (2017) in her study expressed positive impact of GST in terms of commercial benefits that was

not on the purview of Value Added Tax. GST is likely to accelerate economic development and collective gains

are likely to arise in the sectors like – industry, trade, agriculture as well as the end users of goods and services.

Impact on food Market:

The Indian food market which is estimated at over US$ 182 billion accounts for about two thirds of the total

Indian retail market. Further, according to consultancy firm McKinsey & Co., the retail food sector in India is

likely to grow from around US$ 70 billion in 2008 to US$ 150 billion by 2025, accounting for a large chunk of

the world food industry, which would grow to US$ 175 billion by 2025. The food industry can broken down

into the following main heads:

Spices

Food processing

Snacks and confectioneries

Dairy

Beverages

Food chains and restaurants

Keeping these facts in mind, the food industry becomes a very critical industry as it can also generate large

revenues while it forms the most critical for the masses, the agriculturist and the consumers. Also, the argument

that the GST is a regressive tax as it makes the poor poorer and the rich richer comes from here only. Food

includes a variety of items, including grains and cereals, meat, fish and poultry, etc. In the Indian context, the

impact of GST on the food industry has been analyzed below.

Taxing this industry makes a major impact on the economy and accordingly it is imperative to review the pros

and cons of every proposed change. Thus, considering all the models available for taxing ‘Food’ the most apt

option seems to tax it under a comprehensive taxation system with a lower rate. Other challenges such as which

food item to be considered tax-free can be resolved by formulating clear provisions and definitions. This

industry is a sensitive industry and needs to be treaded carefully while imposing the taxes as it could lead to a

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variety of widespread issues.

The following are the key rates applicable to GST on food services.

5% GST on food services applicable to GST on food services

5% GST on restaurant services including room services and takeaway provided by restaurants located

within a hotel featuring room tariff less than Rs. 7500

5% GST on any food/drink (non-alcoholic) served at cafeteria/canteen/mess operating on contract basis

in office, industrial unit, school, college, hotel, etc.

5% GST on meals/food services provided by Indian Railways/ IRCTC or their incensees both on board

trains and on platform.

18% GST on restaurant services including room service and takeaway provided by restaurants located

within a hotel featuring room tariff over Rs.7500

18% GST on food services including delivery of food provided by a restaurant/food joint located within

premises of a club, guest house, etc.

18% GST applicable to all outdoor catering services provided.

Objectives:

1. To understand the perception towards GST among the consumers.

2. To find out the impact of GST on consumption habits of consumers.

3. To suggest suitable policy measure.

Methodology: This paper is based on primary data. A survey was conducted for collecting the data from the

customers of food items across the New Panvel Muncipal Corporation area.

Sample Size: The sample included 100 customers.

Sampling techniques: A simple random sampling technique was used for data collection.

Tools used: The Likert type scale with 5 options ranging from strongly agree, agree, neutral, disagree, and

strongly disagree was used in present research.

Statistical technique: T- test and correlation analysis have been used in the present study.

Statistical Analysis: In the present paper, data was collected from 100 customers have been considered for the

result and findings of the paper. We have seen the correlation between Age and income, Gender and income and

further the analysis is followed by t-test analysis. To measure the impact of GST on the Age groups of

customers, Gender, and level of income in study area has been shown by t-test results in table below.

Table: 1 Perception of the customers on GST based on Age.

Age Frequency Mean SD T- value P- value

18-35 24 35.667 2.5346 3.753 0.001

36 above 76 38.447 2.9289

Source: Primary data collected by the author

The impact of Goods and Services Tax (GST) on the different age groups has been depicted in Table-1, which

indicates the age group wise perceptions of customers regarding GST. The p-value is 0.001. It highlights that,

there is significant difference on the perception of GST among the customers of age group at 0.001 level of

significance.

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Table: 2 Perception of the customers on GST based on Gender.

Gender Frequency Mean SD T- value P- value

Male 58 38.367 3.232 2.863 0.005

Female 62 37.764 2.8769


The impact of Goods and Services Tax (GST) on the different Male and Female has been depicted in Table-2.

This indicates the Gender wise perceptions of customers regarding GST? The p-value is 0.005. It shows that,

there is significant difference on the perception of GST among the Male and Female customers at 0.005 level of

significance.

Table: 3 Perception of the customers on GST based on Level of Income.

Income Frequency Mean SD T- value P- value

1,00,000-

2,50,000

65 36.657 1.7346 2.953 0.005

2,51,000

above

35 28.237 2.8289


The impact of Goods and Services Tax (GST) on the different Income groups has been depicted in Table-3. It

indicates that, the Income group wise perceptions of customers regarding GST. The p-value is 0.005. It shows

that, there is significant difference on the perception of GST among the customers of different income groups at

0.005 level of significance.

Findings:

As per the interpretation of analysis, it has been found that the there is significant impact of GST on the

customers Age, Gender and Income in study area.

As far as Age and Gender is concern, the respondents have same notion of thinking in regards with GST

rates and its impact on purchasing power.

Coming to the income level customers have an opposed mindset towards the GST rates. Because the

lower income people are facing financial burden in paying higher GST in study area.

Suggestions:

GST rates should be decided on the basis of level of income, So that ability to pay approach which is

appropriate method to collect the tax will be implemented in the study area and country as well.

In order to make a required amount of GST revenue to the government. The tax rate should be high for

luxury items and low for necessary goods so that low income group people may get relief.

Exemption schemes must be introduced for middle and low income group customers.

Products like, liquor, tobacco should be taxed at the highest slab rate as compared to food items.

Conclusion:

The goods and services tax has become one of the biggest forum in indirect tax in the country. Not only that it

involves each and every layer of the society, hence it is necessary to covers the opinions of all the income

groups of the society. As it is recognized as one tax, one nation therefore it is applicable to New Panvel

Muncipal Corporation region in the equal sense. Though it is not only source to reduce the purchasing power of

customers in the study area but it has huge impact in the study area. Last but not the least, reasonable GST rates

for food items encourages maximum savings by the individuals which in turn raises the purchasing power for

other necessary items of daily needs and finally it helps in the overall standard of living for customers in the

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study area.

References:

Ehtisham Ahamad, Satya Poddar (2009). ‘Goods and Service Tax Reform and Intergovernmental

Considerations in India’, Asia Research Center, London School of Economics, 2009.

Jonathan. (2017). ‘Impact of GST on Hotels and Restaurants’, International Journals of Academic Research &

Development, 2 (5).

Vijay Kelkar. (2013). ‘GST will help to increase employment: Kelkar’, Business Standard, January 20, 2013.

GupthaNishita. (2014). ‘Goods and Services Tax: It’s Implementation on Indian Economy’, pp- 126 – 133,

CASIRJ Vol. 5, Issue -3.

Abhishek ,A. Rastogi . and Aditya Kumar. (2009). Goods and Services Tax, New face of Indirect Taxes in India.

Taxmann Publications (P) Ltd.

Dash. A. (2017). Positive and Negative impact of GST on Indian economy. International Journal of Management

and Applied Science, Biju Pattanaik University of Technology, India.

Dr. Manjunath. (2016). Customer satisfication in Fast food industry, International Journal of Research in

Finance and Marketing, B.N. Bahadur Institute of Management Sciences, Mysore, Karnataka.

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GST AND ITS IMPACT ON VARIOUS BUSINESS SECTORS

Prof. Kinjal Jishaan Jain

Assistant Professor, B. M. Ruia Girls’ College

Abstract:

Taxation policy plays a vital role in the growth of economy and it impacts the international economy as well. It

is always essential for a country to formulate and implement an efficient taxation policy for its economic well

being. Introduction of GST led a major reform to the indirect tax regime of India. GST is known to be a cure for

the ills of existing indirect tax regime. GST was introduced to subsume various taxes such as VAT, sales tax,

service tax, entertainment tax etc.

It has now been more than a decade since the idea of national GST was mooted by the Kelkar Task Force in

2004. After missing various deadlines the Constitution (101st Amendment) Act, 2016 was passed on 8th

September, 2016 which paved the way for introduction of GST in India. This paper will provide the study on

impact of GST on various business chain as well as on various business sectors.

Introduction

GST (Goods and Services Tax) is a tax introduced with the motive of ‘One Nation One Tax’. The main purpose

of bringing GST was to remove the cascading effect of taxes. It is a single tax on supply of goods and services

right from the manufacturer to the consumers. GST is a destination based tax. India has adopted a Dual GST

model keeping in mind the federal structure of the country. The Centre and State simultaneously levy GST on

taxable goods and services. It comprises of Central Goods and Services Tax (CGST), State Goods and Services

Tax (SGST), Union Territory Goods And Services Tax (UTGST) and Integrated Goods and Services Tax

(IGST).

In the earlier system, tax was levied on production whereas in the new tax system tax is levied on consumption,

which will also bring about an effective cross utilisation of credits. GST has changed the way of doing business

and has impacted various sectors of Indian economy. The implementation of GST was with a long term view

and will not give immediate benefits to all the businesses. On one hand it is beneficial for some business while

on the other hand some sectors faced a negative impact.

Key Words: GST, Indirect Tax, Impact, Business Sectors, Economy

OBJECTIVES

To understand in short the concept of GST.

To study the impact of GST on business chains.

To highlight the impact of GST on various business sectors.


The study is based on secondary data collected from various internet web sites and books. The research is

descriptive in nature.

IMPACT OF GST ON BUSINESS CHAINS

1) MANUFACTURERS

a) Positive Impact

Single Tax System: In the previous tax structure there were various taxes such as service tax, excise

duty, VAT, entry tax etc which concerned the manufacturer. GST has subsumed all the tax into one

single tax giving relief to the manufacturers.

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Exclusion of Concept of Manufacture: In excise law, excise duty was levied on manufacture of goods

and there were many litigations on the issue whether the transaction amounts to manufacture or not. In

GST regime the concept of manufacture is totally excluded as it is a destination based tax.

Utilization of Cenvat Credits: In the earlier system the manufacturer was not able to utilize the credit of

Central Sales Tax and VAT which in turn becomes the cost to him. In GST he has the benefit of

seamless flow of credit. Thus he can take credits of CGST, SGST and IGST.

No Separate Registration: In GST the registration is state-wise and not factory-wise. Thus the

manufacturer is not required to take separate registration if he has more than one factory in the same

state.

Tax on Sample Goods: The previous tax law taxed the goods as soon as they were removed from the

factory. Thus sample goods were also taxable in the same way. In GST law relief has been given for

sample goods, that is, it is taxed when goods are approved or at the end of six months from transfer of

goods whichever is earlier.

b) Negative Impact

Increase in Working Capital Requirement: In GST, the stock transfers have become taxable, which

blocks huge working capital as tax will be realised on final supply of goods.

Time of Supply Concept: In the previous tax regime taxable event was the date of removal of goods

from the factory. GST law is based on supply and it has changed the date of taxable events which is

determined by the Time of supply rules.

Reverse charge on goods: Earlier reverse charge mechanism was applicable only on certain services, but

now it has been extended for goods as well.

Purchase form unregistered person: Cenvat credit can be taken only on those purchases which are made

from registered person. Thus the credit are blocked for purchases made from unregistered person.

2) RETAILERS AND WHOLESALERS

a) Positive Impact

Input Tax Credit: As mentioned for wholesalers, retailers too have the advantage to claim input tax

credit on purchases made by them. This in turn is a cost advantage to the retailers.

Transparent Tax Management: GST has introduced technology in the tax system as all the data is to be

uploaded online. This make the tax system transparent and give the wholesalers and retailers an

opportunity to go digital.

Better Cash Flows: All the data and transaction will be in records, thus there will be constant connection

between the wholesalers and the retailers. This will make it easier for them to process payments in a

timely manner and improve the cash flows of the business, thereby increasing the working capital for

business growth.

Improved supply chain: It provides high visibility and streamlines the supply chain, thus, providing the

wholesalers a better and transparent view of movements of supply.

b) Negative Impact

Cost of Technology Upgradation: Many of the wholesalers and retailers are not technology driven. It

will be an additional cost to the business and will need technology transformation at both ends.

Cost of Input Services: Earlier the services of transportation, logistics etc were in lower tax bracket as

compared to the present system. This in turn will increase the product cost.

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Increased Compliances: In the previous tax structure the number of compliances were less as they had

to file maximum 12 returns depending upon the state, but now the compliance burden has increased due

to change in the return filing pattern.

3) IMPACT ON IMPORTERS AND EXPORTERS

Import and export is treated as inter-state supplies as per GST. Thus IGST is levied on such supplies in

addition to Basic custom duty (BCD).

In case of import of services, the service receiver will be liable to pay tax on reverse charge basis if such

services are provided by a person residing outside India. This provision is similar to the earlier tax law.

IGST on imports is calculated on the transaction value derived as per the valuation rules in Customs Act

which was earlier calculated on the MRP of the goods. This will disturb the working capital requirement

and also reveal the margins of the service providers.

No GST is levied on exports of goods and services and the suppliers can avail the input tax credit after

paying the amount on inputs and input services.

IMPACT OF GST ON VARIOUS BUSINESS SECTORS

1) Banking Sector

Every bank is required to obtain a separate registration for each of its branches. Banks provide a number of

services to their consumers such as credit card, debit card, internet banking etc. After implementation of

GST banks are required to make amendments in their rules and regulations an also upgrade their system

including ATM machines. Input tax credit is now available which was not the case as per the CENVAT

credit rules.

2) Textile Sector

GST has shown a positive impact on the textile and readymade garments industry. The price for

manufacturing of garments has become lower in comparison to the previous tax system. All readymade

garments ranging upto a certain limit is been exempted and GST is levied on the range exceeding the

exemption limit.

3) Hotel and Tourism Sector

Tourism is one of the largest contributor of income for the Indian economy. There will be no GST for

hotels whose tariff range is less than Rs 1000. There are different tax slabs for different tariff ranges.

4) Entertainment Sector

In the earlier tax law entertainment tax was levied on the various entertainment services. Vat and service

tax was also charged on some goods and services. GST subsumed all the taxes and only one tax is charged

on sale of tickets, food, theatre tickets etc.

5) Real Estate Sector

GST has some positive impact on the real estate sector. There is an increase in the profits for builders and

developers due to input tax credit availability. Before implementation of GST, VAT, stamp duty, service

tax and registration charges were charged on all under construction properties while on ready or completed

properties only registration charges and stamp duty was charged. In the present tax regime flat rate is

charged as GST in addition to registration charges and stamp duty.

6) FMCG Sector

As the GST has eliminated the need for multiple sales depot, the FMCG sector is experiencing significant

savings in logistics and distribution costs.

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7) Telecom Sector

Manufacturers in telecom sector can save cost after implementation of GST through efficient management

of inventory and by consolidating their warehouses. Mobile or handset manufacturers will find it easy to

sell their products as GST has eliminated the need to set up state specific entities and transfer stocks.

8) E-Commerce Sector

In today’s scenario, the e-commerce sector is growing at unimaginable pace. GST law has brought Tax

collection at source (TCS) mechanism which is not much appreciated by the e-commerce operators. GST

aims at long term growth of this sector.

9) Healthcare Sector

There is a reduction in the overall cost of technology as the import of technical equipments and machinery

is now made cheaper. However, some life saving drugs were fully exempted from excise duty or duty was

charged at a lower rate which is not the case after implementation of GST.

CONCLUSION

Every tax structure has some positive and some negative impacts. This single taxation regime will encourage

many new businesses to engage in service and manufacturing sector. By merging the various taxes into a single

tax, GST is expected to ease the double taxation for the industries. It is also beneficial for the consumers as it

reduces the overall burden by eliminating the cascading effect if taxes. Overall, GST is also good for the traders

if he smartly manages his business and efficiently carries on the supply chain. Due to long term objective many

sectors do not have an immediate positive impact, but the only thing which is necessary is to have patience and

continuous compliance with the rules and regulation for the upliftment of the economy.

REFERENCES

https://www.icai.org/post.html?post_id=14121

https://cleartax.in/s/impact-of-gst-on-indian-economy

https://www.researchgate.net/publication/320892175_GST_AND_ITS_IMPACT_ON_VARIOUS_SECTOR

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CHANGES IN ACCOUNTING PROCEDURE DUE TO GST

Mr.Murli N Rohra.

R.D.National and S.W.A. Science College,Bandra(W)

Abstract:

Goods and Service tax –“ One Nation - one tax” is the biggest indirect taxation reforms in India. GST was

implemented on 1st july-2017 in our country and impacted the functioning of all the sectors of the economy. The

impact of the radical shift can also be tracked in the segment of finance and accounting. Prior to the

Introduction of GST in India separate accounting entries for each indirect tax law like service tax, excise duty ,

VAT etc was required to be made separately. Now only entries under the goods and service tax are required to

be taken on record for either supply of goods or services.

Technology or software is the backbone of the GST. Success or failure of implementation of GST is heavily

dependent on technology. GST created a paradigm shift in how small businesses run their day to day business.

Changes in the Accounting entries are due to compliances with GST law. However, under the new GST regime

the different taxes have been subsumed in GST, so the number of accounts required to be created has reduced

drastically. Now the business has to maintain the accounts under three heads that is CGST, SGST and IGST.

Introduction :

The goods and service tax has simplified the indirect tax system in India with one nation one tax approach. It

has simplified the business and accounting processes which insures more transparency in business reporting and

compliance. GST is a goods and service taxes payment instead of paying separately for the goods and services.

There is only one type of tax. The tax will be uniform with the help of GST and this will reduce the cost and the

complication in the tax structure as previously there was different tax, rules and structures in different states.

The tax is filtered and the tax on tax is removed. There is huge tax revenue collected as of now, but GST will

break it down into three smaller ones i.e SGST, CGST, and IGST

The accounting changes will depend on business. GST accounting entry changes the previous working process

after the GST is implemented in business. In the GST regime, a tax payer is required to maintain all type of

accounts and records related to GST transactions such as input supplies (Purchases), Output supplies (Sales),

Production, Input credit, output tax, stock, import-export, reverse charge etc.

In this paper, the author discusses the changes in accounting procedure due to GST. The focus is towards

configuration of accounting systems, books and accounts to be maintained under GST, accounting treatment

under GST, payment of GST tax, reverse charge transactions in GST, filing of GST returns

Changes in accounting Procedures under GST.

1. Configuration of accounting systems

a. Inventory Item Configuration

i. Item Name

ii. HSN Code/SAC code

iii. Tax rate

iv. Unit of measurement

b. Sales Account

i. Percentage wise (5%, 12%, 18% and 28%)

c. Customer/Vendors accounts (Multiple GSTIN)

i. Name

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ii. Address

iii. State

iv. GSTN

v. PAN

d. Purchase account (rate wise)

e. Tax ledger (credit, liability, cash for CGST, SGST, IGST)

f. Credit note and Debit note

g. Invoicing under GST

i. Classification

1. Taxable

2. Exempted

3. NIL rated

4. Deemed export

5. Sales to SEZ

ii. Tax type and rates

h. If both states are same CGST & SGST shall be levied otherwise IGST shall be levied for inter state

transactions.

2. List of ledgers to be created

a. Input CGST A/c

b. Input SGST A/c

c. Input IGST A/c

d. Output CGST A/c

e. Output SGST A/c

f. Output IGST A/c

g. GST on advance

h. Creditors –Registered, Unregistered and Composition

i. Electronic Cash CGST Ledger

j. Electronic Cash SGST ledger

k. Electronic cash IGST ledger

3. Journal entries under GST

a. Purchase transactions (Input Supplies of Goods or service) (Intra- state)

Purchase A/c ______________Dr

CGST Input Credit A/c _______Dr

SGST Input Credit A/c________Dr

To Creditors A/c

b. Purchase Transaction (Inter State Purchase)

Purchase A/c _____________Dr

IGST Input Credit A/c_______Dr

To Creditors A/c

c. Sales Transactions (Intra-state Supplies)

Debtors A/c______________Dr

To Sales A/c

To CGST Payable A/c

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To SGST Payable A/c

d. Sales Transactions (Inter state supplies)

Debtors A/c ________Dr.

To Sales A/c

To IGST Payable a/c

4. Set off of Input Credit Against Output Tax Liability of GST

Input Credit Order of set off

a. CGST First towards CGST.

Balance Towards IGST

b.SGST First Towards SGST

Balance Towards IGST

c. IGST First Towards IGST

Second Towards CGST

Balance Towards SGST

5. Reverse Charge Transactions in GST

Normally liability to pay GST is on supplier but the government has notified certain supplies covered

under Reverse Charge Mechanism on which liability to pay GST (partly or fully) is on the Receiver of

supply. In such case the accounting treatment will be as follows.

a. In the books of Supplier

Debtors A/c __________Dr

To Sales A/c

To CGST Payable A/c (% of CGST payable by Supplier, if any)

To SGST Payable A/c (% of SGST payable by Supplier, if any)

b .In the Books of receiver

Purchase A/c _____________Dr

CGST Input Credit A/c ______Dr (Total CGST on Input)

SGST Input Credit A/c ______Dr. (Total SGST on Input)

To Creditors A/c

To CGST Payable A/c (% of CGST Payable by Receiver Under RCM)

To SGST Payable A/c (% of SGST Payable by Receiver Under RCM)

6. Refund in case of export of goods and services

Under GST law, the exports of goods or services are treated as Inter-State Supplies. In the case of export

supplies, the exporter has two options:

a. Export under Bond/LUT (Clear goods without payment of duty and claim the refund of Input credits): In this

case, the exporter has to record sale without charging any tax and determine the unutilized input credit of inputs

for claiming the refund.

b. Export under rebate claim (clear goods with payment duty and claim the refund of duty paid on export

goods.)

7. Imports

Imports are treated as intra-state supplies and therefore, IGST will be payable by the importer of the goods or

services. Further the custom duty is also applicable in the case of Import of Goods but the input credit of custom

duty is not allowed. Hence the importer can claim input credit of IGST and the Customs Duty will be added in

the Cost of imported goods.

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8. Electronic cash and credit ledger

Electronic cash ledger will served as a electronic wallet. The tax payer have to deposit money into his cash

ledger. The money will be utilized to make the payment

Additional accounts / records to be maintained under GST law

a. The additional input tax credit availed register should be maintain showing the details of input tax credit

availed for a given tax period and

b. Output tax liability register showing the details of GST liability outstanding to be adjusted against Input

credit and

c. Output tax paid register showing the details of GST paid for a particular tax period is to be maintained.

The above additional books and records are to be maintained other than regular records of purchase register,

sales register and stock register.

Consequences of not maintaining proper records.

If the taxpayer fails to maintain proper records in respect of goods/services, then the proper officer shall treat

such unaccounted goods/services as if the taxpayer had supplied them. The officer will determine the tax

liability on such uuaccounted goods. The taxable person will be required to pay the tax liability calculated along

with penalty.

Filing of GST returns:

The regular GST returns GSTR-1 ,GSTR-3 and Annual return GSTR-9 are to be submitted online.If the regular

returns GSTR1 about sales are re not filled monthly the then customer will not get the input credit for the

submission of his returns. Similarly GSTR-3 also to be regularly submitted online.

Opinion about procedures

A. Merits

1. Reduction in Raw material cost and other expenses – GST allows seamless input credit for inter state and

intra state purchases of goods. This mean reduction in cost of raw material as input GST can be set off

against output GST payable on sales. GST paid on many services like legal charges, audit fees, can be

setoff against output GST.

2. Cost of fixed assets come down as input credit will be available on both capital goods and services related to

installation and inspection charges.

3. Accounting principles : GAAP is also mandatory on GST. All principles such as revenue recognition,etc will

be applicable for GST.

4. Period of retention of accounts: Every registered taxable person must keep and maintain books of accounts

for seventy two months from the due date of filing of annual returns for relevant year.

5. Clear tax software offers a free integrated tool for GST registered businesses to track and check their

compliances level for GST return file.

6. Every GSTIN can now access the GST health check tool to get the results in an excel form.

B.Demerits

1. GST accounting entries require training to the existing accounts staff in the organizations.

2.Complex structure in the GST rates makes accounting entries complicated.

3. GST accounting entries is challenge for small tax payers

4. Compliances connected with GST accounting entries is very high as the periodical statutory reports are to be

generated and uploaded on the GST portal.

5. Purchase of GST software, appointment of trained accounting staff and consultants for compliances increases

the cost of business.

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Conclusion

GST accounting entries through use of software saves the time of business. GST accounting treatment reduces

the cost of raw material, fixed assets and other business related expenses due to GST Input tax credit availed on

payment of GST output tax.

GST is the one nation one tax applicable universally and it generates more revenue to the government. GST

accounting entries fulfil the compliances of GST Act for payment of taxes, maintenance of record and

submission of GST returns. GST accounting generates more employment and widen and provide greater scope

for accounting profession.

Refernces

https://quickbooks.intuit.com/

https://cleartax.in/s/gst-accounting-entries

https://www.reachaccountant.com/erp-software-pos-software-blog

https://economictimes.indiatimes.com/

https://cleartax.in/s/reverse-charge-gst

Textbook on Indirect Taxes published by Manan Prakashan and Sheth publcation

https://quickbooks.intuit.com/

https://cleartax.in/s/gst-accounting-entries

https://www.reachaccountant.com/erp-software-pos-software-blog

https://economictimes.indiatimes.com/

https://cleartax.in/s/reverse-charge-gst

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STUDY ON CHANGE IN REVENUE OF PRACTICING CHARTERED ACCOUNTANT,

PRE AND POST ADOPTION OF GST.

Prof. Pawan Kumar Sharma

Assistant Professor

Siddharth College of Commerce & Economics, Fort-Mumbai.

Abstract:

Survival of CAs in the near future due to transparent system adopted by the government seems to be difficult.

The purpose of the study is to analyse whether the adoption of GST will increase the revenue of CA

practitioners and help them survive in the near future. Paired sample t test technique is applied to find the

difference in revenue in pre- and post- GST scenario. It is found that revenue of CA firms in post-GST is more

as compared to pre- GST period. This study definitively answers the questions regarding change in revenue.

Further studies are needed to be conducted on problems faced by CA practitioners and assistants to CA

practitioners regarding survival in the near future.

Keywords: GST, pre & post Revenue, CA Practitioner

INTRODUCTION :

As we know, India has adopted GST, which has impacted many fields in terms of employment, besides

eliminating the deluge effect of tax. GST was the firstly introduced by France and later by all other European

countries. GST was proposed in 1999 by Prime Minister Vajpayee and enacted by the Modi dispensation. GST

is the novel approach to bring all indirect tax under one roof. India has adopted GST as dual-modal, i.e.

simultaneously Centre and state levy tax on goods and services. The main objectives of GST are to reduce tax

complication of assessees and to bring all taxpayers under one roof. GST has impacted various sectors such as

the automobile sector, insurance sector, banking sector and on professional. GST has also positively impacted

the employment, which opens the gate for professionals to compete with the taxation system. The main motive

is to bring transparency in taxation regime which will boost the economy as well as Gross Domestic Product.

With the introduction of GST, it has created a business-friendly environment which will help the economy to

grow in the way it wants to be. GST has tried to make all transaction transparent through online simplify returns

and reduce the hawala transactions of black money.

After the enactment of GST, the prospects for employment have increased, which will benefit tax consultants.

India being a populous, developing country, the biggest problem was unemployment.t GST has opened the gates

for those who were in search of better jobs with certain skills. The growth in employment has increased after

better enactment of GST law which has a positive impact on the formal employment sector. But with the

implementation of GST, in the long run, it will show a positive sign towards growth in Gross Domestic Product.

GST being "ONE NATION ONE TAX "which means all other indirect tax will be finished and only one tax

will be applicable on Goods as well as services throughout the country. GST will be playing a key and dynamic

role in the development of the economy in the long run. The first State, where GST bill was passed, was Assam

and later followed by all states. GST also impact many sectors such as the manufacturing sector, Pharma sector,

Textile sector, Construction sector etc. which will get stable in the long run due to their nature of rendering their

services. Further Indirect tax committees also said GST is a significant reform after independence in Indirect tax

regime. GST will provide more enormous benefits in the long run with its smooth implementation since there

were specific problems with both Centre and State as well as general public after its enactment which has

resolved up to a certain extent. Thus it needs to handle with care in its initial stages of implementation.

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Every taxpayer needs to get registered with the government to do business. The small vendors and traders had

suffered a lot since these are those persons who do not have much turnover to get registered in GST and hence

they are exempted from GST. Currently, the limit is for Goods is Rs.40 Lakhs and for services is Rs.20 Lakhs.

Thus the above vendors are now better in terms of purchase and sales. Further the expenses has been increased

to make all available records and documents for filing return before the due date to make compliance proper

with current law and reforms but in turn, it will contribute to the nation in the long run.

GST also impacts the common man through expenses on restaurant bills, travelling, holidays packages and other

household expenses etc. The government expects that a common man should understand the benefits that will

reap in the long run. The common man will get all the advantage in the long run in terms of economy and

infrastructure. Further GST is paid by customers to suppliers and then deposit to the government, which

provides revenue to the government. GST is the major reform made by the government to make the tax system

more transparent and to eliminate the tax on tax. A simple pattern was used to facilitate a tax system where the

fee is a levy on manufacturers where he can claim tax. And then on Wholesalers who can claim tax back then on

retailers who can also claim tax and finally the customer who pay GST since it is a levy on the consumption of

either goods or services. Both Goods and Services are taxed in the same manner whereas before the enactment

of GST there where different format for levying goods and services. At every stage of processing and

manufacturing where value is added to product and services, and thus GST is collected from such traders. With

the implementation of Goods and Service tax, customs duty is reduced on the exporting of goods from India, the

main reason that business organizations who worked in India can establish their market outside India.

Good and Service tax has impacted a lot on the different sector, which helps our economy to grow, which can

compete in international markets. GST helped to make indirect tax system regime not only simplified but also

give a path of further development. With the enactment of GST, a lot of preference has been given to

Information Technology where all returns and assessment has been made online on GST portal, which was a

significant platform for Information Technology. Various IT Companies introduce the calculation software for

Goods and Services Tax to make return filing more in a simplified manner. The IT Companies whose software

were already introduced in the market needed to be updated with new features and rules. These have boosted the

demand in the Indian Market for software and Information technology companies. Currently, Cleartax is the

first company who has gained prominence with the use of this software. The information technology

infrastructure has played a significant role in the implementation of GST. Good and Service tax is the blanket

for all indirect taxes which was introduced till date and got subsumed. Various analysis has been made to find

which tax system was better, i.e. before and after enactment of Goods and Service tax.

Goods and Service tax is the boon for Indian Economy because according to experts and authors, GST will be a

massive success in the long run which will create various employment opportunities and economic growth.

Majority of taxpayers are covered in the GST regime, which provides more significant revenue to government.

Hence Good and Service tax has impacted every part of business, whether backward office or not. The Fear of

Job has been lost with the introduction of GST. With the rise in inflation, businessman faces typically financial

problems. But it will be overall a better chance to use these factors with Good and Service tax to see where the

Economy can stand today.

Thus at the end, we can say that the introduction of GST in India with Dual Model helps the government in

terms of financial and better utilization of these in terms of infrastructure. The Business sector has opportunities

to make its business more accurate. With the implementation of GST, particular challenges are faced by both

government and taxpayers, but these challenges will, in turn, can contribute in the long run in growth and

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development in our country. Every country in the world has adopted Goods and service tax which has both sides

positive as well as negative, which need to be examined.

Review Of Literature

Dr Abbasi Habiba (2018) has conducted a study on GST that how it will impact Indian Economy. The study

focused on Challenges faced with introduction of GST. The sector has been influenced which make product

costlier ultimately affect the financial of Common Man. The study focused on how our economy will be

impacted since the GST has been made transparent with the growth in Information technology where taxpayers

need to submit online all the dues, returns and many more.

Dr Anita Modi (2017) has studied how GST will impact the common man. The positive impact is to remove

the cascading effect on tax and adverse effects being the cost of service will be expensive since tax brackets will

differ from service to service.

Dash A. (2017) concludes the positive impact of GST in terms of employment generation subsumed taxes etc.

and negative impact in terms of increase in compliances cost and sharing of revenue between both state and

centre. However, the study ignored how GST will impact all sectors, which in turn has impact the Indian

economy.

Jaspreet Kaur (2016) has made a study on GST and its impact on goods as well as services. Since with the

introduction of Goods and Service tax, all the indirect tax were subsumed, which was not an additional tax. The

analysis was made to identify how the price will impact both goods and services, i.e. which products or services

will be cheaper after implementation of GST such as restaurant services, Advocates and consultancy services

etc.

Milandeep Kaur et al. (2016) has made a study on GST after its implementation. The study shows how GST

will prove a benefit to taxpayers with challenges faced by them. The study analysis various food items on which

tax was levied before and after enactment of Goods and Service tax. There was no GST on basic necessity, but

the rate was highest among luxury goods. The study concluded on analysis of Goods and not on services since

GST treat both products and service in an equal manner. Further GST has positively impacted the common man

since now there will be only one tax in-country for both goods and services

Objectives Of The Study:

Research objectives describe what a researcher wants to achieve from a study. purpose of the research are the

following objectives:

1. To Find out Impact of GST on Revenue of individual CAs.

2. To identify whether there is change in revenue in PRE and POST GST adoption

3. To analyze whether startup opportunities as a CA practitioners will be an excellent choice in the near

future.

Hypothesis Of The Study

Based on the research objectives, the following are the assumptions:

H0 – There is no change in revenue of CA practitioner in pre and post GST

H1 – There is change in revenue of CA practitioner in pre and post GST


Research Design: This study uses exploratory and descriptive approach.

• Nature Of Study: This paper is quantitative and qualitative in Nature.

• Research Plan for Data Collection: For the present study information has been collected from both

primary source and secondary source.

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• Primary Source: The following plan will be adopted to collect primary data.

research technique: data has been collected through survey and schedule method.

Secondary Source:

Books, Journals And Magazines

Sampling Plan:

Sampling Element: practitioner CA

Sample Size: - 45

Sampling Method: For The Present Study the Researcher uses Non Random Snowball Sampling

and Convenience Sampling.

Place of Study: Mira-Bhayander Region

Statistical Technique: This Research Study Uses The SPSS (Statistical Package For Social

Science).

DATA COLLECTION AND RESPONDENT PROFILE

Paired Samples Statistics

Mean N Std. Deviation

Std. Error

Mean

Pair 1 Revenue POST

GST(PM) 57135.84 45 15259.106 2274.693

Revenue PRE GST(PM) 51258.07 45 15200.428 2265.946

Paired Samples Correlations

N Correlation Sig.

Pair 1 Revenue pOST GST(PM) &

Revenue pre GST(PM) 45 .998 .000

A paired sample t test reported a significant difference in the mean in post GST and pre GST adoption,

t (44) = 42.109 , p< .001 , 95% Confidence Interval [5596.46-6159.09]

The revenue post GST is higher (Mean = 57135.84, Standard Deviation =15259.106) as compared to the

Revenue pre GST ( Mean = 51258.07, Standard Deviation = 15200.428)

So it can be seen that the revenue of CA practitioners have been increased in the post adoption of GST.

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CONCLUSION:

The literature review indicates that the system has now become transparent & procedure in GST filing has

become simplified. So survival of Individual CA Practitioner shortly seems to be Challenging. The government

should give specific authority to CA Prcatitioner & Tax consultants concerning GST. Also proper training

programmes, seminar, conferences, Regular periodicals to update the amendments & also Incentives as a

motivator etc. must be given to CA Practitioner & Tax consultants.It can be concluded that GST regime is the

best move taken by the indian government which has a positive impact on the revenue of Individual CA

practitioner. Although the government has made everything transparent but still many people are outsourcing

their work to the CA’S.

Also in the near future demand for individual CA practitioner will increase in india and foreign countries

because of yearly amendments and changes in taxation.

References:

Abbasi, H. (2018) . GST impact and challenges faced by Indian economy , International Journal on Recent and

Innovation Trends in computing and communication ,Volume :6 ,Issue :4.

Dash, A (2017) .Positive and Negative impact on GST on Indian Economy , International Journal of

Management and Applied Science, Volume 3 , Issue 5.

Kaur, J.(2016) .Goods and Service Tax ( GST) and its impacts , International Journal of Applied Research

,Issue 2(8) ,PP: 385-387.

Kaur ,M ., Chaudhary ,K ., Singh ,S., & Kaur ,B .(2016). A STUDY ON IMPACT OF GST AFTER ITS

IMPLEMENTATION , International Journal of Innovative Studies in Sociology and Humanities

Volume 1 , Issue 2.

Kothari, C.R., Garg, G. (2019). Research Methodology Fourth Edition. New Delhi: New Age International

Publications

Modi ,A .(2017) .Impact of GST on Comman Man , International Journal of Engineering and Management

Research ,Volume 7 , Issue 4 , Page Number : 59-60.

Mohan, S., Elangovan, R. (2017). Research Methodology in Commerce. New Delhi: Deep And Deep

Publications

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AN EMPIRICAL STUDY ON GENERAL AWARENESS ABOUT

GST AMONG THE CONSUMERS

Mr. Shahu D. Ovhal,

Asst. Professor, Dept. of Accountancy

Siddharth College of Commerce and Economics, Mumbai.

Abstract

“One Nation one Tax”- The Goods and Service Tax has become the prominent topic discussed after enacting

GST from 1st July 2017. It is a comprehensive and multi-stage tax reform which has changed the existing tax

system. The study seeks to evaluate the awareness and its applicability and impact of awareness while going for

transactions as per new tax system. The study is based on purely primary data and analyzed by using simple

statistical techniques. The finding is also supported by few suggestions which can be easily implemented in

order to reduce confusion and purify the anti-GST environment.

Key Terms: GST, CGST, SGST, Awareness,

Introduction

The concept of GST was introduced in France 1954. Finance Minister, Arun Jately introduced the Bill in Lok

Sabha and passed in May 2016 and same was passed by Raj Sabha in August 2016. GST Act was passed on 29th

March, 2017and came into force wef 1st July, 2017.

GST is one of the milestone reforms that have been taken place in the Indian tax system. It has replaced VAT. It

is introduced on 1st July, 2017 in order to reduce the complex nature of old tax system with an objective of

ensuring uniformity in tax rate system. It is modified form of VAT, where tax is levied on value added at each

stage of supply chain. Simply, GST is an indirect Tax levied on supply of and goods and services. This GST law

has replaced many indirect tax laws that previously existed in India.

This changed tax system has created confusion among the consumers due to politicians, who have been every

now and then are making propaganda without understanding its benefits to the growth and development of the

country. The present paper is an attempt to indentify basic knowledge and awareness about GST among the

people of urban area. Hence, 66 sample consumers’ from Kalyan city have been interviewed by the researcher

and their feedback has been analyzed.

OBJECTIVES OF THE STUDY

1) To Study the degree of awareness about GST among the consumers

2) To test and gather the knowledge of consumers pertains to the benefits of GST


This paper is based on primary data which has been collected from 66 respondents from Kalyan city. The

structured questionnaire was prepared for the consumers to know the general awareness and understanding

about Goods and Services Tax of them. Personal interview was conducted of the respondents to get the answer

of various basic questions on GST.

ANALYSIS AND INTERPRETATION OF DATA

Analysis and its interpretation on general awareness about GST among the consumers are as follows.

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Q.1) Number of respondents know /don’t know the GST concepts.

Interpretation: 62 (92%) out of 66 respondents stated that they know about GST where as only 4(6%) are

unaware about this concept

Q. 2. Number of respondents know /don’t know who introduced GST.

Interpretation: 63 (95%) out of 66 respondents stated GST introduced by Central government and very few do

not know who introduced GST.

Q. 3. Number of respondents know /don’t know the meaning of CGST.

Interpretation: 53 (80%) out of 66 respondents stated that they know the meaning of CGST which means

Central Goods and Service Tax. On the contrary 13 (20%) people don’t know what it means.

Q4) Number of respondents know /don’t know the meaning of SGST.

94%

6%

Yes

No

95%

2%3%

Central Govt

State Govt

Do Not know

80%

20%Yes

No

77%

23%

Yes

No

Response Respondents %

Yes 62 94%

No 4 6%

Total 66 100%

Answers Respondents %

Central

Govt. 63 95%

State Govt. 1 2 %

Do Not

know 2 3 %

Total 66 100%


Yes 53 80%

No 13 20%

Total 66 100%


Yes 51 77%

No 15 23%

Total 66 100%

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Interpretation: 51(77%) out of 66 respondents stated that they know the meaning of SGST means State Goods

and Service Tax whereas other 15 (23%) respondents do not know what does it mean.

Q 5) Number of people responded about the purpose of GST.

Interpretation: 30 (45%) respondents out of 66 stated the correct purpose of introducing GST i.e. to reduce

number of indirect taxes followed by 4(6%) respondents who said that it is introduced for the purpose of

eliminating cascading effect. Besides, 24% and 23% mentioned that the purpose is to increase government

income and to reduce corruption respectively, 2% respondents remained neutral and not responded.

Q 6) Respondents replied for the question ‘who benefits from GST?’ from the multiple options provided

as under

Interpretation: 55(83%) out of 66 respondents said that the consumers, Central Government and State

Government are going to be benefited by the GST and 2 % of the respondent were neutral.

Q 7) Respondents replied for the question ‘how GST benefits to consumers?’ from the multiple options

provided as under:

24%

23%45%

6%

2%to increase GovtIncome

To reduceCorreption

To reduceNumber ofIndirect taxes

3%11%

2%

83%

2% consumer

centrel Govt

state Govt

All the Above

No response

21%

26%44%

9%Productbecomereasonble

Greatercertaintyabout GST

Options for

answers given Respondents %

To increase Govt.

revenue 16 24%

To reduce

Corruption 15 23%

To reduce Number

of Indirect taxes 30 45%

To eliminate

cascading effect 4 6%

No response 1 2%

Total 66 100%

Options Respondents

%

Consumer 2 3%

Central

Govt. 7 11%

State Govt. 1 2%

All the

Above 55 83%

No response 1 2%

Total 66 100%

Options for answer Respondents

%

Product become reasonable 14 21%

Greater certainty about GST 17 26%

Product price become lesser 29 44%

No response 6 9%

Total 66 100 %

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Interpretation: 29 (44 %) out of 66 respondents stated that the product price becomes lesser due to GST, 21%

respondents said that the product becomes reasonable, 26 % respondent are of the opinion that there is greater

certainty about ST and 9 % respondent were neutral.

Q 8) Responses received from multiple answers for: How GST benefits to Government?

Interpretation: 20 ( 30%) out of 66 respondents stated that GST helps Government for developing overall

infrastructure and reducing legal compliances followed by 19 (29%) respondents said that government income

increases due to GST, and only 2 % respondents not answered .

Q 9) Responses for identification of GST being charged

Interpretation: 65(95%) out of 66 respondents stated that GST being charged can be identified on the basis of

original bill whereas, only 2 % respondents said that it can be identified on the basis of duplicate bill.

10) Responses regarding: whether they shall avoid taking original bill while making payment?

Interpretation: 43 (65%) out of 66 respondents stated that they will demand original bill while making

payment which indicates that government revenue will increase due to GST.

29%

8%30%

30%

3% to increaseGovtIncome

to Healpreducecorreption

98%

2%0%

on the basisof original bill

on basisi ofduplicate bill

on the basisof kachha bill

35%

65%

Yes

No

Options for answer Respondents %

To increase Govt. Income 19 29%

To help reduce corruption 5 8%

To develop overall

infrastructure 20 30%

To reduce legal

compliances 20 30%

No response 2 3%

Total 66 100 %

Options for

answer Respondents %

On the basis of

original bill 65 98%

On basis of

duplicate bill 1 2%

On the basis of

kachha bill 0 0%

No response 0 0%

Total 66 100%


Yes 23 35%

No 43 65%

Total 66 100%

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Q 11-A) Responses for: whether government has taken appropriate step or not by introducing GST?

Interpretation: 47 (71 %) of the 66 respondents stated that GST introduction is the excellent step taken by

Government of India and only 18 % respondent has given negative response, and 11 % respondents has not

responded at all.

Q 11-B) Positive respondents supported the explanation which classified as excellent, average and poor as

under:

Interpretation: out of 47 respondents, 12 (26%) has justified nicely the Government’s step of introducing GST

followed by 36% who explained moderately and 38% respondents could not give satisfactory justification for

the governments initiative of bringing GST .

Q 12) Responses received from multiple answers for: What is the purpose of charging 15% Cess on GST?

Options were given Respondents %

Compensating the state who loose tax due o GST 18 27

For increasing Central Govt. revenue 02 03

For increasing State Govt. revenue 00 00

To use for social welfare 07 11

All of the above

35

53

Total 66 100

.

Interpretation: 27% respondents answered that 15 % Cess on GST is used for compensating the state that loose

tax due to GST of loss of tax due to GST, followed by 11% people who said that it is used for social welfare and

only 3% stated that it is for increasing central Govt. revenue. Whereas a majority, 53 % respondent said that it is

used for all of the purposes all the given purposes.

FINDING AND SUGGESTIONS

a) Findings:

1) A majority of the respondents knows about the GST.

2) Majority of the respondents answered correctly that GST is introduced by the Central Government.

3) Most of the respondents know very well the meaning of CGST and SGST.

71%

29% Yes

No

26%

36%

38%Exellent

Avg

Poor


Yes 47 71%

No 12 18%

No response 07 11%

Total 66 100%

Classified as Respondents %

Excellent 12 26%

Average 17 36%

Poor 18 38%

Total 47 100%

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February 2020


4) A majority respondent has cited right purposes of Government step for introducing GST i.e. reducing

number of indirect taxes is good and benefited to consumers, Central Government &State Government.

5) The consumers do not know the nature and applicability of GST.

6) Majority of the respondents has believed that they insist for original bill only while making payment to

know and understanding of GST being charged but reason behind it is explained not satisfactorily.

7) Majority agreed that GST adoption step taken by Government of India is good.

8) Very few respondents (27 % ) know that 15 % cess on GST is used for compensating of loss of state

due to GST.

b) Suggestions:

Considering the above and average awareness and knowledge of GST among the customers of Kalyan city the

researcher would like to suggest the following to the Government of India including State Government.

1) The Government of India and State Government, Income Tax Department should start GST awareness

program at local level.

2) The customers should be encouraged for learning the GST in order remove misconceptions about GST.

3) The Government should organize not only GST awareness camp but also legal aspect of GST in the

various local areas with the help of NGOs.

4) The consumer movements organizations like Mumabi Grahak Panchayt and other such NGOs should

organizes awareness campaign among different localities for common people

5) The consumers are suggested to read GST act, articles, and books for getting excellent knowledge of

GST.

6) The consumers should make regular habit of reading news papers daily as far as awareness is concern.

CONCLUSION

Government of India introduced GST with the objectives of making the tax structure less complex and to tackle

the problem of tax evasion. Therefore, the misconceptions and anti- GST information spread among the

common people by politicians who are in opposition should be clarified by the government with the help of

some good NGOs and consumer welfare organizations. It is remarked that consumers have limited knowledge

about GST, but technically and legally they required to be more aware.

REFFERENCES

Garg, G(2014)Basic Concept and Features of Goods and Services Tax India. International Journal of Scientific

Research and Management , 2(2), 52-533)

Kuriakose, A (2016), Awareness and Perception off Traders about GST ?: A Study Limited to Kanjirapally

Thaluk. Splint International Journal of Professionals, 3(12), 63-71.

Bharate, G H.. (2010 An Analytical Study of Awareness and Perception of Tax Payers towards Gst amongst

Traders in Rural Areas. International Research Journal of Engineering and Technology (IRJET), 4(5),

1113-1142.

Lourdunathan, K., avier, P. (2017). A Study on Implementation of Goods and Service Tax(GST) in India?:

Prospectus and Challenges. International Journal of Applied Research, 3(1), 626-629.from http://

www.allreseaechjournal.com201/vol 3issuelpart//3-1-42-650. pdf

Loo Ern Chen, Mohd Shurky Bin MChallenes Md Taib, Goods and Service Tax(GST) :Callengges Faced by

Business Operators In Malysia. SHS Web of Conference 36, 0002 (2017)

https://researchgate.net

http:// www.allreseaechjournal.com

http://www.allreseaechjournal.com201/vol%203issuelpart/3-1-42-650

https://researchgate.net/

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February 2020


IMPACT OF GST ON MUTUAL FUND DISTRIBUTORS’ COMMISSION

Prof. Dr. Janardhan Hotkar, Prof. CA. Reshmi M. Gurnani,

Head of Dept. of Accountancy Asst. Professor in Accountancy Department

K V Pendharkar College, Dombivli. Smt. Chandibai Himathmal Mansukhani College, Ulhasnagar.

Abstract:

Goods and Services Tax (GST) is a comprehensive, multi-stage, destination based tax regime that has been

levied on every value addition throughout India from July 1, 2017, replacing the taxes levied by the Central and

State Governments. The new tax regime, governed by a GST Council addresses some of the concerns of the end

buyers, as in indirect taxes the liability passes on. GST sanctions a provision of Input Tax Credit which allows

claiming the tax that has already been paid, so that the final liability could be reduced. Also GST has helped the

business community get rid of multiple taxations such as Excise, VAT and Service Tax and also redresses the

concerns of interstate businesses as earlier there were different VAT regulations in different States.

This paper highlights the impact of GST on Mutual Fund distributors and also aims to explore the issues in GST

implementation on Mutual Funds.

Key words: Mutual Fund, GST, Financial Products

1. Introduction

Under the Goods and Services Tax Act the statutory tax rates for all products and services have been announced

and are in effect from July 1, 2017. It is a revolutionary step that has subsumed all indirect taxes. The impact of

GST has been witnessed on prices of all commodities and services from the manufacturers to the end customers.

The financial services including investment segment will is also influenced. However, there is a marginal

impact of GST on mutual fund industry as well.

The expenses incurred by Asset Management Companies (AMCs) that affect the scheme’s Net Asset Value

(NAV) attracted service tax that was charged at the rate of 15%. Post GST implementation the service charges

have hiked by 3 per cent, increasing the expense ratio of mutual fund houses across the country to 18 per cent.

The 18 per cent rate slab is standardized by the Government authorities for the financial service industry which

means GST for mutual fund distributors has increased tax liability. However, the influence of it will be faced by

the large distributors only. But it should be noted that even though the smaller distributors, who are earning

below ₹ 20 lakhs per annum are exempted from the taxes the advantages of GST can be availed by the

distributors earning less ₹ 20 lakhs by registering for GST.

2. Research Methodology

2.1 Aims and Objectives:

The aim of this project is to take a look at the overview of impact of levying GST on Mutual Funds as well as to

analyze the issues in GST implementation on Mutual Fund industry and thereby in the growth of India’s finance

sector.

2.2 Scope and Limitations:

The scope of this project is to study the effects of charging GST to Mutual fund distributors and the key issues

in levy of GST on India’s Mutual Fund industry. In this regard enumeration of any model has been sought to be

avoided.

2.3 Method of Writing:

The researcher has attempted to adopt an analytical and descriptive approach. The method adopted is analytical

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in so far as it seeks to analyze with facts, the emergence and development of problems associated with charging

GST on Indian mutual fund industry.

2.4 Research Questions:

1. What is the impact of GST on Mutual Funds?

2. What are the key issues in GST with respect to Mutual Funds?

3. And lastly, how will the relief to large distributors affect Mutual Fund industry?

2.5 Sources of Data:

The researchers have relied upon secondary sources like journals, news reports, books, periodical materials and

the internet. Several articles related to GST and its impact on performance and growth of Indian Mutual Fund

industry has been examined.

3. Discussion

3.1 Impact of GST on Mutual Funds

India’s biggest tax reform, Goods and Services Tax or GST, became reality from July 1, 2017. Many mutual

fund investors have been wondering whether GST will have any adverse impact on their investments. Well, the

answer is: yes, it will have a marginal impact on mutual fund investments. The impact will not be that big, but

the increase in service tax from 15 per cent to 18 per cent would make mutual funds a tad expensive. The higher

expense ratio will lead to lower returns in mutual fund schemes.

Following are the ways in which the GST law has impacted the mutual funds industry in India:

Increase in service tax: According to the GST law, service tax has increased from 15 to 18% which has made

mutual funds a little expensive. Since the government has decided that when it comes to the financial services

industry, the service tax has been fixed at a standard rate of 18%. This led to a 3% point hike in the tax

liabilities of the distributors. However, smaller distributors who earn less than Rs.20 lakh per year are

exempted from this taxing system. Distributors who earn less than Rs.20 lakh per year need to get a GST

registration in order to avail tax exemption.

Security transactions have become costlier: Earlier the transactions on securities were not included in Service

Tax (ST) and Value Added Tax (VAT). The implementation of GST has changed this scenario and the

transactions of securities are taxable.

Increase in the expense ratio: Investors have to pay more premiums to invest in mutual funds. So, mutual fund

houses will eventually increase the expense ratio for most of their schemes and plans. Mutual fund houses not

only provide fund management services, but they employ services from other entities as well. For instance,

they use brokerage houses and custodians. This has led to a rise in the expense ratio of any plan that the

investor chooses.

Increased load of compliance on mutual funds: Under GST law, a tax incidence comes up at a spot where any

kind of service is delivered. Apart from this, the Asset management Company (AMC) and its branches are

considered separate entities. The asset management ability of a house providing funding assistance is usually

operated centrally whereas the marketing and sales activity of the plans runs at different paces. A problem

comes up when the head office and the branches are looked at as separate entities.

Mutual fund advice turns expensive: With the increase in service tax, seeking advice related to mutual funds

from an investment planner, investment advisor, or financial guardian has become more expensive. If

investors decide to seek guidance or advice from mutual fund distributors, financial professionals will incur

losses as they lose their business.

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3.2 Issues in GST

1. Applicability and charge of Goods and Services Tax:

With the introduction of service tax (earlier) and now GST, the mutual fund distributors (the service providers)

have to bear the GST out of the commission earned by them in spite of the mutual fund distributor being the

service provider and not the recipient of service. This situation has arisen as the SEBI regulations do not allow

the service tax / GST on distributor’s commission to be charged to the mutual fund scheme over and above the

limits of TER (Total Expense Ratio) prescribed by SEBI.

As a consequence, the GST, though an indirect tax is in the nature of a direct tax to the distributors. The mutual

fund distributors are now paying 30% income tax on the net profits as well as 18% GST on their gross

commission income.

It may be noted that vide circular no. CIR\IMD\DF\21\2012 dated 13.9.2012, SEBI allowed the service tax

(being an indirect tax) on Investment Management Fees levied by the AMC to the scheme, to be charged to the

mutual fund scheme over and above the TER prescribed. Accordingly GST on Investment Management fees is

charged to the scheme over and above the prescribed limits of TER under SEBI regulations.

2. GST tax will be levied as a direct tax:

If the mutual fund distributors are to absorb the GST on distributor commission, then the effective tax rate (for

the highest tax slab) would be quite high.

3. Unfair and discriminatory treatment of levy of GST on Mutual fund distribution commission:

In case of all other financial products too, the GST is borne by the final recipient of the service. Insurance

companies unlike Asset Management Companies or mutual funds are permitted to pass on their GST liability to

their end consumers. In case of banking and other financial services also, the companies are allowed to pass on

the burden of any sum paid to agents as service tax to their customers. But only in case of mutual funds, the

service tax on commission earned is borne by the distributors (the service provider), as shown below:

Comparative Chart of Service Tax treatment on Financial Products:

Financial Service Who pays GST Who bears GST

1. Insurance Agent Insurance Company Customer (Commission Is sdded

in the premium).

2. Stock Broking Stock Broker Customer ( Contracted Rate plus

GST)

3. PMS (Portfolio Management

Service)

Portfolio Manager Customer (Contracted Rate plus

GST)

4. Fixed Deposit FD Agent Company (FD Issuer)

5. Asset Management Company AMC/ Fund Customer ( Investment

Management Fees plus GST)

6. Mutual Fund Distribution AMC/ Fund Distributor (Commission

received less GST)

This treatment is unfair and discriminatory.

In order that the levy is passed on to the final recipient of the service, the SEBI should allow an increase in the

TER to the extent of GST chargeable on commission paid to distributors just as it has allowed GST on fees

charged by the asset management companies to be charged to the scheme over and above the maximum

chargeable TER and also as is the case of GST on distribution commission for other financial products.

4. Financial inclusion and financial independence:

This burden of bearing the GST coupled with the frequent reduction of TER in the past one year and the

additional reduction of TER w.e.f. 1.4.2019 in the garb of economies of scale being reached in the mutual fund

industry, has made mutual fund distribution an unviable option for young and budding professionals and even

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the goal of financial inclusion and independence of the citizens of our country is hampered.

5. Tax invoice to be raised on the mutual fund scheme and not the Asset Management Company:

SEBI circular SEBI/HO/IMD/DF2/CIR/P/2018/137 dated October 22, 2018 directs that all commissions and

remuneration in any form paid to the distributors be charged to the mutual fund scheme and not to the asset

management companies. It is common knowledge that mutual fund distributors provide service to the asset

management companies. But the aforesaid SEBI circular prescribes that the commission paid to the mutual fund

distributors be paid from the mutual fund scheme expenses and not by the asset management company. As such

the distributors raise a Tax Invoice on the mutual fund scheme instead of the asset management company

3.3 Relief to Large Distributors earning up to Rs.50 lakh

In a major relief to distributors who are earning up to Rs.50 lakh, the government has reduced GST rate from

18% to 6% with effect from April 1, 2019.

A composition scheme has been made available for suppliers of services or mixed suppliers with a tax rate of

6% (3%CGST + 3%SGST) having an annual turnover in the preceding financial year up to Rs.50 lakh. The said

scheme is applicable to both service providers as well as suppliers of goods and services, who are not eligible

for the presently available composition scheme for goods.

Since most distributors earning less than Rs.20 lakh have either cancelled their GST registration or not obtained

any GST registration to avail benefits under reverse charge mechanism, the move would largely benefits

distributors, earnings between Rs.20 lakh and Rs.50 lakh.

However, these distributors cannot avail input credits if they opt for the composition scheme. Also, they will

have to pay taxes quarterly but file returns annually.

Conclusion

Overall GST will not impact mutual fund investors specifically, except a hike in the total expense

ratio (TER). Under the GST regime, Asset Management Companies (AMC) will pay a tax of 18% on

the investment management fees, which was 15% earlier and is a part of the expense ratio. TER

charged for managing funds and distributor commissions (in case of regular plans) etc., would

increase based on the call each fund house takes (TER for mutual funds varies between 1.25% and

2.75%). Since tax is eventually borne by investors, their expenses too would go up marginally, as

reflected by the increased expense ratios of schemes. With the increase in tax from 15% to 18%, the

impact of GST on mutual funds would be felt.

References

Association of Mutual Funds in India, (Oct 2017), Goods and Services Tax - FAQs for Distributors

Moneycontrol.com (Jan 12, 2018), “Budget 2018: Mutual Funds seek simplification of GST rules applicable to

MFs” https://www.moneycontrol.com/news/business/budget-2018-mutual-funds-seek-simplication-of-

gst-rules-applicable-to-industry-2481829.html

Quantum Direct, (June 29, 2017), “Impact of GST on Your Mutual Fund Investments”, Investor Information

Guide

Prashant Mahesh (July 3, 2017), “MF distributors, IFAs need to enrol for GST”, The Economic Times

Nishant Patnaik (Jan 10, 2019), “Relief to large distributors earning up to Rs.50 lakh, GST reduced to 6%”,

https://cafemutual.com/news/industry/15394-relief-to-large-distributors-earning-up-to-rs50-lakh-gst-

reduced-to-GSTENABLED, WishFin (blog), “Impact of GST on Mutual Funds”,

https://www.wishfin.com/gst-impact/gst-impact-on-mutual-funds/

https://www.moneycontrol.com/news/business/budget-2018-mutual-funds-seek-simplication-of-gst-rules-applicable-to-industry-2481829.html

https://www.moneycontrol.com/news/business/budget-2018-mutual-funds-seek-simplication-of-gst-rules-applicable-to-industry-2481829.html

https://cafemutual.com/news/industry/15394-relief-to-large-distributors-earning-up-to-rs50-lakh-gst-reduced-to-6

https://cafemutual.com/news/industry/15394-relief-to-large-distributors-earning-up-to-rs50-lakh-gst-reduced-to-6

file:///C:/Users/TSPATIL/Desktop/Conf%20Papers/WishFin%20(blog),

https://www.wishfin.com/gst-impact/gst-impact-on-mutual-funds/

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THE IMPACT OF GOODS AND SERVICE TAX ON INDIAN AGRICULTURE TRADE

Prof. Sushma S. Ahire Dr. Shivanand J. Suryawanshi

S.N.D.T. College of Arts SCB College Commers Visiting Faculty, Department of Economics (PGSR),

and Science, Churchgate Mumbai-20. S.N.D.T. Women’s University, Mumbai-20.

Abstract-

The major objective of this study is to investigate the impact of GST implication on Indian agriculture trade.

Agriculture is the nerve of a country’s economy; it is the same for India. India ranks first in the world for its

cropped area followed by US and China and ranks second worldwide in farm outputs. More than 70% of rural

Indians depend on agriculture as their livelihood. India followed the traditional tax structure pattern, Direct tax

and Indirect tax system. The introduction of GST has replaced both Central and State indirect taxes. GST is a

destination based, universal, multi-stage tax levied on every value addition. Implementation of GST brought all

economical activities including agricultural sector under one roof. GST will improve the transparency,

reliability, timeline of supply chain mechanism for the agriculture products, which have various interpretations.

In this paper, attempt to highlight the positive and negative impact of GST on agricultural trade.

Key words: GST, Agriculture trade, Agriculture inputs, Tax structure.

Introduction :

Goods and Service Tax has replaced all indirect taxes in India to come up simplified unique tax. The GST is a

tax on goods and services which will be paid at the point of receiving.For example, tax on sugar will be paid

where the sugar is sold.GST plays a key role in making the state accountable to its taxpayers and this aiso being

a source of revenue and growth and will helpful to Make in India as well as ease of doing business.

India is a union of states as politically but are we an economic union? Can a trader sitting in Maharashtra sell

goods in Karnataka without having to worry about the rates of taxes in each state? Can a truck starting from

Mahatashtra and Kerala and going up to Delhi travel without being stopped at the check posts on the borders of

each State? GST would remove all these obstacles and make India a common national market where the trade is

really done without fear or favour in any State of the country.

Effective taxation ensures that public finances are sustainable in the longer term to support social objectives and

promote economic development.

Hypothesis :

H0 : The GST implication has not made significant impact on the performance of agricultural trade.

H1 : The GST implication has made significant impact on the performance of agricultural trade.

Reviewed literature:

The tax policy plays a significant role through its impact on both efficiency and equity in Indian economy.

Chaurasia et al.in 2016, find that GST is helpful for the development of Indian economy and it will be very

helpful in improving the gross domestic product of the country by more than two percent.

Swami N, in 2016, said that GST acts as helper in the collective gain for business, agriculture and common

consumers as well as for the Central Government and the State Government and thus ultimately helpful in

development of Indain agriculture production. It was further reported that GST will lead to provide commercial

benefits for agriculture sector, which were remained untouched by the VAT system.

ICFA,Survey report (July-2017) view on GST offers us the best option to broaden our tax base and we should

not miss this opportunities to introduce it when the circumstances are quite favorable and economy is enjoying

steady growth with only mild inflation. Thus GST at Central and State levels are expected to give more relief to

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Special Issues I

February 2020


agriculture, industry and consumers. Report also indicated that agriculture trade and industry have encouraging

responses to GST.

Director General, FAI Satish Chander, said that fertiliser products are suffer from higher incidence of taxes

with implementation of GST. So, it is strongly felt that there is a need for the government to pay special

attention to fertiliser sector, keeping in view its direct linkage with farmers and agriculture. Other tax regime

should not directly or indirectly increase the cost of fertilisers to the farmers, especially when government

continues to provide subsidy on fertiliser directly or indirectly. Prima facie, the government should either allow

zero or concessional rate of GST on fertilisers.

Chairman of the ITA's, Nirmal Khurana, her study about agriculture production as like, tea is a product of mass

consumption; it should have a special rate under the GST regime. The present concessional tax rate of 0.5/1per

cent for teas sold through auctions is allowed to continue under the GST regime. Otherwise, tea will become

costlier.GST rate on tea should be kept on a par with the current tax rate of 5-6per cent.

Goods and Service Tax scenario in India:

GST is a single tax on supply of goods and services, from producer to final consumer. Government of India

introduced and implemented GST on 1st July 2017 as ‘One Nation One Tax’ with a main purpose to provide a

simplified, single tax regime in line with tax framework applicable in various major economies across the world.

This single tax system has helped to increase efficiencies in business and also streamline various indirect taxes.

The GST regmi has in practice different from country to country in term of institutional and technical aspect.

Hungary has the highest rate of GST by 27%, Malaysia has one of the lowest GST rate of 6%. India have

multiple rate slabs (i.e. 0%, 5%, 12%, 18% & 28%). In the Indian budget 2019-2020 estimated the gross tax

revenue(GTR) to be 24.26 lakh crore rupees which is the 11.7% of gross domestic product. According economic

survey 2019-2020 out of GTR 46 percent of tax revenue will be collected from indirect taxes (Custom, Union

Excise Duties, and GST) and 54 per sent tax revenue collected from direct taxes ( Corporate tax, Taxes on

income other than corporate tax).

Table 1: Tax rate on important agricultural inputs in major states:-

Major

Agricultural

inputs

Before-GST rates (%)

GST reate

(%)

Madhya

pradesh

Uttar

Pradesh

Karnataka Maharashtra Central

Fertilizers 5 4 5.5 6 12.5 12

Plant growth

chemical 5 4 5.5 6 12.5 18

Plant

protection

chemical

5 4 5.5 6 12.5 18

Seeds 0 0 0 0 Exempted Exempted

Machineries

(i.e. tractor,

triller, watre

pump ect.)

4 5 6 5 12.5 18

Source : ICFA Survey Report (2019).

Earlier fertilizers were subjected to a 0-8% VAT which, after implementation GST, will attract 12% tax, this has

increased the price of fertilizer by 5-7% in India. GST would make the agro-machineries affordable to the small

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and marginal farmers in India which was beyond their reach due to high excise duty on the machinery. After the

implementation GST it has reduce prices on the national level.

Table 2: Effect of goods and services tax on operational cost of crops (Rs/ha)

Crop groups Major crops Operational cost

Without

GST

With GST % Change

Pulses Arhar 24569 24567 -0.007

Gram 20113 20096 -0.083

Moong 16612 16591 -0.129

Cereals Paddy 40124 40055 -0.170

Wheat 28084 28012 -0.254

Maize 35400 35310 -0.254

Cash crops Jute 45682 45638 -0.096

Cotton 50953 50899 -0.107

Sugarcane 90553 90320 -0.258

Oilseeds Soybean 24943 24843 -0.404

Sesame 18971 18951 -0.103

Groundnut 42815 42734 -0.190

Mustard 23755 23694 -0.258

Source: NABARD, Handbook of Statistics on Indian Agriculture.

Table 2 shows the comparatively operational cost of various major crops rupees per hectare without GST and

with GST operational cost difference. Before the implementation of GST on agriculture major crop groups its

operational cost is high compare after implementation of GST. The taxation policy of Government aims to meet

its legitimate need to collect the tax revenue to fund for agriculture reforms. Thus, a number of indirect taxes

(VAT, excise duty, service tax) were apply under the state VAT, pulses, cereals, cash crop and oilseeds were

taxed at the rate of 4%. In the last column show this difference in percentage. This difference is very few -0.007

the major crop production cost of arhar. And large cost difference after GST implementation -0.404% in the

major crop soybean. Implementation of GST taxes is going to benefit a lot of farmers, traders, cultivators and

distributers, in the long run, owing to its creation of a single unified national agriculture market. It is designed

for farmers to sell their produce for the best available price.

Research methodology:

The paper is based on secondary sources of data to estimate the impact of goods and service tax on Indian

agriculture major crop product cost. To finding the GST implication does the significant impact on the

performance of the agriculture trade data has collection from GST portel, NABARD handbook of statistics on

Indian agriculture, ICFA survey report which have been obtained from various GST implementation discussion

papers, published article in journals, web articles (internet sources), past studies and newspaper etc. With the

help of these secondary sources, attempt has been made to find the obstacles coming on the way of GST vis-a-

vis Indian agriculture trade.

Findings:

Indian agriculture sector had benefited from the GST tax system and the prices of agriculture products like

pulses, cereals, cash crop and oilseeds have also reduced. Also the survey had found that control the agriculture

input prices is a relief to farmers. This would ultimately result in the development of agriculture and allied

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sector in India.

Conclusion:

PM’s vision of doubling farmer’s income by 2022 due to changes in the tax rates at various levels of supply

chain. If the output prices increase, the economy will suffer as the food prices will go up, it will be creating

trouble for the common man. The government needs to be very cautious to implementing the GST system in

agriculture and allied activities and should have extra concern towards the farmers. Thus a slightest burden on

farmers will result in manifold distress and misery, they being the most vulnerable community of the country.

Presently GST structure in India will present a transparent system which will be helpful to reduce the burden of

cascading effect and it will also improve the Tax compliances and Tax collection by uniformity of taxes all over

the country.

References:

GoI (2018), ‘Report of the Working Group on Agriculture and Policy Required for Internal and External Trade’,

Agriculture Division, Planning Commission, Government of India, New Delhi.

Sabari Nath T V" Implementation of Goods & Service Tax (Gst) in India Emerging Opportunities &

Challenges” Quest Journals Journal of Research in agriculture Business, vol. 07, no. 01, 2019, pp 58-60

Economic survey (2019-2020), Ministry of Finance, Government of India, Feb-2020.

ICFA Survey Report (Jul-2017), Impact of GST on agri-input market in India, 2017.

GST Portal (https://www.gst.gov.in)

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February 2020


COMPARATIVE ADVERTISING AND TRADEMARK LAW:INSIGHTS

FROM CASE ANALYSES

Alisha Francis & Srishti Yadav

Abstract:

The competition prevailing in today’s market has made the producers compete against each other by the way of

portraying that their product is better or rather best than the other. The research paper titled,” infringement of

trademark by comparative advertisement “studies the impact of comparative advertisement on trademark

already registered where the researcher tries to release the justice given to the traders whose trademark have

been infringed by the competitors. This paper studies the various remedies given by the court for these violation

in different cases as to who can be sued and who can sue so that the actual trademark owner can retain his

intellectual property rights on the product. The researchers want to know the judgment on these infringement of

trademark in comparative advertisement the methodology adopted was by interacting with the lawyers and

through secondary sources like journals, internet, and newspaper articles.

Keywords: Comparative Advertisement, Intellectual property, Trademark Infringement , judgment.

INTRODUCTION:

In today’s environment of cut throat competition, every brand is giving a tough fight to its competitors which

creates a hostile environment and induces them to get down to comparative advertisement. Comparative

Advertisement is the advertisement that explicitly or implicitly compares at least two brands in the same generic

product or service class or specific product or service attributes trying to portray the superiority of that product/

service over the other brand.

Trademark is a visual mark that differentiates a product or service of a proprietor in respect of origin, material,

quality, accuracy and other characteristics. It is a way of differentiating and identifying a product or service

from among the rest of the similar products and also ensures quality to the customer. A trademark is registered

to get a right to use that mark on products made by that company.

Comparative advertisement done with dishonest means will lead to infringement of trademark. Infringement

occurs when a person uses a trademark which is identical or similar to the other product or service.

OBJECTIVE:

1. To understand the purpose of comparative advertising

2. To know about trademark infringement

3. To analyze the reasons behind improper use of comparative advertising

4. To recognize legal provisions to protect the trademark in case of infringement due to comparative

advertising.

THEORETICAL BACKGROUND:

Comparative advertising is a common strategy used by many FMCG companies. The main types of comparative

advertisement can be seen in the given diagram and examples:

Positive comparative advertisement: it helps the competitor to grab the market in comparison with the brand

who has already established a position in the market. Reduces the confusion among the consumer. It indirectly

helps them compete on the basis of the quality and price which is benefit for the consumer. It positions the

product in the mind of the customer.

The print media is also reporting extensively about such cases.

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Trademark Infringement: according to section 29 of the Trademark Act 1999, using a mark identical to a

trademark registered for any product or service without permission amounts to infringement.

Types of comparative advertisement:

Recognition of Trademark – a trademark is either known once it gets registered or with the frequent usage of the

trademark

Direct comparative

advertisement

Advertisements that directly compare one product with the specific competing brands which can be recognised easily.

Indirect comparative

advertisemnet

Advertisements that indirectly compare the attributes of one product with the attributes of rivals or competing goods.

Non-comparative advertisement

Advertisements that are made for only one brand and does not compare with other competing goods in anyway.

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SCOPE OF THE STUDY:

the purpose of this research is to know the various cases on infringement of trademark by comparative

advertisement and the judgment given on them where this analysis will help in overcoming the gaps of the laws

Application Received

Formality Examination

Conduct search

Application Accepted

Advertising in Gov Gazzete

Statutory Period for Opposition

by 3rd Party

Registration of Trademark

Application Rejected

Reject Letter Issued

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prevailing and regulating the laws.

RESEARCH METHODOLOGY:

it is as way of finding out result on the problem on a specific matter. It finds out information, techniques and

procedures on the research problem. The researcher studies the cases related to trademark infringement using

comparative advertisement and the judgment passed by the jurisdiction on such cases.

LIMITATION:

There are two methods of data collection. The researcher’s imitation was regarding time which forced her to

collect data from secondary sources like journals, reference books, newspaper articles, and internet. Further the

researcher aspires to use survey method to collect the data for her next research paper.

REVIEW OF LITERATURE:

Saadiya Suleman (November 2011) in her opinion says that the advertising industry is full of hidden lies and

subtle truth. The world is full of cut throat competition and these advertising agency are so far coming up with

even more fascinating techniques to lure people. It attracts the target customers as well as competition.

Customers should realize it is not always true what these advertisements portray it can be misleading. ASCI is a

self-regulatory body working since long but still has not come up with any enforcement mechanism for these

ramifications. Semila Fernandes (May 2014) in her research paper opines that though the Indian law takes a

decision upon the infringement on the basis of the correctness of representation but by the time they decide it

and come to settlement of claims it results into terminating the advertisement which makes these laws weak also

Indian laws strictly prohibited exaggerated statements and facts but in major disputes this differences isn’t

clearly identified which further makes it imbalanced. The concept of granting infringement is basically not clear

leading to the first step of identification of the practices that are accepted and relevant though. Manzoor Laskar

(March 2013) opines that protection of trademark is essential for the business as well as customers as it should

not impose fraud against the two. The common law remedy protects the registered & unregistered trademark

from being misused. Elisabetta Corvi (January 2008) in her research paper expresses her view on the cross

culture comparative advertising difference when she got to notice the difference of customer view and opinion

of the same product in different culture. Believability amongst brands was different among individualistic and

collectivist country. Michael Cosgrove (March 2011) opines that trademark is an intellectual property more or

less similar to patent and copyright. Infringement of trademark leads to violation of the property rights. The

researcher feels that the competition is getting intense which leads the advertisers to engage in malpractices and

unhealthy competition by trying to grab a market share without much efforts.

Figure 1: The Economic Times

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DISCUSSION:

CASE 1: Adidas sued Forever 21 and a group of its suppliers in Oregon for using the three stripe mark

registered by adidas. (https://uk.fashionnetwork.com/news/adidas-settles-trademark-case-with-

forever21,901536.html

https://www.thefashionlaw.com/home/adidas-responds-to-forever-21-counterclaims-we-do-not-use-

stripes-merely-as-a-design-element)

ANALYSIS:

Adidas sued Forever 21 for using its three stripe mark majorly pointing out towards the track pants and shorts

where it said that due to the use of this three stripe mark that forever 21 was illegally using it lead to confusion

which was likely to deceive the consumer regarding the source and sponsorship and affiliation and it eventually

harmed their goodwill and reputation. This illegal use of Adidas trademark lead to a huge loss in their profits

and also caused punitive damages. Adidas has written that these apparels and footwear are counterfeit which are

imitating the adidas three stripe mark. Adidas put forth their complaint saying that its and infringement of its

trademark, where forever 21 is using unfair means to compete against us. Adidas also asked forever 21 to stop

selling these products. Since decades these two competitors are fighting over these stripe marks. Forever 21 on

his behalf wrote in a court document that adidas since 2006 has started complaining over these three stripe

marks and its threats are increasing day by day for any kind of striped decorative apparel. Adidas has not only

sued forever 21 for using its trademark but in 2005 has also sued LA based fashion retailer for the very same

reason of using three stripe mark , followed by ecco, marc Jacobs, sketcher and tesla for infringement of its

registered trademark. The German sportswear giant wants the court to curb forever 21 fast fashion retailer’s

attempt to undermine adidas registered trademark. Adidas asserts that it has invested hundreds of millions in

advertising, promotions, sponsorship which has paid off by having a recognition in the market and almost

everybody knows about adidas as a brand. The three stripe mark marks an identity to this famous brand that

helps the customers to distinguish adidas from the competitors.

VERDICT:

Adidas sued forever 21 in the year 2015 after which forever 21 claimed that it would respect adidas trademark

and will not infringe upon but later it still continued the same by using the trademark with more fifty two

products after which adidas further filed a case. Presently, forever 21 has filed bankruptcy for which the case

has been paused on October 4th 2019. Once the bankruptcy is resolved the case shall be opened again.

CASE 2: Coca Cola Company Filed a Case against Bisleri for Infringing On Maaza Trademark

(https://economictimes.indiatimes.com/industry/cons-products/food/maaza-war-coke-takes-bisleri-to-

court/articleshow/3678955.cms

https://www.india-briefing.com/news/coke-wins-landmark-indian-trademark-case-1286.html/)

ANALYSIS:

Coca cola being the owner of the Maaza trademark in India asked the Delhi high court to restrain Bisleri from

infringing the Maaza trademark and disclosing the formulation and intellectual property used for its preparation.

Bisleri chairman Mr. Chauhan said that coco cola’s move is beyond their comprehension as they retain the IPR

for the brand Maaza outside India. Later Mr. Chauhan sent a legal notice to TCCC( the coco cola company) for

getting a registered trademark outside India within a month and stop the production. As the trademark within

India was with coco cola and outside India with Bisleri. Mr Chauhan has sold Maaza distribution to some global

markets. He also claimed for damages for the infringement. The Bisleri chairman said they had not given any

rights to the third party for distributing under the trademark named Maaza. Coco cola in the 1993 and 1994

entered in a non compete agreement with aqua mineral now known as Bisleri which did not point out on the fact

https://uk.fashionnetwork.com/news/adidas-settles-trademark-case-with-forever21,901536.html


https://www.thefashionlaw.com/home/adidas-responds-to-forever-21-counterclaims-we-do-not-use-stripes-merely-as-a-design-element


https://economictimes.indiatimes.com/industry/cons-products/food/maaza-war-coke-takes-bisleri-to-court/articleshow/3678955.cms


https://www.india-briefing.com/news/coke-wins-landmark-indian-trademark-case-1286.html/

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that they had to restrain from the distribution in any other country where the trademark was not registered. Later

coco cola proved that it’s the sole owner of the Maaza trademark and knows the formulation and had got into an

agreement with aqua mineral and golden agro.

VERDICT: The Delhi high court on appeal from TCCC ordered to restrain the defendant Bisleri from using

the Maaza trademark. Where the Coco cola company wins the landmark Indian case restraining the Bisleri from

the selling of this mango flavoured drink in India. The court dismissed the plea of Bisleri’s application.

CONCLUSION:

Comparative advertising has a positive impact as it enhances the customer awareness and creates an impact

on the perception about the customer as to which product they should prefer.

But when the competitor not only tries to compare the product but illegally uses the trademark which the

original owner has registered and spent millions of dollars to get a recognition for the same it leads to

infringement of trademark which may ultimately land up in court.

INSIGHTS:

Modern technology should be used in an appropriate matter to find out the registered trademark so that there

is no infringement caused landing them to pay huge million dollars to settle the claims and damages.

Comparative advertisements should be used to give clarity to the consumer by ensuring that it does not

demean any other brand.

There is an urgent need for all the brands to register their trademark as it is very important as anyone

anytime can misuse it.

REFERENCE:

Elisabetta Corvi (January 2008),” the effectiveness of comparative advertising: a literature review,

Manzoor Elahi Laskar (March 2013),” passing off and infringement of trademark- India

file:///C:/Users/admin/Desktop/SSRN-id2410451.pdf

Michael Cosgrove (March 2011),” case study: trademark infringement issues

Saadiya Suleman (November 2011), “comparative advertising, disparagement and trademarks infringement: an

interface file:///C:/Users/admin/Desktop/vidhigya-7-2-002.pdf

Semila Fernandes (may 2014) ,” a case study approach – an analysis of the infringement of trademark by

comparative advertising. file:///C:/Users/admin/Desktop/A_Case_Study_Approach_-

_An_Analysis_of_the_Infring.pdf

https://economictimes.indiatimes.com/industry/cons-products/food/maaza-war-coke-takes-bisleri-to-

court/articleshow/3678955.cms



https://www.thefashionlaw.com/home/adidas-responds-to-forever-21-counterclaims-we-do-not-use-stripes-

merely-as-a-design-element

https://www.jstor.org/stable/40216312?seq=1

https://www.quora.com/What-are-some-good-examples-of-comparative-advertising

https://indiankanoon.org/doc/924003/

https://www.thefashionlaw.com/home/a-timeline-of-the-ugly-legal-battle-between-adidas-v-forever-21

https://www.google.com/search?q=comparative+advertisement&rlz=1C1CHBD_enIN844IN844&oq=comparati

ve+advertisement&aqs=chrome..69i57j69i59l2j35i39j0j69i61l3.9726j0j1&sourceid=chrome&ie=UTF-

8

file:///C:/Users/admin/Desktop/SSRN-id2410451.pdf

file:///C:/Users/admin/Desktop/vidhigya-7-2-002.pdf

file:///C:/Users/admin/Desktop/A_Case_Study_Approach_-_An_Analysis_of_the_Infring.pdf

file:///C:/Users/admin/Desktop/A_Case_Study_Approach_-_An_Analysis_of_the_Infring.pdf







https://www.jstor.org/stable/40216312?seq=1

https://www.quora.com/What-are-some-good-examples-of-comparative-advertising

https://indiankanoon.org/doc/924003/

https://www.thefashionlaw.com/home/a-timeline-of-the-ugly-legal-battle-between-adidas-v-forever-21

https://www.google.com/search?q=comparative+advertisement&rlz=1C1CHBD_enIN844IN844&oq=comparative+advertisement&aqs=chrome..69i57j69i59l2j35i39j0j69i61l3.9726j0j1&sourceid=chrome&ie=UTF-8



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A STUDY OF IMPACT OF GST ON PERSONAL FINANCE

CA Neeta Vaidya

Chandrabhan Sharma College of Arts, Science & Commerce, Powai, Mumbai.

ABSTRACT:

In the year 2017, India implemented one of the most significant economic reforms - the Goods and Service Tax

(GST). This reform was implemented after a lot of discussions and considering its impact on all the sectors of

the country. The Act received mixed reactions from consumers, industry, business units, service providers and

the society at large. Many experts gave detailed explanations on how GST would be efficient as it removes the

cascading effects of tax on tax and helps in reducing cost and controlling inflation. However, the common man

is the most susceptible due to the implementation of GST. GST impacts prices of various commodities which are

consumed by the common man and the disposable surplus also gets affected. Personal finance is the financial

management which an individual performs to budget, save, and spend monetary resources over time taking into

account various financial risks and future life events. It is about managing income, expenses, savings and

investments. GST will have a mixed impact on various components of personal finance. This study highlights the

impact of GST on various aspects of personal finance.

KEYWORDS: Goods and Service Tax, Personal Finance, Expenses, Investment.

INTRODUCTION:

Personal finance is the management of money and financial decisions for a person or family including

budgeting, investments and retirement planning. It is the process of planning and managing personal financial

activities such as income generation, spending, saving, investing, and protection. GST has impacted the

spending ability of the common man. Some items have become cheaper, whereas others have become costlier.

GST has impacted personal finance of individuals as the important components of personal finance are also

affected due to GST. Personal finance mainly includes the spending for day to day requirements and

investments. The spending of an individual includes certain categories of goods like FMCG, pharma and

healthcare, consumer durables in addition to availing services like transportation, insurance, telecom and

investments in assets like automobiles, real estate, gold etc. This paper highlights the favorable or adverse

impact of GST on selected categories of Goods and Services and also surveys the views of common people

regarding GST.

RATIONALE OF THE STUDY:

There have been many tax reforms since independence which has impacted the masses. The common man

generally gets carried away with some preconceived notions without understanding the basic purpose of the

reforms and the benefits which are expected to be derived from them. GST is an important reform implemented

to make a unified tax structure and replace the multiple taxes existing in our country. This study studies the

impact of GST on the common man in terms of his spending on different goods and services.

STATEMENT OF THE PROBLEM:

The literacy rate in India is 74.04% which means 25.96% of the population are still illiterate and fail to

understand the tax implications of various Acts and in particular GST. Even among the so called literate

population, the understanding of GST is questionable. This study analyses the impact of GST on the prices of

various goods and services and also surveys public perceptions about GST..

OBJECTIVES

The objective of this paper is to study the impact of GST on selected types of goods and services used by people

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in their everyday life and are a major component of personal finance. The different categories of goods and

services on which the impact of GST would be highlighted are as under.

1. FMCG Goods: Fast-moving consumer goods (FMCG) are products that are sold quickly and at a

relatively low cost like non-durable household goods such as packaged foods, beverages, toiletries,

over-the-counter drugs, and other consumables. These goods constitute one of the major component of

the expenditure of the common man. When the GST rates for the FMCG was announced most of the

products/goods were categorized under the tax brackets as expected by the FMCG industry experts.

Although there are few products placed under the 12% bracket which is expected to be more expensive

than under current laws. Under GST basic food products such as milk, rice, wheat and fresh vegetables

have been kept under the NIL bracket ,branded Paneer like mother dairy paneer or Nestle Paneer and

Frozen vegetables have been kept under the 5% bracket whereas certain products like butter, Cheese

and Ghee will get expensive under GST as they are placed in the 12% bracket which is higher than the

current average tax rate of 4-5%. On the whole FMCG industry is going to benefit from the lower

logistics cost and better competitive market and rates for most of the products being kept under the

expected tax bracket.

2. Pharma and Healthcare: After introduction of GST on pharmaceuticals and medical supplies in India

are taxed at four separate rates of Nil, 5%, 12% and 18%. The nil GST on medicines is currently only

applicable to human blood and its derivatives as well as all types of contraceptives. The highest GST

rate on medicines i.e. 18% is applicable only to products containing nicotine polacrilex such as nicotine

gum. The lowest GST rate of 5% (apart from the nil GST rate) is applicable to pharmaceutical products

designated as “life-saving drugs” including oral rehydration salts, vaccines, as well as medicines such as

those used to treat diabetes, tuberculosis, HIV-AIDS, malaria, etc. As of yet, no pharmaceutical

products are featured in the highest 28% GST rate. Under the VAT regime, medications and other

medical supplies were impacted by cascading taxation as both excise duty and VAT were applicable to

all medical supplies including medicines. This has been eliminated through the introduction of GST on

medicines and other healthcare products. In case of various life-saving medications, the price of

medicines under GST has remained nearly the same. This is because a VAT rate of 4% on 65% of MRP

(i.e. 4% VAT was on top of excise duty) being replaced by GST rate of 5%, leading prices to be

maintained at the same level in terms MRP. In case of dietary supplement products, the removal of

excise duty has led to increased profitability and lower prices as these tax reduction benefits get passed

on to customers. The main impact of GST implementation has been on the supply chain of

pharmaceutical products. Under the earlier VAT regime, the central state tax (CST) payable for

interstate transactions was 2%. In order to avoid this tax burden, pharmaceutical companies maintained

depots in every state/union territory where they operated. Subsequent to introduction of GST on

medicines and other pharmaceutical products, the supply process is expected to get more streamlined as

more companies employ a hub and spoke model that reduces warehousing costs and optimizes the

benefit of Input Tax Credit under GST.

3. Consumer Durables: In its 28th meeting, the GST Council gave its approval to slash tax rates on over

100 items that were in the highest 28% tax bracket under the Goods and Services Tax. GST rates on

articles including consumer durables like smaller television sets, refrigerators, washing machines, paints

and varnishes, lithium ion batteries, and more were brought down from 28 per cent to 18 per cent. The

tax council also rationalised rates on several other items too.

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4. GST on Loans and Advances: Earlier Service Tax was levied on Loans which has now been replaced

by GST which would now be levied on loans. The rate of Service Tax was 15% whereas the rate of

GST is 18%. A lot of people are of the opinion that the effective cost of having a loan would increase as

the rate of GST is 3% higher than the rate of Service Tax. Several people are of the opinion that their

EMI’s would increase as the rate has been increased by 3%. However, this is not the case as GST is not

levied on repayment of loan or on payment of Interest on Loan. GST is only levied on the processing

charges and any other charges paid to the bank excluding the principal repayment and interest payment.

These other charges include the Loan Processing Fees, Loan Prepayment Charges and other charges, if

any. As a major chunk of the loan repayment comprises of principal repayment and interest payment,

the impact of GST on Loans would be very negligible. The impact of GST on Home Loans and

Personal Loans has been explained below for a much better understanding of the impact.

5. Mobile network, DTH and Other Services: Service industry are now under 18% GST compared to

the earlier 15%. So, mobile connections, DTH booking of tickets through agents, apps will increase.

Computers are expected to become cheaper.

6. Restaurants: Dining out will be cheaper in most cases because of decrease in taxes. Earlier tax on

restaurants came to an effective rate of 20.5%. This has been reduced for all restaurants to 18% GST,

including 5-star restaurants. Even better, non-ac restaurants without alcohol will be even cheaper under

12% tax. Many restaurants have already started giving discounts and happy hour low prices. So, eating

out has become cheaper under GST. For most restaurants, GST is now 5% without input credit benefits.

7. Banking & Insurance: The cost of new insurance policy premiums will increase due to the increase of

tax on services to 18% (from 15%). Cost of taking out a loan will also increase due to the service

component in loan processing etc. Banking services charge at 15% service tax, which will increase to

18% under GST.

8. Tourism: Railways tickets will increase slightly due to rates. Economy air prices will fall. However,

luxury and business class ticket prices will rise. Budget hotel rooms below Rs. 1000 per day are

exempted from GST. Rooms between 1000- 2500 will attract 12% GST. Rooms between 2500-7500

will be taxed under 18%. Rooms above 7500 are taxed at the luxury rate of 28%. Hotel rent will

decrease for all rooms except for the high-end luxury ones

9. GST on Gold: Subsequent to introduction of GST on items made from gold such as gold jewellery, the

current GST rate on gold is 3%. However, a 5% GST rate is applicable to making charges applied to

gold jewellery in case the manufacturing is outsourced to a job worker. This can however, be charged as

input tax credit (ITC) by the jeweller and only a 3% GST charge is applied to the final bill paid by the

purchaser of gold jewellery items.

10. GST On Real Estate: GST is applicable to real estate purchases only on under construction property.

The GST rate applicable to such commercial or residential transactions is 12% till 31st March 2019.

From 1st April, the applicable GST Rates on residential real estate will be 5% for non-affordable

housing properties and 1% for affordable housing properties. Additionally, different GST rates are

applicable to various building materials used in the construction of houses/flats. This can range from 5%

(sand, marble rubble, etc.) to 28% (cement, etc.).

SCOPE OF THE STUDY:

The study was conducted on 40 respondents and their understanding about GST and how it has impacted their

spending and investments.

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Data is collected both by primary as well as secondary source. Secondary sources such as websites, journals and

research papers are used. Primary data is collected from 40 respondents through an internet survey by using a

questionnaire. Data is collected from the respondents and a simple percentage method is used for data analysis

with mode as the analytical tool. Pie charts and bar diagrams are used for data interpretation.

The outcomes of the study are depicted hereunder

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The respondents gave the following suggestions which are mentioned hereunder.

● Some respondents felt that GST is not at all effective.

● GST Rates should be low.

● The customers should get input tax credit advantage.

● The Act should be more simplified.

● Too many amendments which makes it difficult for common man to understand.

● The rules and regulations regarding GST should be made stringent

● Widen the base of GST.

● Lack of awareness of GST among the masses.

CONCLUSION:

Within the household budget, there are likely to be some obvious gainers and some obvious losers but once the

law and pricing of commodities reach steady state, all consumers should gain. We have provided a few

examples to explain the impact of GST on the common man, the impact on pricing on account of additional

credits and hence reduced cost of supply is separate.

GST is expected to bring greater transparency, improve compliance levels and create a common playing field

for businesses by amalgamating a host of central and local taxes. It would change the current tax regime of

production-based taxation to a consumption-based system. There is no doubt that the corporates would benefit

once they settle in under GST and assess the impact on their respective businesses; however, the advantages to

the common man may take longer to be apparent.

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It is expected that the consumer would also reap the benefits of the new tax regime, once the corporates have

transitioned completely to the new tax structure and start to pass on the benefits to the end user.

REFERENCES:

http://www.gstcouncil.gov.in/

https://cleartax.in/

https://timesofindia.indiatimes.com/

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A STUDY ON ROLE OF NARBARD IN MICRO FINANCE AND SELF HELP GROUPS

Dr. Raj Ankush Soshte

N.S.S. College of Commerce and Economics, Tardeo, Mumbai -400034

ABSTRACT

The importance of institutional credit in boosting rural economy has been clear to the Government of India right

from its early stages of planning. Therefore, the Reserve Bank of India (RBI) at the insistence of the Government

of India, constituted a Committee to Review the Arrangements For Institutional Credit for Agriculture and Rural

Development (CRAFICARD) to look into these very critical aspects. The Committee was formed on 30 March

1979, under the Chairmanship of Shri B. Sivaraman, former member of Planning Commission, Government of

India. The Committee’s interim report, submitted on 28 November 1979, outlined the need for a new

organizational device for providing undivided attention, forceful direction and pointed focus to credit related

issues linked with rural development. Its recommendation was formation of a unique development financial

institution which would address these aspirations and formation of National Bank for Agriculture and Rural

Development (NABARD) was approved by the Parliament through Act 61 of 1981. The present paper focused on

role of NABARD in Micro-finance and self- help groups in India and also presented the initiative taken by the

NABARD to finance to various agencies in India.

Keywords: Micro finance, Self-Help Groups, NABARD etc.

1. INTRODUCTION:

NABARD came into existence on 12 July 1982 by transferring the agricultural credit functions of RBI and

refinance functions of the then Agricultural Refinance and Development Corporation (ARDC). It was dedicated

to the service of the nation by the late Prime Minister Smt. Indira Gandhi on 05 November 1982. Set up with an

initial capital of Rs.100 crore, its’ paid up capital stood at Rs.12,580 crore as on 31 March 2019. Consequent to

the revision in the composition of share capital between Government of India and RBI, NABARD today is fully

owned by Government of India. The concept of self-help groups (SHGs) was promoted by NABARD in 1991-

92. The objective is to meet the financial needs of the poor by linking self –help groups with the formal credit

agencies. NABARD provides refinance to state cooperative agriculture and rural development banks (SCARDBs)

state co-operative banks (SCBs), regional rural banks (RRBs) and other financial institutions approved by the

RBI. The ultimate beneficiaries of refinance from NABARD could be individuals, partnership concerns,

companies, State-owned co-operations or co-operative societies. In the Union Budget for the year 2005-06, it was

announced that sugar factories that were operational in 2002-03, sugar season would be assisted to restructure

themselves. Accordingly, a Committee was constituted by NABARD to work out a scheme in this regard with

representation from the RBI. The Vyas Committee had also suggested measures to strengthen the service Area

Credit Monitoring and Information System (SAMIS) under the service Area Approach (SAA). In this regard,

NABARD constituted another Working Group to review the SAMIS reporting system and to initiate necessary

modification/ changes required therein.

NABARD provides short-term credit facilities to SCBs in respect of eligible CCBs for the following purposes.

1. Financing seasonal agricultural operations (SAO)

2. Marketing of crops.

3. Pisciculture activities.

4. Labour contract/ forest labour co-operative societies

5. Individual rural artisans through PCS.

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6. Procurement, stocking and distribution of chemical fertilizers

7. Approved agricultural, allied and other marketing activities.

Besides short-term credit limits are also sanctioned to SCBs on behalf of apex/ regional weavers/ other industrial

societies for financing procurement and marketing and trading-in-yarn. Short-term limits are also provided to

RRBs for financing seasonal agricultural operations, marketing of crops and pisciculture activities. Medium-term

facilities are also provided to SCBs and RRBs for converting short-term into medium-term loans and for approved

agricultural investments. Long-term loans are provided to the state governments for contributing to the share

capital of co-operative credit institutions.

2. OBJECTIVES OF THE STUDY:

The study based on following objectives:

1. To study the present status of NABARD in India

2. To Study the role of NABARD towards Micro-finance and Self Help Groups in India

3. To study the initiative taken by the NABARD to promote micro-finance and Self Help group in India.

3. METHODOLOGY OF THE STUDY:

The Data for the study has been collected from various secondary sources like books, articles and research papers

which are published in various International, National journals , websites etc.

4. NABARD STRATEGY FOR OUTREACH OF SHG-BANK LINKAGES PROGRAMME:

NABARD is adopting the following strategy to spread the outreach of SHG-Bank Linkage Programme.

Widening spatial distribution and intensity of the outreach of the programme with district oriented

planning and strategy.

Evolving district-wise plan of action/strategy in consultation with existing stakeholders aiming at

promotion and linkage of a minimum of 500 SHGs per district every year.

Training and exposure programmes for the staff of the stakeholders.

Providing promotional assistance to partners for promoting and nurturing the SHGs generally on an add-

on basis.

Widening the range of SHGs promoting agencies.

Involving banks at their corporate level, organizing training programmes for regional/ zonal managers of

commercial banks in association with their Central Offices.

Establishing the financing of SHGs as a business propositions for banks.

Increasing the participation of the co-operative banks by encouraging them to finance SHGs as financing

cooperatives within the co-operatives.

Associating village communities, people’s institutions, rural volunteers and individuals to participate in

the programme within co-operatives.

Increasing the quality of the existing SHGs by propagating self –rating tools.

Large-scale dissemination of the concept and approach among the rural masses.

Encouraging the NGOs to play an important role in correcting the regional imbalances in spread of SHGs

Bank Linkage Programme.

5. NABARD FUNDING FOR FINANCIAL INCLUSION:

The apex agencies such have NABARD have supported the integration of regional rural banks and cooperative

banks into the core banking system (CBS) and have also supported initiatives to ground BCs in these agencies

apart from initiatives focusing on Information and Communication Technology (ICT) and universal financial

literacy. NABARD continued to manage two dedicated funds i.e., (i) Financial Inclusion Fund (FIF) for meeting

the cost of developmental and promotional interventions and (ii) Financial Inclusion Technology Fund (FITF) for

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meeting the cost of technology adoption for financial inclusion. With effect from 01 April 2012, the relative

margin (interest differentials) available to NABARD in excess of 0.5 per cent in respect of deposits placed by

banks under RIDF and STCRC is being credited to FIF/ FITF. The position of contributions/accruals to the FIF

was Rs. 17,618.7 million and FITF was Rs. 2,030.4 million as on 31 March 2014. As on 31 March 2014, the

cumulative sanctions under FIF and FITF were Rs. 5,028 million and Rs. 4,084.5 million, respectively, against

which, disbursements were Rs. 1,353.5 million and Rs. 2,215.5 million, respectively. The Micro Finance

Development and Equity Fund (MFDEF) were closed on 31 March 2013 and the activities being financed by it

are now being covered under FIF. There is a proposal to further merge the FIF and the FITF. The major initiatives

under FIF have been:

(i) support to cooperative banks and RRBs for setting up financial literacy centres (ii) assistance to RRBs for

demonstrating banking technology (iii) support for migration of data of PACS to CBS of cooperative banks (iv)

financial education and literacy programmes in schools7 and through common service centres.

The major initiatives under FITF have been:

(i) ICT solutions for RRBs adopting BC/ BF model

(ii) Support for CBS of weak RRBs

(iii) Assistance for CCBs and RRBs for RuPay KCC and RuPay Debit Card and for purchase of

additional PoS devices (Box 2.2)

(iv) Support to RRBs and cooperative banks for ATM inter-change charges

6. NABARD and Micro Finance and Self Help Group:

NABARD, through its’ Micro Credit Innovations Department has continued its role as the facilitator and mentor

of microfinance initiatives in the country. The overall vision of the department is to facilitate sustained access to

financial services for the unreached poor in rural areas through various microfinance innovations in a cost effective

and sustainable manner.

NABARD has been continuously focusing on bringing in various stakeholders on a common platform and

building their capacities to take the initiatives forward. This has resulted in tremendous growth of microfinance

sector in India through different approaches like:

Self Help Group – Bank Linkage Programme (SHG-BLP):

Based on the observations of various research studies and an action research project carried out by NABARD, the

model of ‘SHG-BLP’ has evolved as a cost-effective mechanism for providing financial services to the unreached

and underserved poor households. What started as a pilot to link around 500 SHGs of poor to the formal financial

institutions during the year 1992-93 has now become the largest microfinance programme in the world, in terms

of the client base and outreach. The SHGs which follow ‘Panchsutras’ viz. conduct of regular group meetings,

regular savings within the group, internal lending based on the demand of members, timely repayment of loan and

maintenance of proper books of accounts are considered to be of good quality and over years have proved

themselves to be good customers of Banks.

The NGO sector has played a prominent role of working as a Self Help Group Promoting Institution (SHPI) by

organizing, nurturing and enabling credit linkage of SHGs with banks. NABARD later coopted many others as

SHPIs including the rural financial institutions (RRBs, DCCBs, PACS), Farmers’ Clubs (FCs), SHG Federations,

Individual Rural Volunteers (IRVs) etc. These stakeholders were encouraged to take up promotion of SHGs by

way of promotional grant assistance from NABARD. This savings led microfinance model has now become the

largest coordinated financial inclusion programme in the world covering almost 100 million households in the

country. With more than 84% of the groups being exclusively women groups, the programme has provided the

much needed push to empowerment of women in the country.

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Table No 1.1 Grant support by NABARD to various agencies

Source: Status of Micro-finance of India 2017-18 , Published by NABARD 2018.

With a view to foster better understanding of mutual requirements between banks, SHGs & SHPIs and to sort out

issues like credit linkage, repayment etc. at ground level, Village Level Programmes (VLPs) are being conducted

with the support of banks and NRLM. VLPs sponsored by NABARD resulted in better interface between bankers

and SHGs leading to increased credit flow and appreciation of each other’s needs. During 2017-18, NABARD

supported more than 30011 village level programmes with a sum of Rs. 464.27 lakh covering 855713

beneficiaries.

Table 1.2 NABARD Re-finance to Banks

Source: Status of Micro-finance of India 2017-18 , Published by NABARD 2018.

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7. INITIATIVES BY NABARD:

NABARD has been playing the role of propagator and facilitator by providing conducive policy environment,

training and capacity building besides extending financial support for the healthy growth of the SHG linkage

programme over the years, various steps taken in this regard may be enumerated as under :-

1. Conceptualization and introduction of pilot programme in February 1992 for linking 500 SHGs with banks

after consultations with Reserve Bank of India, Banks and NGOs.

2. Introduction of bulk lending scheme in 1993 for encouraging the NGOs which were keen to try group approach

and other financial services delivery innovations in the rural areas.

3. Developing a conducive policy framework through provision of opening savings bank accounts in the names

of SHGs (through they are informal groups), relaxation of collateral norms, simple documentation and delegation

of all credit decisions and terms to SHGs.

Training and awareness building among the stakeholders.

Provision of capacity building support of NGOs/SHGs/Banks.

Mainstreaming the SHG linkage programme as part of corporate planning and normal business activity

of banks in 1996 and internalizing, training, monitoring and review mechanism.

Encouraging banks (RRBs and DCCBs) for promotion of SHGs.

Financial support to NGOs for promotion of SHGs.

Encouraging rural individual volunteers in promotion and nurturing of SHGs.

Close monitoring.

Dissemination through seminars, workshops, occasional papers and print media.

Constitution of High Powered Task to look into the aspects of policy and regulation of microfinance and

suggest policy, legal regulatory measures for smooth and unhindered growth of microfinance sector.

Setting up a microfinance development fund in NABARD for meeting the promotional costs of up-scaling

the microfinance interventions. The funds have since been redesigned as microfinance development and

equity fund.

Initiating the credit rating of the microfinance institutions through accredited credit rating agencies of

India by meeting 75 percent of the cost of the rating as grant. This is done to enable the microfinance

institution to approach banks for commercial borrowing and extending micro-credit to the poor.

8. CONCLUSION:

NABARD has been supporting need based skill development programmes under Micro Enterprise

Development Programme, which bridges skill deficits and promotes entrepreneurial talents of the members

to set up micro enterprises for matured SHGs through appropriate resource NGOs and other support

organisations. The constraints in rural enterprise development are primarily low or negligible income, lack of

skill and mentoring services and poor access to markets. The strategy would be to find ways to bridge the

skill, knowledge and resource gap and at the same time maximize on the existing strengths and facilitate

market linkages, which is the critical gap in scaling up sustainable livelihoods for the poor. Resource Agencies

which provide cutting edge design, facilitate product “SHGs, saving for the present, securing the future”

diversification, ensure quality certification, packaging technology for greater shelf-life, marketing platform,

retails space and credit needs can handhold SHG members to become entrepreneurs by setting up of micro

enterprises.

REFERENCES:

Arun Kumar Bandyopadhyay (1982): ―An Analysis of Agricultural Credit with special reference to small

farmers in West Bengal‖, Institute of Economic Growth, Delhi.

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Das A, Senapati M and John J (2009): ―Impact of agriculture credit on agriculture production: An empirical

analysis in India‖, Reserve Bank of India, Occasional

Paper, Vol: 30, no: 2, pp:75-107

Deorukhakar, A.C., Talathi, J.M., Nikam, M.B. and Patil, H.K. (2007): ―Impact of institutional finance on

farmers’ economy in North Konkan region of Maharashtra, India‖, International Journal of Agriculture

Science, Vol: 3, issue: 2, pp: 96-100.

Ghosh, Madhusudan (2017): ―Infrastructure and Development in India‖, Journal of Applied Economic Research,

Volume: 11 issue: 3, page(s): 256-289

Jainuddin, S.M., G.M. Hiremath and Suresh S. Patil (2014): ―Comparative Credit Gap Analysis in an Innovative

Credit Delivery System (Kisan Credit Card Scheme) among Institutional Sources in Karnataka‖,

Agricultural Economics, Research Review, Vol. 27 (Conference Number), p: 195

Manjunath, Soumya and Elumalai Kannan (2017): ―Effects of Rural Infrastructure on Agricultural Development

- A District Level Analysis in Karnataka, India‖, Journal of Infrastructure Development, Vol: 9, issue: 2,

pp: 113-126.

Priya Basu et al., 2005, Microfinance and Rural Credit Access for the poor in India, Economic and Political

Weekly Vol. XL No. 17, PP. 1747-1756

Rai, S. N., S. Ram, V. Bihari and Singh R. I. (1975): ―The role of institutional credit in generating farm income‖,

Indian Journal of Agriculture Economics, Vol: 30, p: 273

Roy, Swapan Kumar (2014): ―Rural Development in India: What roles do NABARD & RRBs play?‖, Journal

of Business Management & Social Sciences Research (JBM&SSR), September, Vol: 3, issue: 9, pp: 25-

30.

Sanap, D.J., J.T. Dorge, B.V. Pagire and D.B. Yadav (2014): ―Demand and Gap in Credit for Grape Crop in

Solapur District of Maharashtra‖, Agricultural Economics Research Review, Vol. 27 (Conference

Number), p: 191.

Sidhu and Gill (2006): ― Agricultural credit and in indebtedness in India: some issues‖, Indian Journal Agriculture

Economics, March, Vol: 61, No: 1, pp: 11-35

Vishwanath and Jayasheela (2004): ―Institutional Credit to Agriculture Declines‖, the Hindu, 20thFebruary, pg

no: 5

Yadav, D. B., B.V. Pagire, D.J. Sanap and J.T. Dorge (2014): ―Economic Analysis of Crop Loans Advanced by

Solapur District Central Co-Operative Bank‖, Agricultural Economics Research Review, Vol. 27

(Conference Number),p: 190

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GOODS AND SERVICES TAX NETWORKING (GSTN)

Dr. Suvaiba Pirani

Assistant Professor

St. Xavier’s College

ABSTRACT

This paper outlines the benefits of GST, its future prospects and attempts to dispel misconceptions about GST.

It also presents the conclusions of a survey, which indicates public perceptions about GST. It also makes

conclusions based on secondary data regarding GST. The study concludes that there is knowledge about GST,

but no clarity about its ability to curb black money and tax evasion. Using secondary data it concludes that GST

can help curb the black economy.

KEYWORDS:GST (Goods and Service Tax), Indian economy, GSTN (Goods and services tax Networking), Tax

malfunctioning, Tax System, Reforms

OBJECTIVES

1. To gain Knowledge about Goods and Services Tax Network functioning.

2. To learn about how GSTN helps towards the eradication of black money in India.

3. To Learn Impact GSTN has on our government, business Sector and for consumers.

4. To examine the future prospect of GST in Indian scenario.

INTRODUCTION

GST would bring about an amalgamation of Central and State taxes into a single tax payment. It would also

enhance the position of India in both, domestic as well as international market. At the consumer level, GST

would reduce the overall tax burden, which was estimated at 25-30% (in 2016). Under this system, the

consumer pays the final tax but an efficient input tax credit system ensures that there is no cascading of taxes.

The current system taxes production, whereas the GST will aim to tax consumption.

GST regime has also introduced “E-way bills” since 2018. Under this system, manufacturers, traders &

transporters can generate e-way bills for the goods transported from the place of its origin to its destination on a

common portal (GSTN) with ease. Tax authorities are also benefitted as this system has reduced time at check -

posts and help reduce tax evasion.

The Goods and Services Tax Network (GSTN), is a common digitized network with AI mechanism to detect,

analyze and identify frauds automatically. GST will support in eradication of Black money in the country.


The present study is intensively based on both, primary and secondary data; as for primary data, a survey was

conducted, ensuring an authentic source of data, paired with secondary data gathered from news papers,

research articles, journals and web sites enlisted under references. This has surely helped very much on

analyzing the trend and future prospect of GST in Indian scenario in a conceptual way, helping us interpret the

objectives through a clearer lens.


Primary data had been collected on a sample size of 60 , targeting tax payers as well as non tax payers on their

awareness of GSTN, it’s functioning, its impacts on various sections of the economy, it’s accountability to the

country’s betterment etc., in accordance to the objectives aforementioned for this study.

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GSTN

The Goods and Services Tax Network (GSTN) is a not-for-profit, Non-government Company promoted

jointly by the Central and State Governments, which will provide shared IT infrastructure and services

to both central and state governments including tax payers and other stakeholders.

The front-end services of Registration, Returns, Payments, etc. to all taxpayers will be provided by

GSTIN (GST Identification Number), the unique number each taxpayer will receive once they have

registered on the common portal.

It will be the interface between the government and the taxpayers.

The system it puts in place will be used to implement PAN-based (Permanent Account Number-based)

registration, filing of tax returns and a payment processing system.

It is expected to check tax evasion and help broaden the tax base.

GSTN is the backbone of the Common Portal which is the interface between the taxpayers and the

government. The entire process of GST is online starting from registration to the filing of returns.

It has to support about 3 billion invoices per month and the subsequent return filing for 65 to 70 lakh

taxpayers.

The GSTN will handle:

Invoices

Various returns

Registrations

Payments & Refunds

In the GST regime, the core services required by taxpayers, such as applying for registration, uploading

of invoices, filing of return, making tax payments shall be hosted on GSTN.

However, all the statutory functions (such as approval of registration, assessment of return,

conducting investigation and audit etc.) shall be conducted by the tax authorities of States and Central

governments.

Benefits to adapting GSTN:

Government:

Simple and easy for administration

Accurate control on leakage

Huge revenue efficiency

Business sector:

Business with easy tax compliance

Good decision making with regard to investment with the support of uniform taxes

Elimination of iterative effect of taxes

Transaction costs reduced, thereby improving competitiveness amongst firms.

Consumers:

Unique and transparent tax leading towards decreasing inflation

Relief with tax burden

Democracy in tax achieved

Eradication of the Black money/Tax malfunction:

Eradication of the Black money and the corruption can be done when everything is digitalized, i.e.,

Digital Payment Methods will be introduced for transactions between businesses and customers.

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If all business transactions are digitalized using GSTN, it will automatically include the consumers and

the producer’s exchanges. In other words, when a consumer purchases a good or service from a business

house, the businessmen have to file tax returns properly.

Our nation is trying evolve the Goods and Services Tax (GST), to maintain an integrated one tax

method, which creates one single market and, reduces the iterative effect of indirect taxes.

Future prospect of GST in India:

The experience of other countries where GST was introduced shows that all of them faced some

teething troubles for the initial two to three years. As compared to Australia and Malaysia, the Indian

experience shows that GST has settled down fairly well.GST has much wider acceptability even among

MSMEs now.

Having implemented GST in a vast country like India after taking 31 states on board, it is time to

perfect the system gradually.

In order to move towards an ideal GST, we must set an agenda for the next three to five years. Our first

attention should go in the direction of stabilizing revenue, both for states and Centre. While states are

already comfortable because of the compensation mechanism in which 14% incremental growth rate of

revenue is assured, the Centre still needs to worry about its revenue.

Second, an attempt should be made to bring all excluded items into GST one by one in the next three to

five years. This includes five petroleum products, electricity, real estate and alcohol in that sequence.

Among the petroleum products, the two items which can easily be brought into GST are natural gas and

aviation turbine fuel (ATF). Exclusion of certain items from GST creates distortions such as cascading

of tax and reversal of input tax credit. Since tax on diesel and petrol gives substantial revenue to states

and Centre, it is obvious that bringing them into the GST net will be a difficult decision. But this is

doable with proper tax structuring of petroleum products, divided between GST and cess.

The items of electricity duty and potable alcohol, on which at present only states have the power to

impose levies, can also be brought into the GST net by imposing only state GST on them. But inclusion

of these items will help in removing input tax credit blockages it will be both more efficient for industry

and more affordable for consumers. By bringing petrol, diesel and potable alcohol into GST, the rate at

which these items are sold to consumers will be common across states.

Third, we must try to rationalize the rate structure as and when the scope for revenue sacrifice increases

with rising revenues. Initially, we can move from a four slab structure to a three slab structure, and

gradually to a two slab structure. Multiplicity of slabs creates classification disputes and duty

inversions, necessitating blockage of funds and refunds. Also, modest rates result in better compliance.

Fourth, in the present GST system there are certain items where input tax credit is not allowed which

can result in accumulated credit and have a cascading effect.

INTERPRETATION AND ANALYSIS

A survey worked out around the topic GSTN (Goods and Service Tax Network) was circulated to a target group

consisting of individuals up to the age of 60. It consisted of 7 questions with relevance to the objectives of this

study. A sample size of 60 had participated in the survey.

From the survey the much evident results were:

Majority of the population (86.7%) were aware of the existence of GSTN and the remaining 13.3% who

were unaware of its existence hailed from the categories, below 20 and 20-30(yrs. of age)

There was a 20% participation of GSTN users countered to 80% non GSTN users in the survey.

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People were of the opinion that GSTN has more of an impact on the consumers followed by business

sector and then the government by 53.3%, 40%, and 6.7% respectively.

66.7% of the population are optimistic in the security GSTN ensures, however 33.3% which accounted

to 20 people still seem sceptic towards this online interface.

Whether GSTN is a step towards a corruption free nation, helping wipe out black money remains still a

question to the people, as over 50% of the sample size chose to go with the option ‘maybe’, whereas our

secondary data supports the fact that it indeed can help in black money eradication, which was

supported by 40% of the population with a remaining of 6.7% suggesting otherwise. This brings out the

lack of awareness of the GST Networks motives amongst the general public, which need to be focussed

on.

There is only a mere 1% disagreement with GST Network being a user friendly/ better method as

compared to the previous tax filing methods. The rest of the population in a 1:1 ratio stand by agreeing

or having a neutral opinion.

From the relevant secondary data gathered above:

Return filing trend and compliance seem to have been curving downwards lately

GSTN helps the Government by making the tax filing processes simple and easy for administration,

giving an accurate control on leakage and huge revenue efficiency

Business sector can be easy going at least with easy tax compliance and good decision making with

regard to investment with the support of uniform taxes. There is elimination of iterative effect of taxes.

With transaction costs reduced, there is improving competitiveness amongst firms.

Consumers being able to enjoy transparent taxing, implies decreasing inflation. There is now a relief

with tax burden as democracy in tax has been achieved.

Digitalization using Goods and Services Tax Network (GSTN) System will automatically include the

consumers and the producer’s exchanges. Now, when a consumer purchases a good or service is

rendered by a business house, there is no more loop holes for tax evasion, thereby stepping towards a

corruption free, and black money free economy with GSTN.

Even though, the Indian experience shows that GST has settled down fairly well the system has to be

perfected gradually by bringing all excluded items into GST one by one, stabilizing revenue, both for

states and Centre, rationalizing the rate structure for GST, taking down the cascading effect caused by

exclusion of items from availing input tax credit resulting in accumulated credit.

The attempt here is to suggest a road map for a future course. The pace of actual implementation can be

based on revenue growth and practical considerations of consumer interest.

SUGGESTIONS/RECOMMENDATIONS

This study could have been helped with more involvement of people who have a firsthand experience with

GSTN as compared to the responses we have attained i.e. GSTN users participation, even though the current

numbers remain decent and good enough.

FUTURE ROADMAP/SCOPE FOR STUDY

GST Network needs to be more aware among the masses to actualize its visions of becoming a trusted National

Information Utility (NIU) which provides reliable, efficient and robust IT Backbone for the smooth functioning

of the Goods & Services Tax regimen enabling economic agents to leverage the entire nation as One Market

with minimal Indirect Tax compliance cost. The survey clearly shows that certain motives of the GSTN

initiative still remains a question to the public as mentioned in the analysis, this needs to be rewritten so as to

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conduct a better study with more involvement, which would give more substantial results that would actually

parallel the motives and visions of GSTN.

CONCLUSION

GST completed successfully one year with minimum pitfalls as compared to other countries which are already

implemented GST. This taxation has made India into a fastest developing country in the world and promoted

digital initiative in taxation environment.

From the date of implementation of GST India is recognized as the investors and business group friendly

country and thereby it is receiving increased amount of foreign investments and minimizing the fiscal deficit

and finally seem to have a gradual reduction in the level of inflation. From this, ultimately the consumers

benefit with lower price of the consumable goods.

The secondary data and primary data taken into comparison to come to a conclusion on this study, gives out that

most young adults are rather aware of the existence of GSTN but are not in using terms with the same and are at

a crossroad where they do not know what the answer must be or is rather. However the secondary and primary

data do go in parallel other than for the lack of awareness on matters such as a link between GSTN and

eradication of black money for instance and the knowledge as to how it actual filings are made on a first hand

basis as the sample size had a rather noticeable percentage of non-GSTN users .

Goods and Services Tax Network (GSTN) is indeed helping eradicate black money. People, who are not

reporting every financial transaction to Excise and VAT etc in the form of tax returns, will get caught easily.

The people who will file their IT returns properly now see the benefits. Ultimately with this, the black money

generation will also decrease.

BIBLIOGRAPHY

Dani, S. (2016). A Research Paper on an Impact of Goods and Service Tax (GST) on Indian Economy. Business

and Economics Journal,07(04). doi:10.4172/2151-6219.1000264

https://cleartax.in/s/gst-law-goods-and-services-tax

P. Naresh Kumar (2018). Goods and Services Tax (GST): Networking and its working process. IJRDO-Journal

of Business Management.

Mr Abhishek , Prof. Subbappa Kaikamba , M S Divyashree. (2019) An Analysis of Future Road Map of Goods

and Services Tax in Indian Scenario. IOSR Journal of Business and Management (IOSR-JBM).

https://blog.mygov.in/editorial/goods-and-services-network-gstn/

https://www.gstindia.com/centre-states-give-go-ahead-to-gst-network/

Goutam Bhattacharya(2017). Evaluation and implementation of GST in Indian growth: A study. International

Journal of Commerce and Management Research ISSN: 2455-1627

https://timesofindia.indiatimes.com/business/faqs/gst-faqs

https://economictimes.indiatimes.com/news/economy/policy/decoding-gsts-future-course-in-

india/articleshow/67020414.cms

CA. Samir L. Kapadia.(2017) Goods and Services Tax Network-Concepts and Challenges in Implementation.

The Bombay Chartered Accountant Journal

https://www.gstn.org/

https://cleartax.in/s/gst-law-goods-and-services-tax

https://blog.mygov.in/editorial/goods-and-services-network-gstn/

https://www.gstindia.com/centre-states-give-go-ahead-to-gst-network/

https://timesofindia.indiatimes.com/business/faqs/gst-faqs

https://economictimes.indiatimes.com/news/economy/policy/decoding-gsts-future-course-in-india/articleshow/67020414.cms

https://economictimes.indiatimes.com/news/economy/policy/decoding-gsts-future-course-in-india/articleshow/67020414.cms

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IMPACT OF GST ON MSMEs

Mr. Manohar Borkar

Assistant Professor

Chetana’s H. S. College of Com.and Eco. Bandra (E), Mumbai-51

Abstract:

The Govt. of India introduced Goods and Service tax in the year of 2017.Goods and service tax is an indirect

tax system. It is a single tax system. It is an inclusive tax system and final based tax. Canada is the first country

which introduced GST for the first time. At present many countries also used the GST. Goods and Service tax

makes the people to pay tax only at the time of consumption of goods and services. In this tax system people do

not pay the taxes at the different level of manufacturing of goods and services. It is “one nation one tax.” The

objective of launching the GST is to eradicate the effects of multilevel taxes imposed on the goods and services

to final consumers. In GST the State Govt. and Central Govt. have to share the tax revenue for stabilizing the

economy. The introduction of GST helps the Govt. to achieve the economic growth at the faster rate by

encouraging the foreign investors to invest in the country. The objective of the study is to understand the

concept of GST and its impact on Small and Medium Enterprises in India.

Keywords: GST, SMEs

Introduction:

The introduction of Goods and Service Tax is a very significant step in the history of indirect tax reform in

India. Earlier, various direct and indirect taxes were imposed on production and services, which have been

replaced By GST This paper is focused on analyzing the impact of GST on MSMEs. such as value added tax,

excise duty, service tax, and sales tax. The earlier taxes created a cascading effect of taxes. GST is introduced to

eliminate cascading tax effect and improve the competitiveness of Indian goods.

GST includes almost all the indirect taxes like entertainment tax; value added tax, excise duties, import duties,

luxury tax, central sales tax, service tax etc. GST is the comprehensive tax which is to be put on production and

consumption of goods and services by the Central and State Govt.

Brief History:

Goods and Service Tax is a new reform in India. In 1986 Mr. V .P. Singh, the then Finance Minister introduced

Modified Value Added Tax (MODVAT). In the nineties, Finance Minister Dr. Manmohan Singh initiated a

discussion on a common and single tax policy for the country i.e. ‘Goods and Service Tax’. In 2002, Prime

Minister Atal Bihari Vajpayee appointed the Dasgupta Committee to design a GST system.

In 2005, the Kelkar committee also recommended rolling out GST as suggested by the 12th Finance

Commission. In 2006, Finance Minister P. Chidambaram proposed a GST rollout by 1st April 2010. In 2015,

Finance Minister Arun Jaitley introduced the GST Bill in the Lok Sabha. The tax came into effect from July1,

2017 through the implementation of 101st Amendment of the Constitution. The GST Council approved the

‘Central Goods and Services Tax Bill 2017’, The Integrated Goods and Service Tax Bill 2017, The Union

Territory Goods and Service Tax Bill 2017, The Goods and Service Tax (The Compensation to the States) Bill

2017, which were passed in 2017. Thereafter, State Legislatures of different States have passed respective State

Goods and Service Tax Bills. After the enactment of various GST laws Goods and Service Tax was launched

all over India with the effect from July 2017.

Objectives:

1. To study the concept of GST.

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2. To understand the impact of GST on MSME’s.


This study is based on qualitative aspects of GST. An attempt has been made to study the impact of GST on

MSMEs. Only secondary data is used that has been collected from various articles, journals, books and websites

etc. It has been used to evaluate the impact of GST on MSMEs in hotel industry, conceptual framework and

definitions on GST.

Review of Literature:

A study in Mysore Shana and Rohit Bhat (2018) titled ‘A Study on the Problem of Good and Service Tax on

Hotel Industry in Mysore District’, shows that people have adverse notion towards GST rates and financially

weaker people faced adverse impact of GST rates in local hotels. It was also observed the young population (20

– 30 years) has no definite perception about GST but the age group above 35 has clear perception of GST. The

high income population faced difficulties while making payments in high class hotels whereas middle income

population faces difficulties over GST.

Vijay Kelkar, Chairman of Finance Commission has expressed his views by saying that implementation of GST

would enhance employment in manufacturing and will also decrease costs of manufacturing. He opined that

there will be rapid increase in manufacturing output, export and blue-collar employment in Indian economy.

While justifying his logic, he said that 2 per cent reduction in cost would enhance the profit of manufacturing

sector by 20 per cent and that a proper GST structure and proper implementation could increase GDP by 2 to

2.5 percent, said Vijay Kelkar. Kelkar has expressed hope that GST will being entire country as one market and

accelerate growth.

A study by Poonam highlights the conceptual framework of GST, its advantages and disadvantage, challenges

and the impact of GST. Dash A. highlights the positive and negative impact of GST discusses the input credit

system. Jaiprakash expects that GST would provide relief to both central and state government as well as the

economic sectors like – industry, agriculture and trade. The opinions from trade and industry sector are

welcoming and GST is seen as an opportunity to boost the performance of the economy.

Nishita Guptha outlines positive impact of GST in terms of commercial benefits, that were not there under

VAT. GST is likely to accelerate economic development and collective gains are likely to arise for Centre and

State governments, industry, trade, agriculture, as well for end users of goods and services. Similarly, Pinki,

Supriya Kamna and Richa Varma feel that if GST is implemented, both Central and State government and

consumer will be benefited in the long run.

Sarvanan Venkadasalam shows the impact of GST on ASEAN state. A Least Square Dummy Variable Model

(LSDVM) shows that the implementation of GST by seven ASEAN countries shows mix results. The empirical

evidence shows that there is positive correlation between household final consumption expenditure and

government consumption expenditure has strong bearing on the GDP of nation. But the study shows that the

implementation of GST was negative in case of Philippines and Thailand. The GDP growth was slowed done

after the implementation of GST. On the contrary, the positive impact of GST is positive only in case of

Singapore. It means that there are other determinants that plays significant role in accelerating GDP growth and

GST also cannot push GDP of nation.

Agogo M Mawuli states that GST is not favorable for less developed countries because it does ‘not accelerate

broad based economic growth.

Ehtisham Ahmad and Satya Poddar believe that GST is likely to provide simple and transparent tax system that

would enhance output and productivity in India, provided we have a rational GST structure.

Impact of GST on MSME’s:

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MSMEs are the backbone of the economy. Today we have more than 3 million MSMEs in India. MSMEs

contributing almost 45 percent of the industrial output and 42 percent of India’s total net export, and it are one

of the leading employment generating sectors. GST impacts the MSME sector in the following ways:

A. Positive Impact:

1. One Nation One Tax: GST proclaimed as “one nation one tax” provides uniform procedures, uniform

payment of fees, and smooth and uniform structure in all the states, thereby enabling an MSME to start

business in multiple states.

2. Interstate trade: Earlier MSMEs were not much engaged in interstate trade as it attracted more taxes and

increased cost to customers, thereby reducing their customer base. With the introduction of the GST

interstate trade become easy as the tax credit can be transferred irrespective of location of buyers and

sellers. As a result MSMEs will be able to expand their business across borders.

3. Reduce tax burden: GST eliminates the cascading effects of taxes by subsuming various state and

central taxes. Businesses are able to take input tax credit too with GST. This reduce tax burden on

businesses, making goods cheaper and increasing profit margin for MSME’s.

4. Save time and efforts of MSMEs: Under GST all compliance procedures such as registration, payment,

refunds, and return will be carried out through online portals. The burden on MSME’s to interact with

department officers carrying out compliances will be eliminated. In this way GST will time and efforts

of MSME’s.

5. Encouraging manufacturing sectors: With the implementation of GST, burden of tax is expected to

reduce both for the manufacturer and the end user. Manufacturer can get the benefit of input tax credit

and the end user has to pay only the tax charged by last dealer or the retailer in the supply chain.

B. Negative impact:

1. Burden of Lower Threshold: Under the previous excise tax regime, no duty is paid by a manufacturer

with the gross turnover of less than Rs. 1.50 crores. However, after GST implementation, this

exemption limits get considerably lowered to Rs. 20 lakhs. As a result, a large number of MSMEs and

start-ups come under the network of the GST.

2. Selective Tax Levying: GST is not applicable to liquor for human consumption and petroleum

products, which creates further gaps and does not support the unified market ideology of GST.

3. Compliance Cost: GST regime operates on self assessment model, requiring MSMEs to file several

returns and execute other compliances with monthly frequency. This will increase costs.

4. Technological preparedness: Upgrading IT system and training employees for GST requires sizeable

expenditure, which would increase overhead costs for MSMEs.

5. Financial Preparedness: Since outward and inward supplies would be electronically matched every

month, availing of input tax credit by the buyer would be based on the compliances of the supplier.

Any failure by the supplier to declare his outward supplies correctly would lead to mismatch of returns

leading to reversal of credit availed by the MSMEs.

6. No tax differentiation for luxury items and services: The tax neutrality will not differentiate luxury

goods and normal goods. At present the state and central government levy higher taxes on luxury

goods and services. Under GST, all goods and services will have to pay the same tax which could lead

to increased inequity. MSMEs may not be able to compete against large businesses.

7. Excess working capital requirement: Taxation of stock transfer will primarily impact working capital

requirements. The quantum of impact will vary depending on stock turnaround time at warehouse,

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credit cycle to customers, quantum of stock transfer, etc. higher amt of capital requirement will

increase interest cost which ultimately increases the prices of finished goods.

Conclusion:

The Govt. of India introduced GST to avoid the multiple tax system and their cascading effects on the

consumers. GST simplifies the tax system and increases the tax base. GST brought many MSMEs under the tax

system. MSMEs have to change their business strategies, systems, supply chain and costing and quality

standard norms. At present MSMEs find it difficult with the GST compliances but in the long run it will benefit

them, as the govt. is taking initiatives to look after the issues faced by the MSME sector under the GST.

References:

1. Alka shah (2017), “Integrated Goods and service tax an Indian Innovation”

2. Dash A(2017), “Positive and negative impact of GST on Indian Economy” –International journal of

management.

3. Poonam(2017), “Goods and service tax in India- An introductory study” International journalof science

technology and management.

4. Patrik M (2015) Goods and service tax: Push for growth. Centre for public policy research.

5. R.Lavnaya kumari,(2017) Impact of Goods and service tax on Indian msmes, International journal of

research in economic and social science.

6. Rani Jacob, (2017),The impact of Goods and service tax on micro, small and medium enterprises. Imperial

journal of interdisciplinary research.

7. Anubha,Vashisht, Amita Chaudhary and Priyenka. (2016) Role of SMEs in Indian Economy, International

journal of Management.

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TO STUDY: “IMPACT OF GOODS AND SERVICE TAX ON SMALL

AND MEDIUM ENTERPRISES”

Mrs.Sadhana Prakash Ambre Chavan

ShriAnandraoPawar College, Kanganewadi,Chiplun, RTG

ABSTRACT

Goods and Services Tax (GST) is an indirect tax which was introduced in India on 1 July 2017 and was

applicable throughout India which replaced multiple cascading taxes levied by the central and state

governments. It’s true that GST means “Great Step towards Transformation”, “Great Step towards

Transparency” in India and it is also true that someone gives “birth” while someone else “nurtures it”. Now

we are witnessing, how this tax reform reshapes our economy and business dynamics for Micro, Small and

Medium Enterprises. Flourishing amidst a challenging environment, the Small and Medium Enterprises (SMEs)

of India experienced several highs and lows in the past few years. This paper highlights the impact of GST on

SMEs.

INTRODUCTION

At present, the total tax collection in India is around 14.5 Lakh Crore, of which 34% is indirect tax. Indirect taxes

include service tax, stamp duty, customs duty, VAT etc. It refers to the collection of tax indirectly by the

Government of India. GST is meant to bring every indirect form of tax under one roof. For small and medium

sized businesses, owners or manufacturers have to take care of different taxes and have to run to various

departments to fulfill all the tax related documentations. Some file different taxes biannually, annually, half

yearly etc. the more the departments, the more is the harassment. Currently, the total tax levied by the central and

the state governments add up to 32%,but with the implementation of GST, the business owners have to pay a

much lower tax of around 18-22 %.

GST will help and ease the process of starting a business in India. Earlier, every business in India was required to

obtain VAT registration, which differs in every state with different rules and regulation. However, under GST, the

businesses have to only register for GST which will have a centralized process, similar to service tax.

Under GST a business does not have to register or collect GST if the annual turnover is between 5 lakh to 10 lakh.

And this is applicable to every COUNTRY.???

Key words: GST, VAT

OBJECTIVES OF THE STUDY:

1. To study meaning and importance of GST.

2. To study meaning of Small and Medium enterprises.

3. To study Impact of GST on SMEs

4. To understand initiatives and new policies undertaken by Government.


The present work is conceptual in nature and based on secondary data or information which made available in

the form of analytical reports, government documents and publications, journals and websites.

MEANING AND IMPORTANCE OF GST:

The GST journey began in the year 2000 when a committee was set up to draft law. It took 17 years from then

for the Law to evolve. In 2017 the GST Bill was passed in the Lok Sabha and Rajya Sabha.

GST is an indirect tax which has replaced many indirect taxes in India. The Goods and Service Tax was passed

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in the parliament on 29th March 2017. The Act came into effect on 1st July 2017; Goods and Service Tax law in

India is a comprehensive, multi stage, destination based tax that is levied on every value addition.

BENEFITS OF GOODS AND SERVICE TAX:

GST has mainly removed the Cascading effect on the sale of goods and services. Removal of cascading effect

has impacted the cost of goods. Since the GST regime eliminates the tax on tax, the cost of goods decreases.

GST is also mainly technologically driven. All activities like registration, return filing, application for refund

and response to notice needs to be done online.

MEANING OF SMALL AND MEDIUM ENTERPRISES:

SMEs make up the majority of the businesses operating around the world. Generally, they are indepent firms

with no than 50 employees. However, the maximum numbers of employees are different from country to

country.

Small and medium enterprises (SMEs) are decided by the number of employees and or revenues they have. To

be considered a small and medium enterprise, these two determinants must fall under certain standard held by

the respective country. Generally in the USA and Europe, small companies have less than 50 employees and

medium sized companies have less than 250 employees.

POSITIVE IMPACT OF GST:

1) Starting business becomes easier: A business with multi state operation in this case has to follow varied

tax rules applicable to different states. This not only creates excess complication but also adds to procedural

fees. Uniform GST will standardize the process.

2) Improved SME’s market expansion: with implementation of GST, this will be nullified as tax credit will

transfer irrespective of location of buyer and seller. This allows SME’s segment to expand their reach across

the border.

3) Lower logistical overheads: As GST is tax neutral. It will eliminate time consuming border tax procedures

and toll check posts and encourage supply of goods across borders.

4) Aids SME’s dealing in sales and services: There is no difference between sales and services. This is good

news for them and hence for them taxation is simplified and will be calculated on total.

5) Unified Market: GST will allow flexibility in transfer of goods across states and reduce the cost of doing

business, as the reform will cut down multiple taxes imposed by state and central government.

6) Purchase of capital goods: 50% of the input tax credit against purchase of capital goods is available in the

year of purchase and the balance amount in subsequent years. Under GST regime, input tax credited in the

same year. This will support “Make in India” campaign.

NEGATIVE IMPACT OF GST:

1. The burden of lower threshold: The GST bill proposes a reduction in threshold to be Rs. 9 lakh to

increase the tax net and Rs. 4 lakh for North Eastern states. These reductions will significantly impact

SME’s working capital.

2. No tax differentiation for luxury items and services: The tax neutrality will not differentiate luxury goods

and normal goods. Under GST implementation, all goods and services will have to pay the same tax which

will lead to rich becoming richer and poor becoming poorer. It is not an ideal situation for SME’s competing

against large businesses.

3. Selective tax levying: GST will not be application to Alcoholic liquor for human consumption and

petroleum based businesses, which creates further gap and does not support the ‘unified market’ ideology of

GST.

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4. The burden of higher tax rate for services provider: Service Tax rate is 15%. GST rate will be around

18%. The Scenario in the service sector will further be impacted as the concept of centralized registration

has been done away with each unit in different states will have to take separate registration. If company

supplies one unit in state A to another unit, in state B, then also taxes also payable.

5. Excess Working Capital Requirement: Taxation of stock transfer will primarily impact the working

capital requirements. The quantum of impact will vary depending on stock turnaround time at warehouse,

credit cycle to customer, quantum of stock transfer etc.

Below we have provided a high level impact analysis of GST on small and medium businesses in India.

Compliance

Procedure

Positives Negatives

Registration Online registration will ensure

timely receipt of certificate of

registration and minimal

bureaucracy interface

Not all the SMEs have technical expertise to

deal with online systems, thus most of them

will need intermediaries to obtain registration

for them. This will add to their registration cost.

Payment Electronic compliance will bring

transparency and will also

reduce the compliance cost.

Since funds are required to be maintained in the

form of electronic credit ledger with the tax

department, it may result in liquidity crunch.

Refund Electronic refund procedures

will fast track the process and

enhance liquidity for SMEs

Refunds can be claimed only after filing of

relevant returns. Also it depends on the

compliances done by the supplier and his rating.

Returns All returns are required to be

filed electronically and input tax

credit and tax liability

adjustment will happen

automatically on the basis of

these returns

Minimum of thirty-seven returns are required to

be filed by every registered taxpayer during a

financial year. Thus SMEs will have to deploy

additional resources and eventual cost of

compliance will increase

CONCLUDING REMARKS:

After agriculture, the SME’s sector is the second largest employment generation sector. In India, SME’s

contribute roughly 45% of total employment and 33% GDP. These companies are vastly importance to the

country’s well being, both in terms of creating jobs and generating tax revenues. Earlier tax system was a

complicated system with 17 different types of taxes and GST is a boon for businesses with one tax. New GST

registrations have also increased SME’s credit update. The number of SME’s seeking credit for the first time

increased significantly to about four lakh in July-December, 2017. Starting up a new project or business any

where become simple and with one stop online GST registration.

REFERENCES:

1. www.wikipedia.com

2. www.ijemr.net

3. Reference Books on GST and Legal Laws

4. Economics times newspaper.

http://www.wikipedia.com/

http://www.ijemr.net/

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PROTECTION OF MOVIES THROUGH INTELLECTUAL PROPERTY LAWS IN INDIA

Ms. Kavita N. Hedaoo

Assistant Professor,

Government Law College, Mumbai

Abstract:

Today’s era is era of creativity. Originality and new creativity plays very prime role in entertainment industry.

The economic profits and raising money in need always depends upon what creativity is applied in the film.

Competition to stand in industry and gain profits is increasing day by day in this industry. Hence, the work of

any person shall not be utilized by other without permission of originator and creator. This rule is based on

simple principle that no one shall gain profit at the cost of other. Therefore, protection of law to original and

creative work can be given by intellectual property laws. This study shows how copyrights and trademarks

protect creativity and originality using case studies. However, defences and other aspects relating to copyright

is also discussed in this paper.

INTRODUCTION

The industry which has always competition, evolution, development is an Entertainment Industry. Days have

gone when only countable persons were working in this industry. Today, new people having no family

background of industry are indulging in this business. This industry is the largest industry in India.

Approximately 1,500-2,000 films in different languages are produced every year. Each story need to be unique

story, screenplay and exclusive songs too. The uniqueness confers exclusive ownership and exclusive rights of

creator. It increases its chances of more economic profit and enhance business. Hence such outstanding work

needs to be protected so that no one can use this unique work without permission of creator. Hence in such

scenario the role of Intellectual Property becomes important. Intellectual property includes Patent, Designs,

Trademark, Trade Secrets, Copyright etc. As far as entertainment industry is concerned, Copyright and

Trademark specifically play important role in entertainment industry. These laws play strong role in protecting

the original creativity of maker.

OBJECTIVES OF THE STUDY

1. To understand the area of intellectual property which is applicable to entertainment industry.

2. To study cases relating to infringement of intellectual property

3. To study defences under intellectual property law.


This study mainly highlights the role of Indian intellectual property laws in Indian entertainment industry. This

paper is mainly based on secondary data, collected from websites, books, journals and newspapers. Case study

method is also applied to study cases relating to infringement of intellectual property.

ROLE OF MEDIA IN SOCIETY

Media is an effective means of communication. It plays such important role that it is considered as fourth pillar

of democracy. New thoughts and changes can be emerged in society through the media. Media educates people

through their different ways of presentation like daily serials, advertisement, short films etc. Cinema is the one

of the ways to communicate with people. Movies generate revenue in crores. Some movies earn 100 crores in a

single day. Some movies are Bio-pics while others are based on social evils and show existing reality. Hence

such movies not only generate revenue, but have some impacts over society. Such movies which are unique and

creative can be safeguarded under copyright and trademark.

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COPYRIGHT AND TRADEMARK

Copyright encourage authors, composers, artists and designers to create original work by rewarding them with

the exclusive right for limited period to use the work for monetary gain. Copyright law gives exclusive right to

the expression of work, but not to any idea embodied in that work. Hence the idea may be the same, but the

expression must be unique and distinctive. Copyright can be filed for lyrics, music, dialogue and screenplay etc.

Trademark is used to create distinctive identity. Hence entertainment company’s names, band names can be

protected under trademark law. It prevents others from using names that are similar to such extent as to cause

confusion among consumers as to exactly who is delivering the film.

There are different stages where copyright or trademark apply

1) NAME OF A FILM:-

To attract audience and to show the uniqueness and originality of the film unique and distinctive name is

required. Therefore, film makers always try to keep such title. It is important to protect the title of movie. A film

maker has right to register the name of the film before beginning of shooting. Such registration prevent others

from using the same title. But protection to the title under copyright and trademark law can’t be given as

copyright subsists only in certain classes of works as per s.13 of The Copyright Act, 1957. Copyright subsists

for original literary, dramatic, musical and artistic works, Cinematograph films and sound recording. Hence the

title alone does not come under ambit of copyright protection. The work needs some amount of authorship to

seek protection under the copyright law. But due to minimum amount of authorship title doesn’t qualify for

copyright.

On the other hand trademark law intends to identify the origin of product. A mark has to be distinctive to qualify

under trademark. However, trade law protects the title of a film if-

i) The title of the series of literary work, where the title of the series of film enjoys standard trademark

protection to indicate that each edition comes from the same source. Therefore, producer in India can

apply for registration of film name under schedule 4, Class 41 of The Trademark Act, 1999.

ii) The title of single literary work entitles to protection of trademark only if disputed title acquires secondary

meaning and is capable of associate itself with previous work.

CASES:-

Sholay Media & Entertainment Pvt. Ltd v Parag Sanghavi

In 1999, Plaintiff announced a sequel to famous movie of 1975 “Sholay” and wanted to engage director Ram

Gopal Verma as a director for new film. But Verma wanted to make a modern day remake of “Sholay” rather

than a sequel. However, discussion failed and again Ram Gopal Verma approached plaintiff in 2003 for

requesting license to remake Sholay. But negotiation failed there. Afterward plaintiff on being informed that

Ram Gopal Verma was directing movie “Ram Gopal Verma ki Sholay”. Plaintiff filed a suit against defendants.

Consequently an undertaking to change the title of move to “Ram Gopal Verma ki Aag” was recorded. Hence

Delhi H.C. granted trademark protection.

Kanungo Media (P) Ltd v. RGV Film Factory

Plaintiff filed a suit for a permanent injunction for copyright infringement on the ground that defendant adopted

the title of his Bengali film ‘Nisshabd’ which was not released publicly but exhibited at several film festivals

and received several awards. Delhi High Court stated that to extend the Trademark protection to the single

copyrighted work, it must be proven that such title has acquired a reputation and public and industry i.e. has

acquired secondary meaning. Court dismissed the suit on the ground that plaintiff filed the suit in court very

late as movie was ready to release in 10 days. Even though plaintiff was aware of adoption of the title by RGV,

he refrained himself from legal action. Hence his silence was amounted to a waiver of its rights.

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2) SCREENPLAY AND WRITING:-

Screenplay of the film is copyrightable. The originality can be created by producer through hiring writers and

pay them while filing copyright to story. It gives exclusive right over its creation. The author of screenplay

transfer copyright to producer so that Production Company vest with the right of copyright. However, a script

may be on existing work also such as novel, a play or comic book. In such cases producer seeks permission of

writer and paying fee or royalty.

S.57 of The Copyright Act prescribes special right to author-

(1) to claim authorship of work even after assignment of copyright in a work

(2) entitles author to restrain to third parties from making any distortion, mutilation or medication or any

other act in relation to the said work that would be prejudicial to his honour or reputation and entitles author

to claim damages if such act is done.

CASES:-

Sanjeet Pillai v Venukunnapalli and Anr.

Petition was filed in Kerala High Court to seek various relief against respondent who had completed the film by

mutilating, distorting and modifying script of petitioner after termination of petitioner as director.

District Court denied the injunction to plaintiff to restrain the respondent from releasing, publishing, exploiting

film and issuing pre-releases publicity without providing authorship credit to petitioner. However, High Court

noted that plaintiff has strong case and his legal right do not exhaust to claim authorship due to assignment.

Court took balanced view and held that the film may be released without exhibiting anyone’s name as script

writer or writer of screenplay till disposal of suit.

Twentieth Century Fox Film v. Sohail Maklai Entertainment Pvt.Ltd.

In 2013, petitioner filed suit against respondent for unlawful and unauthorized remake of ‘Phone Booth’ into

Hindi film ‘Knockout’.

Justice Dalvi watched both movies and passed an order of “stay on release”. However the Division bench

reversed the stay order and asked the defendant to deposit Rs. 1.5 Cr. to court as deposit. In next hearing, both

the parties submitted minutes of order which means basically that matter is settled between both the parties

outside the court with the amount of Rs.1.5.Cr.

3) MUSIC, LYRICS AND BACKGROUND SCORE

Another major factor which is cause of grand success of movie is music, lyrics, and background score. These

are copyrightable. Previously film maker used to pay fee to the musician and lyricist and copyright their creation

under their production banner. But now musician and lyricist can claim copyright for their creation and continue

to receive royalties.

CASES:-

Pritam Chakraborthy v. Iranian Music Band

Movie ‘Agent Vinod’ faced the litigation for copyright infringement for song “Pungi baja”. It was alleged as the

song is copied from Iranian Music Band “Brobax Corp” which was founded in 2003. Hence Brobax issued

notices to Pritam and Production house. The band filed the case against Pritam and Production House. The

court held that Brobax has no locus standi to file suit for copyright as the copyright with original song was in

favour of authors and not band.

In another case in June 2019 Madras High Court passed interim order in favour of music director Ilaiyaraja

prohibiting exploitation of songs in composed by him, in any form including television, reality shows,

music, concrts and in online radio channels without his prior permission. Order was passed in civil suit by

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Ilaiyaraja alleging copyright infringement of his songs by Agi Music, Echo recording, Giri Trading Co. and

few others

In Oct.2019, music composer Dr. Zeus accused the maker of Bollywood film Bala of copyright

infringement by British artist claiming that his hit song ‘Don’t be Shy’ was recreated in the film without his

permission.

The maker of Bala however released official statement that they have completed the formalities for acquiring

copyright from company that owns the world wide right to the song in question.

DEFENCES AND OTHER ASPECTS:-

1) De minimis infringement-

It states that the law doesn’t concern itself with trifles. Hence petty copy right infringement that take place

daily are not actionable.

Independent News v. Yashraj Film Pvt. Ltd.

Singer sung part of a popular song on his interview on television. The infringement was deemed by Delhi H.C,

as De Minimis and held not actionable.

2) Statutory Exception –

S.52 of The Copyright Act, 1957 lays exceptions i.e. certain acts not to be infringement of copyright. Hence fair

dealing with any work, not being computer program for purpose of –

a) private or personal use including research

b) criticism or review, whether of that work or of any other work

c) reporting of current event and current affairs, including public lecture.

3) Blocking Injunctions against Internet Service Provider (ISP)-

Blocking injunction is given when intellectual property owner discovers the infringement by person whose

identity can’t be ascertained. A court orders against one/more internet service provider to implement technical

measures to prevent access to websites found to be hosting or accessing to infringing material

3) Arbitratability of IP issues-

Apart from court quick resolution machinery can be used to solve IP issues.

Eros International Media Ltd v. Telemax Links India Pvt. Ltd

Bombay H. C. ruled that arbitration tribunal could consider IP issues except issues surrounding their validity.

CONCLUSION-

The huge revenue generation industry in India is entertainment industry. Technological development has

affected the functioning of this industry. Use of computer and internet services have provided every information

at one click. Hence to copy and carry forward is an easy task in such situation. Entertainment industry always

has threat of intellectual property right infringement. Above cases are well examples of violation of intellectual

property by industry persons. Hollywood themes, concepts are copied without permission of owner. Hence

industry must try to bring innovative themes, script, music and dance. Awareness and strict adherence of

intellectual property rights laws may reduce such incidences.

References:-

P. Narayanan, Intellectual Property Law

http:// iptse.com

http://spicyip.com

http://www.iam-media.com

Journal of intellectual property rights

Times of India.

http://spicyip.com/

http://www.iam-media.com/

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TAXES SUBSUMED UNDER GOODS AND SERVICE TAX

Shahnoor Sayyed

Siddharth College of Commerce and economics, Anand Bhavan,D.N. Road,Fort, Mumbai- 400001

Abstract

Goods and Service Tax or GST, as it is known, is all set to be a game changer of the Indian taxation system.

GST evolved an all India One Nation Tax regime. It has now been a decade since the idea of national Goods

and services Tax was mooted by Kelkar Task Force in 2004. The Task Force strongly recommended fully

integrated “GST’’ on National basis. However, GST missed several deadlines and continued to be surrounded

by clouds of uncertainty, and introduced on 1 April, 2016. In Indi , there are different indirect taxes applied

on goods and services by central and state government GST intended to include all these taxes in to single tax.

Introduction

Goods and Service Tax (GST) is an indirect tax levied in India on the sale of goods and services. Goods and

services are divided into five tax slabs for collection of tax - 0%, 5%, 12%, 18% and 28%.Petroleum products

and alcoholic drinks are taxed separately by the individual state governments. There is a special rate of 0.25%

on rough precious and semi-precious stones and 3% on gold. In addition a cess of 22% or other rates on top of

28% GST applies on few items like aerated drinks, luxury cars and tobacco products.

The tax came into effect from July 1, 2017 through the implementation of One Hundred and First Amendment

of the Constitution of India by the Modi government. The tax replaced existing multiple cascading taxes levied

by the central and state governments. The tax rates, rules and regulations are governed by the Goods and

Services Tax Council which comprises finance ministers of centre and all the states. GST simplified a slew of

indirect taxes with a unified tax and is therefore expected to dramatically reshape the country's 2.4 trillion dollar

economy.

GST is one indirect tax for the entire country.

https://en.wikipedia.org/wiki/Petroleum_product

https://en.wikipedia.org/wiki/Petroleum_product

https://en.wikipedia.org/wiki/Alcoholic_drink

https://en.wikipedia.org/wiki/State_governments_of_India

https://en.wikipedia.org/wiki/State_governments_of_India

https://en.wikipedia.org/wiki/Cess

https://en.wikipedia.org/wiki/One_Hundred_and_First_Amendment_of_the_Constitution_of_India



https://en.wikipedia.org/wiki/Modi_government

https://en.wikipedia.org/wiki/Govt_of_India

https://en.wikipedia.org/wiki/States_of_India

https://en.wikipedia.org/wiki/Minister_of_Finance_(India)

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Objectives and Research Methodology of the Study

Being and explanatory research, it is based on secondary data of journals, articles, newspaper and

magazines. The accessible secondary data is intensively used for the study. The study was planned with the

following objectives :

Ensuring that the cascading effect of tax on tax will be eliminated.

Ensuring the availability of input credit across the value chain.

Reducing the complications in tax administration and compliance.

Ensuring the subsuming of taxes

Scope of GST

For business and industry

Easy compliance

Uniformity of tax rates and structures

Removal of cascading

gain to manufactures and exporters

For Central and State Governments

Simple and easy to administer

Better controls on leakage

Higher revenue efficiency

For the consumer

Single and transparent tax proportionate to the value of goods and service

Relief in over all tax burden

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Difference Between GST and VAT

The Goods and Services Tax (GST), which has replaced the Central and State indirect taxes such as VAT,

excise duty, and service tax, was implemented on July 1, 2017.

In this article, let us understand the differences between VAT and GST and their implications. GST has

eliminated the cascading effect of taxes on the economy. Let us get a deeper understanding of cascading effect

of taxation.

What is cascading effect of tax ?

Cascading effect is when there is tax on tax levied on a product at every step of the sale. The tax is levied on a

value which includes tax paid by the previous buyer, thus, making the end consumer pay “tax on already paid

tax”

COMPARISON

What is VAT?

Value Added Tax (VAT) is an indirect value added tax which was introduced into Indian taxation system on

April 1, 2005. As a taxation concept, VAT replaced Sales Tax. VAT was introduced to make India a single

integrated market. On June 2, 2014, VAT was implemented in all states and union territories of India, except

Andaman and Nicobar Islands and Lakshadweep Islands.

Here are a few disadvantages of VAT :

Cascading effect of taxes

It was not possible to claim Input Tax Credit (ITC) on service under VAT

Different VAT rates in different states

Different VAT laws in every state

What does GST bring in that VAT could not?

Designed to be a single, comprehensive, destination-based taxation concept that will unify the entire country in

terms of how the tax is collected, GST has revolutionized the Indian taxation system. The Goods and Services

Tax (GST) intends to further eliminate the concept of “ tax on tax ”.

Benefits of implementation of GST:

Removal of cascading effect of tax

Simple online procedure

Lesser compliances

Defined treatment for e – commerce companies

Let us look at an example:

Consider a consultant providing services to his clients.

Under VAT regime:

The consultant charged 15% service tax on services of Rs 70,000. So, his output tax was Rs 70,000 * 15% = Rs

10,500.

Then, if he purchased office supplies for Rs. 25,000 paying 5% as VAT : Rs 25,000

*5% = Rs 1,250.

He had to pay Rs 10,500 output service tax without getting any deduction of Rs 1,250 VAT already paid on

stationery.

His total tax outflow is Rs 11,750.

Under GST :

GST on service of Rs 70,000 @18% = Rs 12,600

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Subtract GST on office supplies (Rs 25,000*5%) = Rs 1,250 Net GST to pay = Rs 11,350

Types of GST

Since GST subsumed indirect taxes of both central government (excise duty, service tax, custom duty,

etc.) and state governments (VAT, Luxury tax, etc.), both the governments now depend on GST for their

indirect tax revenue.

Therefore, the GST rate is composed of two rates. Intra-state transactions will carry one of CGST and one of

SGST (in case of state) or CGST and UTGST (in case of union territory). Therefore, while making an intra-state

sale (i.e., sale within the same state), the CGST collected will go to the central government and the SGST

collected will go the respective state government in which sale is made. Similarly, SGST or UTGST are

replaced with IGST when intra-state transactions are involved.

1. What is CGST?

CGST refers to the Central GST tax that is levied by the Central Government of India on any transaction of

goods and services tax taking place within a state. It is one of the two taxes charged on every intrastate (within

one state) transaction, the other one being SGST (or UTGST for Union Territories). CGST replaces all the

existing Central taxes including Service Tax, Central Excise Duty,

CST, Customs Duty, SAD, etc. The rate of CGST is usually equal to the SGST rate. Both taxes are charged on

the base price of the product. See the example below to understand it better.

e.g. – In the example above, when Suresh sales a product to Pradeep in the same state (Rajasthan), he has to pay

two taxes. CGST is for the central government while SGST is for the state. The rate of CGST is 9%, same as

SGST. After the application of CGST (9% of Rs 10,000), the final cost of the product will become Rs 11,800.

All the taxes in all the conditions above are borne by the end consumer in the final cost, not by the manufacturer

or the dealer of the product or service. Since GST is levied on consumption, the state where the product is

originally manufactured is not entitled to the tax collected. If the manufacturing state levies a tax, the same will

be transferred to the consuming state through the Central government.

2. What is SGST?

The State Goods and Services Tax (SGST) is a tax charged on intra-state supplies of both goods and services by

the state government and is governed by the SGST Act.

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An important point to note is that any tax liability obtained under SGST can be set off against SGST or IGST

input tax credit only.

SGST (State GST) is one of the two taxes levied on every intrastate (within one state) transaction of goods and

services. The other one is CGST. SGST is levied by the state where the goods are being sold/purchased. It will

replace all the existing state taxes including VAT, State Sales Tax, Entertainment Tax, Luxury Tax, Entry Tax,

State Cesses and Surcharges on any kind of transaction involving goods and services. The State Government is

the sole claimer of the revenue earned under SGST. Let’s understand this with an example.

e.g. – Suresh from Rajasthan wants to sell some goods to Pradeep in Rajasthan. The product, originally priced at

Rs 10,000, will attract GST at 18% rate comprising of 9% CGST rate and 9% SGST rate. The SGST tax amount

here is Rs 900 (9% of Rs 10,000) which is fully claimed by the Rajasthan State Government. The rate of the

product after SGST will be Rs 10,900.

3. What is IGST?

Integrated GST (IGST) is applicable on interstate (between two states) transactions of goods and services, as

well as on imports. This tax will be collected by the Central government and will further be distributed among

the respective states. IGST is charged when a product or service is moved from one state to another. IGST is in

place to ensure that a state has to deal only with the Union government and not with every state separately to

settle the interstate tax amounts. Let’s try to understand IGST with an example.

e.g., – Ramesh is a manufacturer in Rajasthan who sold goods worth Rs 10,000 to Suresh in Rajasthan. Since it

is an interstate transaction, IGST will be applicable here. Let’s assume the GST rate is 18% for the particular

item. So, the IGST amount charged by the Central Government will be Rs 1800 (18% of Rs 10,000), and the

refined rate of the product will be Rs 11,800.

Now, GST is a consumption tax that means only the state where the goods are actually consumed will get the

tax benefits, irrespective of the manufacturing state.

4. What is UTGST (or UGST) ?

1. UTGST full form is Union Territory Goods and Services Tax.

The Union Territory Goods and Services Tax, commonly referred to as UTGST, is the GST applicable on the

goods and services supply that takes place in any of the five Union Territories of India, including Andaman and

Nicobar Islands, Dadra and Nagar Haveli, Chandigarh, Lakshadweep and Daman and Diu. This UTGST will be

charged in addition to the Central GST (CGST) explained above. For any transaction of goods/services within a

Union Territory: CGST + UTGST

The reason why a separate GST was implemented for the Union Territories is that the common State GST

(SGST) cannot be applied in a Union Territory without legislature. Delhi and Puducherry UTs already have

their own legislatures, so SGST is applicable to them.

The main agenda has been taken up by the GST council for which the apex body has introduced the UTGST

which will continue to provide benefits as same as SGST. Apart from that, New Delhi and Puducherry will still

enjoy the SGST provisions as both states have their separate legislatures and can operate freely on the terms of

SGST and has also been considered as the states by the GST Council.

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Difference between Different Types of GST Taxes

Types of

Differ

ences

CGST

SGST

IGST

UGST/UT

GST

Applic

able

transa

ctions

(Good s

& Servic

es)

Intrastate

(Within one

state)

Intrastate

(Within one

state)

Inter-state

(between two

states or one state

and one UT) and

imports

Within one

Union

Territory

(UT)

Collec

ted by

Central

Govt.

State

Govt.

Central Govt.

UT Govt.

Benefi

tting

Author

ity

Central

Govt.

State

Govt.

Central Govt. &

State Govt.

UT Govt.

Tax

Credit

Use

Priorit y

CGST

IGST

SGST

IGST

IGST

CGST

SGST

UTGST

IGST

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Taxation Scheme

Taxes subsumed

The single GST(goods and service taxes) replaced several former taxes and levies which included: central

excise duty, services tax, additional customs duty, surcharges, state-level value added tax and Octroi.

Other levies which were applicable on inter-state transportation of goods have also been done away with in

GST regime. GST is levied on all transactions such as sale, transfer, purchase, barter, lease, or import of goods

and/or services.

India adopted a dual GST model, meaning that taxation is administered by both the Union and State

Governments. Transactions made within a single state are levied with Central GST (CGST) by the Central

Government and State GST (SGST) by the State governments. For inter-state transactions and imported goods

or services, an Integrated GST (IGST) is levied by the Central Government.

GST is a consumption-based tax/destination-based tax, therefore, taxes are paid to the state where the goods or

services are consumed not the state in which they were produced. IGST complicates tax collection for State

Governments by disabling them from collecting the tax owed to them directly from the Central Government.

Under the previous system, a state would only have to deal with a single government in order to collect tax

revenue

The GST is imposed at variable rates on variable items. The rate of GST is 2.5% for soaps and 28% on washing

detergents. GST on movie tickets is based on slabs, with 18% GST for tickets that cost less than Rs. 100 and

28% GST on tickets costing more than Rs.100 and 5% on readymade clothes. The rate on under-construction

property booking is 12%.

Some industries and products were exempted by the government and remain untaxed under GST, such as dairy

products, products of milling industries, fresh vegetables & fruits, meat products, and other groceries and

necessities.

Checkposts across the country were abolished ensuring free and fast movement of goods

The Central Government had proposed to insulate the revenues of the States from the impact of GST, with the

expectation that in due course, GST will be levied on petroleum and petroleum products.

The central government had assured states of compensation for any revenue loss incurred by them from the date

of GST for a period of five years. However, no concrete laws have yet been made to support such action. GST

council adopted concept paper discouraging tinkering with rates.

What is Input Credit under GST ? And how to claim it ?

Enough has been said about what a significant reform GST will be. But if there is one thing that completely

stands out about this new tax, it is – the mechanism of input credit under GST.

Here’s a quick check about you can expect from this post –

For beginners – Don’t worry if you have never heard of ‘input credit’ before. We’ll start from scratch.

For businesses – If you are a business, you may have already heard of VAT input credit, and you will

soon know how it differs from GST input credit.

Part 1 :- What is input credit?

Input credit means at the time of paying tax on output, you can reduce the tax you have already paid on inputs.

Say, you are a manufacturer –

tax payable on output (FINAL PRODUCT) is Rs 450 tax

paid on input (PURCHASES) is Rs 300

You can claim INPUT CREDIT of Rs 300 and you only need to deposit Rs 150 in taxes

https://en.wikipedia.org/wiki/Services_tax

https://en.wikipedia.org/wiki/Surcharges

https://en.wikipedia.org/wiki/Value-added_taxation_in_India

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Input Credit in GST

Input Credit Mechanism is available to you when you are covered under the GST Act.

Which means if you are a manufacturer, supplier, agent, e-commerce operator,

aggregator or any of the persons mentioned here, registered under GST,

You are eligible to claim INPUT CREDIT for tax paid by you on your PURCHASES.

Part 2 :- Type of Taxes under GST

All existing taxes such as VAT, CST, Excise Duty, Service Tax, Entertainment Tax shall go

away and GST will replace them.

There are 3 types of taxes under GST

SGST – State GST

CGST – Centre

GST IGST –

Integrated GST

https://blog.cleartax.in/does-gst-apply-to-me/

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CONCLUSION

Implementation of GST is one of the best decision taken by the Indian government.For the same reason, July 1

was celebrated as Financial Independence day in India when all the Members of Parliament attended the

function in Parliament House.

The transition to the GST regime which is accepted by 159 countries would not be easy. Confusions and

complexities were expected and will happen. India, at some point, had to comply with such regime.

Though the structure might not be a perfect one but once in place, such a tax structure will make India a better

economy favorable for foreign investments. Until now India was a union of 29 small tax economies and 7 union

territories with different levies unique to each state.

It is a much accepted and appreciated regime because it does away with multiple tax rates by Centre and States.

And if you are doing any kind of business then you should register for GST as it is not only going to help Indian

government but will help you also to track your business weekly as in GST you have to make your business

activity statement each week.

Bibliography

www. cleartax.com

www.Reachaccountant.com

www.wishfin.com www.taxmann.com

www.indiafilings.com

http://www/

http://www/

http://www.wishfin.com/

http://www.taxmann.com/

http://www.indiafilings.com/

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STUDY ON GROWTH RATE OF GOODS AND SERVICES TAX

Maria Ruby (Asst. Professor in Accountancy)

Siddharth College of Commerce & Economics, Fort, Mumbai- 400001

Abstract

The Goods and Services Tax (GST) Bill was implemented in India w.e.f. 1st July, 2017. It changed the way of

paying and collecting indirect taxes in India. It replaced the different indirect taxes levied by the Centre and the

State. Earlier, the Centre used to charge different indirect taxes on goods & services like excise duty, service tax,

additional custom duty, etc. And likewise the State used to charge VAT, entertainment tax, luxury tax etc. But now

one common tax will be charged on supply of goods & services, that is GST. GST has become one of the major

sources of tax revenue for the government. This paper aims to find out whether GST collections have increased

or not. In addition to this, this paper also analyzes the growth rate of GST collections and the various reasons

behind the rise or fall of this growth rate. This study is mostly focused on GST collections for the period 1st April,

2019 – 31st January, 2020 of the current financial year 2019 - 2020.

Key Words: GST, CGST, SGST, Integrated GST, Growth Rate, Imports, E-Invoicing, E-way billing.

Introduction

Prior to the implementation of GST, the Centre and the States followed different taxation laws and levied different

indirect tax rates on goods & services. There was no uniformity in the indirect tax system across the country. And

under this type of system, there was cascading effect of tax (i.e. tax was paid on tax). So, there was a need for a

taxation system which would implement a common taxation law, with uniformity in the indirect tax rates, and

eliminate cascading effect of tax. Hence, in 1999 a new indirect taxation system -.GST was proposed. In 2000,

the government formed a committee to design the GST Model but couldn’t implement it due to various political

reasons. Then in 2015, the government under the leadership of the then Finance Minister Arun Jaitley again

introduced the GST Bill in LokSabha. In 2016, the Constitution Amendment Bill was passed, paving way for

GST. Then finally, in 2017 this GST Bill was launched in India at midnight on 1st July, 2017 by the then President

Pranab Mukherjee. Now, it’s been just three years since the implementation of GST. So this paper will help to

know the growth rate of GST collection has increased or not. To find out, this paper has been divided into 7 parts

– i) the objective of this research, ii) the significance of this study, iii) the research method used, iv) the facts and

findings found through different secondary sources, v) the recommendation & suggestions, vi) the conclusions

drawn and the vii) the references from where the data and figures have been collected.

Objective of the Study

Evaluation of the GST growth since its implementation.

To study the effect of exempted goods & lower tax rate goods on GST collections.

To study the effect of falling imports & output of core industries on GST collections.

Significance of the Study

It takes time to adhere to the payment of indirect tax in the new system (GST). Thus this research paper will help

to determine whether tax payers are paying GST or not. If yes, then this will be an indication that tax payers have

accepted this change, transformed their business accordingly to implement this new indirect system of taxation.

This research will also highlight the reasons for the growth or decline in GST collections.

Research Methodology

This research is done on the basis of secondary data available. This research is descriptive and analytical. It starts

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by asking the question, “Is there growth in GST collection or not?” Then it focuses on the findings gathered from

different sources to answer that question. It also analyzes the reasons as to why GST growth rate has increased or

decreased. Hence, for this kind of research, facts and figures are collected through different articles, websites, e-

newspaper and government press releases.

Facts and Findings

Table Showing the Average GST Collections

For the three financial years since its implementation

Financial Year Average GST Collection

in Rs. Crores % Growth

2017 – 2018 89,885 25.18

2018 – 2019 98,114 9.16

2019 – 2020 1,01,918 3.88

Note:

Avg.GST collection = (CGST + SGST + IGST + Cess) / months

Central GST (CGST), State GST (SGST), Integrated GST (IGST)

IGST and Cess also includes tax collected on the imports.

For F.Y. 2017 – 2018 Avg. collection is calculated on the data available for 8 months from 1st Aug, 2017.

For F.Y. 2019 – 2020 Avg. collection is calculated on the data available for 10 months till 31st Jan, 2020.

As you can see in the above bar graph, since its implementation from 1st July, 2017 the average GST collection

in India has grown. The current financial year 2019 – 2020 has recorded the highest average GST collection, till

31st January, 2020. But the line graph shows very slow growth percentage of the GST collection. The growth rate

in the year 2019- 2020 has shown a fall to 3.88 % as compared to its previous year. This is the lowest growth rate

of GST recorded. In other words, the fact is that GST is increasing but at a very slow rate, as compared to previous

growth.

GST growth is growing slowly in India in the F.Y. 2019 – 2020:

Tax Evasion: Under reporting of sales, fraudulently classifying products into lower GST rates category,

collecting taxes but not depositing it with the tax department, manufacturers-dealers buying and selling goods

only through cash basis without preparing any invoice, all these tactics slow down the growth of GST

collection. These are the problems seen since the implementation of GST and which still continue to exist in

the current financial year.

Tax Exemption: Earlier, the GST council had already decided that no tax will be imposed on food items like

80,000

85,000

90,000

95,000

100,000

105,000

2017 - 2018 2018 - 2019 2019 - 2020

AVERAGE GST COLLECTION (in Rs. Crores)

25.18

9.16

3.880

5

10

15

20

25

30

2017 – 2018 2018 - 2019 2019 – 2020

Growth RATE (in %) of GST Collections

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fresh meat, chicken, eggs, milk, curd, flour, bread, salt, fresh fruits, fresh vegetables, etc. And from 1st January,

2019, the council has also decided to exempt frozen and preserved vegetables from the levy of tax.

Tax cut: The GST council has decided that from 1st January, 2019 the tax rates will be reduced on 23 goods

& services to 18 % from 28% only on certain goods like movie tickets, TV screens up to 32 inches, pulleys,

transmission shafts, cranks, gear boxes, used tyres, digital cameras, video camera recorders, video game

consoles, etc.

Loopholes in the system:For example:

(i) The shopkeeper of jewellery store asks the customer whether they want original bill (in which GST is

charged) or rough bill (in which GST is not charged) at the time of payment. Most of the customers say yes

to the rough bill, to pay less price on the goods purchased.

(ii) The GST council announced that from 1st April, 2019 the taxpayers whose aggregate turnover is up to Rs.

40 lakhs p.a. will be exempted from the payment of GST. Then what about a taxpayer whose has 4 firms,

and his total turnover is Rs. 2 Crores. Such taxpayer can show that each of his firm’s turn-over is Rs. 40

lakhs, so he is exempt from payment of GST. Though the total income of his firms is Rs. 2 Crore, there is

no need for him to pay GST.

Compliance Cost: In May, 2019 the GST network has decided to give free accounting software to small and

medium enterprise (SMEs) to reduce their compliance burden. But still the cost of computers, consultancy

fees of CA are stopping them to pay GST.

Unregistered dealers: Most of the local shops of kirana stores, stationary shop, etc. are not registered under

GST Network. They simply say, their turnover is under Rs. 40 lakhs, so there is no need to register and pay

GST. But everyone in their neighborhood knows their aggregate turnover is more than Rs. 40 lakhs p. a.

,which they purposely hide to avoid GST.

Lower Imports:

Table Showing the Revenue Generated from Imports

For F.Y. 2018 – 2019 and F.Y. 2019 – 2020

(for the period during Apr, 2019 to Jan, 2020)

Financial Year Imports (Rs.Crores.) % Growth

2018 – 2019 30,30,317.38 7.33

2019 – 2020 28,08,202.38

Table Showing the Average GST collected on Imports F

For F.Y. 2018 – 2019 and F.Y. 2019 – 2020

(for the period during Apr, 2019 to Jan, 2020)

Financial Year GST collected on Imports

(Rs. Crores.) % Growth

2018 – 2019 25,049 5.4

2019 – 2020 23,704

As you can see in above in 1st Table the imports have decreased by 7.33 % in F.Y. 2019 – 2020 as compared to

the imports of previous year. This is mainly due to less production in 6 core industries, which is discussed in next

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point. But due to lower imports, the tax collected on imports has also decreased by 5.4 % (as you can see above

in 2nd Table).

8 Core Industries Growth Reduces:

Line graph comparing the growth rate (in %) of 8 core industries

Between F.Y. 2018 – 2019 and F.Y. 2019 – 2020

(For the months April to December)

As you can see in above line graph the production activities of Coal has fell down to -3.8 %, Crude oil fell

down to -6.0 %, Natural Gas fell to -3.8%, Refinery Products fell to -0.6%, Cement fell to 0.7% and Electricity

fell to 0.5% - as compared to previous year. Out of 8, the growth or the output of the 6 industries has reduced

during April to December, 2019. Because of this GST could not be charged on the maximum output, hence

GST collection growth has reduced.

Recommendations and Suggestions

All the loopholes in the system should be rectified immediately as soon as possile, so that more tax payers

pay GST as required by the GST System and the Government.

TRPs should be trained how to e-file new GSTR forms. Many TRPs should be appointed to help local

shopowners, businessman to e - file their GSTR at lower fees.

Awards, cash rewards, exemption from tax for e.g. 3 months should be given to tax payers, who regularly pay

GST on time.This will motivate others too to pay the tax on time.

To overcome over invoicing or under invoicing, generation of fake bills, Finance Minister Nirmala

Sitharaman and her ministry has already made it mandatory to implement e-invoicing, e-way bills. Training

is required to be given to the TRPs, accounts department staff relating to such new methods.

Many tax payers are finding it difficult to understand and comply with this system. So, the move suggested

by the Prime Minister and his govt. to replace this process centric system with citizen centric system, should

be implemented soon.

Conclusion

Through this research paper, one can come to the conclusion that GST is growing, but there is slower rate of

growth in the GST collections. This is probably because of the above mentioned loopholes / problems. If such

problems continue to exist, then this will affect the contribution of GST towards the revenue of the government.

To decrease the fraud done in GST, the Finance Ministry has already implemented e-invoicing, e-way billing and

is also planning to implement faceless assessment, where the tax payer and the tax assessor will not know each

other. To make the system more simpler, government is planning to replace this process centric system with

7.9

-3.7

-0.1

4.1

-1.4

4.3

13.9

6.4

-3.8-6.0

-3.8

-0.6

4.7 5.2

0.7 0.5

-10

-5

0

5

10

15

Coal Crude Oil NaturalGas

RefineryProducts

Fertilizers Steel Cement Electricity

2018 - 2019

2019 - 2020

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citizen centric system. No matter how much efforts the government makes to lower GST rates, to improve GST

collection, it is our moral duty to pay our taxes on time. Only then will Government GST revenues increase. This

will in turn, help in the economic growth of our country.

References

https://pib.gov.in/newsite/PrintRelease.aspx?relid=196229

https://www.hindustantimes.com/topic/gst-collection

https://www.livemint.com/news/india/gst-collection-in-december-rises-to-rs-1-03-lakh-crore-

11577874260095.html

https://economictimes.indiatimes.com/news/economy/policy/23-goods-and-services-to-get-cheaper-from-

january-1-as-reduced-gst-rates-kick-in/articleshow/67327071.cms?from=mdr

https://www.business-standard.com/article/pti-stories/finmin-notifies-april-1-as-date-for-availing-increased-gst-

exemption-limit-composition-scheme-119030701022_1.html


https://www.hindustantimes.com/topic/gst-collection

https://www.livemint.com/news/india/gst-collection-in-december-rises-to-rs-1-03-lakh-crore-11577874260095.html

https://www.livemint.com/news/india/gst-collection-in-december-rises-to-rs-1-03-lakh-crore-11577874260095.html

https://economictimes.indiatimes.com/news/economy/policy/23-goods-and-services-to-get-cheaper-from-january-1-as-reduced-gst-rates-kick-in/articleshow/67327071.cms?from=mdr

https://economictimes.indiatimes.com/news/economy/policy/23-goods-and-services-to-get-cheaper-from-january-1-as-reduced-gst-rates-kick-in/articleshow/67327071.cms?from=mdr

https://www.business-standard.com/article/pti-stories/finmin-notifies-april-1-as-date-for-availing-increased-gst-exemption-limit-composition-scheme-119030701022_1.html

https://www.business-standard.com/article/pti-stories/finmin-notifies-april-1-as-date-for-availing-increased-gst-exemption-limit-composition-scheme-119030701022_1.html

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INCREASING GRIP OF AGRICULTURAL PATENTS ACTIVITY IN INDIA

Sonwane, Rajesh S. (Assistant Professor in Economics)

Abhinav College of Arts, Commerce and Science, Bhayander (East), Dist. Thane: 401105

This report considers developments in agricultural patents since fifteen years and their economic implications. It

first provides an overview of the international framework for intellectual property protection and of the general

trends of India in agricultural patients.

Abstract

Agricultural research has expanded rapidly in biotechnology, farming, vaccine, paddy wheat etc. There was

gradual increase in patenting activity during 2005 to 2012 in different sectors of agriculture. Eighty per cent of

all seed in India is still saved by farmers. Farmer’s indigenous varieties are the basis of our ecological and food

security. Coastal farmers have evolved salt resistant varieties. Bihar and Bengal farmers have evolved flood

resistant varieties, farmers of Rajasthan and the semi-arid Deccan have evolved drought resistant varieties,

Himalayan farmers have evolved frost resistant varieties. Pulses, millets, oilseeds, Rice wheat’s, vegetables

provide the diverse basis of our health and nutrition security. This is the sector being targeted by the Seed Act.

These seeds are indigenous farmers varieties of diverse crops -- thousands of races, hundreds of wheats, oilseeds

such as linseed, sesame, groundnut, coconut, pulses including Gahat, Narrangi, Rajma, urad, Moong, masur, tur,

vegetables and fruits. The Seed Act is designed to "enclose" the free economy of farmer’s seed varieties.

Key words: Agricultural, Patent activity, Bio-technology

Introduction

Until about 1980, the only intellectual property protection available for crops was the Plant Breedr’s Right (PBR)

relatively weak from prevailed developed country. diversification in Indian agriculture was also noticeable during

the last twenty years, such as dairy products and animal husbandry registered 19.0 and 5.78 times increase in

patenting activity over the period 1995-2010 besides development of new plants and processes (10.87 times) and

horticulture and cultivation forestry rising (5.87 times). Public sector organisations and companies sector must

forge public-private partnerships to address the R&D gaps and generate technologies at affordable prices in the

field of agriculture to the stakeholders in the developing countries in the backdrop of product patent regime. In

Indian agriculture, it has some unique characteristics having 250 different crops cultivated in different agro-

climatic conditions. In Indian economy, agriculture sector play the crucial role, with 18.5 per cent share in national

income; 15 per cent of total exports with two-thirds of work force engaged in this sector. Inputs from agricultural

engineering have played dominant role in boosting the productivity and production through appropriate

mechanization technique.

New Vision to Agricultural Sector

Nowadays, people looking towards the agriculture as industrial point of view or as business, which cannot sustain

without research and development and astute investments. In the past three decades, the role of intellectual

property rights (IPRs) in agribusiness has increased enormously. Apart from investment in agricultural research,

intellectual property rights (IPRs) have profound impact on technology development, and its transfer. There has

been an increasing interest in the innovations of pre-harvest as well as post-harvest agriculture machinery. The

present paper gives an idea about intellectual property different inventions in agriculture also takes an overview

of the current scenario of geographical indications in India biotechnology is the sector that holds the most potential

for advances in agriculture to improve productivity. Biotechnology R&D is mostly concentrated in the hands of

large multinational enterprises in the US, Europe and Japan. It is in this field of technology more than others, that

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proprietary rights over knowledge is getting increasingly important. Today, in the United States, patents are even

granted to animal inventions and human gene sequences, if these are eligible for such protection.

Data Analysis

This development is ‘Sustainability’ which has been defined by the Food and Agriculture Organization (FAO)

(2013) as “the management and conservation of the natural resource base, and the orientation of technological

and institutional changes in such a manner as to ensure the attainment and continued satisfaction of human needs

for present and future generations”. Sustainable agriculture includes practices such as crop diversification,

biological pest control, and genetic improvements in crops to resist pests, diseases, and drought and to use

nutrients more efficiently. Maximum percentage of patent applications were filed in biocides, pest repellents or

attractants and plant growth regulators (60%), followed by new plants or processes for obtaining them (9.35%),

animal husbandry, silk rearing or breeding new animal breeds (7.48%) and horticulture, cultivation, forestry

(5.91%).

Patents granted in India in Agricultural sector

Year No. of granted patents No. of patents of

Agriculture

% of Agri. related

2005-06 4320 29 0.67

2006-07 7539 33 0.43

2007-08 15316 244 1.59

2008-09- 16061 343 2.15

2009-10 6168 111 1.81

2010-11 7509 150 1.79

2011-12 4280 74 1.99

TOTAL 61193 984 1.66

Source: Annual report of 2010-11 Comptroller General of Patents, Design, Trade Marks.

Results and analysis Agricultural patenting activity in respect of published applications from 2005 to 2012 in

different agricultural sectors is presented in Table 1. The total patenting activity has increased from 2005 to

2010, though some decline was observed in 2011. Likewise agricultural patenting activity in respect of published

application increased from 248 in the year 2005 to 703 in 2010. The percentage of agricultural patenting was

1.49% in 2005 which increased over years to 2.88% (Table 1). The percentage of total granted patents in

agriculture was only 0.671 in 2005–2006, while in 2008–2009 it was 2.135. Other growing fields of inventions

like computer/electronics, mechanical and chemical technology have registered as high as 9,594, 7,782 and 6,911

patents respectively out of 39,400 patents granted in all fields in the year 2010–2011 (Anonymous, 2011). The

total number of granted patents in 2005–2006 was 4,320 which rose to 16,061 in 2008–2009 (Table 2), while the

number of patent applications filed in 2005–2006 was 24,505 which increased to 34,287 in 2009–2010, primarily

due to the leading fields of engineering and computers, chemicals and biotechnology. India is among the top 12

in biotechnology research patent sector of Asia-pacific industry. In bio-agro segment accounts 14% segment of

Indian industry. The Study recently understand the trend of Patent activity in agriculture sector especially when

so much is talked about Skill India and Made in India. The Study was for the period 2014 to 2017.Based on

findings, it reveals that 5448 patent applications were filed in the Indian Patent Office for the said period and it is

no coincidence that the top 10 countries on the World Economic Forum’s Global Competitiveness Index (GCI).

According to the Study, agrochemicals sector leads the pack with 2880 patent applications, followed by Animal

husbandry (775 Applications); Tissue culture technique (488 Applications); Horticulture and forestry (404

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Applications). Other segments include Harvesting & mowing (213 Applications); Planting, Sowing & Fertilizing

(194 Applications); Soil Machinery (159 Applications); Threshing & Storing (93 Applications). The Study says

that despite ongoing White Revolution Dairy Products segment received only 48 applications in the last three

years.

Conclusion

The broad objective of the study was to analyse patents scenario in agricultural Sector by analysing the patent

activity and granted patents in respect of different areas of agriculture and the major players operating for process

and product patenting. Patenting activity during 2005 to 2012 in different sectors of agriculture was increasing.

References

National Common minimum Programme of United Progressive alliance. Govt. of India

Anonymous (2011) Annual Report of the Office of the Controller General of Patents, Designs,

Trade Marks and Geographical Indication, 88pp, Ministry of Commerce, GOI, New Delhi, India.

Balaji, J. (2003) ‘Product patents in the content of pharmaceutical and agricultural sectors’, Project assignment

(Module II) P.G. Diploma in Patent Law, id No. PLH86/02, 2002–2003 NALSAR

Proximate Education, NALSAR University of Law, Hydrabad.

Chopra, V.L. (2013) Climate Change and Its Ecological Implication.

www.uspto.gov.

http://ep.espacenet.com

http://pctgazette.wipo.int

http://www.uspto.gov/

http://ep.espacenet.com/

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IMPACT OF GOODS AND SERVICE TAX (GST) ON INDIAN ECONOMY

Sohil Suleman Jiwani (M Com.)

Siddharth College of Commerce & Economics, Fort, Mumbai

Abstract:

GST is a single national uniform tax levied across India on all goods and services. In GST, all Indirect taxes such

as excise duty, central sales tax (CST)and value- added tax (VAT) etc. will be subsumed under a single regime.

Introduction of The Goods and Services Tax (GST) expected as a significant step towards a comprehensive

indirect tax reform in the country, which would lead India for its economic growth. The Proposed study is designed

to know the impact on GST on Indian Economy with the Help of Its individual effect on different sectors. The

Study is Exploratory in nature and Secondary Data has been used for the study. The data will be collected from

different Journals, Periodicals, Newspapers and Internet.

Key Words: GST, Economy, cascading effect of taxes,GST Council, Cess

INTRODUCTION

To remove cascading effect of taxes and also to provide for a common national market for goods and services,

the Government of India proposed for amendments to introduce the goods and services tax for conferring

concurrent taxing powers on the union as well as states including union territory with legislature to make laws for

levying goods and services tax on every transactions. GST is an indirect tax has introduced on 1 July 2017 in

India and was applicable throughout India which replaced multiple cascading taxes levied both by central and

state governments. The GST is governed by a GST Council. Under GST, goods and services are taxed at the

following rates, 0%, 5%, 12% , 18% and 28% and there is a special rate of 0.25% on rough precious and semi-

precious stones and 3% on gold

Further in addition a Cess of 15% or other rates on top of 28% GST applies on few items like aerated drinks,

luxury cars and tobacco products. Expert viewed it as biggest tax reform in India founded on the notion of “one

nation, one market, one tax”. The GST rollout has converted India into a unified market of 1.3 billion citizens.

The rollout has a positive hope of India‟s fiscal reform program regaining momentum and widening the economy

of the nation. The idea behind implementing GST in the country in 29 states and 7 Union Territories is that it

would offer a win-win situation for every citizen .The entire taxation base will be shared between the assessment

mechanism of the center and the states who would get to collect tax on the economic activities taking place in

Indian territorial waters. At the ninth GST council meeting the center made significant concessions to bring states,

including the defiant ones. The administrative decisions will be as follows. The state will administer 90 percent

of the tax players, including service providers with annual turnover up to rupees 1.5 crore with scrutiny, and audit

powers and the balanced 10 Percent will be controlled by the Centre. Tax players above that threshold turnover,

including those pay integrated 9interstate imports) GST will be equally shared between the canter and state, and

this will lead to significant shifting of the tax players base from center to state.

An overview of GST and Its impact on different sectors

If talk about impact of GST on manufacturers, distributor and retailers It is believe GST is expected to boost

competitiveness and performance in India‟s manufacturer due to tax structure. High infrastructure spending and

declining export are just some of the concerns of this sector. Single tax system will decrease the administrative

costs for manufacturers and distributors and this sector will grow morestrongly.

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If thrown glance on impact of GST on Service Providers it is observe that most of the tax burden is borne by

domains such as telecommunication services, Insurance industry, business support services,Banking and Financial

services,IT services etc.Introduction of GST will decrease burden

The Logistic industry forms the backbone of the economy. We can fairly assume that a well- organized and mature

logistics industry has the potential to shoot ahead the “Make In India” initiative of the Government of India and

has positive impact on economy. Simultaneously GST will help the e- com sector‟s growth but the long-term

effects will be particularly interesting because the model GST law specifically proposes a tax collection at source

(TCS) mechanism, If talk about Pharma industry GST is expected to benefit the pharma and healthcare industries.

It boosts medical tourism with simplified tax structure. Telecommunications sector prices are expected to come

down after GST. Manufacturers will save on costs through efficient management of inventory. Handset

manufacturers will find it easier to sell their equipment as GST will negate the need of the state and will also save

upon logistics costs. Textile industry generates employment to a large number of skilled and unskilled workers.

It contributes about 10% of the total annual export, and this value is likely to increase under GST. GST would

affect positively to the cotton value chain of the textile industry which lead economic growth. The real estate

sector is also plays important role in the Indian economy, it Plays an important role in employment generation in

India. The sector will see substantial benefits from GST implementation. Agricultural sector is the largest

contributor of GDP. It covers 16% of GDP. The major issues faced by the agricultural sector, is transportation of

agro products across state lines. It is expected that GST will resolve the issue of transportation. FMCG sector

could raise significant savings in logistics and distribution costs as the GST will eliminate the need for multiple

sales depots. The GST rate for this sector is expected to be around 17% which is way lesser than the 24-25%

taxrate paid currently by FMCG companies. Under the current tax system, there are several taxes applicable on

automobile sector like excise, VAT, sales tax, road tax, motor vehicle tax, registration duty which will be

subsumed by GST.

An analysis on GST and its impact on Indian Economy

The implementation of goods and service Tax(GST) coupled with a digitized economy ushered in by

demonstration, will make India’s economy ”look much clean errand bigger“ said union finance minister Arun

Jaitely at the vibrant Gujurat global Summit. Further he said, it is going to be a major step towards the integration

of informal economy and this it is going to increase the transactions, which are covered within the Banking system

transactions and may lead to higher revenue in the future. He said“A new India Has Emerged”. It is inevitable

that with the increase in level of demand, the level of supply would respond likewise. TheGST council is being

asked by the ministry of Commerce to keep exporters of the plantation, leather and cement out of its framework

and suggested to impose lower tax on them to boost output and increase employment generation. With this the

producers increase productivity and perform better in global market‟s council retained its proposed definition of

Agriculturist to allow land to have been personally cultivated only if its farmed by individuals and family members

of HUF and its exempted under GST. Manufacturers and traders would benefit from fewer tax filings, transparent

rules and overall sound bookkeeping system. Consumers would be paying less for the goods and services and lead

to change their expenditure pattern and livelihood, The government would generate more revenues as revenue

leaks would be plugged by G S T implementation.

How has GST really impacted Indian current economy situation and in future:

Firstly: from the viewpoint of the consumer, the consumers have pay more tax for most of the goods and services

they consume .The GST implementation has a cost of compliance and tax on most of the goods attached to it. It

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examine that this cost of compliance will be prohibitive and slightly high for the small scale manufacturers and

traders. Resulted to this pricing of goods will go high and has direct impact on cost of living of the society.

Secondly: If long term effect of GST analyses it is expected that GST would not just mean a lower rate of taxes,

but also minimum tax slabs imposed on. In many Countries where the Goods and Service Tax has helped in

reforming the economy, apply only 2 or 3 rates.GST is designed to minimize the rate with a lower rate for essential

commodities, and a higher tax rate for the luxurious commodities. Currently, in India, there are 5slabs, but there

will be a shift soon .thirdly; Impact of GST on macroeconomic indicators is likely to be very positive in the

medium term. Inflation would be reduced as the cascading (tax on tax) effect of taxes would be eliminated in the

country and at the same time revenue from the taxes for the government is very likely to increase with an extended

tax net, and the fiscal deficit is expected to remain under the checks and GST would be a change maker on this.

Moreover, exports would grow, while FDI (Foreign Direct Investment) would also increase. The experts believes

that the country would grow economically in the ease of doing business with the implementation of the most

important tax reform ever in the history of the country.

Conclusion

A single taxation system would encourage new businesses and entrepreneurs to engage in service and

manufacturing sector. GST levied only on consumption of goods or services. This leads to eliminate economic

distortions in taxation amongst states and also helps in free movement of goods, further it also minimize the

complexity of taxation. It will also beneficial to individuals as the prices will go down due to GST and decrease

in price leads to increase in consumption and directly increase the GDP. As GST implementation applied at aim

for all states lack of policy barrier will remove. Directly GST will increase the investment in FDIs which increase

the foreign exchequer of the country and indirectly increase the employment opportunities. It will promote new

start ups in India for its business-friendly taxstructure.

References

Articles from News Papers

www.indiataxes.com

www.articles.economictimes.indiatimes.com

www.taxmanagementindia.com

www.goodsandservicetax.com

www.casirj.com

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A STUDY OF THE ROLE PLAYED BY DIGITALISATION IN THE INVESTMENT OF MUTUAL

FUNDS IN VASAI REGION

CMA ALWIN MENEZES,

Assistant Professor in Accountancy,

Abhinav College, Bhayandhar (E)

ABSTRACT:

The mutual funds are professionally managed funds and have a record of providing good returns over a period

of time.There are in total 44 Asset Management Companies (AMC) in India as of today. The study is basically

done to understand how digital mode of investment is influencing the growth of investment especially in the Mutual

fund sector. The sample frames in this study are the 100 investors of mutual funds in Vasai region who will be

administered a structured questionnaire. It is supported by secondary data from books, journals, reports and

articles relevant to the topic. In order to accomplish the required objectives of the study Tables have been used

for visual presentation of the data. Chi square test have been used to prove the hypothesis of the data. It has been

observed that the investors are aware about the ease of payment advantage on digital platforms, about paperless

registration on online platforms. Investors are aware about how to get update about their investment from the

digital platform. It has been observed most of the investors are aware about online fraud, data security problems,

biased information and risky recommendations floating on online platforms. Digitalisation reforms have lead to

easy monitoring of mutual fund schemes in the last three years.

Key Words: Mutual Funds, Digitalisation, Mira-bhayander, Investment.

I. INTRODUCTION:

The investors who fear the stock market have found a new avenue in the form of mutual funds. As per Association

of Mutual Funds (AMFI), a mutual fund is a trust that pools the savings of a number of investors who share a

common goal and invest it in capital market instruments like shares and debentures. The Securities and Exchange

Board of India (SEBI) is the regulator for the mutual fund market. The mutual funds are professionally managed

funds and have a record of providing good returns over a period of time.

The investors considers the various factors while making a decision about investing in mutual funds like the net

asset value, awareness about the fund, source of investment, the name of the sponsor, the investment time frame,

the expected appreciation in capital etc.

The first mutual fund scheme was launched by Unit Trust of India (UTI), i.e. Unit Scheme 1964.The mutual fund

industry has been through many ups and downs during its course of development from 1963 to 2018.

From 1963 to 1988, the mutual fund industry had Rs 6800 Cr of Asset Under Management (AUM) (only UTI was

available), but after the entry of the Public Sector Mutual Funds it moved to 47,004 Cr. by the end of the year

1993.In the next 10 year with the entry of private mutual funds the asset under management reached 121805 Cr.

and there were 33 mutual fund companies at the start of the year 2003. The mutual fund industry from 2003 to

2013 faced a lot of hardship and slowdown due to the global meltdown of 2009.

SEBI took various progressive steps to lift the spirits of the mutual fund investor and improved mutual fund

market penetration in tier II and tier III cities .The industry’s Asset Under Management (AUM) reached 10 Lakh

Crores(10 Trillion) in may 2014 and by July 2016 it reached 15 lakh crores. It has now reached 23.16 trillion as

on 28th Feb 2019.

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II. CONCEPT OF MUTUAL FUNDS:

According to SEBI Regualation Act, 1993 “Mutual funds are investment avenues where an investor/common man

can invest in small amounts in the share market”. A mutual fund is a fund established in the form of a trust to raise

money through the sale of units to the public or a section of the public under one or more schemes for investing

in securities.

1II. LITERATURE REVIEW:

1. (Marcin Kacperczyk, Nov., 2008) The researchers studied the unobserved actions of mutual funds and its

impact on the performance of the mutual fund. It was conducted on a sample of US equity mutual funds

between 1984 and 2003.The technique used to analyse the returns is the difference between the investor

returns and the buy-and-hold returns of the portfolio disclosed in the most recent past. It was examined

that the effects of unobserved actions were persistent in the long run both for the bottom and the top

performing funds. The funds differed substantially with respect to the impact of such actions and the cross-

sectional difference in unobserved actions had significant predictive power for fund performance.

2. (Musto, 2011) The researchers examined the economics of mutual funds in general and open ended mutual

funds in particular. Among the topics reviewed were tax efficiency, transaction cost, risk shifting, window

dressing, governance, marketing, price setting and concerns that arise at the family level.

3. (Singh, Mar-12) The study was related to the attitude of the investors towards mutual funds. The investors

are more interested in returns of the investment and the liquidity provided by the scheme as more important

traits followed by flexibility, transparency and affordability. The scope for growth of mutual fund

companies depends on their service standards and disclosure requirements.

4. (Dr Sarita Behl, Jul-12)The paper investigates the performance of mutual funds schemes in India in total

29 open ended growth oriented equity schemes for the period from April 2005 to March 2011 were studied

by the researcher. It was evaluated using Sharpe, Treynor and Jensen's measure. The study revealed that

14 out of 29 mutual fund schemes outperformed the benchmark returns. In the study the Sharpe ratio was

positive for all the schemes which show that funds were providing returns greater than risk free rate.

Results of Jensen measure revealed that 19 out of 29 schemes were showing positive alpha which indicated

superior performance of the schemes.

IV. PROBLEM OF THE STUDY:

The study is basically done to understand the factors influencing Investment decision making with reference to

mutual funds in Vasai Region The focus will be on the educated class of the region and the role played by

digitalisation in the investment decision making process of mutual fund investment.

A number of studies have been covered to get knowledge of the research area under study. An inspection of the

review of literature brings out the fact that there is an in-depth study done in mutual funds in different areas. The

areas mostly covers the performance analysis of various selected schemes or asset management companies, the

role of the fund manager ,the ability of the fund manager, the analysis of the open ended schemes ,etc. The

literature review reveals that the study of role played by the digital medium needs to be conducted to understand

the utility in decision making related to investment in mutual funds. Such a study needs to be conducted in the

Vasai area as it is close to Mumbai metropolitan region needs to be done in detail and therein lays the research

gap. Hence, there exists a research gap and the present study entitled “A Study of the role played by digitalisation

in the investment of Mutual Funds In Vasai Region”

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V. OBJECTIVE OF THE STUDY

The proposed study has the following objectives:

1. To analyse impact of digitalization on mutual fund investment decision making with respect to mutual

fund.

2. To critically evaluate the role of digitalization in investment in mutual funds.

VI.HYPOTHESES:

Null Hypothesis:

H0: There is no significant role played by digitalisation in the investment decision with respect to mutual

funds in Vasai region

Alternative Hypothesis:

H1: There is a significant role played by digitalisation in the investment decision with respect to mutual

funds in Vasai region.

VII. RESEARCH METHODOLOGY

a) SAMPLE FRAME: The sample frames in this study are the investors of mutual funds in Vasai region.

Convenience sampling was adopted, with a sample size of 100 investors from various part of the region

b) SELECTION OF THE SAMPLE: The study made with the use of survey method, in which questionnaires

was administered to investors in mutual funds in Vasai region. They were contacted through friends, family,

agents and brokers.

DATA COLLECTION: A questionnaire was given to the respondent to fill the data and obtain their response.

c) SOURCES OF DATA:

Primary source: A structured questionnaire was prepared to get responses by 100 respondents of investors in

mutual fund in Vasai region.

Secondary source: Studies of overall composition of Mutual Funds Investment was based on:-

i. SEBI reports

ii. RBI reports

iii. AMFI reports

iv. Website of Asset Management Companies (AMCs)

v. Financial Websites like moneycontrol.com and Value research.com

vi. Mutual Fund Insight a Magazine published by value research.

vii. Newsletters, News papers reports etc.

d) RESEARCH VARIABLES AND ANALYSIS:

Research variables: The variables for study is the role of digitalisation, the period of investment, types of

investment, risk and returns on investment.

e) STATISTICAL TOOLS AND TECHNIQUES:

In order to accomplish the required hypothesis of the study Graphs, Tables, Pie Charts have been used for visual

presentation of the data. Chi square test have been used to prove the hypothesis of the data.

VIII. SIGNIFICANCE OF STUDY:

1. The study and its outcome can become a tool to understand the role played by digitalization in Mutual fund

investment decision making.

2. It will help in relooking at the strategy of using digital medium to attract investors in mutual fund sector.

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IX. ANALYSIS OF DATA:

It can be observed that out of the options provided moneycontrol.com and paisabazaar.com are known to mutual

fund investors. It has been observed that 90% of the investors are aware about the ease of payment advantage on

digital platforms. 67% are aware about paperless registration on online platforms .55% investors are aware about

how to get update about their investment from the digital platform. It has been observed that 73% of the investors

are aware about online fraud, 64% are aware about data security problems and 40% are aware about biased

information and risky recommendations floating on online platforms.

Hypothesis Testing.

H0: There is no significant role played by digitalisation in the investment decision with respect to mutual


H1: There is a significant role played by digitalisation in the investment decision with respect to mutual


Table 1. Mode of Investment in Mutual Funds

Criteria observed expected O - E (O - E)² / E % of chisq

Online 40 50.000 -10.000 2.000 50.00

Offline 60 50.000 10.000 2.000 50.00

Total 100 100.000 0.000 4.000 100.00

4.00 chi-square

1 df

.0455 p-value

(Source: Compiled from Primary Data)

Analysis: Since the p-value is less than 0.05 it indicates that the responses are not evenly distributed among the

respondents .The residual value of online and offline is same i.e. 2 so it is concluded that the investors prefer both

the methods of investment.

So it can be concluded that we fail to reject the null hypothesis that digitalisation does not play a crucial role in

investment decision making in mutual fund investments.

Table 2. Since when are you using digital mode for investment in Mutual funds?

Criteria observed expected O - E (O - E)² / E % of chisq

0-3 years 77 25.000 52.000 108.160 72.03

3-5 years 17 25.000 -8.000 2.560 1.70

5-10 years 6 25.000 -19.000 14.440 9.62

10 years and

above 0 25.000 -25.000 25.000 16.65

Total 100 100.000 0.000 150.160 100.00

150.16 chi-square

3 df

2.43E-32 p-value

(Source: Compiled from Primary Data)

Analysis: Since the p-value is less than 0.05 it indicates that the responses are not evenly distributed among the

respondents .The residual value of 0 to 3 years is more i.e. 108.160 than the other options provided. So it is

concluded that the investors have started using digital mode in the recent past which is normally less than 3 years.

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So it can be concluded that we reject the null hypothesis that digitalisation does not play a crucial role in

investment decision making in mutual fund investments.

Conclusion: The p-value is less than 0.05 in both the cases so we reject the Null Hypothesis and accept the

Alternate Hypothesis that digitalisation does play a crucial role in investment decision making in mutual fund

investments.

X. CONCLUSION:

It can be concluded that digitalisation has played an important role in the increase in mutual fund investment in

the region. Offline and Online mode of investment is preferred .Awareness is sought from internet, friends, agents;

television advertisement etc. It can be observed that out of the options provided moneycontrol.com and

paisabazaar.com are known to mutual fund investors. It has been observed that the investors are aware about the

ease of payment advantage on digital platforms, about paperless registration on online platforms.Investors are

aware about how to get update about their investment from the digital platform. It has been observed most of the

investors are aware about online fraud, data security problems, biased information and risky recommendations

floating on online platforms. Digitalisation reforms have lead to easy monitoring of mutual fund schemes in the

last three years but the most important parameters considered while investing in Mutual Funds is safety.

XI. LIMITATIONS OF THE STUDY

1. The study is confined to Mutual funds investment.

2. The data analyzed is confined to the survey of 100 investors.

3. The data relates to Vasai region.

XII: REFERENCES:

Dr Sarita Behl, M. R. (Jul-12). A Comparative Analysis of Mutual Fund Schemes in India. International Journal

of Marketing,Financial Services and Management Research.Vol1 ,Issue 7, ISSN 2277-3622.

Marcin Kacperczyk, C. S. (Nov., 2008). Unobserved Actions of Mutual Funds. The Review of Financial Studies,

Vol. 21, No. 6 , 2379-2416.

Musto, D. K. (2011). The Economics of Mutual Funds. Annual Review of Financial Economics, Vol. 3 , 159-172.

Singh, D. B. (Mar-12). A study on investors’ attitude towards mutual funds as an investment option. International

Journal of Research in Management,Issue 2,Vol 2, 61-70.

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IMPACT OF GST ON MICRO, SMALL AND MEDIUM ENTERPRISES IN INDIA

Mr. Gautam Dilip Maske

(Assistant Professor in Commerce)

Sathaye College, Dixit Road, Vile-Parle, Mumbai -400 057

Abstract

The Goods and Services Tax (GST) was the most awaited tax reform, the GST bill was passed by the Rajay Sabha

on 3rd August, 2016 and the amended bill was passed by the Loksabha on 8th August, 2016. It was implemented

on July 1, 2017 with the primary objective of GST is to subsume all sorts of Indirect taxes in India like Central

Excise Tax, VAT, Sales Tax, Service Tax etc. to implement ‘one nation, one tax’ system in the country. It is also

aimed to bring more transparency and to reduce tax evasion and corruption in the county. Even though major

intention of implementation of GST is simplify the Tax system in the country but it will also help to boost the

economy in long run. Micro, small and medium enterprises (MSMEs) are the backbone of any economy therefore;

one has to understand the effects of GST on these MSMEs which is not only contributes to GDP of the country

but also generates employments. So, this paper will be discussing the concept of GST and it’s the positive as well

as negative impact on MSMEs in India.

Keywords: Indirect Tax, GST, tax reforms, MSMEs,

Introduction

The research paper is regarding impact of GST on small and micro enterprises. With the introduction of GST

there is a condition chaos and confusion among businessmen. The aim of this research paper is to explain the

mechanism of GST and its effects on small and micro enterprises. In India, the idea of GST was started in 2004,

whereby the Kelkar Committee was convinced that a dual GST system shall be able to wider market of tax base,

improve revenue collection through levying and collection of indirect tax and more pragmatic approach of

efficient resource allocation. Under the Goods and Service Tax mechanism, every businessman is liable to pay

tax on output and shall be entitled to enjoy credit on input tax paid and tax shall be only on the amount of value

added. GST, which embodies the principle of "one nation, one tax, and one market" is aimed at unifying the

country’s 2.75 trillion economy and 1.3 billion people into a common market. Under GST, goods and services

fall under five tax categories: 0 per cent, 5 per cent, 12 per cent, 18 per cent and 28 per cent. The LokSabha has

finally Passed the Goods and Services Tax Bill and it is expected to have a significant impact on every industry

and every consumer. Apart from filling the loopholes of the current system, it is also aimed at boosting the Indian

economy especially, Small and Micro industry.

Micro, small and medium enterprises are the backbone of any economy as they not only contributes to GDP of

the country but also generates employment to large number of people. So, it responsibility of the government to

promote and boost these small and micro enterprises through various initiatives. In India, government has

prescribed the limits of investment to define micro, small and medium enterprises, as per Micro Small and

Medium Enterprises Development (MSMED) Act, 2006 any enterprise engaged in manufacturing, production,

processing and preservation of goods, having investment in plant less than Rs. 25 lakh is termed as micro

enterpise, the enterprise having investment more than Rs. 25 lakh but less than Rs.5 crore is termed as small and

the enterprise having investment more than five Rs. 5 crore but less than Rs.10 crore is termed as medium

enterprise. similarly, The Enterprises engaged in providing or rendering of services and whose investment in

equipment less than Rs.10 lakh is called micro enterprise, the service enterprise whose investment is more than

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Rs. 10 lakh but less than Rs. 2 Crore is called small enterprise,Whereas an service enterprise whose the investment

in equipment is more than Rs. 2 crorebut does not exceed Rs. 5 crore is termed as medium enterprise.

GST has affected the small and micro business to great extents since its inception positively as well as negatively

in this paper we discuss the various positive and negative effects of GST on Small and micro business along with

basic features of Indian GST.

Features of Indian GST

1. GST is one indirect tax for the entire nation, which will make India “one unified common market”.

2. It will replace multiple taxes like VAT, CST, Excise Duty, Entry Tax, Octroi, LBT, Luxury Tax etc.

3. There are four types of GST namely:

a) SGST – State GST, collected by the State Govt.

b) CGST – Central GST, collected by the Central Govt.

c) IGST – Integrated GST, collected by the Central Govt.

d) UTGST – Union Territory GST, collected by the Union Territory

4. Tax Payers with an aggregate turnover in a financial year up [ Rs. 20 Lakhs &Rs. 10 Lakhs for North Eastern

Sates and Special Category States] would be exempted from tax.

5. GST slabs are pegged at 5%, 12%, 18% & 28%.

Objectives of Study

1. The first objective of the paper is to highlight the impact of GST on MSMEs.

2. The second objective is to explain the working mechanism of GST in India. .


It is a type of descriptive research paper and data used in this paper were collected through secondary sources like

website of Finance Ministry(finmin.gov.in), GST Council (gstcouncil.gov.in), GST Council Archives

(gstindia.com), and money others. Literature review form journal papers, newspaper reports, and magazine based

articles on GST. Based on the above mention data, the objectives of the study are defined and research design is

drafted which highly descriptive in nature.

1. Impact of GST on MSMEs in India

A) Positive Impacts

1. Launching a new business became easier

In the earlier tax regime, if the business had operations across multiple states, then it would need to register for

VAT with each state’s sales tax department in order to carry out business activities in that state. The fact that

every state had their own tax rules and system, and the business owners especially small business, had to pay

multiple procedural fees for VAT registration, which was the additional burden on them. Under GST, the

registration is centralized and the rules are uniform for all the states across the country, which has helped the small

businesses to save money on the account of registration fees. All one has to do is fill and submit an online form

to obtain a GSTIN (GST Identification Number). Launching a new business is became comparatively easier

under the GST regime.

2. The process of taxation became simpler

In earlier tax regime, small and medium sized businesses, owners or manufacturers have to take care of different

taxes and have to run to various departments to fulfil all the tax-related documentations. Some file different taxes

biannually, annually, half-yearly, etc. The more the departments, the more is the harassment. So, combination of

different taxed helped reduce dealing with fewer tax authorities.

https://taxguru.in/goods-and-service-tax/provisional-id-gst-identification-number-gstin.html

https://taxguru.in/goods-and-service-tax/audit-gst-regime.html

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3. Expansion of business

Introduction of GST has helped the small businessmen to expand the business very conveniently with a single

GSTIN number, they set up their business in different part of the country with same registration which was not

possible in the earlier tax regime. Similarly in GST regime, the businessmen do not need to pay different taxes to

various departments. Which has also helped small business owner to concentrate on the business activities to

expand their business.

4. Reduction in Tax Burden

GST is meant to bring every indirect form of tax under one roof. In the past tax regime, the total tax levied by the

central and the state governments add up to 32%, but with the implementation of GST, the business owners have

to pay a much lower tax of around 18-22 percent. This has helped to reduce the tax burden on small business,

which has help them to make goods available at cheaper rate to their customer.

5. Reduced cost of logistics

The past tax regime had created a lot of hassles for the transportation sector. The long queues at checkpoints and

inter-state entry points have caused vehicles to stand idle for long periods of time, adding to labor and fuel costs.

Businesses transporting goods to other states have had a hard time filing paperwork and paying entry taxes at the

inter-state borders, further delaying the delivery of goods. Under GST, the Central Sales Tax (CST) on interstate

sales has replaced with a combined tax called IGST, which is composed of CGST and SGST and collected by the

Central Government. As the removal of border and check-post taxes makes state boundaries less significant, this

has helped to reduce the transportation cost to great extent.

5. No need for distinction between goods and services

Previously, businesses providing both goods and services had to calculate the VAT and service taxes individually.

GST eases the process by removing the distinction between goods and services; tax is calculated for the final total,

not individual products or services. This helped MSMEs take advantage of the tax incentives for payment on the

procurement of input goods and services like import, interstate and local purchases, and telephone services etc.

6. Increased threshold limits for Registration

Under the previous tax regime, businesses with a moderate annual turnover (Rs.5 lakh in some states and Rs.10

lakh in other states) are supposed to register and make payments for VAT. Under GST, this burden is eliminated

for many businesses, since a business does not have to register or pay if its annual turnover is less than Rs.20 lakh

(Rs.10 lakh in North Eastern states). Also, under the composition scheme, businesses with turnover between

Rs.20-Rs.50 lakh pay GST at a lower rate. This had a positive effect on startups and other small businesses by

relieving them from tax burdens.

B) Negative Impacts

Though there are a lot of advantages to GST, MSMEs may have some difficulties about transitioning to GST and

getting used to the new tax regime within a short period of time. These difficulties might be increased compliance

or number of returns. Here are a few negative effects of GST that are likely to affect MSMEs.

1. Multiple registrations for Pan-India businesses

Under the new regime, a business have to register online for GST in every state involved in its sales process. If

your business delivers goods across 5 states, then you’ll have to register for GST in those 5 states to carry out

your business activities. Since the entire registration process takes place online, small business owners who are

not used to working online might not find the transition easy.

2. Returns must be filed on a monthly basis

Under GST, there are around 36 returns in a fiscal year. GST returns need to fill every month so businessmen has

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to close his books on monthly basis, which takes lot of time will which he could use to spent on other productive

activities, like developing their business and acquiring clients. To top it off, until you’ve filed the relevant returns,

you cannot claim refunds and your customers cannot claim tax credit for the goods they bought from you. Should

you miss a single return, you’ll be penalized Rs.100/- a day and your compliance rating on the GSTN portal will

be reduced.

3. Increase in Cost of tax compliance

As mentioned above, consistently filing 3 returns a month, periodically reconciling your transactions, and

uploading invoices regularly will required for an accountant with technical expertise. Hiring an accountant and

paying them, adds to the burden on small businesses. It is tedious to maintain separate books of accounts for every

state involved in the supply of goods/services and assess the records of various entities involved in every single

transaction. Some small businesses might use the services of licensed third parties that help firms comply with

the GST regime. For this services, small businesses may have to pay sum of rupees ranging from Rs.1000-

Rs.5000, depending on the kind of service that is rendered to them.

4. Mandatory Registration for e-commerce suppliers and operators

Businesses carrying out activities related to e-commerce should register under GST irrespective of their annual

turnover rate. Unlike other types of businesses, e-commerce firms will not be eligible for threshold exemptions

or for the Composition Scheme (which allows firms to file their tax returns on a quarterly basis instead of 3 times

a year and pay taxes at a much lower rate). Also, e-commerce firms should register for GST in every single state

where they supply goods.

Conclusion

Overall, GST simplifies the entire process of filing and paying taxes. It will also increase the competition between

SMEs by unifying the Indian market. If you’re proactive and take care of your GST compliance measures

beforehand, you can minimize the potential negative effects of the new regime on your business. In the long term,

GST is expected to have a positive impact on SMEs and the Indian economy as a whole.

Reference

Adhana, D.K.(2015) Goods and Service Tax (GST): A panacea for Indian Economy. International Journal of

Engineering and Management Research 5(4), 332-338.

Chakraborty, P., and Rao, P.K. (2010, January 2) Goods and services tax in India: An assessment of the base.

Economic and political weekly, 45(1), 49-54

Taqvi, S. M. A., Srivastava, A. K., and Srivastava, R. K.(2013), Challenges and opportunities of Goods and

services tax (GST) in india, Indian Journal of Applied Research, 3(5), 413-415.

https://msme.gov.in/faqs/q1-what-definition-msme

https://blog.saginfotech.com/impact-gst-on-startups-smes

https://www.finmin.nic.in/

http://gstcouncil.gov.in/

https://msme.gov.in/faqs/q1-what-definition-msme

https://blog.saginfotech.com/impact-gst-on-startups-smes

https://www.finmin.nic.in/

http://gstcouncil.gov.in/

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INSIGHT INTO REFORMATION OF MUNICIPAL TAXES: THE APPROACH OF BOMBAY

MUNICIPAL ACT III OF 1888

Dr. Swapna H Samel

Associate Professor, Fulbright Scholar,

Dept. of History, B. K. Birla College, Kalyan

Mumbai accounts for slightly more than 6.16% of India's economy contributing 10% of factory employment,

30% of income tax collections, 60% of customs duty collections, 20% of central excise tax collections, 40% of

foreign trade and Rs 40,000 crore (US $10 billion) in corporate taxes to the Indian economy. The municipal

corporation of Mumbai which is responsible for collection and administration of property tax and maintaining

civic amenities is known as Brihanmumbai Municipal Corporation (BMC) in Marathi and Municipal Corporation

of Greater Mumbai (MCGM) in English.

India’s richest civic body kept taxes unchanged while increasing its capital expenditure in its annual budget. The

Brihanmumbai Municipal Corporation proposed an outlay of Rs 33,441.02 crore for the financial year 2020-21—

a near 9 percent increase over the previous year. The civic body has, however, proposed a 5 percent increase in

fees for various licenses, such as birth certificates, market permits, among others.

“Despite municipal revenue coming under stress, capital expenditure has increased by 36 percent (to Rs 14,637.76

crore),” Municipal Commissioner Praveen Pardeshi said while presenting the budget estimate today. “Further,

revenue expenditure has been reduced from Rs 19,205 crore to Rs 18,796 crore due to cost-cuts in revenue

expenditure and establishment cost”

Municipal governance in India has existed since the year 1687, with the formation of Madras Municipal

Corporation, and then Calcutta and Bombay Municipal Corporation in 1726. In the early part of the nineteenth

century almost all towns in India had experienced some form of municipal governance. In 1882 the then Viceroy

of India, Lord Ripon, who is known as the Father of Local Self Government, passed a resolution of local self-

government which laid the democratic forms of municipal governance in India

The City of Bombay Municipal Act – 1888 –

Bombay has led the country in many sphere of life. It was true in case of the Municipal administration too.

Bombay Municipal Corporation demanding important legislative reforms opened negotiati0ons with

government of Bombay to find best ways and means of transferring provincial receipts and burdens to local

authorities. On 2nd march, 1883, the Town Council appointed a Committee to confer with the Municipal

commissioner to find out the probable amount of different charges that would be entailed on the Municipality

by the transfer of various items of expenditure to it. Several meeting were held at which, several references

regarding the amendments to the Act of 1872 and 1878 were carefully considered .Finally, the report was

forwarded to the Corporation on 19th May, 1887, and the bill was put forward for discussion. Those who took

part in the fruitful discussions were Maj. Selby, Mr. Naylor, Mr. Telang, Lord Ray, Mr. P. Mehta, Mr. Forbes

Adam and Mr. Lathan. The result of all this discussion was that the Bill was finally passed, without most of the

obnoxious features to which the Corporation had objected to.With the publication of this Act in the Bombay

Government Gazette on 14th September 1888, the Bombay Municipal Act of 1888 came into force.

The most important change which this act brought was decentralization of power. The following were the major

changes included in section 5 of the Act of 1888:

A] The Corporation became the supreme administrative body and the custodian of the city’s purse.

B] The Standing Committee became the Financial Advisory Body and working Committee of the Corporation.

https://en.wikipedia.org/wiki/Viceroy_of_India

https://en.wikipedia.org/wiki/Viceroy_of_India

https://en.wikipedia.org/wiki/Lord_Ripon

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C] The Municipal Commissioner became Chief Executive Officer.

The obligatory duties of the Corporation were laid down in section 61 and 63 of the Act of 1888 as under:

A] The construction, maintenance and cleaning of drains and drainage works and of public latrines, urinals and

similar conveniences.

B] The construction and maintenance of works and means for providing supply of water for public and private

purposes.

C] Scavenging and the removal and disposal of excretions and other filthy matter of all ashes, refuse and rubbish.

D] The reclamation of places for the disposal of the dead and the provision of new places for the said places for

the said purposes.

E] The regulation of places for the disposal of the dead and the provision of new places for the said places for

the said purposes.

F] The registration of births and deaths.

G] Measures for preventing and checking the spread of dangerous diseases.

H] The construction and maintenances of public markets and slaughter houses and the regulation of all markets

and slaughter houses.

I] The regulation of offensive and dangerous trades.

J] The entertainment of a Fire Bridged and the protection life and property in the case of fire.

K] The securing or removal of dangerous buildings and places.

L] The construction, maintenance, alteration and improvement of public streets, bridges, culverts, causeways

and the like.

M] The lighting. Watering and cleansing of public streets.

N] The removal of obstructions and projection in or urban streets, bridges and other public places.

O] The naming of streets and suitably accommodating schools for primary education.

Q] The maintenance of a Municipal Office and of all public monuments and other property vested in the

Corporation.

To assist the Commissioner in the discharge of these Duties, under the Act of 1888, Standing Committees and

Corporation, placed at his disposal the following four Heads of Departments.

1. Executive Engineer

2. Executive Health Officer

3. An Assessor and Collector

4. A Chief Accountant

The new post created under the Bombay Municipal Act of 1888 was that of the Chief Accountant. A free battle

was waged in the Council over the appointment of the Chief Accountant. Pherozshah Mehta was in favour of the

Corporation, while J.B. Richey was in favour of the Commissioner. Speaking effectively in the Council in this

regard J.B. Richey said :

“….. We must legislate with a view to human nature. There should be harmony between the Municipal

Commissioner and his chief financial adviser, which is essential to the due working of the Municipal executive

machine. This can only be done if the subordinate is in a position to look for countenance and support to no one

outside the office. Finally, the right to appoint Chief Accountant was given to the Commissioner.

The Chief Accountant is an officer who is required to give the Municipal Commissioner the benefit of his advice

on all matters relating to the efficient record of and check over expenditure. His duties included interpretation of

various rules and regulations framed from time to time dealing with leave, acting and other allowances, pensions

and other personal matters affecting the employee’s service. He had to advise the commissioner as to the progress

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of expenditure, to assist him in preparing the yearly budget, estimates of levied to advise the various departments

of the Municipality on all financial audit and account questions. He had to report any apparent extravagance in

outlay, to advise on the borrowing capacity of the Corporation. He had to keep watch over rates paid for labour

and stores. Further, the more important duty he had to perform was to receive all money payable to the

Municipality and arrange for the subsequent payment into the Government Treasury. He had to check all payment

to whom Municipality was indebted.

The fiscal policy remained practically unchanged under the Act, except that the tax on the Fire Insurance

Companies was abolished. Instead a tax of not less than three quarters per centum was levied in order to provide

for expense necessary for the entertainment of Fire Brigade and the protection of life and property in case of fire.

The Municipal Taxes to be levied were defined as follows:

Property taxes to be levied on buildings and lands in the city. Section 140 dealt with the following taxes:

a) Water tax of so many per centum of their rateable value as the corporation shall deem reasonable value with

reference to the expense of providing water supply for the city.

b) A Halalkhor tax not exceeding three per centum of their rateable value;

c) A general tax of not less than eight and not more than 12 per centum of their rateable value.

d) A fire tax of not more than ¾ per centum of the rateable value.

1) A tax on vehicles and animals.

2) A toll on vehicles entering the city from Salsette

3) Town duties.

Section 196 of the act empowered the Corporation to collect the additional taxes. The following additional items

of revenue were provided for:

1. “Liquor License fees

2. Receipts from Tobacco Duty and Licenses.

3. Receipts on account of fees for licenses for public conveyances.

4. License fees for the regulation of certain trader within the city.

5. Receipts on account of fees for licenses for the playing of music in streets and public places.

6. Fines levied by any Magistrate in respect of any offence against the provisions of the Municipal Act or any

regulation or by law made under the Act.”

The government properties were assessed on a special basis. They were exempted from certain general taxes. As

regard port Trust properties, it was agreed that they could only be regarded as quasi – public property occupying

a position midway between private and public property. The Governor-in-Council being a disinterested person,

the valuation of such properties should be fixed by him. That sum to be paid annually by the Board should be nine

tenths of the amount by an ordinary owner of the buildings and lands in the city. For the purpose of preparing

budget, an elaborate procedure was prescribed. Sections 125 to 134 deal with the entire system of Annual Budget

Estimate. “The Commissioner shall, on or before each 10th day of committee, an estimate of the probable

expenditure for the ensuing year and of the balance available and a statement of his proposal for taxation. The

Standing Committee shall on or as soon as may be after the tenth day of November with due regard to all

requirements of the Act, frame a budget estimate of the income and expenditure of the corporation for the next

official year.”

A printed copy of the budget was to be sent to each Councilor not later that 15th December. The Standing

Committee proposed the levy of taxes and Town duties at such rates as they thought fit.

Then the meeting of the corporation was to be called in January, on a day not later than10th of January. Before

the 31st January the corporation must determine the rates and town duties for the following official year. Further

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Section 129 said : “The Corporation may refer the budget estimate back to the Standing Committee for further

consideration, or adopt the Budget estimate submitted to them.” Even the corporation could alter it as they fought

fit.

After the Budget estimates were finally passed, the corporation could during the year, increase the amount of the

Budget grant or make additional grants on the recommendation of the Standing Committee. The Standing

Committee could reduce or transfer a budget grant, but if the amount or reduction or transfer exceeded Rs. 500,

the Corporation could pass an order in regard to it. The Government had no powers to approve or modify the

Budget. The Corporation had all the control over the expenditure under a sanctioned budget as well as control

over the items incorporated in budget. The Corporation enjoyed complete fiscal autonomy.

Today when we talk about the economic development of any city, it mainly depends on the income of the

municipality which further depends on the taxes collected by the citizens. A variety of taxes are levied by

the urban local government in different states. The most common taxes are property tax/house tax, profession

tax, vehicle tax, Octroi, tolls, technical tax, tax on animals, entertainment tax, tax on transfer of property and tax

on advertisements. Last year Mumbai development Plan 2034 was declared, to fulfill those dreams city need

finance and then variety of taxation system may be introduced in future. Thus, the frame work of the Act of 1888

was so well done that even after more than hundred years the basic structure of the Municipal Act of 1888 remains

the same.

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SOFTWARE PIRACY AND IPR

Prof. Chhaya Pawaskar

Siddharth College of Commerce & Economics

Abstract

Development of Information technology has led to rapid development of software. The major threat to computer

software is piracy. Today more than 35% softwares which are in use, are pirated. No separate law exists for

software piracy. The Indian Constitution has the Copyright Act, 1957, amended in 1994, which acts as the main

statute for all copyright-related laws in India. This paper is an attempt to identify the different types of software

piracy, as well to identify the major reasons behind software piracy. Awareness about copyright law related to

computer software in developing countries can reduce the rate of software piracy. In the end, this paper

suggests certain points to consider, which can reduce software piracy.

Introduction

Over the past few years, the world has observed rapid growth and great achievements in the field of information

technology. As software industry has expande, so has the criminal activity of software piracy. Software

companies have been afflicted by piracy for years. Technological advances have made it easy for anyone to

reproduce and distribute copyrighted works anywhere, anytime and to anyone. These same technologies have

made large-scale commercial copyright infringement a major form of theft and fraud. Software piracy has been

identified as the worst problem facing the software companies today. It has not only affected the software

companies but also has caused much panic for content owners. The development of technological tools such as

computers, software and the Internet has made our lives easier, but abuse of such tools has created a serious

issue like software piracy which is now a growing concern for several countries.

Definition

‘Software Piracy’ is the unauthorized/illegal copying, distribution or use of a software. It may include use of a

software unauthorizedly without obtaining a proper license from the software company or simultaneous use of

single user license or loading software on more machines, than authorized under the license terms. According to

the Business Software Alliance (BSA), about 36% of all software in current use is stolen globally.

Copyright

In India, provisions as to Software Piracy are covered under Indian Copyright Act 1957, which were inserted by

the Copyright (Amendment) Act, 1994. It now includes definition of a ‘Computer Program’ and defines an

infringing copy as one, which is used without the license and/or permission granted by the owner of copyright.

It further provides penal provision under Section 63B of the Act, which is titled, “Knowing use of infringing

copy of computer program to be an offence” and the Section reads as follows:

“Section 63B: Knowing use of infringing copy of computer program to be an offence: Any person who

knowingly makes use on a computer of an infringing copy of a computer program shall be punishable with

imprisonment for a term which shall not be less than seven days but which may extend to three years and with

fine which shall not be less than fifty thousand rupees but which may extend to two lakh rupees: Provided that

where the computer program has not been used for gain or in the course of trade or business, the court may, for

adequate and special reasons to be mentioned in the judgment, not impose any sentence of imprisonment and

may impose a fine which may extend to fifty thousand rupees.”

Copyright holders routinely invoke legal and technological measures to prevent and penalize copyright

infringement.

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Further provisions of Copyright Act empower a Police Officer, on a police complaint being made, not below the

rank of Sub Inspector to seize without warrant infringing copies as well as the material that is being used for the

purpose of making such copies.

Most Common types of Software piracy:

1) Softlifting

Softlifting is the act of illegal copying of software and distributing it to friends, organisations or duplication and

resale in violation of the terms of the license agreement. Many personal users and enterprises are doing it

knowingly or unknowingly and only few of them care about it. Such activities leads software industry to lose

billions of dollars each year and shatter the profitability of large software companies as well as small ones. It

often happens when organizations expand computer capabilities and install unauthorised copies, rather than

going through the purchasing procedure.

2) Internet Piracy

Nowadays, Internet piracy is one of the fastest and easiest ways to receive pirated software. There are several

websites that make software available for free download in a number of ways. Many computer users download

software from the Internet.

3) Hard-Disk Loading

Hard-disk loading occurs when an individual or company sells computers preloaded with illegal copies of

software into the hard disks to encourage the consumer to buy their products. Since this kind of activity is

common, SIIA (Software & Information Industry Association) recommends computer buyers to confirm with

the vendors that software preloaded on the machines are legal and licensed copies. If the vendor is unwilling to

supply with the proper documentation, SIIA highly recommends not dealing with that vendor

4) Software Counterfeiting

Software counterfeiting is illegal duplication and sale of copyrighted software in such a way that it appears to be

authentic. Counterfeit software includes accompanying manuals that the original legitimate software was sold

and is usually sold at prices well below that of the retail price of the legitimate software. According to a study,

“The dangerous world of counterfeit and pirated software” conducted by IDC in 2013, the chances of infection

of malware from counterfeit software are 1 in 8 for consumers and 1 in 9 for businesses.

5) Unauthorized Use Of Academic Software

Many software companies sell academic versions of their software to public schools, universities and other

educational institutions. When the software is labelled to use for academic or educational purposes only, it

cannot be used for commercial or other for profit purposes. Using academic software for private use in violation

of the software license is a form of software piracy and it not only hurts the software publisher, but also the

institution that was the intended recipient of the software.

6) Renting

Renting involves someone renting out a copy of licensed software for temporary purposes. In such type of

piracy, software is rented to individual computers and returned the original software to the renter. This method

of piracy is not as common as other forms of piracy due to its distribution nature but it still does exist. It has

always been illegal to rent unauthorized copies of software. The “Computer Software Rental Amendments Act”

formed in the US in 1990 strictly prohibits the rental, lease or lending of a computer program for direct or

indirect commercial gain unless authorized by the owner of the copyright in the program.

Major factors behind software piracy

Software piracy continues for several reasons, however, and is a serious problem. The magnitude of software

piracy varies in different countries. Many buyers believe they have the right to copy the software for which they

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pay a huge amount of money. In recent years, many studies and surveys have been focused more on finding the

causes of software piracy.

Key reasons behind software piracy based on different studies are analyzed below.

1) Public Awareness

Lack of awareness in proper use of software is considered to be the key point influencing software piracy.

Although software industries provide information regarding copyright of software to computer users by

employing licensing agreements as a means of information during the installation process, most of the users do

not even bother to read license agreements before moving to the next step in the installation period. Many

people misuse software products. They install software in their computers and make a copy of it and give it to

others and they do not even realize that what they are doing is illegal and against the copyright law.

2) High Price Of Software

The high price of software is another factor causing software piracy. Economies with low per capita income are

likely to have higher piracy rates because software product prices are unaffordable to the average person.

Software products developed in economically rich countries are generally not affordable in poorer countries.

The economy of any country has a strong correlation with the piracy rates. According to a global study

conducted by BSA in 33 countries as a part of the Ninth Annual BSA global software piracy study, piracy rate

was higher in developing countries, than in the developed countries.

3) Legal Enforcement

Several studies regarding software piracy have shown that the piracy rate is mostly higher in the Asian and

African countries compared to countries in the North America and Western Europe. This is because computer

users in North American and Western European countries are aware of copyright rules and laws. Copyright laws

are strictly followed in these countries. For example in the US, if any business organization or individual is

found guilty in copyright infringement, they will be sentenced to jail terms of up to 5 years along with $250,000

as fines. Thus, unauthorised reproduction and distribution of such computer programs without the permission of

owner leads to criminal proceeding and penalties. However, a study by Tan (2002) suggests that where there is

low probability of being caught and penalised, an individual or business will continue using pirated software.

4) Social And Cultural Factors

It has been found that there is a strong correlation between social or cultural factors and software piracy. These

factors refer to the prevailing social structure of a country and the attitudes shared by the members of that

society. Several previous studies have shown that collectivist-individualist aspects of the society affect the

piracy rate in any country. For example, according to a study by Kallol, Peeter and Robert (2006), software

piracy is most popular in collectivistic societies where software is purchased by an individual and is shared

among other members of the society.

5) Pirated Software On The Internet

There are millions of people around the world who use computer and the Internet on a daily basis. Using

computers in our daily lives has made our lives easier and has benefited us in many aspects but it has also

brought some problems, and software piracy is one of them. Availability of pirated software on the Internet is

one of the major factors increasing the software piracy rate globally. Pirating the software from the Internet is

termed as the Internet piracy where the Internet is used to download unauthorized software. Access to high-

speed Internet connections makes it easier to download software programs. Beside this, many illegally attached

computer games are sent through the Internet as emails, which is also a form of piracy.

Recommendation

In order to fight against the software piracy following measures should be taken:

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1) It is recommended to reduce the cost of the software in developing nation as more than 50% of the

population can’t afford costly software.

2) Software developer and company owners should be made well aware of Intellectual property rights

related to software and how to implement it.

3) Software installation and execution should be done online using a computer or mobile from the

developer company’s website by only the authorized users.

4) It is necessary to spread awareness about different license rates available for students, academicians,

educational institutes and professionals

Conclusion

It is been observed that main reason for software piracy is the high cost of software. Since India is a mass

market, popular software prices can further be reduced to more than fifty percent because of volumes.

Awareness of Student version of software should be made in schools and colleges. Other reasons of software

being equally important the precautionary measures should be taken, Lastly Copyright Law should be strictly

implemented in case of software piracy which will help in reducing the rate of software piracy to a great extent.

References:

file:///D:/C/IPR%20paper%20presentation/file-thepractical%20lawyer.pdf

https://www.itlaw.in/cyber-crime-in-india/software-piracy/

https://blog.ipleaders.in/piracy-laws-india/

http://www.faithaca.org/SIIA.pdf

https://www.techdirt.com/blog/casestudies/?tag=software+piracy

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TRADEMARK UNDER THE PATTERN ACT

Dr. Rekha Vijay Gore

Assistant Professor of History

D.G. Ruparel College, Matunga Road (W) Mumbai

A trademark is a word, name, symbol, phrase, logo, color, sound, smell, or other marking (combination of thes)

that lets consumers know who provides a particular product.

When the government grants a trademark to owners, it is a monopoly over using trademark so that the public

can readily identify the providers of goods and services. Without such a monopoly, businesses could circulate

inferior products under their competitors’ marks. This could deceive the public in to buying inferior products

and tarnish the reputation of the providers of highly-quality products.

When a trade mark comes to symbolize the products itself, rather than the provider of the product, it ceases to be

a trademark, and anyone can use it to describe his or her own similar product. This can occur when a brand

becomes so successful that consumers refer to the product by brand name alone. Thus, trademark owners, as

holders of a monopoly, have a responsibility to ensure that the trade marks their provision of the product instead

of the name of the product itself.

IPR (Intellectual Property Right)

Intellectual property is a term referring to a number of distinct types of creation of the mind for which

temporary property right are recognized by the law. Common types of IPR include copyrights, trademarks,

patents industrial design and domain names rights.

Intellectual property that comes under copyright are books other writing, music, compositions, sculpture, fill,

computer program and painting. Other neighboring rights protected along with copyright are performer rights

(acting, musician and singing) phonogram produces (recordings) it. The motto of such protection is to

encourage creative work.

Trademarks rater to distinctive sign which distinguish services of good of one undertaking from those with

undertaking and geographical indices rater to good originating from one place or attributed to one geographic

location, for example parceling tea.

These distinctive signs may be used symbolically for their service quality, can stimulate competition and help

the purchased with information regarding choice

New Invention: design and secrets.

These categories of IPR are primary aimed to encourage innovation in the field of design, new invention, and

new technology. Patents, design and trade secret come under this heading

TRADE MARK, PATENT AND COPYRIGHT ARE NOT EQUAL

Trademark did not develop from the Constitution, but from judicial decision. A patent product invention and

discoveries, such as a better mousetrap, an improved golf club head design, or system for recycling waste

material. The patent statute allow patent for anyone who “invents or discovers any new and useful process,

machine, manufacture, or composition of matter, or any new and useful improvement thereof.

Copyrights products, artistic expressions such as drawing, books, poems, choreography, songs, architecture and

motion pictures. A copyright product the expression itself, not the idea expressed. This concept can be difficult

to separate, but a clear line can be drawn between language and information. A copyright automatically attached

to any written work upon creation. For work created on or after January 1, 1978, copyright protection generally

lasts for the author lifetime plus seventy years after the author’s death.

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As stated in the Constitution, patent and copyright protections eventually expire so that the public can use the

holder’s work and thus promote scientific and artistic progress. By contrast, trademark right can last in

perpetuity, assuming the trademark owner property renews the trademark.

A BRAND IS A SHORTCUT

Trademarks serve as a shortcut or an easy way for consumers to associate a service or product with quality,

value, prestige and other attributes. Brand value stems more from earning power then prestige. Example

“McDonald’s

TRADEMARK FRIENDS AND FAMILY

Any word name, phrase, logo, slogan, symbol, source indicator, or any combination of these adopted to

distinguish a particular good from those of others.

SERVICE MARK

R- is attached to marks that are registered with the appropriate government agency.

TM- is attached to trademarks about which no claim of registration is being made.

SM- is attached to service marks about which no claim of registration is being

C- means an author is claiming copyright protection for a work. For example C- 2003 Talcott J. Fracklin

p- means an author is claiming copyright protection for phone record of a sound recording

Patent pending means inventors; patent no means that the invention is patented

TRADE NAME

The Coca-Cola Company -----“Coca-Cola”

The Ford Motor Company ------ “Ford”

Microsoft Corporation --------“Microsoft”

e Bay Incorporated ---------eBay”

PROTECTING THE BRAND

The second strongest marks are “arbitrary” marks- symbols in common use that were not previously associated

with the mark owner’s product. For example, “Apple” computers, “Camel” cigarettes, and “Indian” motorcycles

represent common words that have becomes associated with certain products only through trademark use.

Likewise, stars, stripes, and check marks are in common use, but Converse, Adidas, and Nike associated them

with athletic shoes.

Arbitrary marks come with a natural protection against misuse: because the public already associated the word

with something else’s, the trademark owner and public are less likely to use the mark as the sole name for the

product. For example, if someone said “I’m going to ride my Indian,” then most people would get a little

uncomfortable instead of understanding that the person was going to ride a motorcycle. Consequently that the

person was going to ride a motorcycle. Consequently, arbitrary marks are more likely to be used in association

with the product, thus retaining the trademark status and protecting the mark owner against misuse.

TRICKS OF TRADE

Courts give the next highest degree to protection to “suggestive” marks, which suggest a product’s attribute but

do not directly describe the product. For example, “Atlas” van lines, “Coppertone” tanning lotion, and “Husky”

toole represent word that suggest an aspect of a product- strength, dark skin, and durability, respectively without

directly describing it.

Two other problems arise from adopting descriptive marks. First, establishing secondary meaning provides no

room for error- using the word in its descriptive sense can be fatal to establishing its trademark meaning.

Second, only in rare instances can the owner of a descriptive mark monopolize the word. With newer marks, the

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best a descriptive mark owner can generally do is force a competitor to clearly disclose his product’s source

when using the descriptive term.

Tips on creating a brand:

1. Make a list of your product’s core values.

2. Develop a word, phrase, or other symbol that conveys these core values.

3. Determine whether your brand is a strong or weak trademark and understand the implication this can have on

your use of the brand.

4. Make sure that no one else is already using your brand.

5. Begin using your brand. Notify the public that is a trademark or services mark by placing a next to it (if you

using the brand for goods) or next to it (if you are using the brand for services). Also place the following

languages on material using by brand: “(Insert brand) is a trademark of “(Insert brand) is a service mark of

(insert your computer name)” (if you are using the brand of services).

6. Record the date you first used the brand, and keep a file containing a sample of each use along with the date

and time of publication.

7. Decide if you want to register your brand. Never, ever place advertisement, next to an unregistered brand. s.

Tips of maintaining brands:

1. Make affirmative decisions whether to keep or abandon a brand. Never inadvertently let brands into disuse.

2. Do not create “trademark maintenance programs” designed to keep brands alive for purpose of blocking

competition.

3. Find legitimate uses for brands that trade off the brand’s good will. Such uses include licensing programs,

co-branding, and tribute programs.

4. Keep records of brands’ use and significant events related to the brand.

5. Attempt to sell, license, or affirmatively abandon brands you no longer intend to use.

TRADEMARK LICENSE AGREEMENT

Licensor, (name of company, state of organization, and place of business), own the marks attached as exhibit A.

Licensor agree to grant license, (name of company and place of business) an exclusive license to use the marks

only in manner set forth in exhibit B. Licensee agree it will pay Licensor the amount set forth in the schedule

attached as exhibit C.

The parties expressly agree that licensor retains full ownership of the mark and any application or registration of

the marks. Licensee agrees it will do nothing inconsistent with Licensor’s ownership, application, or registration

of the mark, and licensee will not use any words or symbol in a manner that is confusingly similar to licensor’s

use of the mark. Licensee further agrees not to attack Licensor’s title in the mark or the validity to this license.

Licensee’s use of the mark shall inure to the benefit of and be on behalf of licensor. Licensee understands that

nothing in this license shall give Licensee any right, title, or interest in the mark, except the right to use the mark

in accordance with this license.

Licensee shall maintain the quality of all goods and services under the mark in accordance with the

specifications set forth in Exhibit D, as amended by Licensor from time to time. The parties agree licensor

retains the right to inspect the quality of goods or services sold under the mark to ensure licensee meets

Licensor’s specifications. Licensee agrees to maintain books and records relating to its activities for inspection

upon Licensor’s request for inspection upon Licensors request during normal business hours.

Companies can encourage employees to report infringement primarily through education. Companies can also

offer token rewards to people who report infringement, such as “logo police” badges or other fun items designed

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to simulate conversation about the topic. Employees should understand what constitutes potential infringement

and know who to report to when they discover an infringement.

CONCLUSION:-

Trademarks and Patterns are very useful to the consumer for creating, maintaining and protecting a valuable

brand.

REFERENCES:-

Brookfield communication, inc.v.West Coast Entertainment Corp, 174 F.3d 1036 (9th Cir. 1999), 91

E.I. Du Pont de Nemours Co. v. Yoshida International, Inc, 393. F. Supp. 502 (E.D.N.Y. 197), 79

"Intellectual property", Black's Law Dictionary, 10th ed. (2014).

World Trade Organization. World Trade Organization. Retrieved 2016-05-23.

"Patent Archives – Ladas & Parry LLP". Ladas.com. Archived from the original on 2013-01-15. Retrieved

2015-08-17.

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A STUDY ON AWARENESS OF IPR AMONG THE TEENAGERS IN MUMBAI COLLEGES

Ms Jyoti R Singh

Lala Lajpatrai college of Commerce and Economics Department of Commerce

Abstract:

The term Intellectual Property Rights came in to presence since one hundred and fifty years to include large

group of rights such as copy rights, patent, trademark etc. It tries to ensure the privileges of IP proprietors to

empower them to receive the benefits of their innovativeness. It is not just significant for the legal advisors,

judges, and researchers to aware about IPR, it is also essentials for teenagers to know about IPR. The objective

of the study was to understand the awareness among teenagers regarding Intellectual Property Rights. To

examine the knowledge of the students regarding IPR, a survey was conducted in the form of questionnaire.

Key Words:- Awareness, Intellectual Property Rights, Copy Right, Patent, Trade Mark.

Chap 1 . Introduction:

Any rights over creations of the mind or products of the intellect are known as intellectual property rights. To

qualify for protection under the existing intellectual property regime, the creator has to conclusively prove that

the creation is his or hers and they have not lifted the idea or the process from someone else or have not copied

their creation from an existing piece of intellectual property. The intellectual property rights cover the musical,

literary, artistic, inventions and discoveries, and even designs, artworks, phrases, words, and symbols. Indeed, it

can be said that IPR (Intellectual Property Rights) encompass any work of the mind and hence, the ambit of the

works that are covered is indeed growing by the day considering the fact that the 21st century has witnessed an

explosion in the number of products that are creations of the intellect.

Chap 2. Research Methodology

2.1 Objectives of the Study:

To study the students awareness about IPR.

2.2. Scope of the Study:

The researcher has made an attempt to collect the data from students of Mumbai colleges. The scope of the

research was limited to awareness about IPR among the teenagers.

2.3 Research Design:-

The research design is exploratory as well as descriptive with regards to assessing the knowledge about IPR.

Descriptive research answers the questions what, which, where.

2.4 Sampling Design:-

The survey was conducted in Mumbai colleges only with a sample size of 120 students. Simple random method

was used while collecting the data.

2.5 Methods of Data Collection:-

Primary and Secondary data was conducted to collect the data. Primary data was used in the form of responses

to a questionnaire. Secondary data was collected by referring the various research articles on this topic.

2.6 Hypothesis:-

H0: There is no relation between the awareness level of IPR and Gender of respondents.

H1: There is a relation between the awareness level of IPR and Gender of respondents.

H0: There is no relation between the awareness level of IPR and type of IPR.

H1: There is a relation between the awareness level of IPR and type of IPR.

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2.7 Statistical Technique:-

The researcher has used the chi – square test to test the hypotheses.

2.8 Limitation of the study:-

1. The study was restricted to only degree college students.

2. Respondents may be biased while answering the questions.

3. The study was limited to the basic aspects of IPR.

4. The survey was collected from only 120 respondents.

Chap 3 Data Analysis:-

Data Analysis and Interpretation

3.1 Testing of Hypothesis

H0: There is no relation between the awareness level of IPR and Gender of respondents.

H1: There is a relation between the awareness level of IPR and Gender of respondents.

The above Hypothesis is tested using chi-Square test

Table 3.1.1 Crosstab

Awareness Yes 27 37 64

No 24 32 56

Total 51 69 120

Source: Primary Data

Table 3.1.2 Chi-Square Tests

Value df

Asymp. Sig.

(2-sided)

Exact Sig. (2-

sided)

Exact Sig. (1-

sided)

Pearson Chi-Square .005a 1 .941

Continuity Correctionb .000 1 1.000

Likelihood Ratio .005 1 .941

Fisher's Exact Test 1.000 .544

Linear-by-Linear

Association .005 1 .941

N of Valid Casesb 120

Source: SPSS

Findings:

P Value = 0.544

P value > 0.05

Therefore, researcher Reject H1

There is no relation between the awareness level of IPR and Gender of respondents.

This signifies that the awareness of the IPR is not inclined towards one gender but is independent of the gender

of the respondents.

H0: There is no relation between the awareness level of IPR and type of IPR.

H1: There is a relation between the awareness level of IPR and type of IPR.

The above Hypothesis is tested using chi-Square test

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Table 3.1.3 Crosstab

Awareness yes 16 14 7 3 24 64

no 14 7 12 4 19 56

Total 30 21 19 7 43 120

Source: Primary Data

Table 3.1.4 Chi-Square Tests

Value df

Asymp. Sig.

(2-sided)

Pearson Chi-Square 77.812a 7 .000

Likelihood Ratio 107.597 7 .000

Linear-by-Linear

Association 9.184 1 .002

N of Valid Cases 120

Source: SPSS

Findings:

P Value = 0.000

P value < 0.05

Therefore, researcher Reject H0

There is a relation between the awareness level of IPR and type of IPR.

This means that the respondents are highly aware about the type of IPR which exist and respondents are all

aware of the same.

3.2 Figurative Interpretation of Data

Figure:-3.2.1 Gender

Source:- Primary

Interpretation: The above figure shows 57.5% of the respondents are male and 42.5% of the respondents are

female.

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Figure:- 3.2.2 Awareness

Source:- Primary

Interpretation:- Figure 3.2.2 shows that 53.3% of the respondents are aware about the term IPR and 46.7% of

the respondents are not aware about IPR.

Figure:- 3.2.3 Full form of IPR

Source:- Primary

Interpretation:- 64.2% of the respondents knows the full form of IPR, which is Intellectual property rights,

whereas 23.3% of the respondents doesn’t know the full form followed by 7.5% and 5% respondents.

Figure:- 3.2.3 Type of IPR

Source:- Primary

Interpreation:- The above figure clearly shows that 35.8% of the respondents are aware about types of IPR,

whereas 25% of the respondents are only aware of copy right followed by 17.5% respondents know about

patent, 15.8% are aware of Trade mark and only 5.8% respondents know about geographical location.

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Figure:- 3.2.4 Nature of IPR

Source:- Primary

Interpretation:- The above figure shows that 35.8% of the respondents know the nature of IPR as right whereas

27.5% of the respondents say that it’s a public property followed by 19.2% says owner and 17.5% are not aware

about the nature of IPR.

Figure:- 3.2.5 Patent

Source:- Primary

Interpretation:- The above figure describes that 28.3% respondents knows that patent is used for invention

whereas 20.8% are not aware about the usage of patent followed by 20.8% says that it is used for new

technology and 15.8% are aware that it is used for all the elements mentioned above.

Figure:- 3.2.6 Trade Mark

Source:- Primary

Interpretation:- The figures describe that 60% of the respondents indicate that sign/symbol consist of trade

mark, 15.8% says that it consist design followed by 15% says that it consist all of the above, 13.3% are not

aware of trade mark, 12.5% as letter 8.3% as expression, 4.2% as figurative element.

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Figure:- 3.2.7 Copy Right

Source:- Primary

Interpretation:- Figure 3.2.7 shows that 35% of the respondents are aware about copyrights, 23.3% are aware

about movies copy right, 13.3% of CD, 16.7% respondents are not aware about copy rights and 6.7%% are

aware of paintings and 5% are aware of poem copyrights.

Figure:- 3.2.8 Information about IPR

Source:- Primary

Interpretation:- 60% of the respondents are aware of IPR from internet, whereas 23.3% of the respondents got

information of IPR from teachers, 10% from books and 6.7% from seminar/workshops.

Chap 4. Conclusion and Suggestions

4.1 Conclusion:

The research paper was undertaken to find out the awareness level of IPR among teenagers in the Mumbai

colleges. The finding of the study shows that teenagers are aware about the IPR. But some of them are not aware

about different elements of trade mark, copy right and patent. It was also observed that there is no relationship

between males and females in terms of having knowledge about IPR. It was also seen that respondents are

aware of IPR from internet.

4.2 Suggestions

The students should be given knowledge about different elements of IPR by organising workshops/

seminars for them.

The students should be given practical training related to IPR by giving them small research projects.

IPR concept should be inbuilt in regular curriculum in detail to make them aware about it.

There should be a compulsory subject and paper for IPR at graduation level.

Colleges should organise various competition related to types of IPR.

References:

Abbott F, Cottier T, Gurry F. London: Kluwer Law International; 1999. The international intellectual property

system: Commentary and materials.Part I.

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Article by “Prachi Juneja” and Reviewed By Management Study Guide Content Team

Bainbridge DI. New York: Longman; 2002. Intellectual property.

Bently L, Sherman B. Oxford: Oxford University Press; 2001. Intellectual property law.

Gutterman AS, Anderson BJ. London: Kluwer Law International; 1997. Intellectual property in global markets:

A guide for foreign lawyers and managers.

Sulekha, Sukhbir Singh. Haryana: International Journal of Library and Information Studies 2018: Awareness of

IPR (Intellectual Property Rights) among the Research Scholars of Kurukshetra University Kurukshetra

Watal J. London: Kluwer Law International; 2001. Intellectual property rights in the WTO and developing

countries.

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INTELLECTUAL PROPERTY RIGHTS AND ECONOMIC DEVELOPMENT

Namdev Doke

Modern College of Arts, Science and Commerce, Ganeshkhind, Pune-16, Maharashtra, India

Abstract:

Intellectual property rights refer to the exclusive rights of an individuals or institutions over the use of their

intellectual creations for commercial use. And Economic development refers to the qualitative enhancement in

the standard of living of human beings. Innovations and creations are lengthy, highly dedicated and costlier

process. Thus, they need to be protected and encouraged. World Intellectual Property Organisation’ (WIPO)

was established in 1967 to protect the IPRs. In this paper, efforts are made to describe the relationship between

IPRs and economic growth. Various work done in this regard is taken into consideration to analyse this

relation.

Part One: Intellectual Property Rights- conceptual illustration

The word ‘intellectual property rights’ is itself self-explanatory. It refers to the exclusive rights of an individuals

or institutions over the use of their intellectual creations. It has time dimensions. Intellectual property rights

provide protection to the creator of any new concepts or ideas that are used commercially for the certain period

of time. This concept of Intellectual Property Rights is wide enough and consisting of the terms like patents,

copyright, trade secrets, trademarks, geographical indications etc.

The roots of intellectual property rights are found in British society, during the period of seventieth century.

Originally it was used to protect the authors for their intellectual literary work. Queen Elizabeth had provided

the royal grants to the creators and approximately two hundred years later it has got legal support.

To protect the intellectual properties of the creators, the United Nations Organisation took initiatives and set up

a separate organisation named ‘World intellectual Property Organisation’ (WIPO) in 1967. The WIPO is self-

funding body of United Nations and has 192 member countries as of now. It is an international platform for the

intellectual property services, policy, information and cooperation. The main objective of WIPO is to develop

the intellectual property system that enables innovation and creativity for the society as whole.

The original objective behind providing the Intellectual Property Rights is to encourage the individual and

institutional creators to create their intellectual outcomes and use for commercial purpose. Invention or creation

is a time consuming, lengthy and costlier process where there is no certainty of outcomes. Sometimes it takes

too much time to get the commercial value for the creations. Thus, it requires to be encouraged and given

protection.

Part II: Correlative discussion on Intellectual Property Rights and Economic Development.

Economic development refers to the qualitative enhancement in the standard of living of human beings and

Intellectual Property Rights refers to the protection of the right of individuals and business firms of their

inventions and creations. The Intellectual Property Rights and economic growth have strong positive

correlationship. Effective and strengthening the system of Intellectual Property Rights, higher the economic

growth. WIPO and UN have been working on the relationships between Intellectual Property Rights and

economic growth and have found strong correlation between them. Economists estimated that about 65 per cent

of business values of large firms in United States are generated due to an effective system of Intellectual

Property Rights. It is observed that Intellectual Property incentive industries generate 72 per cent more value

than non-Intellectual Property incentive industries.

Economic development is multi- dimensional concept and is influenced by various economic variables.

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Income is one of the leading variables of

economic development. Protecting and

encouraging the innovating ideas of an

individuals and business firms is necessary on

the part of higher level of innovations and

productivity. Productivity is positively

affected by the innovations in product

development and technical changes in process

of productions. Several Asian economies have

witnessed the strong relationship between

Intellectual Property Rights and economic

development. The relationship between

Intellectual Property Rights and Gross

National Income per capita is illustrated in the

diagram depicted here. Gross national income

per capita is shown on x axis and Intellectual

Property Rights are shown on y axis. It is clearly seen that the countries having effective and strengthen

Intellectual Property Rights system have higher GPI per capita.

The role of intellectual property rights in economic development various across the countries and depends on

the allocation of resources to creating intellectual assets as well as the amount of protected knowledge and

information used in production.

Parvez Zamurrad Janjua and Ghulam Samad explained the relationship between Intellectual Property Rights and

economic growth in their jointly published work titled “Intellectual Property Rights and Economic Growth: The

case of middle income developing countries” in 2007. In their paper, the long run relationship between

Intellectual Property Rights and economic growth have been verified for the period of 1960 -2005 and found

strong positive relation.

William Daley, The Fletcher School of Law and Diplomacy, Tufts University, published his paper titled “In

search of Optimality: Innovation, Economic Development, and Intellectual Property Rights” and illustrated the

impact of Intellectual Property Rights on economic growth in developed and developing countries. Intellectual

property rights play a significant role for policymakers and, when employed correctly, have the power to

engender innovation and economic development.

In the diagram illustrated here to the right shows the

relationship between GDP per capita and Economic

Growth. In the diagram, theta represents GDP per

capita and beta represents Intellectual Property

Rights. It is clearly seen that there is strong positive

relationship between Intellectual Property Rights

and economic growth.

Edited book publication by Sanghoon Ahn under

KDI series in economic policy and development

titled “Intellectual Property for Economic

Development” discussed the role of Intellectual

Property Rights in economic development. In his book, the role of Intellectual Property Rights in economic

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development is discussed in depth. He considers the various forms of Intellectual Property Rights and

technology transfer and their implications for economic development. This book presents in depth analysis of

Intellectual Property Rights in the context of countries at different levels of development, including Mexico,

China and Korea. Focus is paid to the differences between East Asia and Latin America.

In summation one may say that there is a strong and positive relationship between Intellectual Property Rights

in economic development. Therefore in developing countries like India, there is need for strengthening the

system of Intellectual Property Rights.

References:

Ha-Joon Chang, Intellectual Property Rights and Economic Development – Historical Lessons and Emerging

Issues, Jutaprint 2 Solok Sungei Pinang 3, Sg. Pinang 11600 Penang, Malaysia.

Pervez Zamurrad Janjua And Ghulam Samad, 2007, Intellectual Property Rights and Economic Growth: The

case of middle income developing countries

https://www.iatp.org/sites/default/files/Intellectual_Property_Rights_and_Economic_Deve.pdf

https://www.wipo.int/about-wipo/en/

https://iccwbo.org/publication/intellectual-property-powerhouse-for-innovation-and-economic-growth/

William Daley, 2014, In search of Optimality: Innovation, Economic Development, and Intellectual Property

Rights

https://www.slideshare.net/AshutoshSharma28/ipr-and-economic-development

https://en.wikipedia.org/wiki/Intellectual_property

https://economictimes.indiatimes.com/topic/IPR

Sanghoon Ahn, 2014, Intellectual Property for Economic Development, KDI series in economic policy and

development.

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AN EMPIRICAL STUDY ON AWARENESS ABOUT IPR AMONG POST-

GRADUATE STUDENTS OF COMMERCE

Mr. Pankaj Pittambar Sarawade

Assistant Professor in Commerce

Siddharth College of Commerce &Economics, Fort, Mumbai- 400001

Abstract:

In the present era of globalization, students in general and commerce & management students in particular

require to have detailed knowledge about Intellectual Property and its rights. These students have to enter into

the competitive corporate world, where they not only need to be creative and innovative but are also required to

be ethical executives or businesspersons. This motivated the researcher for undertaking a study upon the degree

of basic awareness about the Intellectual Property and its rights among these students. The present empirical

study is based on feedback of PG students on the various elementary aspects of IP and IPRS. The paper

concludes by giving suggestions in order to increase awareness among such students of undergraduate and post

graduate programmes, so that they can be more creative and ethical in their future career of business or

employment.

Keywords: IPR, Awareness, concept, Law, Intellectual, respondent, Meaning.

Introduction:

The word ‘Intellectual’ as an adjective means involving or appealing to the intellect, ‘having a highly developed

ability to think, reason and understand’. The same word as a noun means ‘a person with a highly developed

intellect and great mental ability’. The term “Property” is synonymous with the right of ownership. Ownership

and property are interdependent. In its widest sense, property includes all a person’s legal rights, of whatever

description. A man’s property is all that is, his in law.

According to Prof. Niblett, “Intellectual property is the most basic form of property because a man uses

nothing to produce it other than his brain. The basic reason for intellectual property is that a man should own

what he produces, that is what he brings into being. If what he produces can be taken from him, he is no better

than a slave.”

Intellectual property rights (IPR) are the rights given to persons by law over the creations of their minds,

inventions, literary and artistic works, and symbols, names and images used in business. They usually give the

creator an exclusive right over the use of creation for a certain period of time. One cannot copy the name of a

company or even a product.

Intellectual property is an umbrella term covering patents, trademarks and copyrights etc. The importance of

intellectual property was first recognized in the Paris Convention for the Protection of Industrial Property

(1883) and the Berne Convention for the Protection of Literary and Artistic Works (1886). Both treaties are

administered by the World Intellectual Property Organization (WIPO). India is a member of the World Trade

Organization and committed to the Agreement on Trade Related Aspects of Intellectual Property (TRIPS

Agreement). India is also a member of World Intellectual Property Organization, a body responsible for the

promotion of the protection of intellectual property rights throughout the world.

Since past two and half decade, Intellectual property and its rights has been a highly discussed topic in every

country and our nation is no exception. For ethical growth and development of business, creation of new and

innovative ideas is essential. At the same time such ideas, designs and products should get legal protection for

certain period. Students pursuing commerce and management education and aspiring to become entrepreneurs

https://www.drishtiias.com/important-institutions/drishti-specials-important-institutions-international-institution/world-trade-organisation-wto

https://www.drishtiias.com/important-institutions/drishti-specials-important-institutions-international-institution/world-trade-organisation-wto

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or mangers in corporate sector, require to be nurtured in such a way that they will be apply their intellect for

innovation and creativity in their role performance. This thought encouraged researcher to identify to what

extent the PG students of Commerce and management are familiar with IP and IPRS concepts and what is their

stand about its protection, the present study is a small attempt for understanding the degree of awareness about

this concept.

Objectives of Study:

1) To study the degree of awareness about IPR in general among the post graduate students of commerce

faculty.

2) To test and gather the knowledge of post graduate students pertains to the significance of IPR

Research methodology:

The present research paper is based on primary data which has been gathered by conducting interview of 83

Post graduate students from two prominent commerce colleges of Mumbai and analyzed using simple tables, pie

diagrams and also created index. Structured questionnaire was used for the data collection and secondary data

has been collected from related literature articles available on the various website.

Analysis and Interpretation of Primary Data:

Having considered the relevance of the topic, the analysis is done about the basic aspects of IPR. I\i.e. Concepts

of IP and IPRS, laws related to IPR, concept of forms of IPRS and advantages of IPRS in general which is as

under:

1. Number of respondents know/don’t know Concepts of intellectual property.

Interpretation: 37 (45%) out of 83 respondents stated that they know the IPR concept whereas 46 (55%) are

unaware about this concept.

2.Number of respondents know/don’t know Concepts of intellectual property Rights.

Interpretation: Only 27(33%) respondents are aware about these IPR

concepts. On the contrary 56 (67%) respondents do not know the IPR concept.

3. Number of respondents know/don’t know types of intellectual properties.

45%55%

Yes

No

33%

67%

Yes

No

43%

57%

Yes

No

Response

No. of

Respondents Percent

Yes 37 45%

No 46 55%

Total 83 100%

Response

No. of

Respondents Percent

Yes 27 33%

No 56 67%

Total 83 100%

Response

No. of

Respondents Percent

Yes 36 43%

No 47 57%

Total 83 100%

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Interpretation: 36 (43%) out of 83 respondents stated that they are having knowledge about the types & form

of IPR, whereas 47 (57%) are unaware about the types & form of IPR.

4. Number of respondents know/don’t knows Laws Related IPR.

Interpretation: Only 32respondents are aware about this IPR Laws whereas rest are completely ignorant

about laws related to IPR.

5. Number of respondents know/don’t know Patent.

Interpretation: Only 42% respondents know about the patent. On the

other hand 48 (58%) PG students are not aware about the concept Patent.

6. Number of respondents know/don’t know of copyright.

Interpretation: 45 (54%) out of 83respondents stated that they know the copyright, where nearly equal number

of respondents (38, 46%)are unaware about the copyright.

7. Number of respondents know/don’t know of trademark.

Interpretation: Only 47 respondents out of 83 are aware about this trademark whereas others are does not

know what trade mark is.

8. Number of respondents know/don’t know about the protection period of any innovative patented

product under Indian Patent Act.

39%

61%

Yes

No

42%

58%

Yes

No

54%

46% Yes

No

57%

43% Yes

No

Response

No. of

Respondents Percent

Yes 32 39%

No 51 61%

Total 83 100%

Response

No. of

Respondents Percent

Yes 35 42%

No 48 58%

Total 83 100%

Response

No. of

Respondents Percent

Yes 45 54%

No 38 46%

Total 83 100%

Response

No. of

Respondents Percent

Yes 47 57%

No 36 43%

Total 83 100%

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Interpretation: 61% respondents know about the Indian Patent Act, Invention of any product can be protected

how many years, whereas others are ignorant.

9. Number of respondents know/don’t know about the validity period for trade mark registration as per

Trade and Merchandise Mark Act.

Interpretation: Only 32 out of 83 respondents mentioned that they know the validity period of protection to

registered trademarks per Trade and Merchandise Mark Act., whereas 51 respondents are unaware about it.

10. Number of respondents know/don’t know advantages of IPR.

Interpretation: Only 22 respondents out of 83 are aware about the advantages of IPR whereas other

respondents 61 (73%) do not know about the advantages of IPR.

IPRK Index

Above findings have been combined for individual respondents & this paper also uses the responses to create an

Intellectual Property Rights Knowledge or IPRK Index using the following formula:

IPRK Index= ∑ Respondent’s individual Marks for all questions ÷ Maximum Marks

For questions 1 to 7 & 10, respondents who answer “Yes” are also asked to explain their knowledge briefly.

Based on this, they may be graded between 0 (Don’t Know/Not Aware) to 3 (having very good knowledge of

the subject). Questions 8 and 9 can give a maximum of 1 mark each (0 means no and 1 means yes). So, a

respondent can get maximum marks out of 26 marks. Dividing by 26, the highest value may be 1 and the lowest

could be 0. In our sample the IPRK has minimum and maxima of 0.0384 to 0.6923. The higher the value, the

greater the knowledge regarding IPR. With a mean of 0.2822, the IPR knowledge cannot be said to be very

good, even among PG students.

61%

39% Yes

No

39%

61%

Yes

No

27%

73%

Yes

No

Response

No. of

Respondents Percent

Yes 51 61%

No 32 39%

Total 83 100%

Response

No. of

Respondents Percent

Yes 32 39%

No 51 61%

Total 83 100%

Response

No. of

Respondents Percent

Yes 22 27%

No 61 73%

Total 83 100%

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The graph shows the IPRK Index for the 83 individual respondents considering their individual

responses.

Finding of the Study

1. A majority of the respondents don’t know the concept of Intellectual property and IPRS

2. Most of respondents don’t knows the various types/Form of intellectual properties

4. A majority of the respondents don’t know about the Laws Related to IPRs

5. A majority of the respondents don’t know about the concept patent.

6. Nearly 50% respondents don’t know about the meaning copyright from of IPR.

7. A majority of the respondents know about meaning of trademark

8. Large numbers of respondents don’t know about the protection period of any innovative patented product

under Indian Patent Act.

9. Most of respondents don’t knows about the Trade Mark Validity Periods

10. Only few respondents could mention the advantages of IPR, a majority PG student could not site even one

advantage of IPR.

11. The average or mean of IPRK Index is 0.2822 out of a maximum possible value of 1. This indicates

relatively poor knowledge regarding IPR.

Suggestions:

Considering the poor awareness about IPR among the average PG students, the paper gives the following

suggestions to the heads of educational institutions, their managements and students in order to improve, not

only awareness among the students but also for the purpose of improving the standard of higher education.

1) Principals, Heads of departments and senior teachers should conduct seminars, conferences in the

institutions related to IPR especially for PG Students.

2) Students should be encouraged to write and present articles in Seminars and conferences on such a most

discussed and burning topic.

3) Frequently, special lectures of industry/corporate executives should be organized for the PG students.

4) Students should be taken for field visits where they can gain practical knowledge of IP and IPR related

aspects.

0.00

0.10

0.20

0.30

0.40

0.50

0.60

0.70

0.80

1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 55 58 61 64 67 70 73 76 79 82

Series1

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5) Students should be motivated to read books, journals, articles related to IPR and allied syllabus and should

be told that such knowledge will help them for their career advancement

6) PG teachers should be well-versed with their subjects and they should interact with students beyond syllabi

studies and an attempt should be made to change their psychology regarding the study of IPR laws. For

example, Guest lectures delivered by experts of IPR, practical assignment regarding IPR for PG students

etc..

CONCLUSION

The outcome of the present study is disappointing because it was expected and perceived that students pursuing

a Master programme would be very familiar with such an important topic which they have learned at their

undergraduate level. But, unfortunately it has been seen that their basic understanding about IPR and related

aspects is poor. It also reflects that students are not pursing PG programmes seriously, rather they are not willing

to acquire extensive knowledge of commerce in general and IPR and GST in particular. Somehow, this also

indicates the failure of the heads of institutions and the PG and UG teachers who are probably involved in

stereotype and outdated methods of teaching. There is a need to make changes in the education system and the

national policy of education that should ensure transformation in the students’ personality and make them full of

subject knowledge, communication skills and confidence.

REFERENCES:

https://fairuse.stanford.edu/overview/introduction/intellectual-property-laws/

Attorney at law, Nolo author, LinkedIn Learning Instructor, Blogger-Dear Rich: A Patent, Copyright and

Trademark Blog.

https://lawsikho.com/course/diploma-intellectual-property-media-entertainment-laws

https://www.alllaw.com/topics/intellectual_property

Intellectual property rights books -1st edition- by NEERAJ PANDEY (Author), KHUSHDEEP

DHARNI (Author)

https://fairuse.stanford.edu/overview/introduction/intellectual-property-laws/

https://lawsikho.com/course/diploma-intellectual-property-media-entertainment-laws

https://www.alllaw.com/topics/intellectual_property

https://www.amazon.in/s/ref=dp_byline_sr_ebooks_1?ie=UTF8&field-author=NEERAJ+PANDEY&text=NEERAJ+PANDEY&sort=relevancerank&search-alias=digital-text

https://www.amazon.in/s/ref=dp_byline_sr_ebooks_2?ie=UTF8&field-author=KHUSHDEEP+DHARNI&text=KHUSHDEEP+DHARNI&sort=relevancerank&search-alias=digital-text

https://www.amazon.in/s/ref=dp_byline_sr_ebooks_2?ie=UTF8&field-author=KHUSHDEEP+DHARNI&text=KHUSHDEEP+DHARNI&sort=relevancerank&search-alias=digital-text

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ARTIFICIAL INTELLIGENCE AND PATENTS

Prof. Poonam Shah

Siddharth College of Commerce and Economics, Anand Bhavan, Fort Mumbai – 01

Abstract:

Artificial Intelligence (AI) is growing at a great pace and is spreading across many industry sectors. AI as a

concept was first coined in the 1950s and has been the basis for a plethora of science fiction novels and movies.

Now, 60 years later, AI is rapidly entering nearly every industrial sector and is increasingly embedded into

modern society. The world is progressing through Computer Technologies and Artificial Intelligence is one of

them. Artificial intelligence is the study and implementation of techniques that allow actions requiring

intelligence on the part of human intelligence, to be performed on computational devices There is rapid growth

of worldwide patenting in AI technologies.

This paper aims to trace the developments of the evolving jurisprudence of the AI in India and the multiple

forms it has adopted over time with respect to the existing legal framework for patenting the AI inventions.

Key Words: AI (artificial intelligence), Computer software

Introduction

Artificial Intelligence refers to those computer systems of capable of performing tasks that would normally

require some intelligence, if done by human. an approach to make a computer, a robot, or a product to think how

smart human thinks. AI is a study of how human brain thinks, learn, decide and work, when it tries to solve

problems. The aim of AI is to improve computer functions which are related to human knowledge, for example,

reasoning, learning, and problem-solving.

What is Artificial Intelligence (AI)?

To make it simple – Artificial Intelligence is intelligence exhibited by machines.

It is a branch of computer science which deals with creating computers or machines as intelligent as human

beings.

The term was coined in 1956 by John McCarthy at the Dartmouth conference, Massachusetts Institute of

Technology.

It is a simulation of human intelligence processes such as learning (the acquisition of information and rules

for using the information), reasoning (using the rules to reach approximate or definite conclusions), and

self-correction by machines, especially computer systems.

Industrial Scope Of AI

The world of AI is a crowded arena and has been progressing at an outstanding rate in recent years, with

different titles and voices like Siri, Alexa, Cortana, Watson, Einstein and Coleman becoming familiar in daily

life and within the enterprise. Innovation has of course been driving the advancements and developments of AI,

but a huge amount of investment has fuelled the progress, ensuring the continuation of exploration. Research

and funding are almost symbiotic in requiring one another to progress in areas such as the AI space.

1. Is it possible for a computer to become completely artificially intelligent?

Work is being done in this arena however except some instances of computers playing games faster than the

best human players no success has been achieved.

For Example: In May 1997, an IBM super-computer called Deep Blue defeated world chess champion Gary

Kasparov in a chess match.

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Another recent example of 2016 is, Alpha Go, a program driven by Google’s Deep Mind AI, has won

Korean Lee Sedol, one of Go’s most dominant players.

2. Why Is Artificial Intelligence Important?

Today, the amount of data that is generated, by both humans and machines, far outpaces humans’ ability to

absorb, interpret, and make complex decisions based on that data. Artificial intelligence forms the basis for all

computer learning and is the future of all complex decision making. As an example, most humans can figure out

how to not lose at tic-tac-toe (noughts and crosses), even though there are 255,168 unique moves, of which

46,080 end in a draw. Far fewer folks would be considered grand champions of checkers, with more than 500 x

1018, or 500 quintillion, different potential moves. Computers are extremely efficient at calculating these

combinations and permutations to arrive at the best decision. AI (and its logical evolution of machine learning)

and deep learning are the foundational future of business decision making.

Everyday Influences of Artificial Intelligence

Many everyday influences of artificial intelligence are altering the way our daily lives look. If someone from the

1950s travelled through time and arrived in 2019, they would marvel at the way we use our smart phones to

navigate around town, how virtual digital assistants such as Alexa and Cortana respond to our queries and would

be baffled by our addiction to social media channels such as Facebook, Instagram and Twitter. What is now

normal to us and powered by AI, would be utterly foreign to our friend.

Examples of Artificially Intelligent Technologies

Robotic process automation: Automation is the process of making a system or processes function

automatically. Robots can be programmed to perform high-volume, repeatable tasks normally performed by

humans and further it is different from IT automation because of its agility and adaptability to the changing

circumstances.

Natural language processing (NLP) is the processing of human language and not computer language by a

computer program. For Example, spam detection, which looks at the subject line and the text of an email

and decides if it’s junk.

Pattern recognition is a branch of machine learning that focuses on identifying patterns in data.

3. Applications of Artificial Intelligence (AI)

Healthcare Sector: Machine learning is being used for faster, cheaper and more accurate diagnosis and

thus improving patient outcomes and reducing costs. For Example, IBM Watson and chatbots are some of

such tools.

Business Sector: To take care of highly repetitive tasks Robotic process automation is applied which

perform faster and effortlessly than humans. Further, Machine learning algorithms are being integrated into

analytics and CRM platforms to provide better customer service. Chatbots being used into the websites to

provide immediate service to customers. Automation of job positions has also become a talking point

among academics and IT consultancies such as Gartner and Forrester.

Education Sector: AI can make some of the educational processes automated such as grading, rewarding

marks etc. therefore giving educators more time. Further, it can assess students and adapt to their needs,

helping them work at their own pace. AI may change where and how students learn, perhaps even replacing

some teachers.

Financial Sector: It can be applied to the personal finance applications and could collect personal data and

provide financial advice. In fact, today software trades more than humans on the Wall Street.

https://www.netapp.com/us/info/what-is-deep-learning.aspx

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What are the downsides and risks of Artificial Intelligence (AI)?

The decrease in demand for human labour due to machines and intelligent robots taking over the jobs in

the manufacturing and the services sectors. For Example: In China some customs officers are now robots, In

japan robots as housemaid is emerging trend.

Existential risks: Stephen Hawking once said “The development of full artificial intelligence could spell

the end of the human race. Once humans develop artificial intelligence, it will take off on its own and

redesign itself at an ever-increasing rate. Humans, who are limited by slow biological evolution, couldn’t

compete and would be superseded”.

AI technologies falling into terrorist hands may unleash modern terror network and therefore vulnerability

of humans may magnify.

4. Artificial Intelligence Use Cases

Applications of AI can be seen in everyday scenarios such as financial services fraud detection, retail purchase

predictions, and online customer support interactions. Here are just a few examples:

Fraud detection. The financial services industry uses artificial intelligence in two ways. Initial scoring of

applications for credit uses AI to understand creditworthiness. More advanced AI engines are employed to

monitor and detect fraudulent payment card transactions in real time.

Possible areas for AI applications in Indian conditions

It can complement Digital India Mission by helping in the big data analysis which is not possible without

using AI.

Targeted delivery of services, schemes, and subsidy can be further fine-tuned.

Smart border surveillance and monitoring to enhance security infrastructure.

Weather forecasting models may become proactive and therefore preplanning for any future mishaps such

as floods, droughts and thereby addressing the farming crisis, farmer’s suicide, crop losses etc.

By analyzing big data of road safety data and NCRB (National Crime Record Bureau) data for crimes, new

road safety policies can be formulated.

What are the challenges India’s Artificial Intelligence Development is facing?

AI-based applications are mostly driven largely by the private sector and have been focused largely on

consumer goods.

Public-private funding model which is a success in the United States, China, South Korea, and elsewhere

may be considered good for India. Today it is not present in India.

Our educational system is not updated to the modern technologies and is outdated in today’s economic

environment as the nature of jobs shifts rapidly and valuable skills become obsolete in a matter of years.

The debate of poverty vs. technology and where to spend the most is likely to persist until the political class

takes a higher interest in real issues than trivial ones.

What is a patent?

A patent is a grant of protection for an invention. Owning a patent gives you the right to stop someone else

from making, using or selling your invention without your permission for a certain number of years..

Objects Of Patent Law

Encourage scientific research, new technology and industrial process.

Grant of exclusive monopoly rights

Stimulate new inventions

Pass the invention into public domain for new advancement of technology.

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Legislations regulating patent laws in India

The patent system in India is governed by the Patents Act, 1970 as amended by the patents Act, 2005

The Patents Rules, 2003, as amended by the Patents Rules 2006

Can Artificial Intelligence software be patented in India?

Artificial intelligence has disrupted the entire technology ecosystem and has opened avenues which were far

from imagination a few years back. A lot of activity has been observed in the field of AI with R&D being

carried out to implement AI in various industries on a macro level.

A very crucial step for the companies/individuals operating in the AI domain is protecting their technology.

Patent Laws And Artificial Intelligence

“…Digital technologies are doing for human brainpower what the steam engine and related technologies did for

human muscle power during the Industrial Revolution. They’re allowing us to overcome many limitations

rapidly and to open up new frontiers with unprecedented speed. It’s a very big deal.” The inter-connection

between Patent laws and AI is increasing in today’s technological world. AI has been used extensively in order

to simplify the execution of basic functions and primarily reduce human effort. At a quick glance, AI enabled

systems come across as working in a fashion akin to simple calculators and such gadgets. However, it functions

in a much more complicated manner. Today, AI enabled systems are equipped to perform tasks based on their

own key learnings, creating the possibility of them inventing something. While this is a huge development from

a technological standpoint, it poses new challenging questions from a legal standpoint, i.e., from the perspective

of patent law.

Amendment to the Patent Laws

Patent Act provides a lucid distinction between the Inventor and Invention, but with the advent of AI

mechanism, IP industry is facing a hurdle regarding the ownership of the invention or creation out of the AI

enabled system. Whenever any IP right claim is demanded over an AI generated invention is the most

controversial issue striking the coast is upon whom to bestow the intellectual property right? Whether it is the

AI machine, the owner of the machine or the inventor of the machine is a big question of law. With the constant

increasing usage of the technology clearing of ambiguity regarding the application of patent laws is has now

become an integral issue. A uniform treatment of the AI system will be a positive step. All the member nations

of multilateral trading agreements should begin to recognise AI, by bringing an amendment to TRIPs. There is

also a need of passing an AI data protection Act. All the AI devices today, are performing human like functions.

There will be a time when these devices will start performing better than humans. Therefore, to keep a track of

the same, legislation should be enforced which could also include criminal and civil liabilities.

Secondary data

Sources of secondary data: Books, Magazines ,News paper, Internet etc.

Conclusions

After going deeply through every aspect of the above topic, artificial intelligence, this paper concludes that

introducing AI and Patents have shown a remarkable progress in human mankind in almost all the sectors. With

the increasing demand of technological intelligence, every work is performed at faster rate, which directly or

indirectly contributes to country’s economic progress. With so much advantages of artificial intelligence list,

there are also disadvantages, or threats and challenges if not utilized in a correct environment. Thus, there is a

need for patents which safeguard the application in a best possible manner. The author concludes that for a

country to prosper there should a regular update of all the artificial intelligence applications and they should be

made available easily to all sectors for smooth operations. Threats and challenges can be solved to greater extent

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if used in a proper manner and in the right hands.

References:

www.researchgate.com

Patents, World Intellectual Property Organization, available at http:// www.wipo.int/patents/en/, last seen on

25/9/2018

Economic Times

http://www.researchgate.com/

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COMPARATIVE ADVERTISING AND INFRINGEMENT OF TRADEMARK

– LEGAL PERSPECTIVE IN INDIA

Prof. Sagar Raghunath Kotkar

Assistant Professor, Dept. of Business Law,

Sydenham College of Commerce & Economics, ‘B’ Road, Churchgate, Mumbai -400020.

.

Abstract :

The research topic “Comparative Advertising and Infringement of Trademark – Legal perspective in India”

focuses light on the various aspects regarding the comparative advertising. This paper discusses the law

relating to Comparative advertising in India, the legal provision from the different perspectives such as The

Provisions under the Trademarks Act, 1999, The Constitutional provisions, The Consumer protection view, the

cases decided by the Supreme Court, High Courts and subordinate Judiciary- analysis of the cases, etc.

Key words: Comparative Advertising, Infringement, Trademark

Introduction:-

In today’s open market where the whole world is a part of single market because of the globalization,

liberalization policy accepted by the various countries. In the global market as the commercial competition

between various companies selling the similar services/goods in the market, the companies face lot of struggle

to enter in the market to sell their product, to expand their business, to reach to the customer with the unique

identity, specialties of the product/services and finally their aim by using various marketing techniques to

increase the demand of their product and the company can get maximum profit by way of maximum demand

and maximum supply in the market.

Advertising is an essential tool in the marketing, which can have the maximum impact on the minds of the

consumers for a long time. Advertising is one of the most important and critical aspect of trade & business. It is

the life blood of free media1. The advertisement can be in the form of either verbal or express or either in the

form of audio, visual or audio-visual mode but it’s effectiveness plays an important role in relation to sale of the

product and ultimately profit of the company. The competition gives rise to comparative advertising &

sometimes infringement of the trademark.

Research Methodology –

The type of research adopted is the analytical research. The scope of study is limited to the Indian Laws and

cases only.

Objectives of the Study –

1. To study concept of Comparative Advertisement and Infringement of Trademark

2. To analyze the legal position

Comparative Advertising –

There is no specific definition of comparative advertising under the Indian law but by way of various cases

under the Trademark Act, researcher can say that comparative advertisement is a kind of the advertisement in

which comparison of goods or services of the one seller from that of the other on the basis of quality, quantity,

durability, price, etc.

The comparative advertising promotes the competition in the market as it focuses on the advantages of the

product.

The companies basically attempts to influence the mind of the consumer by way of advertising, highlighting the

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use, benefits, special attributes of their product/services in such a way that the consumer wants to use/purchase

it.

Trademark –

Trademark is a mark of a company, organization, Institution, which must be of a unique nature. It can be in the

form of logo, design, symbol, name, image, etc. which helps in the identification of the product by way of its

unique identity. It represents the authenticity of the product/services of the company. It is a matter of reputation

of the company. In the legal sense it is covered under the category of Goodwill.

Some legal provisions related with the Comparative Advertisement and Infringement of the Trademark –

Constitution of India –

Commercial advertisement is a form of Commercial Speech and hence it can be covered under the Article 19(1)

of the Constitution of India which deal with the Freedom of Speech and Expression but Article 19(2) of the

Constitution of India provides No law should change the law of freedom of speech however Sovereignty and

Integrity of India is maintained. Advertisement is a free speech and protected under the Constitution. The

Constitution of India provides the freedom under the Freedom of Speech & Expression bit it also has the control

over the false, misleading information. So, the Businessman, Industrialist cannot do any statement which is

contrary to these provisions. The competition in the market should be fair it should not be derogatory to the

provisions of the law, the competition should be beneficial to the consumer.

The Trademark Act, 1999 –

The Trade Mark Act is a special Act enacted for the purpose of protection of trademark from deception,

confusion and misuse.

Section 2(1)(m) of the Act defines a mark as, “A mark includes a device, brand, heading, label, ticket, name,

signature, word, letter, numeral, shape of goods, packaging or combination of colors or any combination

thereof.”

Section 2(1)(zb) of the Act defines trademark means, A mark capable of being represented graphically and

which is capable of distinguishing the goods or services of one person from those of others and may include

shape of goods, their packaging and combination of colors.

Section 2(1)(zg) of the Act defines well known trade mark in relation to any goods or service, means a mark

which has become so to the substantial segment of the public which uses such goods or receives such services

that the use of such mark in relation to other goods or services would be likely to be taken as indicating a

connection in the course of trade or rendering of services between those goods or services and the person using

the mark in relation to the first mentioned goods or services.

The Monopolies and Restrictive Trade Practices Act, 1969

Section 36A of the Act says that, Any defective or unfair method or practice which depicts false or misleading

information of another product will result in disparaging the goods and products of the competitors. This in turn

will directly affect the trade of another person.

This MRTP Act has been repealed and replaced by The Competition Act, 2002 with effect from September

2009.

The Consumer Protection Act, 1986 –

The Consumer Protection Act basically focuses light on the protection, preservation and awareness of the rights

of the consumers. It discusses about the Unfair Trade Practices in Sec 2(r)(1)(x), which states that Unfair Trade

Practice means giving false or misleading facts disparaging the goods, services or trade of another person.

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Whether the Comparative Advertisement permitted under the Trademark Act?

Up to a certain extent it is permitted. Section 30(1) of the Trademarks Act, 1999 states that it is not infringement

to use a registered trademark with the purpose of identifying goods or services as those of proprietor, provided

the use – a) is in accordance with the honest practices in industrial or commercial matters, b) is not such as to

take unfair advantage of or be detrimental to the distinctive character or repute of the Trademark.

Section 29(8) of the Trademarks Act, 1999 states that, “A registered trade mark is infringed by any advertising

of that trade mark if such advertising – a) Takes unfair advantage of and is contrary to honest practices in

industrial or commercial matters or b) is detrimental to its distinctive character or c) is against the reputation of

the trademark.

So it is a trademark infringement if the advertisement falls under any of the above stated three categories as per

Section 29(8).

The disparagement of Comparative Advertisement is reviewed and evaluated on the basis of 3 parameters as –

1. Whether the advertisement contains a false statement which could result in influencing and provoking

or inducing the consumer to buy or use the goods and products.

2. Whether the advertisement is misleading.

3. The effect of such depiction on the end user or the common man.

Some case laws regarding Comparative Advertisement and infringement of Trademark -

a) Reckitt & Colman of India Ltd Vs Kiwi T T K India Ltd (1996)

In this case, the plaintiff manufactures and markets liquid shoe polish under the brand name Cherry Blossom

liquid polish and the defendant is also manufacturers and markets liquid shoe polish under the brand name Kiwi

liquid polish which claims in its advertisement on the website shows that cherry blossom has less wax and more

acrylic content which in due course will crack and cause damage to footwear. Brand X is shown as similar to

that of the packaged bottle of the plaintiff’s product. The Delhi High Court gave decision in favor of the plaintiff

and instructed that the defendant should not disparage the goods of the competitors.

b) Reckitt & Colman of India Ltd Vs. M. P. Ramachandran and others (1999)

In this case, the plaintiff manufactures and markets blue whitener under the brand name Robin Blue with its

particular trade mark and styling while the defendant is also manufacturers and markets blue whitener under the

name of Ujala, which claims in its advertisement no other whitener is economical as compared to defendant’s.

The Calcutta High Court held the defendant was disparaging the goods of plaintiff and granted injunction.

c) Britannia Vs Unibic Biscuits India (2007)

In this case, the plaintiff manufactures and markets biscuits under the brand name Britannia Good Day Biscuits

while the defendant is also manufacturers and markets biscuits under the name Great Day along with tag line –

Why have a Good Day, When you can have a Great Day!. It was a clear violation of the registered trademark –

‘Good Day’ and Bangalore City Civil Court granted injunction to the defendant.

d) Hindustan Lever Ltd Vs Colgate Palmolive Ltd &

e) Pepsi Co Inc Vs Hindustan Coca Cola Ltd

In the both cases ( d & e) Colgate & Hindustan Coca Cola Ltd were held liable respectively. In both the

advertisements the competitors name could not be heard but could be clearly made out from lip movement. Such

method is within the ambit of disparagement.

There are some other cases also, which deal with disparaging the products of the competitor company’s

products. The above given cases are of the reputed brand and being in clear violation of the provisions of laws.

Conclusion –

The traders should keep in mind regarding the advertisement of the product that the advertisement should not

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violate the provisions of the law; it should not bring dis-repute the other company’s products. The competition

should be fair in the open market.

References -

Tata Press Ltd. Vs Mahanagar Telephone Nigam Ltd. & Ors. AIR 1995 (5)SCC 139

The Constitution of India – Part III – Fundamental Rights

The Trade Marks Act, 1999.

The Monopolies and Restrictive Trade Practices Act, 1969

The Competition Act, 2002 – Avtar Singh

The Consumer Protection Act, 1986

www.ipindia.nic.in

E. T. Lokganathan, Intellectual Property Rights – TRIPS Agreement and Indian Laws, New Century

Publications

Legal Service India-(2013) Use of Trademark in Comparative Advertising : situation in India.

http://www.ipindia.nic.in/

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STUDY OF INTELLECTUAL PROPERTY RIGHTS (IPRs) AS AN ECONOMIC INCENTIVE

THAT STIMULATE INNOVATION AND TECHNOLOGICAL

PROGRESS OF A COUNTRY

Prof. Shashikant V. Mundhe

Assistant Professor

Siddharth College of Commerce and Economics,Mumbai – 400 001

Abstract

The man made property that includes intangible creation of the human intellect is called Intellectual Property.

Copyrights, patents, trademarks are some of the popularly known types of intellectual properties.Literature

shows that the intellectual property was existed in the Ancient Rome and got developed in its modern form in

England during 17th and 18th century.

The people can make profits from the information and intellectual goods that they create. For that matter there

has to be some mechanism to protect their intellectual creations. Accordingly the laws related to intellectual

properties, called as Intellectual Property Rights (IPRs) came in force in almost all the countries. Intellectual

Property Rights (IPRs) are the rights given to people for the creation of their minds or intellect, like, inventions,

literary and artistic works, symbols, names, images, and designs. These laws have been encouraging the

creation of wide variety of intellectual goods, allowing them to make profits from it.

Present study is an effort to study Intellectual Property Rights (IPRs) as an economic incentives that stimulate

innovation and technological progress of India based on progress made by India in getting IPRs

registered.Indians are becoming more and more innovative as there are economic incentives provided to them

by intellectual property rights.

The available data shows that India has been making considerable progress in the field of Intellectual Property

Rights, like Patents, Trademarks, Copyrights, geographical indications, designs. Maharashtra has been the

leader state in this regard. There are certain IPRs, likedesigns, patents and trademarkswhere India has made its

presence in the world IPR markets.

Key Words: Copyrights, patents, trademarks, IPRs, inventions, designs, etc.

INTRODUCTION:

The economic and social development of a country depends on creativity of its people. This creativity is also

referred to as the creation of human minds. The creation of human minds like, inventions, literary and artistic

works, symbols, names, images, and designs, is called the Intellectual Property.

The people can make profits from the information and intellectual goods that they create.Traditional property

like, land, house, etc., can be protected by putting fence, compound or by employing guards but intellectual

property being invisible, its really difficult for the creator to protect it from being used it by others.

Governments primary function, here, is to protect the property of its people so that they will be encouraged to

create property in its various forms. Accordingly the laws related to intellectual properties, called as Intellectual

Property Rights (IPRs) came in force in almost all the countries. Intellectual Property Rights (IPRs) are the

rights given to people for the creation of their minds or intellect.These laws have been encouraging the creation

of wide variety of intellectual goods, allowing them to make profits from it. Literature shows that the

intellectual property was existed in the Ancient Rome and got developed in its modern form in England during

17th and 18th century. Intellectual property became prevalent in the majority of the world's legal systems during

late 20th century.

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George Alfred DePenning is considered to have made the first application for a patent in India in the year 1856.

His invention, "An Efficient Punkah Pulling Machine", was granted the first ever Intellectual Property

protection in India.

Since then the Government of India under British Rule as well as Independent India have enacted several laws

to protect intellectual property so that people will be encouraged to be creative. This being a money making

activity, it has played a greater role in economic and social development of India.

Accordingly, this research paper presents Intellectual Property Rights (IPRs) as an economic incentives that

stimulate innovation and technological progress in India, based on progress made by India in getting IPRs

registered.Indians are becoming more and more innovative as there are economic incentives provided to them

by intellectual property rights.

The present study reveals that India has made considerable progress in the field of Intellectual Property Rights.

Of all the states in India, Maharashtra has been the leader state in this regard. The findings also show that, there

are certain IPRs, like designs, patents and trademarks where India has made its presence in the world IPR

scenario.

LITERATURE REVIEW:

According to (Millar V Taylor (1769), Hinton V Donaldson (1773), Donaldson V Becket (1774)) “Literary

Poetry” was the term commonly used for legal debates in the Britain during 1760s and 1770s.

In the opinion of Jean- Frederic Morin, "the global intellectual property regime is currently in the midst of a

paradigm shift.

As per the Article 27 of the Universal Declaration of Human Rights, "everyone has the right to the protection of

the moral and material interests resulting from any scientific, literary or artistic production of which he is the

author".

OBJECTIVE OF THE STUDY:

To study Intellectual Property Rights (IPRs) as an economic incentive that stimulate innovation and

technological progress of India based on progress made by India in getting IPRs registered.


The present research study is descriptive in nature. It is based on secondary data collected through various

reports published by the office of the Controller General of Patents, Designs, Trademarks, and Geographical

Indications, Annual Report Intellectual Property 2017-18, Handbook on IPR in India, WIPO IP Facts and

Figures 2018, etc.

ANALYSIS:

The Intellectual property Rights awarded by the concern government departments allow owners of such rights to

derive monetary benefits from the intellectual property that they have created. It has been proved to be one of

the finest way to make huge profits. This becomes evident if one compares the business on IPR in 1990 to that

in 2018. The number of patents applications worldwide were 997,501(of which 406,582 were granted) in 1990

this increased to 3,326,300 in the year 2018. The number of patents grants worldwide in 2018 stood at

1422,800.

Because of huge financial incentives hidden in IPRs, this research paper presents Intellectual Property Rights

(IPRs) as an economic incentives that stimulate innovation and technological progress in India, based on

progress made by India in the field of applying for IPRs and getting them registered.

The paper analyses it under two heads, one by giving India’s progress on certain fronts in the world IPR markets

and second, by comparing its own progress over the period of time.

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India’s position in the World IPRs

In terms of application class count per unit of GDP is concerned, India’s performance is among the top 10

best performing countries in the world. Here, India stands at 8th rank in the top 10. China, New Zealand, the

Republic of Korea and Turkey are the top performers. Application class count per unit of GDP allows us to

compare trademark filing activity in countries with different filing systems (single-class versus multi-class)

and economies of very different sizes.

India received 2nd highest number of designs in applications and accordingly ranked 2nd among the middle-

income- countries. The Intellectual Property office at the Islamic Republic of Iran had received highest

number of applications. It had received a total of 17,978 applications, followed by India at 11,117

applications.

India stood 7th in terms of number of patents applications receivedin the year 2017. It received a total of

46,582[1]patents applications in 2017. China leads the list with total of 1.38 million patents applications

received by its office. US office, on the other hand, stood 2nd, but received nearly half the applications

received by China, US received a total of 606,956 applications in 2017. Japan had received 3rd largest

number of applications(318,479) followed by Republic of Korea (204,775) and the European Patent Office

(EPO166,585). Among the top ten countries, India had received applications more than received by

developed countries like Canada and Australia and developing country like Federation of Russia. During the

year 2017, India (+3.4%) and the EPO (+4.5%) saw a strong growth in filings.

India, again, ranked 7th in the Trademark Filing Activity, with a total of 283,575 filing activities in the year

2017. China, undoubtedly, remained the world leader, with a total of 5.74 million filing activities followed

by a count of 613,921 in USA. Countries like, the Islamic Republic of Iran, China and Japan had registered

growth in the filing of trademarks. France, India and Republic of Korea, on the other hand, had registered

decline in the filing activities.

India’s Progress over the recent period

The researcher has considered progress made by Indians in intellectual property applications filed, examined,

granted or disposed during the last five years from 2013-14 to 2017-18. The available data shows that the

country has made a considerable progress on almost all the areas of intellectual properties.

Patents:

The number of patents applications filed during 2017-18 increased considerably as compared to those filed

during the previous year 2016-17. Around 42,951 patents applications were filed in the year 2013-14 this

increased to 45,444 in 2016-17 and further to 47,854 in 2017-18.

The number of patents applications examined increased from 18,615 in 2013-14 to 28,967 in 2016-17 and

further to 60,330 in 2017-18. Applications examined during 2017-18 increased by more than double the

number examined during 2016-17.

Total of 4,227 patents applications were granted in the year 2013-14 which further increased to 13,045. The

number of patents applications granted by the concerned department had increased by more than three times

over the study period which indicates the progress made.

Disposal of patents applications covers patents granted/ refused and also applications withdrawn and

abandoned by the applicants. Being not important for the theme of the study hence ignored.

Designs:

The IP office in India received a total of 8,533 design applications in the year 2013-14 which increased to

11,837 in the year 2017-18.

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The concerned office examined a total of 7,228 design applications during 2013-14 which increased to

11,940 design applications being examined during 2016-17 and a slight decline in it in the next year 2017-

18. Design applications examined during 2017-18 were 11,850.

As far as the design registrations are concerned, the country must be quite happy because the total number

of designs got registered are in quite a good number. Total of 7,118 designs were registered in the year

2013-14 which increased to 10,020 in the year 2017-18.

Trademarks:

Huge number of applications on trade marks are being filed, examined and got registered over the period of

last five years.

A total of 2,00,005 applications for trade mark registrations were filed during 2013-14 which increased to

2,83,060 in 2015-16 and further declined to 2,72,974 during 2017-18.

Around 2,03,086 applications for trade mark registration were examined during 2013-14 which increased to

5,32,230 during 2016-17. It registered a decline in the next year where a total of 3,06,259 applications for

trade mark registrations were examined.

One good thing about the trade mark registrations is that the number of trade marks being registered is

increasing continuously. A total of 67,876 trade mark applications got registered during 2013-14 and it

registered huge increase over the study period. A total of 3,00,913 applications for trademark registration

got registered.

Geographical Indications:

A total of 75 applications for geographical indications were filed, 42 were examined and a total of 22 got

registered during the year 2013-14. This has declined over the period. During 2017-18 a total of 38

applications were filed, 18 were examined and 25 applications were registered.

Copyrights:

A total number of 17841 applications were received during 2017-18 and 34,388 applications were examined

whereas, number of registrations of Copyright (ROC) was 19997. During the year 29309 new discrepant

letter was issued and total number of applications disposed was 39799.

CONCLUSION:

Above analysis shows that India has been doing well on IPRs like, Patents, Trademarks, Copyrights,

geographical indications, designs. The data shows that the number of applications filed, examined and registered

for Patents, Trademarks, Copyrights, geographical indications, designs have continuously been rising, with

certain exceptions, over the study period. Getting the intellectual property rights registered in ones name is a

money making activity hence the researcher concludes and views Intellectual Property Rights (IPRs) as an

economic incentive that stimulate innovation and technological progress of India and Indians are becoming

more and more innovative as there are economic incentives provided to them by intellectual property rights. In

addition the study also concludes that the progress made by India in IPRs sector is helpful in economic growth

and development of Indian economy.

REFERENCES:

IPR Annual Report 2017-18, the Office of the Controller General of Patents, Designs, Trademarks and

Geographical Indications, Government of India.

World Intellectual Property Indicators 2017-18: www.wipo.int/ipstats/en/wipi.

WIPO Statistics Database, September 2018.

http://www.wipo.int/ipstats/en/wipi

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Tarun Krishnakumar, “All your intellectual property are belong to us: how copyright and patent “trolls” are

questioning the jurisprudential foundations of treatingintellectual property as “property”, The Indian

Journal of Intellectual Property Law, 2012, Vol. 5, pp 93.

Rajkumar S. Adukia, Handbook on Intellectual Property Rights in India.

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A STUDY OF NATIONAL INTELLECTUAL PROPERTY RIGHTS OF INDIA

POLICY AND INNOVATION

Dr. Usha Vishnu Bhandare

Assistant Professor

K.B.College of arts and commerce for women, Thane

Abstract

The Union Cabinet approved the National Intellectual Property Rights Policy on 12th May, 2016, which was a

roadmap for the future of intellectual property rights in India. Our government recognized that India has a pool

of talented human minds and determined to tap these creative and innovative energies and channelize them

towards a better and brighter future for all. National Intellectual Property Rights Policy was framed by

considering the strengths in various sectors, i.e. Research and Development organizations, Educational

Institutions, Corporate entities, including MSME, Startups and other stakeholders in the creation of an

innovative conducive environment which stimulates creativity and innovation across the country. Until, there is

a financial benefit, no one will take much interest in any innovation and creation. Hence, the government made

it commercial which ultimately enables inventors to use creativity and innovation as a source of income. India

has a well-established TRIPs Complaint legislative, administrative and judicial framework to safeguard IPR

which meets its international obligations even though US government put India under priority watch list

country. Hence, the researcher made an attempt to study the objectives and benefits of National Intellectual

Property Rights and contribution of NIPR policy in economic development of the country.

Introduction

“Creative India; Innovative India” with this visualisation, the government of India implemented the National

Intellectual Property Rights Policy on 12th May, 2016.

Creativity and innovation have been a constant in growth and development of any knowledge economy. There is

an abundance of creative and innovative energies flowing in India. The evolution in the various sectors such as

pharmaceutical, handicraft and textile industry, software industry, Ayurveda etc. are the few examples where

innovation always takes place. But it is a fact, that much of the intellectual property created remains

unprotected, both on account of awareness or wrong perception that the registration procedure is complicated.

NIPR policy is assisting in nurturing the IP culture, guiding and enabling all creators and inventors to realize

their potential for generating, protecting and utilizing IPRs which would contribute to wealth creation,

employment opportunities and business development. The rationale for the National IPR Policy lies in the need

to create awareness about the importance of intellectual property rights (IPRs) as a marketable financial asset

and economic tool. The year 2018 witnessed several sea changes in intellectual property rights in India. One of

the most promising advances has been to create a balance between knowledge creation and spreading

awareness.

Objectives of the study

1. To study the objectives of national intellectual property rights in India

2. To gain knowledge about recent development in IPR under National intellectual property rights in India

3. To study the goals of new National intellectual property rights in India

4. To understand the recent development of IPR law in India

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Evolution of Intellectual Property Rights and development of IPR law in India

Intellectual property rights were imported in India from the West. The Indian Trade and Merchandise Marks Act

1884 was the first Indian law regarding IPR. The first Indian patent law was enacted on 1856. Later on, two

more laws were enacted i.e. Indian Patent and Design Act, 1911 and Indian Copyright Act, 1914. In 1948, the

Indian government appointed the first committee to review the prevailing patents and design legislations. In

1957, government appointed Justice Rajagobala Ayyangar committee to revise the patent law.

WTO came into existence in 1995 by replacing GATT. In July 2016, there were 16 member nations of WTO.

The WTO member nations have signed a number of agreement to promote international trade and

development which given a birth to intellectual property rights known as TRIP’s. The TRIP’s agreement

protects the rights of owners in respect of patent, copyright, trade-marks, design and other form of

intellectual property. TRIPs also specifies enforcement procedures, remedies and dispute resolution

procedures. The main focus was on protecting innovation and creation of new ideas, as well as technology.

Intellectual property rights are the rights are given to persons over the creation of their minds.

Recent Development in Intellectual Property Rights in India

A. Trademark

To become free from the list of Priority list watch country, Indian government made certain changes in the

trademark law in line with international practices and ensure implementation of India’s commitments under

TRIPs agreement. India replaced the Trade and Merchandise Marks Act 1958 with the Trade Marks Act, 1999

and made certain changes which include:

1. The service marks were made protectable through registration.

2. The registration procedure was made comparatively easier than earlier.

3. The period of registration and renewal has been increased from seven to ten years.

4. Under the new law, both registered and unregistered trademarks can be assigned with or

without the goodwill of the business and increased the fee with respect to trademark filing.

B. Copyright

Under the Indian law, the protection granted to the creator of original works of authorship such as literary

works, dramatic, musical and artistic works, cinematographic films and sound recordings. The most important

advantage of copyright protection is that even articles published in one country, will be protected globally.

Protection is given to works first published in India, in respect of all countries that are member states to treaties

and convention to which India is a member. The key area is the duration of copyright which is the lifetime of the

author plus sixty years.

C. Patent

Similar to trademark, copyright, design and geographical indicators, patent is also an intellectual property which

is protected under the patent act of 1970. The term period under the act is for 20 years. One of the drastic

changes in patent law is that Indian patent office leaned towards technology driven solutions. In August 2018,

the IPO invited expression of interest for making use of artificial intelligence, block chain, internet of things and

other technologies for patent processing systems. On 4th December 2018, in consultation with IPO released the

draft patent (amendment) Rules, inviting public comment. In 2018, India also took a step forward in order to

offer the benefits of the Patent Prosecution Highway (PPH) to applicants filing patent applications in India. On

29 October 2018, an agreement was signed between Japan and India to start a pilot programme of a Japan-India

PPH.

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D. Protection for Plant Varieties and Rights of Farmers established

After the issues of turmeric powder and basmati rice, the government of India enacted the Protection of Plant

and Varieties and Farmers Right Act, 2001 to protect the rights of farmers for their contribution made in

conserving, improving and making available plant genetic resources under the provision of the TRIPs

agreement.

E. New Designs Law

India enacted a separate law for the protection of copyrights in an industrial design. The Designs Act, 2000

replaced the earlier Designs Act, 1911. The new law protects proprietors of novel or original designs and

enforces those rights against infringers.

Key points of the new IPR Policy

To promote innovation and entrepreneurship while protecting the interest of public

Educating entrepreneurs about IP rights, streamlining IP registration processes, and facilitating IP

licensing arrangements

The new IPR policy of India is entirely compliant with the WTO’s agreement on TRIPS.

The policy has the proposal to create an effective loan guarantee scheme to encourage start-ups in the

country.

It aims to promote research and development through various tax benefits.

Examination time for trademarks has been reduced from 13 months to 8 months, with the new target

being to bring the time down to one month by March 2017

The policy suggests making the Department of Industrial Policy and Promotion (DIPP) as the nodal

agency for all IPR issues in the country. Copyrights related issues will also come under the DIPP’s

ambit from that of the Human Resource Development (HRD) Ministry.

Under the Indian Patents Act, a CL (compulsory License) can be issued for a drug if the medicine is

deemed unaffordable, among other conditions, and the government grants permission to competent

generic drug makers to manufacture it.

Objectives of National Intellectual Property Right Policy 2016(NIPR)

The Policy lays down the following seven objectives:

IPR Awareness: - To create public awareness about the economic, social and cultural benefits of IPRs

among all sections of society.

Generation of IPRs - To stimulate the generation of IPRs through private and government sector.

Legal and Legislative Framework - To have strong and effective IPR laws, which balance the

interests of rights owners with larger public interest.

Administration and Management - To modernize and strengthen service-oriented IPR administration.

Commercialization of IPRs - Get value for IPRs through commercialization.

Enforcement and Adjudication - To strengthen the enforcement and adjudicatory mechanisms for

combating IPR infringements.

Human Capital Development - To strengthen and expand human resources, institutions and capacities

for teaching, training, research and skill building in IPRs.

Future plan/Goals of National Intellectual property right policy

To administer and implement all IP laws under the DIPP, which is administered by ministry of HRD

and communication and technology.

To improve Information and Communications Technology infrastructure at different levels for making

the administration process more efficient.

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To promote infusion of funds to Research & Development.

Launching a nationwide promotion campaign titled "Creative India; Innovative India" to increase

awareness about the benefits of the new IPR policy in India.

Expanding the Traditional Knowledge Digital Library to allow public research institutions and private

players to use it.

Strengthening the enforcement mechanism for better protection of IPR.

Providing incentives to promote Research & Development by providing tax benefits and financial

support for products based on IPR generated from public funded research.

Developing IPR expertise in the industry, academia and legal fraternity. By developing Intellectual

property rights curriculum, the Policy intends to raise awareness of IP issues.

Conclusion

The basic purpose of IPR is to achieve economic, social and technological advancement that protects the ideas

and stimulates innovation, design and helps to the creator of technology. The new NIPR encourages innovators

to share the knowledge for the development of technology which leads to wealth creation. It is indeed the main

purpose of IPR to share knowledge and engender innovation, but unfortunately it is criticized that if IPR protect

especially technology, no one will take risk in sharing knowledge. Secondly, in India, a majority of the

population is in rural areas. It is essential to generate awareness to make them understand IPR. Thirdly, the

procedure for registration of patent and other innovations should be simplified, so that the inventor can save his

energy, money and time for more technological development rather than in procedural system. The cases of

patents which are pending should be fast tracked. It is found that nearly 2.4 lakh patent applications are still

pending. IPR should undertake under CSR policy and provide tax benefits on the monetisation of innovation.

References

http://iitk.ac.in/siic/d/sites/default/files/National_IPR_Policy_12.05.2016.pdf

https://www.researchgate.net/publication/288712599_Intellectual_property_rights_and_its_development_in_Ind

ia

Tiwari, R. (2011). Management of Intellectual property rights : an updated review. Journal of natural

science, Biology and medicine , 2 (1), 131-146.

www.wto.int

www.TRIPs.org

http://iitk.ac.in/siic/d/sites/default/files/National_IPR_Policy_12.05.2016.pdf

https://www.researchgate.net/publication/288712599_Intellectual_property_rights_and_its_development_in_India

https://www.researchgate.net/publication/288712599_Intellectual_property_rights_and_its_development_in_India

http://www.wto.int/

http://www.trips.org/

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INTELLECTUAL PROPERTY RIGHTS AND PHARMACEUTICAL INDUSTRY

Prof. Vaishali Bankar

Akbar peerbhoy college of commerce and economics

Introduction

In the globalised era, new and improvised drugs are being introduced in the market driven by rapid changes in

technology. Over the past couple of decades, many advances in the pharma sector had led to introduction of

blockbuster drugs, thus saving lives of millions of people. Most of the revenues from these commercially

successful drugs are invested in research and development (R&D) and innovating new drugs.(1) The

pharmaceutical is one of the sectors where the innovation makes a dramatic impact on the bottom line of the

drug manufacturers, thus these companies are focusing more on Research& Development to survive the

competition and gain market share. Innovation is the key element that defines the success of the pharmaceutical

sector while the risk associated with launch of new drugs can threaten its survival in the marketplace. Besides

this, innovation help pharma companies to distinguish themselves from generic manufacturing company to

research-based company.

HISTORY:

The history of the Indian pharmaceutical industry dates back to 12 April 1901 when Bengal Chemical and

Pharmaceutical Works Pvt. Ltd, Kolkata, was started by Acharya Prafulla Chandra Ray(2) with certain eminent

medical practitioners. There is mention of at least of two other Indian companies ,which made significant

contribution in the production of allopathic medicines , founded earlier than 1901 —B K Paul &Co, Kolkata,

and N Powell & Co, Mumbai, which pioneered essentially in the imports and distribution of allopathic

medicines along with production of certain others local medicines; although details of the local production could

not be authenticated. Setting -up of Bengal Chemical was followed by the establishment of Alembic

Pharmaceutical Works 3, Baroda, in 1907, Zandu Pharmaceutical Works Ltd4 Kolkata, in 1910, Calcutta

Chemical Company(3), Kolkata, in 1916, and Bengal Immunity7, Kolkata, in 1919. These companies had

started Indian companies were not yet technologically rich, and could not freely produce and supply “patented

medicines” to the people of India because of legal barriers. But Indian entrepreneurs continued to show their

enthusiasm to capture a part of the business, which grew. During 1930s and 1940s, several other Indian

companies came up. Noteworthy among them were Cipla8, Mumbai (established in 1935); Amrutanjan Health

Care, Chennai(4) (registered in 1935); East India Pharmaceuticals Ltd, Kolkata (formed in 1936) FDC Ltd,

Mumbai (established in 1940); Dey’s Medical Stores, Kolkata (started as a retail medical store in 1941 followed

by factory in 1957) Indoco Remedies, Mumbai (incorporated in 1947); and IPCA Labs, Mumbai (established in

1949) Based on the scattered information left by these companies in their history-sheets as obtained from the

sites of the companies on the net, it was observed that Indian entrepreneurs initially produced pharmaceuticals

dispensed in various formulated forms such as tablets, dry powders, capsules, liquids, ointments and other

forms, dispensed as alkalizers, digestives, immune boosters based on traditional herbal medicines, disinfectants

based on coal- tar products , plant-based astringents, balms for pain relief and alcoholic herbal extracts of

different kinds. The Second World War (1939-45) caused severe scarcity of modern medicines in India. At that

time microbial diseases created considerable distress among people, and were the principal cause of death. The

prevalent diseases included typhoid fever, tuberculosis, small -pox, malaria, measles, cholera, plague, dysentery

and diarrheal diseases, a host of conditions of sepsis, respiratory diseases, including pneumonia and bronco-

pneumonia, venereal diseases, kala-azar, leprosy, infection from hook- worm and other parasitic worms in the

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intestine, guinea-worm diseases and filariasis. Among non-microbial diseases, diabetes, mental disorders and

certain types of cancer, were leading causes of disabilities and death. Modern medicines were not available in

adequate quantities to treat these diseases15. Following the war, the modern medicines coming through imports

brought by multinational companies were considerably expensive. The three countries — UK, Germany and

Switzerland— among the West European countries were most advanced at that time in the pharmaceutical

industry. These countries developed new APIs and formulations thereof; which were effective in treating wide

range of ailments and more importantly deadly diseases caused by microbes (typhoid fever, dysentery, diarrheal

diseases, malaria, tuberculosis and sepsis). Only the needy who could afford the cost used medicines; most

people could not. There was, therefore, a national crisis to develop policies and methods to enable supply of

life-saving medicines at affordable price. The pre-independence availability scenario of modern medicines

through the Indian companies was not exciting by any standards.The Indian pharmaceutical companies

produced affordable cheaper drug formulations to meet the requirement of poor Indians. In the process, several

spurious drug formulations were introduced in the market. Firstly, new chemical entities (NCEs) and APIs

locally were scarcely available throughout the country, and secondly, most modern APIs used to be the patent-

protected proprietary products of the multinational companies, and therefore use of such bulk drugs for turning

out formulations and using foreign brand names for respective formulations by the Indian collaborators required

payment of heavy royalties essentially with the zeal of patriotism to compete with the imported medicines of

British companies and MNCs The Indian pharmaceuticals industry is one of India's most successful industries

more than the economic contribution in terms of output employment and exports the industry provides drugs at

affordable prices to the Indian people today India is amongst top 15 pharmaceuticals manufacturing countries in

the world the industries progress in recent years has been added by significant increase in R&D spending some

10 companies have embarked on molecule discovery research the industry is poised to take a fair share in the

$400 million global pharmaceutical market given the WTO agreement on replacing process patent by product

patent patent some believe that the core competency of the Indian pharmaceutical industry namely reverse

engineering will be threatened the fears how ever made turn out to be less significant as the industry has been

adjusting to the changing scenario 2005 amendment of The patent act stipulated that their discovery of new

form of a known substance and which does not result in the info info enhancement of the its efficacy will not be

eligible for patent protection thanks to this domestic manufacturers code continue to bring to the market generic

equivalent of the patented chemical entity on the expiration of the period of exclusive commercial exploitation

Impact of patent protection

Intellectual property rights especially patents are the bedrock of the pharma industry as the industry solely rely

on the innovation that can be monetized in the future. In simple terms, patents are an exclusive right granted for

an invention which is novel and non-obvious to a person/entity skilled in the art to which the invention relates

to. According to industry estimates, patents contribute 70%-80% of overall revenues of the pharma companies.

Patents in the pharma industry are generally treated equivalent to their product portfolio and are one of the

effective ways to protect the innovation and generate a return on investment. They play an integral role in the

pharmaceutical industry to safeguard the inventions of the company, thus help in producing drugs that meet

patient needs in developing and developed countries. Patents are also critical for the industry as they help in

recouping investments incurred during research and development, and marketing of the drug(7).

Present Scenario:In the recent months, pharma companies have been facing patent challenges, thus posing a

threat to pharmaceutical innovation and increasing uncertainty about market exclusivity and litigation cost for

commercially successful drugs. For instance, Novartis AG lost a patent battle against Torrent Pharmaceuticals in

the US over the drug Gilenya, which was one of the high revenue generating drugs. These patent wars can be

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addressed by adopting effective patent strategy by branded pharma companies through obtaining patents for

methods of manufacture and active ingredients.

An effective strategy should be developed to obtain patents for the broadest possible scope in the R&D process,

whereas methods of use and formulations patents can be filed at the clinical trial stage that defines the product

use and attributed. As the cost involved in the R&D is too high, majority of the pharma companies rely on

patents and apply for patent protection right from research stage i.e. prior to clinical trials, thus shortening the

time to market the drug and increase return on investment. Inventions in many technology-based industries can

be kept a secret till the time it reaches the market and utilize the patent term of 20 years whereas inventions in

the pharma industry has to be disclosed and protected prior to foraying into the market.

Extending patent protection

Pharma companies extend the patent term for commercially successful drugs by obtaining patents for new

formulations of the known compound through ease of use or reduced dosage, thus making it superior to the

previous drug. This provides an advantage to the branded companies to compete with generics competitors and

protect market share. Furthermore, the drug takes less time to obtain an approval from Food and Drug

Administration (FDA).

Future of pharma industry

Pharma companies are focusing on drugs that increase the sales volume and improve market share, thus

boosting profits instead of developing life saving drugs.

As the drug discovery is becoming time consuming and expensive for the pharma companies, they have limited

time to market their drugs. As a result, the industry is facing expiry of the patents on the commercially proven

drugs. Without extended patent protection, the company will not be able to fund their R&D efforts. Also,

extension of patent product lifecycle can help companies to invest more time in research and development and

novel medications. On the contrary, extended patent protection means these drugs will be expensive for a longer

period of time.

In the absence of adequate patent protection, pharma companies have to limit their patent portfolio resulting in

erosion of market share. In order to compete with the pharma companies globally, Indian pharma companies

have to focus on developing new drugs and protecting their intellectual property. It is imperative to protect

intellectual property for commercialization in near future. As patents are crucial for pharma companies, they

should focus on maintaining and developing patent portfolio. Indian companies can also produce patented drugs

through licensing from foreign companies or earn revenues from generic drugs. High cost of research and

development and lack of stronger product patent regime can stifle the growth of the pharmaceutical industry.

To sum up, patents are necessary to promote innovation and economic growth. They help in gaining competitive

edge in the market, and increase revenues and market share. Adequate patent protection can provide pharma

companies a platform for future growth and produce new drugs. Also, protecting new inventions help pharma

companies recuperate skyrocketing costs incurred in R&D and maximize the commercial product lifecycle.

Therefore, it is critical to devise an effective IP strategy in order to maximize the returns and realize the true

potential of intellectual property(5)

CONCLUSION:

The current state of the pharmaceutical industry indicates that IPR are being unjustifiably strengthened and

abused at the expense of competition and consumer welfare. The lack of risk and innovation on the part of the

drug industry underscores the inequity that is occurring at the expense of public good. It is an unfairness that

cannot be cured by legislative reform alone. While congressional efforts to close loopholes in current statutes,

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along with new legislation to curtail additionally unfavorable business practices of the pharmaceutical industry,

may provide some mitigation, antitrust law must appropriately step in(6)

REFERENCES

Manoj Poonia is Assistant Vice President, Operations and Surbhi Bhardwaj is Assistant Manager, Operations,

Effectual Service

“Bengal’s Long-lost Entrepreneurial Spirit”. Retrieved from www.scribbler.com

Retrieved on January 22, 2019 from http://www.eastindiapharma.org/history.html

Ghoshh, P. K. and Ramanaiah, T. V., IPR issues in Biotechnology in Developing

Countries and India, J.of Intellectual Property Rights,2001 January, Vol 6 pp1-17,

http://nopr.niscair.res.in/bitstream/123456789/19457/1/JIPR%206%281%29%201-17.pdf

Subbaram NR. Hyderabad: Pharma Books Syndicate; 20036)Angell. The PharmaceuticPM.To Whom Is It

Accountable? N Engl J Med. 2000;342:190Wikipedia. 2019. “Calcutta Chemical Company”. Retrieved

multiple times, last on January 22, 2019 from https://en.wikipedia.org/wiki/Calcutta_

Gottlieb S. Drug firms use legal loopholes to safeguard brand names. BMJ. 2000;321:320. [PMC free

article] [PubMed] [Google Scholar]

http://www.scribbler.com/

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1118325/?report=reader

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1118325/?report=reader

https://www.ncbi.nlm.nih.gov/pubmed/10926582

https://scholar.google.com/scholar_lookup?journal=BMJ&title=Drug+firms+use+legal+loopholes+to+safeguard+brand+names&author=S+Gottlieb&volume=321&publication_year=2000&pages=320&pmid=10926582&

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AN EMPIRICAL STUDY ON INTELLECTUAL PROPERTY RIGHTS AND

ITS IMPORTANCE FOR THE INDUSTRY

Dr. Vaishali Nadkarni

The Byramjee Jeejeebhoy college of Commerce,

33, M. Karve Road, Charniroad, Mumbai 400 004.

Abstract:

Intellectual property rights (IPR) have been defined as ideas, inventions, and creative expressions based on

which there is a public willingness to bequeath the status of property. IPR provide certain exclusive rights to the

inventors or creators of that property, in order to enable them to reap commercial benefits from their creative

efforts or reputation. There are several types of intellectual property protection like patent, copyright,

trademark, etc. IPRs are generally understood to have two principal areas of basis of the links between IPR and

secondly the innovative methods to manage the IPR.

Keywords : IPR, patent, copyright, trademarks industrial application

Introduction

IP is protected in law by trademark, patents and copyrights which enable people to earn recognition or financial

benefit from what they invent or create. By striking the right balance between the interests of innovators and the

wider public interest, the IP system aims to foster an environment in which creativity and innovation can

flourish. The different types on intellectual property rights are trademarks, copyright and patents which is used

by the industry for bringing in development and recognition for their growth of brands. Intellectual property (IP)

is about promoting progress and innovation. The IP system should be seen as a tool to regulate and facilitate

trade, information and knowledge in innovative and creative goods and services. The knowledge and human

creativity exemplified by the IP in these products make the modern world possible. IP rights do not simply

benefit creators but, rather, society as a whole.

The intellectual property rights were essentially recognized and accepted all over the world due to some very

important reasons. Some of the reasons for accepting these rights are:-

a. To provide incentive to the individual for new creations

b. Providing due recognition to the creators and inventors.

c. Ensuring material reward for intellectual property

d. Availability of the genuine and original products

Types of Intellectual Property rights

The Copyrights are provided for items like literary, musical, artistic works like songs, musical scores, poetry,

paintings, sculpture, films, architecture, maps, technical drawings; computer programs, data base etc. are

provided to the creators. Copyrights provide exclusive right to the creator to use or authorize others to use their

creations. The reproduction in various forms, copying, printing, recording, public performance or adaptation are

prohibited. This right provides economic right to the creator that is the financial benefit for a lasting period of

fifty years after the creator's death.

A patent is an exclusive right granted for an invention or providing right to the patent owner to decide how - or

whether - the invention can be used by others. In exchange for this right, the patent owner makes technical

information about the invention publicly available in the published patent document.

A Trade- mark can be patented like invention and industrial designs. The trade mark can be combination of

words, letters, numbers, drawings, images, symbols, and even sounds. The trade marks not only protect the

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owner’s rights but are also required for consumers to have confidence in the product purchased by them.

Reputation and quality are also associated with trade-marks. Trade-marks are generally registered for seven

years but they can be renewed indefinitely by applying again and paying the required fee.

Objective of the study: To understand the importance of IPR for the growth of industry

IPR enable industry to meet global challenges

Nearly all of the hundreds of products on the World Health Organization’s Essential Drug List, which are

critical to saving or improving people’s lives around the globe, came from the R&D-intensive pharmaceutical

industry that depends on patent protections. Innovative agricultural companies are creating new products to help

farmers produce more and better products for the world’s hungry, while reducing the environmental impact of

agriculture. IP-driven discoveries in alternative energy and green technologies will help improve energy security

and address climate change.

IPR encourage Innovation and enrich entrepreneurs

Risk and occasional failure are the lifeblood of the innovation economy. IP rights motivates the entrepreneurs to

keep pushing for new advances in the face of adversity. IP rights facilitate the free flow of information by

sharing the protected know-how critical to the original, patented invention. In turn, this process leads to new

innovations and improvements on existing ones. These rights are embraced by all sectors of industry—small,

medium and large companies alike and by labour organizations, consumer groups and other trade associations.

The paradigm shift in the process of IP and NSI

During the last two decades, there have been a number of policy and legislative changes in respect of

intellectual property (IP) and the national system of innovation (NSI). The study provides a critical review of

drafts of the national IP policy published in 2013 as well as the IP Framework released in 2016 for public

comment especially the BRICS group of countries (Brazil, Russia, India, China and South Africa) within the

context of the National Development Plan (NDP), It is characterised by a desire to move away from being

dependent on resources and commodities, to becoming a more knowledge based and innovation driven

economy. It is hoped that such a move would assist the country to address some of the social and economic

development challenges particularly with the functioning of IPR. The Trade-related Aspects of Intellectual

Property Rights (TRIPS Agreement) of the World Trade Organisation (WTO) provides that IP must contribute

to innovation and to transfer of technology and knowledge in a manner that is conducive to social and economic

welfare.

This study has thus explored the complex, complementary and sometimes contested relationships between IP

and innovation, with particular emphasis on the potential of an intellectual property system to stimulate

innovation and foster social and economic development. The research has also analysed the interconnectivity of

IP and innovation with other WTO legal instruments, taking into account the globalised economy and in

addition to its performance with developmental priorities. The patenting trends such as European Patent Office

(EPO), Patent Cooperation Treaty (PCT), United States Patents and Trademarks Office (USPTO) databases over

the period 1996-2015, amongst BRICS group of countries has also been documented.

The researcher has further documented new findings, observations and insights, particularly in relation to higher

education and research institutions, which are directly attributable to the Intellectual Property Rights from

Publicly Financed Research and Development Act. The public institutions are becoming relevant players in the

NSI and are responsible for growth of certain technology clusters and at the same time, the decline of private

sector participation in patenting as well as R&D investment over the 20-year period. Recommendations are

included regarding specific interventions to ensure soundness between the IP and innovation systems. Such

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coherence and alignment should strengthen the systems’ ability to stimulate innovation and foster inclusive

development and competitiveness, which are relevant for addressing socio-economic development priorities.

Measures to Strengthen the Enforcement of IP Laws

Number of measures to strengthen the enforcement of copyright law has been taken by the Government of India.

The summary of the same is as follows:

1. The Government has brought out: A Handbook of Copyright Law to create awareness of copyright laws

amongst the various stakeholders users like the scientific and academic communities and members of the

public.

2. Modules on copyright infringement have been included in their regular training programs at National Police

Academy, Hyderabad and National Academy of Customs, Excise and Narcotics

3. The Department of Education, Ministry of Human Resource Development, Government of India has initiated

several measures in the past for strengthening the enforcement of copyrights that include constitution of a

Copyright enforcement Advisory Council (CEAC), creation of separate cells in state police headquarters,

encouraging setting up of collective administration societies and organization of seminars and workshops to

create greater awareness of copyright laws among the enforcement personnel and the general public.

4. Special cells for copyright enforcement have so far been set up in 23 States and Union Territories, i.e. Andhra

Pradesh, Assam, Andaman & Nicobar Islands, Chandigarh, Dadra & Nagar Haveli, Daman & Diu, Delhi,

Goa, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Karnataka, Kerala, Madhya Pradesh,

Meghalaya, Orissa, Pondicherry, Punjab, Sikkim, Tamil Nadu, Tripura and West Bengal.

Recommendations

Governments should undertake regular reviews of copyright frameworks in the digital era. In conducting these

reviews, governments should not only study the changing creative content landscape in a world but also move to

concrete action. An appropriate action is required, to update national copyright laws and coordinate them

between nations. – Policy-makers should develop frameworks enabling increased lawful access to content via

the Internet, thereby reducing the incentives to obtain pirated content. – A voluntary global registry for

copyrighted content should be created to facilitate licensing of copyrighted material. In contrast with national

registries, which can continue to play an important function in relation to jurisdiction specific enforcement

actions, a global registry would be aimed principally at enabling copyright owners and users to efficiently

connect and identify licensing solutions appropriate for a particular use. – New approaches to addressing

important works should be developed and formalized. Technology changes in the last decade have made it far

easier to identify authors and other right holders using reasonable efforts. Attention needs to be given to ensure

that all players in the value chain are contributing appropriately to today’s distribution landscape. Collective

management organizations, right holders and policy-makers should work together on global standards for

acquiring and distributing content use information. – Policy-makers and content distributors should encourage

the development of globalized digital marketplace approaches that could reduce geographical impediments to

commerce in digital works and ensure a fair balance between the interests of copyright owners and users.

Conclusions

In today’s interconnected knowledge-centric society, the economic stakes of an appropriate IP framework are

high. IP enables greater investment in products and services to improve society, including life-saving vaccines

and medicines, and high-yield, drought-resistant crops that increase the world’s food supply. By leveraging the

IP system for social and economic growth, society will benefit from a wider base of knowledge, increased

investment in research and development, broader support of creative arts, greater access to open markets and

better consumer protection. Given the challenges facing the global economy, the IP system is more important

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than ever in providing the framework to foster new products and cultivate new inventions that are instrumental

in creating the next generation of jobs, investments and growth. Development of a country’s intellectual Capital

is the most important task in these regards. An effective intellectual property rights system lies at the core of the

countries development strategies. Within knowledge based, innovation driven economies, the intellectual

property system is a dynamic tool for wealth creation, providing an incentive for enterprises and individuals to

create and innovate a fertile setting for the development of and trade in, intellectual assets, and a stable

environment for domestic and foreign investments. Although India has complied with the obligations of TRIPS

by amending its IP laws, certain issues need to be taken care of.

References:

Vankayala Phanindra , V. Shirisha1 , Piduguralla Surendra, ( 2013), A REVIEW ARTICLE ON

INTELLECTUAL PROPERTY RIGHTS (IPR), International Journal of Research in Pharmaceutical and

Nano Sciences. 2(4), 2013, 466 - 470. ISSN: 2319 – 9563

WIPO/ARIPO/OAPI (WAO) Conference on Intellectual Property (IP), Innovation and Value Addition for

Business Competitiveness and Sustainable Development in Africa, WIPO-ARIPO-OAPI/INN/HRE/INF/1

PROV. NOVEMBER 1, 2019

Sibanda, McLean (2018) Enabling intellectual property and innovation systems for South Africa's development

and competitiveness, University of South Africa, Pretoria, http://hdl.handle.net/10500/24247

David Kappos Partner Cravath, Swaine & Moore, John Villasenor, Tiffany Misrahi (2013), Intellectual Property

Rights in the Global Creative Economy, October (2013) Message from the World Economic Forum’s

Global Agenda Council on the Intellectual Property System, Global Agenda Councils World Economic

Forum

Abhishek Joshi, Importance of Intellectual Property Rights, , National Law Institute University, Bhopal

Manoj Singh and Associates (2017), India: The importance of Intellectual Property Rights (IPR) And What

Start-sups Should Know 17th October, 2017

http://www.mondaq.com/india/x/637842/Trademark/The+Importance+Of+Intellectual+Property+Rights+IP

R+And+What+Startups+Should+Know

Sachin Mangal(2005), INTELLECTUAL PROPERTY RIGHTS: INDIAN SCENARIO, Journal of Business

Administration Online, Spring 2005, Vol. 4 No.1.

http://hdl.handle.net/10500/24247

http://www.mondaq.com/india/x/637842/Trademark/The+Importance+Of+Intellectual+Property+Rights+IPR+And+What+Startups+Should+Know

http://www.mondaq.com/india/x/637842/Trademark/The+Importance+Of+Intellectual+Property+Rights+IPR+And+What+Startups+Should+Know

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ETHICAL ISSUES OF COPYRIGHTS REGARDING BOOK PUBLISHING,

RESEARCH PAPERS AND ARTICLES

Prof. Vishal R. Karanjavkar

Assistant Professor

Siddharth College of Commerce & Economics, Anand Bhavan, Fort, Mumbai-01

Abstract

Ethics are broadly the set of written or unwritten rules, that govern our expectations of our own and others’

behavior. Research Ethics are a set of ethics that govern how scientific and other research is performed at

research institutions such as universities and how it is disseminated. This paper discusses mainly the various

ethical issues relating to copyrights violations in case of book publishing. Initially this paper throws light on

basic aspects like ethics, intellectual property rights and their types. It then elaborates upon the actual concept

of copyright, ethical issues in its regard while book publishing, challenges due to unethical practices and finally

gives some concluding remarks and suggestions regarding compliance of ethics in book publications, which

should be followed for integrity of knowledge based on research. This paper is based on secondary information,

gathered from different online articles, research papers, books etc.

Key-words:- Ethics, Intellectual Property Rights (IPR), Copyrights, Issues

Introduction

Ethics is the branch of knowledge or philosophy that deals with moral principles that govern a person’s behavior

while conducting an activity. Ethics is concerned with distinguishing between good and evil in the world,

between right and wrong human actions. It is one of the complicated subjects in human history. Many

academicians and corporate leaders studied the relationship between doing the right things and making money

out of it for many years but hardly came on certain conclusions. Ethics referes to code of conduct that anyone is

expected to follow while doing any activity.

Intellectual Property Rights

It means the legal rights which result from intellectual activity in the industrial, scientific, literary and artistic

fields. There are different types of IPRs like Patents, Copyrights, Trademarks, Trade Secrets, Right of Publicity,

Geographical Indications , Industrial Designs , Layout designs. In this paper we are going to discuss about

ethical issues regarding one of the intellectual property rights i.e. copyright while publishing books.

Copyright

It is legal concept giving the creator of an original work the exclusive rights to it and to who may use it and for

what purposes, to prevent unauthorized copying and publishing of an original work. This is usually for a limited

period only and ensures that the copyright holder is credited for his or her work. The duration of copyright

varies for different kinds of material. Here the focus is regarding book publishing. Under Section 13 of the

Copyright Act, 1957, copyrights exist in various kinds of works like literary, dramatic, musical, artistic,

cinematography, sound recording etc.

Usually copyrights are the property of an author. But in the publishing industry, the owner of the copyright may

be the publishing company due to an agreement between the author and the publisher. In some cases, the author

of book will sell the copyright of the contents to another person or company, making the purchased of the

copyright the new owner of the copyrighted material. There is a long list of transferable rights for the written

material which the copyright owner can contract to other parties or individuals when seeking to profit from the

copyrighted material. Sometimes, even though a book is published by a major publisher, the author still owns

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the copyrights. This is because the author can give a license which gives the publisher temporary limited

permission to use the contents or story, instead of a full assignment which permanently transfers all rights to the

book. This is an ideal situation for an author who is willing to authorize an adaptation of his/her book for eg. For

making the book into movies and other commercialization ventures.

There are various ethical issues as follows.

1. Authorship

It is a highly sought attribute, as it is associated with recognition for creativity. In addition, it is associated with

multiple benefits such peer recognition, better evaluation and financial gains. These spur researchers to author

articles/books, but some take recourse to unethical practice of Gift/honorary authorship. Authorships are more

often gifted to colleagues with lower academic rank or to those with fewer publications in last few years, to the

departmental head and to those performing various non-author tasks such as reviewing or approving manuscript

before submission, providing care, recruiting study subjects, supervising or recruiting co-authors and

contributing illustrations. Sometimes the senior colleagues’ greed, insincerity and lazy attitude sabotage efforts

towards having an honest and authentic author list. On the part of junior colleagues, they want to use the

creditability of the seniors for acceptance of their publication at public level. There is another issue i.e.

ghostwriting wherein individuals who write, are not named as authors and are not even acknowledged to be

associated with manuscript. Another issue is that of Guest authorship where reputed and renowned researchers,

authors who have not participated in the conduct of the study or in the manuscript preparation, are enrolled by

the industry to allow their names to be mentioned as authors. This phenomenon is harmful not only because it

suppresses the contribution of ghost-authors but also because these guest authors bestow undeserved credibility

upon industry written papers/books. The readers have no way of knowing the bias that may have crept in.

The journal editors, educational institutions, publishers and the government agencies need to come together to

curb such malpractices by taking various measures like awareness programs, policy making and implementation

and legal standup.

2. Plagiarism

When an author or creator of literary or artistic work submits his/her work purporting to be his/her own, but

which in any way borrows ideas, organization, wording or anything else from another source without

appropriate acknowledgement of the fact, the author or creator is guilty of plagiarism. Plagiarism is basically of

two types – one is deliberate and other one is accidental.

Deliberate Plagiarism occurs when

The author does not give due credit to previous work done in the field but instead presents the previous

work as his or her own idea.

The author does not credit techniques used to conduct the research to the people who developed them.

The opinions and ideas of other are passed off as the author’s

Very often, poor time management or time constraints push a researcher to plagiarize large chunks of material

from other authors, instead of spending time on background research and original writing.

Accidental or Unwitting plagiarism occurs when a careless mistake is made when writing down the references

The researcher does not feel the need to acknowledge the original author of well-known fact,

considering it “common scientific knowledge” For example, global climate change causing rise in sea

level.

There is a cultural difference. For example, junior researchers from certain cultures may feel that it

would not be correct to alter the words used by senior researcher who is na authority in the field.

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There are language problems: non-native speakers of English may not be confident of their ability to

paraphrase another author’s words while still retaining the correct meaning.

The article being paraphrased is a highly technical description, which the researcher feels incapable of

writing in his or her own words. This is especially true for students or inexperienced researchers.

Apart from these, Self-Plagiarism also occurs when

A person has established some articles earlier and then combines them together to make one larger

article or even a book without acknowledging the previous articles.

The author creates salami publications in an attempt to publish different aspects of the same study as

different papers, even if the study would be better presented as one large paper.

Plagiarism is unethical. An accusation of plagiarism can at best, leave the researcher/writer for sloppy and

careless work. At worst, such an accusation can taint the researcher forever, with a reputation for indulging in

scientific fraud. Careful attention should be given when quoting, appropriate paraphrasing and meticulous

acknowledgement of sources will help the researchers avoid accusations of plagiarism.

3. Copyright Infringement

Copyright infringement occurs when copies of copyrighted work are for sale/hire without permission or

authority, like in the case of online piracy. A copyrighted work is performed in a public place. Infringing copies

are distributed for the purpose of trade or personal gains. Infringement is actually classified into two categories-

primary infringement and secondary infringement.

Primary Infringement is the actual act of copying, while Secondary infringement includes unauthorized

dealings like selling the pirated books, importing. In the case of secondary infringement, knowledge is present

with the infringer while in the case of primary infringement, knowledge may or may not be present.

There are certain acts that do not amount to copyright infringement. However, there are certain conditions that

must be fulfilled. These conditions include the use of copyrighted work for research, study, criticism, schools

and legislations. Awareness about copyright infringement and copyright laws is important in a developing

society, as creativity is an essence of growth.

4. Conflict of Interest

Another ethical issue is non-disclosure or non-declaration of conflicts of interest weather it is financial or non-

financial like personal, political, academic, religious institutional that can potentially influence professional

judgement and bias conclusions. For Example, it is necessary to disclose a financial reimbursement from a

company involved in a research project or your spouse working for sponsoring company or publisher. Actually

we all have conflict of interest. There are various opinions regarding this concept. Some experts think declaring

conflicts of interest does not give guarantee about research to be free from any kind internal or external

manipulation. Some say why to declare when such connections are not going actually affect the actual finding of

the research.

There are also other issues regarding research misconduct such as data fabrication, data falsification, and

misrepresentation. They are all threat to all researchers and authors as it puts the trustworthiness their work at

risk. It is a threat to the integrity of research

Historical Overview

In past decade, India has made rapid strides in contributing scholarly content to global research output and

currently accounts for about 88 % of scholarly publications from South Asia. Although there has been visible

spurt in the quantity of scholarly publications from India the average quality of research quality remains low.

Instances of research misconduct, including data fabrication, falsification and plagiarism are plenty. To

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encourage ethical publishing and research behaviour, Association of Publishers in India in collaboration with

other stakeholder organisations including The Federation of Indian Publishers, Indian Reprographic Rights

Organisation, Federation of Indian Chambers of Commerce and Industry and German Book Office launched

guide to ‘Publishing Ethics’ on the occasion of World Book and Copyrights Day.

Conclusion

In current scenario, there is need for the Indian research community to focus on publishing ethics in its stride

towards global recognition in research and innovation. Publishing Ethics are concerned with all of us as readers,

learners, researchers and teachers and affects us all in different aspects weather it is culturally, legally or in

monetary terms. One of the unnoticed reason behind all above mentioned ethical issues is motto to be followed

in today’s competitive world i.e. “publish or perish” This puts pressure on researchers and authors to publish as

many publications in different forms like research papers, journals, books. Publishing business is difficult

business. It is an integral part of the intellectual and cultural system of any country. In order to keep the boat of

creativity floating, interest of creative community of authors and also artists and other stakeholders like

publishers, printing industry owners and society as a whole must learn to respect their intellectual property i.e.

copyrights leading to publishing rights.

References:

https:// en.wikipedia.org/wiki/Ethics

Dr. Vishnu J. Bhandare (2019) “A Research Paper on Unethical Practices and Ethical Challenges in Marketing”

Business and Economics Journal, Vol. 7, issue 4, pp. 1-2.

https://www.sciencedirect.com

API website:http://bit.ly/PublishingEthicsBooklet

https://www.theweek.in

http://www.allaboutbookpublishing.com/2631/intellectual-property-rights-challanges

www.editage.com/insights/plagiarism-in-academic -publishing

Sandeep B. Bavdekar(2012),https://www.ncbi.nlm.nih.gov>pmc

https://www.sciencedirect.com/

http://www.theweek.in/

http://www.allaboutbookpublishing.com/2631/intellectual-property-rights-challanges

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LAWS AND CONVENTIONS RELATED TO IPR IN INDIA

Adv. Deepak S. Pagare

Assistant Professor in Business Law

Siddharth College of Commerce and Economics, Fort, Mumbai-01

Abstract:

Intellectual Property (IP) refers to any type of invention of an individual using creative mind or intellect. It may

be in the form of patents, trademarks, copyrights, geographical indications etc. Such IPs are requiring to be

protected through appropriate legislations from infringement and misuse from ulterior motives of unethical

users. The present article provides an overview of the various laws & conventions dealing with innovation of

Intellectual Property Rights (IPR) in India. The paper has highlighted achievements of new IPR policy 2014 and

has also elaborated key legislations of IPR and measures for strengthening its enforcement. This article is based

on the secondary data and information gathered from research papers published online and related websites.

The conclusion is that IPR protectionis necessary for faster economic growth through stable environment for

domestic and international trade and investment.

Keywords: IPR, Laws, Act, TRIPS; Patent, Copyright, Trade mark

Need of IPR

The progress and well-being of humanity rest on its capacity to create and invent new works in the areas of

technology and culture.

Encourages innovation: The legal protection of new creations encourages the commitment of additional

resources for further innovation.

Economic growth: The promotion and protection of intellectual property supports economic growth,

creates new jobs and industries, and enhances the quality and enjoyment of life.

Safeguard the rights of creators: IPR safeguards creators and other producers of their intellectual

commodity, goods and services by granting them certain time-limited rights to control the use made of the

manufactured goods.

It promotes innovation and creativity and ensures ease of doing business.

It facilitates the transfer of technology in the form of foreign direct investment, joint ventures and

licensing.

Major Treaties & Convention

Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of

Patent Procedure

Paris Convention for the Protection of Industrial Property 1883

Convention Establishing the World Intellectual Property Organization

Berne Convention for the Protection of Literary and Artistic Works 1886

Patent Cooperation Treaty (2001)

Protocol Relating to the Madrid Agreement(1891) Concerning the International Registration of Marks-

Madrid Protocol

Washington Treaty on Intellectual Property in respect of Integrated Circuits

Nairobi Treaty on the Protection of the Olympic Symbol

Convention for the Protection of Producers of Phonograms Against Unauthorized Duplication of Their

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Phonograms

Marrakesh Treaty (2013) to facilitate Access to Published Works by Visually Impaired Persons and

Persons with Print Disabilities.

India and IPR

India is a member of the World Trade Organization and committed to the Agreement on Trade Related Aspects

of Intellectual Property (TRIPS Agreement), 1994. India is also a member of World Intellectual Property

Organization, which is responsible for the worldwide promotion and protection of IPR. These rights are outlined

in Article 27 of the Universal Declaration of Human Rights (UDHR), which provides for the right to benefit

from the protection of moral and material interests resulting from authorship of scientific, literary or artistic

productions .India is also a member of the following important WIPO-administered International Treaties and

Conventions relating to IPRs.

Achievements under new IPR policy

1) Improvement in Global Innovation Index Ranking: India’s rank in the GII issued by WIPO has

improved from 81st in 2015 to 52nd place in 2019.

2) Strengthening of institutional mechanism regarding IP protection and promotion.

3) Clearing Backlog/ Reducing Pendency in IP applications: Augmentation of technical manpower by

the government has resulted in drastic reduction in pendency in IP applications.

4) Automatic issuance of electronically generated Patent and Trademark certificates has also been

introduced.

5) Increase in Patent and Trademark Filings: Patent filings have increased by nearly 7% in the first 8

months of 2018-19 vis-à-vis the corresponding period of 2017-18. Trademark filings have increased by

nearly 28% in this duration.

6) IP Process Re-engineering: Patent Rules, 2003 have been amended to streamline processes and make

them more users friendly. Revamped Trade Marks Rules have been notified in 2017.

7) Creating IPR Awareness: IPR Awareness programs have been conducted in academic institutions,

including rural schools through satellite communication, and for industry, police, customs and judiciary.

8) Technology and Innovation Support Centers (TISCs): In conjunction with WIPO, TISCs have been

established in various institutions across different states.

9) Development of TRIPS compliant regime in India : The WTO expects harmonization of several

aspects of Indian Law relating to IPRs. The TRIPS agreement set minimum standards for protection for

IPR rights and also set a time frame within which countries were required to make changes in their laws

to comply with the required degree of protection. In view of this, India has taken action to modify and

amend the various IP Acts in the last few years.

Key Legislations of IPR

1) The Patent Act 1970

The history of Patent law in India starts from 1911 when the Indian Patents and Designs Act, 1911 was enacted.

The present Patents Act, 1970 came into force in the year 1972, amending and consolidating the existing law

relating to Patents in India. The Patent Act, 1970 has been amended by the Amendment Acts of 1999 and 2002

and 2005.wherein product patent was extended to all fields of technology including food, drugs, chemicals and

micro-organisms. After amendment, the provisions relating to Exclusive Marketing Rights (EMRs) have been

repealed, and a provision for enabling grant of compulsory license has been introduced. The provisions relating

to pre-grant and post-grant opposition have been also introduced. However, it must not fall into the category of

inventions that are non-patentable as provided under sections 3 and 4 of the Indian Patents Act, 1970.Sections

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104 to 114 of the Indian Patents Act 1970 provide guidelines relating to patent infringement. According to

Section 53, the validity of a patent is 20 Years from the date of filing a patent application. Whenever the

monopoly rights of the Patentee are violated, the rights are secured again by the Act through judicial

Intervention. The Patentee has to Institute a suit for infringement.

The relief’s which may be awarded in such a suit are-

1) Interrogatory / interim injunction

2) Damages or account of profits

3) Permanent injunction.

Section 106 of the Indian Patents Act 1970 grants power to the court to grant relief in case of groundless threats

of infringement proceedings. The period of limitation for instituting a suit for Patent infringement is there years

from the date of infringement.

2) Trade Mark Act, 1999

The Trade and Merchandise Marks Act, 1958 has been replaced by the Trade Marks Act, 1999, In India the

trademarks have been protected for over four decades as per the provisions of the Trade and Merchandise Mark

(TMM) Act of 1958. India became a party to the WTO at its very inception. One of the agreements in that

related to the Intellectual Property Rights (TRIPS). In December, 1998 India acceded to the Paris Convention.

Meanwhile, the modernization of Trade and Merchandise Marks Act, 1958 had been taken up keeping in view

the current developments in trading and commercial practices, increasing globalization of trade and industry, the

need to encourage investment flows and transfer of technology, need for simplification of trademark

management system and to give effect to important judicial decisions. To achieve these purposes, the

Trademarks Bill was introduced in 1994, but it lapsed. After a comprehensive review the Trademarks Act, 1999

was passed by which replaced the Trade and Merchandise Mark Act of 1958. The important salient features of

the Act inter-alia include: • It broadens the definition of infringement of a registered trademark to include action

against the unauthorized use of a confusingly similar mark, not only in respect of the goods and services

covered by registration, as was previously the case, but also in respect of goods and services which are so

similar that a likelihood of deception or confusion exists. • An action for infringement will also be available

against the unauthorized use of a mark in relation to dissimilar goods, if such mark is similar to a registered

mark that is well known in India and the interest of the owner is likely to be affected adversely. The remedy for

infringement of a trademark is also strengthened under the new law by authorising the police with the power to

seize infringing articles without a warrant. Sections 29 and 30 of the Act lay down certain provisions for

protecting the registered trademark in case it is infringed on by someone else.

3) Copyright Act, 1957

Copyright in India is governed by Copyright Act, 1957. This Act has been amended several times to keep pace

with the changing times. As per this Act, copyright grants author's lifetime coverage plus 60 years 8 PP-

IPRL&P after death. Copyright and related rights on cultural goods, products and services, arise from individual

or collective creativity. All original intellectual creations expressed in a reproducible form will be connected as

"works eligible for copyright protections". Copyright laws distinguish between different classes of works such

as literary, artistic, musical works and sound recordings and cinematograph films. The work is protected

irrespective of the quality thereof and also when it may have very little in common with accepted forms of

literature or art. Copyright protection also includes novel rights which involve the right to claim authorship of a

work, and the right to oppose changes to it that could harm the creator's reputation. The creator of the copyright

in a work can enforce his right administratively and in the courts by inspection of premises for evidence of

production or possession of illegally made "pirated" goods related to protected works. The owner may obtain

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court orders to stop such activities, as well as seek damages for loss of financial rewards and recognition. The

Copyright Act, 1957 was amended in 1984 and computer programming was included with the definition of

"literary work.' The new definition of "computer programme" introduced in 1994, means a set of instructions

expressed in works, codes or in any other form, including a machine readable medium, capable of causing a

computer to perform a particular task or achieve a particular result. The greatest fear and challenges to the

copyright industry is the piracy of works (books, music, films or computer software etc).

The special nature of infringement of copyrights in computer programmes has again been taken note of by the

Copyright (Amendment) Act, 1994 by inserting a new section 63 B. The new section provides that any person

who knowingly makes use on a computer of an infringed copy of a computer programme will be punishable

with imprisonment for a term of not less than seven days, which may extend to three years and with a fine of not

less than ` 50,000/- and which may extend to ` 2,00,000/-. Provison to section 63B, however, provides that

where computer programme has not been used for gain or in the course of trade or business, the court may at its

discretion and for reasons mentioned in the judgement not impose any sentence of imprisonment and impose

only fine upto 50,000/-. The Copyright (Amendment) Act, 1999 makes it free for purchaser of a

gadget/equipment to sell it onwards if the item being transacted is not the main item covered under the

Copyright Act. This means computer software which is built in the integral part of a gadget / equipment can be

freely transacted without permission of copyright owner.

This amendment also ensures fair dealing of 'broadcasting' gaining popularity with the growth of the Internet.

With this amendment India has updated the Act to meet the concerns of the copyright industries mainly

consisting of Book, Music, Film and Television, Computer and Database Industries. The Copyright Act, 1957

amended in 2012 with the object of making certain changes for clarity, to remove operational difficulties and

also to address certain newer issues that have emerged in the context of digital technologies and the Internet.

Moreover, the main object to amendments the Act is that in the knowledge society in which we live today, it is

imperative to encourage creativity for promotion of culture of enterprise and innovation so that creative people

realize their potential and it is necessary to keep pace with the challenges for a fast growing knowledge and

modern society.

Other laws

The following laws have been enacted to protect newly recognized species of intellectual property in India:

1) The Geographical Indications of Goods (Registration and protection) Act, 1999;

2) The Semiconductor Integrated Circuits Layout-Design Act, 2000;

3) The Protection of Plants & Varieties and Farmers Rights Act, 2001; and

4) The Biological Diversity Act, 2002

5) The Designs Act of 1911 has been completely replaced by the Designs Act of 2000.

Measures to Strengthen the Enforcement of IP Laws

Number of measures to strengthen the enforcement of copyright law has been taken by the Government of India.

The summary of the same is as follows:

1. The Government has brought out A Handbook of Copyright Law to create awareness of copyright laws

amongst the stakeholders, enforcement agencies, professional users like the scientific and academic

communities and members of the public.

2. National Police Academy, Hyderabad and National Academy of Customs, Excise and Narcotics conducted

several training programs on copyright laws for the police and customs officers.

3. The Department of Education, MHRD, Government of India has initiated several measures for strengthening

the enforcement of copyrights, like constitution of a Copyright enforcement Advisory Council (CEAC),

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creation of separate cells in state police headquarters, encouraging setting up of collective administration

societies and organization of seminars and workshops to create greater awareness of copyright laws among

the enforcement personnel and the general public.

4. Special cells for copyright enforcement have so far been set up in 23 States and Union Territories, i.e.

Andhra Pradesh, Assam, Andaman & Nicobar Islands, Chandigarh, Dadra

Conclusion

Today, possession of land, labor and capital are just not enough for a country to succeed. Creativity and

innovation are the new drivers of the world economy. The policies adopted by a country shall determine the

nation’s well-being. Development of a country’s intellectual capital is the most important task. An effective

intellectual property rights system lies at the core of the country’s development strategies. Within the knowledge

based, innovation driven economies, the intellectual property system is a dynamic tool for wealth creation,

providing an incentive for enterprises. It is also good for a stable environment for domestic and foreign

investments. Although India has complied with the obligations of TRIPS by amending its IP laws, certain issues

still remain. And there is a need for a constant thinking over the core issue of IP protection, in order to respond

to situations arising out of global competition. Government’s effort to strengthen National IPR policy, IP

appellate tribunal, e-governance and commitment to abide by the TRIPS agreement of WTO in letter and spirit

will help in improving perception of India globally.

References:

https://www.drishtiias.com/to-the-points/paper3/intellectual-property-rights

https://www.atu.edu/jbao/spring2005/MangalSpring2005.pdf

http://www.nja.nic.in/Concluded_Programmes/2017-18/P-1048_PPTs/1.IPR%20in%20India.pdf

https://www.drishtiias.com/to-the-points/paper3/intellectual-property-rights

https://www.atu.edu/jbao/spring2005/MangalSpring2005.pdf

http://www.nja.nic.in/Concluded_Programmes/2017-18/P-1048_PPTs/1.IPR%20in%20India.pdf

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AWARENESS OF IPRS AMONG UG COMMERCE LEARNERS: A STUDY

Dr. Hema Pranav Mehta

Assistant Professor (Business Law)

Tolani College of Commerce, Andheri-East, Mumbai-400093.

Abstract :

The need of an hour today is felt that, IPR is playing a key role in gaining and creative competitive advantage in

terms of overall gains for achieving higher economic growth in a market oriented economy. It is felt that today’s

generation requires IPR’s greater understanding and attention by the University, industry, particularly the

students, start-ups, Research scholars. In today’s’ knowledge based economy; one need to be competitive and

relevant there is always the constant need to be updated for research and innovation.

Intellectual Property Rights helps in generating the free flow of knowledge and information by sharing the

protected know-how critical to the original ideas. In turn, this will lead to process of new innovations and

improvements in existing original ideas. Bringing various important and diverse points together is the fact that

protects IPR. These rights are accepted and embraced by various sectors of industry—small, medium and large

companies alike—and by various labour organizations, consumer groups, and other trade association1. Since

research and development are highly demanded in commercial world, industry expects Commerce program

students to have research as a part of their academic completion, benefits awareness on IPR and its benefits .

Hence an attempt is made in this paper to see the extent of benefits awareness on IPR and its related concepts

and applications among them.

Key words: IPR, awareness, research and innovation, Commerce program students

Introduction

For an overall development of a country i.e to have sustainable and economic growth,, innovation, creativity,

novelty and uniqueness is a very important dimension. Today industries and the global markets are greatly

dependent on the intellectual property rights protection as it is one of the vital public policy. By the mid-1990s, a

minimum global standard for IPR awareness and consciousness had been preserved in the WTO Charter through

the incorporation of the Agreement on Trade-Related Aspects of Intellectual Property Rights and its related

aspects.

The biggest issue of controversy lies in the genuine implementation of the transfer in international economic

policy and the lowering of tariffs and nontariff trade related barriers to the embrace of strong IPR.

Intellectual property rights (IPR) are lawful claims and rewards settled by governments inside their significant

powers that award trademark, licenses and proprietors of copyright the elite option to misuse their protected

innovation for a specific period. The central right for protecting IPR is to give a motivator to advance by giving

IP proprietors a chance to recover their innovative work costs. With the quick change in innovation and social

drivers, the presentation of the Intellectual Property Rights has gotten progressively significant as it gives a

legitimate and strategy toolbox to empower advancement, invigorating speculations required to create, advertise

new developments and spreading innovation. Notwithstanding, certain policymakers, nongovernmental

associations, researchers and others have questioned on the jobs of IPRs in the 21st century and furthermore

whether its full usage may be expensive to creating countries.

1 https://www.theglobalipcenter.com/why-is-ip-important/

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Research Objectives

The study has been conducted mainly to:

1. To study and understand whether the UG Commerce learners have heard about their Intellectual Property

Rights

2. To study and understand whether the UG Commerce learners have knowledge and understanding of IPR for

them.

3. To study and understand whether the UG Commerce learners would like to join a short term course for

upgrading their knowledge of the various IPR related laws.

Significance of the study

The present study deals with the awareness level amongst UG Commerce learners emphasising on their IPR . It

is clearly evident in this study that knowledge and awareness of learners is highly dependent to their level of

education. This study also revealed that the learners have heard about the various types of IPRs but don’t have

proper or thorough understanding in depth of the same. UG Commerce learners are found to be more alert and

keen to know about their rights and opportunities. It is not that they have failed to realise the significance of

intelligence and creativity for moving forward. Education is the strong instrument for ensuring everyone’s

empowerment. It helps in imparting important knowledge and information necessary for transforming socio-

economic-political status of learners particularly in positive direction which ultimately leads to growth. The study

shows that more or less awareness of various IPRs are existing. Awareness can lead these learners towards

upward direction, capable of planning, sorting, making decisions, organizing, implementing, managing and

carrying out activities, to deal with situations. It is truly said that empowerment is a process of awareness and

capacity building leading to greater participation, to greater decision making power, control and to transformative

action2&3.

Limitations of the study

This examination does not address in-depth knowledge of IPR, it endeavours to totally perceive how the IPR and

it related provisions and their fundamentals are well understood to empower themselves and to be proactive in

the uncertain world. The study is restricted to the B.Com undergraduates’ from our own Institution, Tolani

College of Commerce, Andheri-East and it is basically covering only some types of Intellectual Property Rights-

Copyright, Patent Right, Trademark and Geographical Indicators.

Generally Known IPRs

Copyright

For the needs of this Act, "copyright" means the prerogative subject to the provisions of this Act, to try or

authorise the doing of any of the subsequent acts in respect of a piece or any substantial part thereof, namely4--

(a) within the case of a literary, dramatic or musical work, not being a program ,--

(i) to breed the add any material form including the storing of it in any medium by electronic means;

(ii) to issue copies of the work to the general public not being copies already in circulation;5

(iii) to perform the add public, or communicate it to the public;

(iv) to form any cinematograph film or audio recording in respect of the work;

(v) to form any translation of the work;

2 http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.1028.1393&rep=rep1&type=pdf 3http://questjournals.org/jrhss/papers/vol3-issue10/C3101419.pdf 4 https://www.taxdose.com/meaning-of-copyright/ 5 http://www.legalserviceindia.com/legal/article-947-the-doctrine-of-first-sale-in-indian-copyright-law.html

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(vi) to form any adaptation of the work;

(vii) to try , in reference to a translation or an adaptation of the work, any of the acts laid out in reference

to the add sub-clauses (i) to (vi);

(b) within the case of a computer programme:

(i) to try any of the acts laid out in clause (a);

[(ii) to sell or give on commercial rental or offer purchasable or for commercial rental any copy of the

pc programmer:

Provided that such commercial rental doesn't apply in respect of computer programmes where the programme

itself isn't the essential object of the rental.]6

(c) within the case of an inventive work,--

[(i) to breed the add any material form including--

(A) the storing of it in any medium by electronic or other means; or7

(B) depiction in three-dimensions of a two-dimensional work; or

(C) depiction in two-dimensions of a three-dimensional work;]

(d) within the case of a cinematograph film,--

[(i) to form a replica of the film, including--

(A) a photograph of any image forming part thereof; or

(B) storing of it in any medium by electronic or other means;]8

[(ii) to sell or give on commercial rental or offer purchasable or for such rental, any copy of the film.]9

(e) within the case of a audio recording ,--

(i) to form the other audio recording embodying it 6[including storing of it in any medium by electronic or

other means];

[(ii) to sell or give on commercial rental or offer purchasable or for such rental, any copy of the sound

recording;]

(iii) to speak the audio recording to the general public .

Explanation.--For the needs of this section, a replica which has been sold once shall be deemed to be a

replica already in circulation].

Patent Right

Patent means protected by a government issued right allowing someone to make and sell a product or service for

a certain amount of years without anyone being allowed to copy it.10&11

A patent is an exclusive right granted for an invention, which is a product or a process that provides, in general, a

new way of doing something, or offers a new technical solution to a problem.12 To get a patent, technical

6https://books.google.co.in/books?id=Y5nYlNf5yLgC&pg=PA104&lpg=PA104&dq=%22Provided+that+such+commercia

l+rental+does+not+apply+in+respect+of+computer+programmes+where+the+programme+itself+is&source=bl&ots=nZX

LouP3Zu&sig=ACfU3U1O50HevY2E1BtSiJDq3d56l_r8Fg&hl=en&sa=X&ved=2ahUKEwju0NO7qt_nAhWbf30KHZaZ

CLAQ6AEwAXoECAoQAQ 7 http://copyright.gov.in/Copyright_Act_1957/chapter_iii.html 8 http://copyright.gov.in/Copyright_Act_1957/chapter_iii.html 9 https://in

http://copyright.gov.in/Copyright_Act_1957/chapter_iii.htmldiacode.nic.in/handle/123456789/1367?view_type=browse&s

am_handle=123456789/1362

10 http://us-patent.info/news-and-events/news_science_us_patent/patent-dictionary-definition-patent-defined/ 11 https://www.wipo.int/patents/en/faq_patents.html 12 https://www.wipo.int/patents/en/

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information about the invention must be disclosed to the public in a patent application. In principle, the patent

owner has the exclusive right to prevent or stop others from commercially exploiting the patented invention. In

other words, patent protection means that the invention cannot be commercially made, used, distributed, imported

or sold by others without the patent owner's consent.13& 14

Trademark

Trademark assurance is accessible for specific names, images, gadgets, or words that will be utilized regarding a

decent or administration. In fact, if a specific imprint is related with an assistance, it is known as an "administration

mark," yet trademark is regularly used to allude to the two imprints related with administrations and products.

The reason behind trademarks is to permit organizations and people to show the wellspring of their products or

administrations and to recognize them from others in the business.

A trademark does not just gives the trademark proprietor the selective option to utilize the imprint yet in addition

permits the proprietor to keep others from utilizing a comparable imprint that can be mistaking for the overall

population. A trademark can't, notwithstanding, keep someone else or organization from making or selling similar

products or administration under an unmistakably unique imprint. Rights to an imprint can be set up through the

genuine utilization of the imprint in a business or business setting.

At the point when an individual cases the rights to a specific imprint, the person is permitted to utilize "TM" (for

a trademark) and "SM" (for an assistance mark) to assign that the imprint is trademarked. The image "®" assigns

government enrolment and can in this manner just be utilized after the USPTO registers the imprint, which means

the image can't be utilized when an application is pending. What's more, the ® image may just be utilized with

products as well as administrations that were recorded in the government trademark application.15

Geographical indicators

A geographical indication (GI) is a sign utilized on items that have a particular land birthplace and have

characteristics or a notoriety that are because of that beginning. So as to work as a GI, a sign must recognize an

item as starting in a given spot. Moreover, the characteristics, attributes or notoriety of the item ought to be

basically because of the spot of source. Since the characteristics rely upon the geological spot of creation, there is

an unmistakable connection between the item and its unique spot of.16 & 17

Geographical indications are typically beneficial for agricultural products, foodstuffs, wine and spirit drinks,

handicrafts, and industrial products and services too.

Methodology

Data was collected using primary and secondary methods. A structured close ended

Questionnaire of questions relating to 4 types of IPR was distributed and 200 valid

questionnaires were returned. The source of the data is questionnaires filled by and were

received from respondents who were learners of second year of B.Com.

Hypotheses

(1) Ho1 = UG Commerce learners have not heard about Intellectual Property Rights

H11 = UG Commerce learners have heard about Intellectual Property Rights.

(2) H02 = UG Commerce learners have no knowledge and understanding of IPR for them.

H12 = UG Commerce learners have knowledge and understanding of IPR for them.

13 https://www.wipo.int/patents/en/ 14 https://medium.com/@hargup/what-is-copyright-1014adb9c63 15 https://smallbusiness.findlaw.com/intellectual-property/what-is-a-trademark.html 16 https://www.wipo.int/geo_indications/en/ 17 https://raza-associates.com/geographical-indication-bill-passed-by-senate-committee-of-pakistan/

https://www.wipo.int/patents/en/

https://smallbusiness.findlaw.com/intellectual-property/what-is-a-trademark.html

https://www.wipo.int/geo_indications/en/

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(3) H03 = UG Commerce learners would not like to join a short term course for upgrading their knowledge of

the various IPR related laws.

H13 = UG Commerce learners would like to join a short term course for upgrading their knowledge of the

various IPR related laws.

Data and Source of Data Collection

The study is focusing on primary data, secondary data and the research approach is quantitative research

approach. The research is used to analyse the data for understanding whether the learners having heard and

having knowledge and understanding of various IPRs understudy. The source of the data was questionnaire filled

by B.Com undergraduates to analyse the objectives of the research. Google form of questionnaire was shared

and 200 duly filled forms were received from respondents who were learners of class second year of B.Com.

This study took a period of 1 month from January 2020 to February 2020.

Analysis:

Table.1 : Responses to know whether the respondents had heard about various IPRs.

Sr.

No

Questions

Responses Percentage

Yes No Yes No

1. Have you faced any issues of being cheated

for your original work in your life?

160 40 80% 20 %

2. As a learner, do you know about the laws that

are set up to protect your intelligence and

creativity?

75 125 37.5% 62.5%

3. Have you heard of the Copy Right ? 50 150 25% 75%

4. Have you heard of the Patent Right? 40 160 20% 80%

5. Have you heard of the Trademarks? 80 120 40% 60 %

6. Have you heard of the Geographical

Indicators?

40 160 20% 80%

Fig.1. Study of responses to know whether the respondents had heard about various IPRs.

Table 2. Responses for knowing whether the respondents had knowledge and understanding of IPRs.

80%

37.50%25% 20%

40%

20%20%

62.50%75% 80%

60%

80%

0%10%20%30%40%50%60%70%80%90%

Have you facedany issues of

being cheatedfor your original

work in yourlife?

As a learner, doyou know about

the laws thatare set up toprotect your

intelligence andcreativity?

Have you heardof the Copy

Right ?

Have you heardof the Patent

Right?

Have you heardof the

Trademarks?

Have you heardof the

GeographicalIndicators?

Percentage Yes Percentage No

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Sr.

No

Question on whether they had

knowledge and understanding of

Responses Percentage

Yes No Somewhat Yes No Somewhat

1. Copyright Act, 1957 20 120 60 10% 60% 30%

2. Patent Act , 1970 20 150 30 10% 75% 15%

3. Trademark Act, 1999 20 140 40 10% 70% 20%

4. Geographical Indicator Act,

1999

20 160 20 10% 80% 10%

Table.3. Responses to know if a short term course is started for bringing awareness in learners, are they

willing to join for enhancing their knowledge

Sr.

no

Question Responses Percentage

Yes No Yes No

1. If a short term course is started for

bringing awareness in yourself, are you

160 40 80% 20%

10% 10% 10% 10%

60%

75%

70%

80%

30%

15%

20%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Fig.2. Study of responses for knowing whether the respondents had

knowledge and understanding of IPRs.

Percentage Yes

Percentage No

PercentageSomewhat

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willing to join for enhancing your

knowledge

Findings

Sr. No Hypotheses Conclusion

1. Ho1 = UG Commerce learners have not heard about Intellectual

Property Rights

Rejected

H11 = UG Commerce learners have heard about Intellectual

Property Rights.

Accepted

2. H02 = UG Commerce learners have no knowledge and

understanding of IPR for them.

Accepted

H12 = UG Commerce learners have knowledge and understanding

of IPR for them.

Rejected

3. H03 = UG Commerce learners would not like to join a short

term course for upgrading their knowledge of the various IPR

related laws.

Rejected

H13 = UG Commerce learners would like to join a short term

course for upgrading their knowledge of the various IPR related

laws

Accepted

Conclusions

The best need of great importance is change of social frame of mind to learners and to make her mindful of her

privileges. "At the point when learners is actively involved, the family moves, the town moves and the country

moves"18. It is fundamental as their idea and their worth frameworks lead to the improvement of a decent

18 https://www.smartsparrow.com/what-is-active-learning/

80%

20%

Fig.3. Study of responses to know if a short term

course is started for bringing awareness in learners

and their willingness to join for enhancing their

knowledge

Percentage Yes Percentage No

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family, great society and at last a decent country. The most ideal method for strengthening is maybe through

enlisting learners in the standard of improvement. Learners strengthening will be genuine and powerful just when

they are enriched with salary and property with the goal that they may remain on their feet and develop their

personality in the general public. The Empowerment of Learners has gotten one of the most significant worries

of 21st century at national level as well as at the universal level. Government activities alone would not be

sufficient to reach towards this objective. Society must step up to the plate and make an atmosphere where there

is no ignorance and isolation of an individual in exercising his/ her creativity and intelligence and learners have

full chances of self-basic leadership and taking part in social, political and financial existence of the nation with

a feeling of fairness and by being completely mindful of her different rights and lawful mindfulness.

Suggestions

1. As a matter of fact emphasising on delivering training of learners, which forms the grassroots issue.

Consequently, training and education for learners must be given extraordinary consideration along with the

deep awareness of their various rights.

2. Mindfulness programs should be sorted out for educating and updating learners about particularly having a

place with flimsier areas about their privileges.

3. Learners have to be permitted to work and must be given enough wellbeing and backing to work. They ought

to be furnished with appropriate wages and work at standard with men so their status can be raised in the

general public.

4. Severe execution of Programs and Acts ought to be there to control the mal-rehearses common in the general

public.

5. Short term courses to create awareness on the above acts understudy can be started for learners.

Web bibliography 1 https://www.theglobalipcenter.com/why-is-ip-important/

http://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.1028.1393&rep=rep1&type=pdf 1http://questjournals.org/jrhss/papers/vol3-issue10/C3101419.pdf 1http://www.legalserviceindia.com/legal/article-947-the-doctrine-of-first-sale-in-indian-copyright-law.html 1https://books.google.co.in/books?1 http://copyright.gov.in/Copyright_Act_1957/chapter_iii.html 1 http://copyright.gov.in/Copyright_Act_1957/chapter_iii.html 1https://in

http://copyright.gov.in/Copyright_Act_1957/chapter_iii.htmldiacode.nic.in/handle/123456789/1367?vie

w_type=browse&sam_handle=123456789/1362 1 http://us-patent.info/news-and-events/news_science_us_patent/patent-dictionary-definition-patent-defined/ 1 https://www.wipo.int/patents/en/ 1 https://www.wipo.int/patents/en/ 1 https://smallbusiness.findlaw.com/intellectual-property/what-is-a-trademark.html 1 https://www.wipo.int/geo_indications/en/ 1https://raza-associates.com/geographical-indication-bill-passed-by-senate-committee-of-pakistan/

https://www.smartsparrow.com/what-is-active-learning/

https://medium.com/@hargup/what-is-copyright-1014adb9c63

https://www.taxdose.com/meaning-of-copyright/

https://www.wipo.int/patents/en/faq_patents.html

http://www.legalserviceindia.com/legal/article-947-the-doctrine-of-first-sale-in-indian-copyright-law.html

https://www.wipo.int/patents/en/

https://smallbusiness.findlaw.com/intellectual-property/what-is-a-trademark.html

https://www.wipo.int/geo_indications/en/

https://www.smartsparrow.com/what-is-active-learning/

https://www.taxdose.com/meaning-of-copyright/

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IMPACT OF PATENT LAW ON ECONOMIC GROWTH OF INDIA

Dr. Rama Dayashankar Varma

Assistant Professor

B M Ruia Girls’ College

Abstract :

The term "patent" refers to the monopoly right over an invention. Patent is one of the most effective of

intellectual properties to achieve economic development. The innovation theory of business cycles is related to

the name of Joseph Schumpeter, who says that new changes in the structure of the economy are the source of

economic fluctuations. Such innovations that are the center of economic development, the role of patents

become important in economic development. The purpose of patent rights is to promote innovation and

economic development.

In this paper, we will talk about the impact of the Patents Act on India. Also, we will discuss patent challenges.

A detailed description of the patent status in India is given in this research paper.

Key Words : Patent, Economic Growth, Trade Related Aspect of Intellectual Property Rights TRIPS ,

challenges.

Review of Literature :

Gupta, V.K. (2000) analyzes trends in patent filing, by India in USA, post WTO activities. He indicates

contribution of CSIR as a leading organization in filing patents

in India, as well as USA. The private sector firms in area of drugs and pharmaceuticals have taken lead in filing

patents in USA. He has also highlighted the trend in patent filing during the period from 1989 to 1999 and listed

the organizations leading in patent filing. The leading subject area was chemical industries.

Debbarman, S (2008) Collected Indian Patent filing data from the Annual reports of the Controller General of

Patents, Design and Trademarks and has analyzed the Indian Patents‟ contribution. He has noticed that there is

an increase in the patent filing activity in India. The study also indicated that Maharashtra, Delhi and Tamil

Nadu are the leading states in patent filing in India. USA, Japan, and Germany are leading countries, in patent

filings in India in the NRI sector. Along with the prime subjects, Chemical Sciences, Biotechnology, Computer

and Electronics are the emerging areas in patent filing. The data has been collected for the period from 1995 to

2005.

Jayaraman, T. (2009) discusses in his paper, issues related to development of S & T

policies in India and S & T output in terms of publications. He compares the publication cited in SCI among

five countries, India, China, Korea, Brazil and Israel from 1980 to 2000. He has also studied patenting activity

in India and progress made by Indian companies in filing patents. A comparison of Patents filed by Indians and

foreign residents is well illustrated in his paper.

Objectives:

To study the concept of Patent Act.

To analyze patent related inequality in various states of India.

To study Impact of Patent in India.

To know the challenges of Patent in India.

Methodology:

This research paper is based on secondary data. The secondary data has been collect by various website, articles,

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journals and reports of various ministries.

Introduction :

In modern times, a patent is an intellectual property right granted to an inventor on an invented new product or

process. Under such a fixed-term monopoly, he is able to recover the costs incurred in his invention and earn

economic benefits from that invention. Hence it was considered necessary so that people and industrial

companies could be inspired to invent. Generally, a new invention requires a longer time and higher cost, so

giving such protection to inventors through patents and giving them a monopoly of commercial exploitation of

new products and processes for a period of time is a major obligation of the modern government system. has

been made .

The Agreement on Intellectual Property Rights on the Trade Related Aspect of Intellectual Property Rights

(TRIPS) is an important and comprehensive international agreement. The member countries of the World Trade

Organization (WTO) are automatically deemed to be involved in this agreement. The agreement covers most of

the provisions of intellectual property. It also includes patents, copyrights, trademarks, geographical indications,

industrial design, trade secrecy and exclusionary rights on new plant species. It came into force from 1 January

1995 and it is mandatory for all member countries of the World Trade Organization ((WTO) to consider it. The

basic objective of granting intellectual property rights is to encourage human intellectual creativity. Due to the

wide scope of intellectual property rights, it was considered necessary that arrangements should be made for the

specific area for its relevant rights and related rules etc. On this basis, these rights can be classified into the

following forms

1) Copyright

2) Patent

3) Trademark

4) Industrial design

5) Geographical indicator

The first Indian Patent and Design Act was enacted in 1911 in India. After the independence again, the Patents

Act was formed in 1970 and it was implemented from the year 1972. The Act was amended by the Patents

(Amendment) Act, 2002 and the Patents Act has been amended repeatedly: 1999, 2002, 2005, 2006. These

amendments were necessary to conform to the Patent Act trips.

Major amendments were made in 2005, when product patents were extended to all areas of technology such as

food, drugs, chemicals, and microbes. 2005 was the deadline for full compliance with TRIPS. The rules were

amended in 2012, 2013, 2014 under the Patents Act. From the year 2005, India also started patenting on

medicines. The administration of the patent system in India is subject to the 'Controller General of Patents,

Designs, Trademarks and Geographical Indicators'. At present, the World Trade Organization has extended the

period of patent application to 20 years, which used to vary from country to country. There has been an increase

in the number of Indian patent applications filed in recent times as compared to previous years and consequently

the economy has grown. The government implemented the National IPR Policy in 2016. This paved the way for

strengthening IPR in the country. This led to an increase in the number of IP filings during the last five years.

Currently well-established multinationals in India have clearly proved the impact of intellectual property for the

development of the economy in the world.

India is a developing country and its emerging market is beneficial for other countries. Significantly, a patent is

beneficial for the profit of big companies. Therefore, we should register a large number of patents like China

and relax rules to the optimum level so that research and inventions are not limited to just a few hands.

As a result of Indian patent law, many multinationals started investing in India. Multinationals also started their

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research and

development process in India, which has indirectly boosted India's economic growth and provided employment

to the people of India.

Table No. 1. Trends in Patent Applications

Year 2013-14 2014-15 2015-16 2016-17 2017-18

Filled 42,951 42,763 46,904 45,444 47,854

Examined 18,615 22,631 16,851 28,967 60,330

Granted 4,227 5,978 6,326 9,847 13,045

Disposal 11,411 14,316 21,987 30,271 47,695

Source : Office of the controller General of Patents, Designs & Trademarks, Geographical indications.

The growing importance of patents in India is becoming evident in the table No. The rate of obtaining patents is

increasing every year.

Table No. 2 Patent filled in India in 2018-19

Indian Applicant No. Of Patent

IITs (Combined) 557

Chandigarh University 336

ITC 239

Council of Scientific & Industrial Research

(CSIR)

202

Bharat Heavy Electricals (BHEL) 173

Source : Office of the Controller General of Patents, Designs & Trademarks.

Patent filings and grants in India are dominated by foreign applicants: they filed two-thirds of applications in

2018-19, and got four-fifths of patent grants, according to the Office of Controller General of Patents, Designs

and Trade Marks. In India, Qualcomm, the US chipmaker, topped both patent filings and grants in 2018- 19.

According to the World Intellectual Property Organization (WIPO), India's patent registration is much lower

than the US and China. In a year, more than one lakh patents are registered in the US and China, while in India

about two thousand. In 2018, the top five countries in the world in terms of the most applications for

international patents - America, China, Japan, Germany and South Korea respectively. China leads the world in

terms of domestic patents.

There is a disparity in the number of patent applications in various states in India, in Table No.3, Maharashtra

rank is shown in first place, Himachal Pradesh has only 110 patent applications. This variation among states

indicates that the importance of patents has been understood in most developed states. Backward states still

require considerable awareness of patents.

Table No. 3 Applications filed by Indian applicants 2018-19(State-wise)

Sr. No. State No. Of Applications

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Source : Office of the Controller General of Patents, Designs & Trademarks.

Challenges :

The law states that a patent will be granted only on a new discovery. But patent authorities do not know

if information is available in the past? Just as the properties of neem and turmeric were patented.

The number of patent applications is increasing in India, but its acceptance rate is very low. In the case

of patents, there is still no atmosphere in the country that can make it included in the top countries of the

world.

The number of applications is high and the number of supervisors examining them is small. Obviously,

this also affects the quality of patents accepted.

The Patent Department currently falls under the Ministry of Commerce and Industry, whose patent issue

is probably not taken as seriously as in the heavy and complex government machinery.

Common people do not know the technical writing of patent applications and patent attorneys charge a

lot in exchange for search and writing, which is not possible for most of the individual inventors here.

The large number of pending applications indicate that this is the main challenge before our system of

granting patent rights.

1. Maharashtra 3744

2. Tamil Nadu 2737

3. Karnataka 1971

4. Delhi 1419

5. Telangana 947

6. Uttar Pradesh 719

7. Gujarat 702

8. West Bengal 533

9. Haryana 444

10. Kerala 308

11. Andhra Pradesh 271

12. Punjab 247

13. Madhya Pradesh 190

14. Rajasthan 186

15. Jharkhand 168

16. Orissa 164

17. Uttarakhand 128

18. Himachal Pradesh 110

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Conclusion :

India is still not fully awakened to the importance of intellectual property rights (IPRs), particularly patents and

their commercial implications. Intellectual property administration also needs to be made transparent and agile.

Private sector participation in research and development in India is very low and the main reason for this is the

weak intellectual property rights system of India. The Industrial Development Organization of the United

Nations has proved through a study that economic growth has taken place rapidly in countries whose

intellectual property rights system is well-organized. Therefore, there is an urgent need for improvement here.

India needs to make the Controller General of Patents, Designs, Trademarks and Geographical Indicators tight

and fit. Our system of granting patent rights should be reformed and hearing of applications should be made

mandatory within a certain time.

References :

Debbarman, S. (2008). A bibliometric study of Indian Patent applications from 1995 to 2005. Annals of Library

and Information studies , 56(June), 153-163.

Gupta, V. K. (2000). Trends in post WTO patenting by India in USA. Current Science, 73, 955-959.

Jayaraman, T. (2009). Science, Technology, and Innovation Policy in India under Economic Reform: A Survey.

Accessed at

http://www.networkideas.org/ideasact/jan09/PDF/Jayaraman.pdf . (Accessed on 3 March 2010).

http://www.ipindia.nic.in/patents.htm

https://ipindiaservices.gov.in/PublicSearch/

https://m-economictimes

http://www.ipindia.nic.in/patents.htm

https://ipindiaservices.gov.in/PublicSearch/

https://m-economictimes/

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INTELLECTUAL PROPERTY RIGHTS AND THE INDIAN PHARMACEUTICAL INDUSTRY

Dr. Sunil Y. Gaikwad

Dept. of Economics, Siddharth College of Commerce & Economics, Mumbai

Abstract :

Intellectual property rights (IPR) have been defined as ideas, inventions, and creative expressions based on

which there is a public willingness to bestow the status of property. IPR provide certain exclusive rights to the

inventors or creators of that property, in order to enable them to reap commercial benefits from their creative

efforts or reputation. There are several types of intellectual property protection like patent, copyright,

trademark, etc. Patent is recognition for an invention, which satisfies the criteria of global novelty, non-

obviousness, and industrial application. IPR is prerequisite for better identification, planning,

commercialization, rendering, and thereby protection of invention or creativity. Each industry should evolve its

own IPR policies, management style, strategies, and so on depending on its area of specialty. Pharmaceutical

industry currently has an evolving IPR strategy requiring a better focus and approach in the coming era.

Key Words: IPR, Patent, designs, trademarks, Pharmaceutical Industry.

1.Introduction :

The Indian IPR section is grossly categorized into patents, designs, trademarks, and geographical indices

if we see the history of Indian “IPR” section, it can be divided into

three definite eras: pre-independence, post-independence (before Trade Related Aspects of

Intellectual Property Rights or TRIPS), and post-independence (after TRIPS) era.

Intellectual property rights, especially patents, are highly comprehensive documents which allow inventors to

register their inventions at the national and international level for all particular length of time. Patents are

very important and valuable in the process of knowledge

production and knowledge commercialization. Pharmaceutical patents are important for the

advancement of research. Patent protection for pharmaceutical products is important as compared to other

industries. Pharmaceutical Industry in Indian become globally viable through the world in present scenario

because of their manufacturing capabilities with quality and cost-efficiency of production capacity and

upgrading research and development capabilities for new drugs and associated activities such as clinical

trials and contract manufacturing.

2. Pre-independence era:

In India, the history of IPR dates back to pre-independence era. In 1856, India witnessed the first legislation

regarding patent (Act VI), which was subsequently replaced in 1857 and 1859. In 1872, the act was renamed

as “The Patterns and Designs Protection Act.” The 1911 act (Act II) replaced all previous acts which

bought patent administration under the “controller of patents,” which was further amended in 1920, 1930, and

1945

3. Post-independence era (before TRIPS):

In the post-independence era, generally, multinational companies governed Indian medicine market. The drugs

were imported at a higher cost, and in terms of drug price, India ranked among the highest priced nations in the

world. It was seen that the old “Indian Patents and Designs Act, 1911” was not fulfilling the requirements of

the Indian population . Hence, Justice Dr. Bakshi Tek Chand committee was constituted for a detailed

evaluation of the pros and cons of the Indian patent system. The committee rightly pointed out that the patent

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act should contain clear recommendation to ensure Indian population's needs with regard to food, medicines,

and medical devices and these should be made available to public at the 2cheapest price commensurate, at the

same time honoring patentee with a reasonable compensation. These recommendations are the basis of two

major changes; the 1950 (Act XXXII of 1950) amendment (emphasis on working of inventions and

compulsory license [CL]/revocation) and the 1953 bill (Bill No. 59 of 1953).

4. Primary patent:

Patents are usually filed already during the research phase in the development of a new drug, in the

pharmaceutical industry are called primary patents. In that primary patent, patents give on the active ingredients.

These early patents are filed to protect potential active ingredients that form the basis of the new drug. Since the

early stages of drug development are characterized by an enormous amount of uncertainty that 1 in 5,000-

10,000 test active ingredients results in a successful drug, early patent filings in this, in that case, many of these

filings will either not be pursued, or if granted, will never be related to a marketed drug.

5. Secondary patents:

After drug development, patents are filed on other aspects of active ingredients such as different dosage forms,

formulations, and production methods.

6. Criteria of patentability:

Some requirements should be full filled during patent application, to achieve the status of a patent. Broadly, the

invention itself has to meet three main requirements: (i) Novelty, (ii) inventive step, and (iii) industrial

applicability (needless to say that deadlines and fees might apply). The first requirement, novelty, means that

only new inventions can be patented. If an invention is publicly disclosed before a patent application is

filed, it will not be able of protection. This previous disclosure is known as either prior art or state of the art of

the technological field. The second requirement by definition is reached whenever an invention is not obvious

to someone with a good knowledge and experience in the corresponding

technical field. Finally, the requirement of industrial applicability implies the invention to be possible to be

carried out in practice. The invention lies in one of the following categories: (i) Products, (ii) processes or

methods, and (iii) machines.

7. Challenges of the Current Indian Patent System:

Effect of product patent on Indian pharmaceutical sector:

As Indian patent system was a “Process patent-” driven system, the transition to “product patent”

system was expected to be devastating to the pharmaceutical industry, and the early reaction was full of panic.

The expected outcomes were “unexpected rise in drug price” and subsequent destruction of Indian

Pharmaceuticals Industry. However, the Indian pharmaceutical sector copped up with the new regulatory

changes and the indigenous R&D sector started growing.

Patent protection period of 20 years:

Granting of “patent” is a way to encourage innovation, which allows patentees to enjoy monopoly over

the patented product for a period of 20 years from the date of filing. The effect of this monopoly can be very

severe in pharmaceutical sector, more so in the case of lifesaving drugs.

Compulsory licensing:

To counteract this monopoly-associated damage, the Patents Act, 1970, has some specific provisions to balance

the situation. This act also has a provision that the patented products to be available to end users at sufficient

quantity, and at the same time, the price should be in affordable range. If the patentee fails to do so, the

Government of India can give CL to interested parties so that the patented product fulfills the requirement

of the product. Although the first CL was issued in the year 2012 (Bayer's patented drug Nexavar to Natco

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Pharm Limited), the history of compulsory licensing is not new. In Section 22 of the Patents and Design Act,

1911, it is mentioned that, after the expiration of 3 years of a patent life (day 1 being the date of sealing of the

patent), any interested person can apply for CL if the following grounds are not satisfied, for example, the

commercial angle of the patent is not fully worked out, the Indian population demand/requirement regarding the

patented property is not met adequately and the demand of the “patented product” has to be fulfilled

substantially by importing it from other countries. The “Patents Act,” 1970 (section 84), also kept the provision

of CL if the reasonable requirements of Indian population with respect to the “patented invention” are not

satisfied or the “patented invention” is not available to public at a reasonable price. In 2002, another ground was

amended which states that CL can be applied if the “patented invention has not worked in territory of India.” In

2005, CL covered both “manufacture and export” of pharmaceutical products (section 92A) to any

country which do not have manufacturing capacity of have insufficient manufacturing capacity to address its

public health issues. Although lots of controversies came after India's grant of first “CL” to NATCO

and subsequent grants, the trend seems to be an unbiased one, with a critical balance between the interest of

generic manufacturers, intention of the patentee, and the interest of the population

Lots of patent and no clinical translation:

Although the number of patents granted is increasing, the translational gap is quite huge in the pharmaceutical

sector. Among these, lots of the patents are from academic institutions and are part of academic thesis work.

Other important issues are lack of orientation toward clinical translation and deficient funding.

Issue of evergreening of patents:

“Evergreening,” refers to a strategy by which additional “secondary patent,” is applied by minor formulation or

other changes of the parent patented molecule, of which patent period is going to expire. Indian Patent Act

counteracts evergreening measures by inclusion of Section 3(d), which distinguishes between “discovery and

innovation” and clearly defines which is not patentable. Although a criticism like nonagreement to TRIPS came

in the NOVARTIS case with regard to GLIVEC, the Honourable Court cleared its stand on “evergreening” and

discouraged such strategies.

8. CONCLUSION AND FUTURE DIRECTION:

Although lots of patent applications are from pharmaceutical sector, their clinical translation is very less.

Rationally, right now Indian Pharmaceutical Market is dominated by the generic market and invention has a

very little share in its expansion. The main reason behind this seems to be separate work in each field, lack of

proper multidisciplinary work between the preclinical and clinical scientists, deficient funding, and

heterogeneous interests of the involved sectors, lack of systematic training of workforce, and lack of

visionary. Industry-academia collaboration and establishment of quality control bodies can be valuable in this

regard So far, the Indian Patent System is balancing the delicate balance between the interest of the patentee and

Indian population. There are several stories such as imatinib (Novartis), tadalafil (Eli Lilly), rosiglitazone

(GlaxoSmithKline), fenofibrate (Abbott), sorafenib (Bayer) regarding the product patent, EMR, off-patent

products, and how the inventor company tries to save their inventions from generic marketing. Effective lessons

learned from these events allowed us to understand the limitations of current IPR system and subsequently to

make the system more strong.

REFERENCES:

Controller General of Patents, Designs and trademarks. History of Indian Patent System. [Last accessed on 2018

Jun 27]. Available from: http://www.ipindia.nic.in/history-of-indian-patent-system.htm

Susanta Kumar rout intellectual property rights and its application toward pharmaceutical industry with special

reference in India, Innovare Journal of Education, Vol 4, Issue 4, 2016, 5-7

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Controller General of Patents, Designs and trademarks. History of Indian Patent System. [Last accessed on 2018

Jun 27]. Available from: http://www.ipindia.nic.in/history-of-indian-patent-system.htm.

Ghai D. Patent protection and Indian pharmaceutical industry. Int J Pharm Sci Rev Res. 2010;3:43–8.

Indian Patents Act. 1970. [Last updated on 2017 Jun 23; Last accessed on 2018 Jun 27]. Available from:

http://www.ipindia.nic.in/writereaddata/Portal/IPOAct/1_113_1_The_Patents_Act_1970_._Updated_till

_23_June_2017.pdf.

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TRIPS AGREEMENT AND PROTECTION OF INTELLECTUAL PROPERTY RIGHTS

Dr. Vishnu J. Bhandare

Associate Professor

Siddharth College of Commerce and Economics, Fort, Mumbai - 01

Abstract:

Intellectual Property and Intellectual Property Rights is an important subject in domestic and international

trade of all sectors. It is an invention of human intellect which requires protection through new laws and

amendment in the existing laws. The present article discusses the origin and concept of Intellectual Property,

Intellectual Property Rights, their different forms and importance. It also explains the TRIPS Agreement of

WTO, its features and the key provisions t for the protection of all forms of IPRS. The outcome of the discussion

is supported by the various IPR related research articles / papers and national policy document of IPR.

Key words: IP, IPR, TRIPS, Patents, Copyrights, Industrial Designs, Geographical Indication

The Origin of Intellectual Property:

The history of Intellectual Property (IP) begins in 500 BCE when a Greek state, Sybaris, declared for citizens to

obtain a one year patent for “any new invention in luxury.” Though the IPs related laws have become more

complicated in the ensuing centuries, their intentions are the same. Different countries introduced intellectual

property laws for encouraging creativity and to give benefits to the inventor for their genuine creation.

IP related laws are scattered in early history. In the past, some major and well-known legislation was passed.

The first of these, British law was established in 1623 as Statute of Monopolies. In those days, all major

industries were controlled by good associations / groups. These groups were so powerful that the government

had empowered them import, produce and sell some items. They were also given the responsibility to introduce

major new innovations & ownership and control upon their own inventions as well as those of others. Today,

many legislations exist to effectively implement and safeguard the interest of creators or owners of intellectual

property.

The Concept of Intellectual Property and Intellectual Property Rights:

Intellectual Property refers to the creations of the human mind and human intellect which may be tangible or

intangible has a value, all such properties needs to be protected by legislation. IP is useful commercially for any

business/ company for its sustainable growth and enhancing goodwill & reputation which ensures it’s in long

run survival.

Intellectual Property Rights (IPRs) refers to rights provided to individuals or organizations that do invention or

specific innovation in products or processes for a certain period of time. They intend to encourage creativity and

innovation which imparts knowledge for achieving social and economic welfare. IPRs exist in the form of

Patents, Trademarks, Geographical Indicators (GIs), Copyrights, etc.

In other words, IPRS are a bundle of exclusive legal rights over creations of mind, both artistic and commercial.

These rights give statutory expression to the moral and economic rights of the creators and other producers of

the intellectual goods and services by granting them certain time-limited rights to control the use of those

productions. These rights also promote creativity and the dissemination and application of its results and

encourage fair-trading, which contributes to economic and social development.

Legally, IPRs gives a person or creator “The exclusive right granted by State, to prevent others from using,

manufacturing, distributing - inventions, processes, applications, new and original designs, trademarks, new

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plant varieties, data bases and artistic and literary works”. Such a person is known as ‘rights owner’ or ‘rights

holder’.

Forms of Intellectual Properties:

1) Industrial Designs: Design deals with features, shapes, patterns, etc., applied to an article by an industrial

process. Eg: A utility item like a chair itself does not qualify for IPR, but its special carvings, embossing

etc., which increases its value though its utility remains same, are eligible for IPR under Designs Act.

Designs can be registered based on originality, henceforth they can use ® or registered, with registration

number.

2) Patents: Section 2(m) of the Indian Patents Act, 1970 defines Patent as ‘a new product or process

involving an inventive step and capable of industrial application’. Patent is a monopoly right granted by law

for the exclusive use of an intellectual property to one or more individuals. The instrument by which such

grant is made is known as ‘Patent’. The patent to whom it is granted is called the ‘Patentee’. It is a

monopoly right granted to a person, who invented a new product or process of making an article for 20

years under the Indian Patens Act, 1970, and can be renewed after expiry period. The inventor has to file for

patent first, and then make his / her invention public. A patent has to be applied in each country by the

inventor to claim rights in that country. e.g.: A group of scientists working on new drug development in

Himalaya Drugs for some salary. The patent of the drug developed is given to Himalaya Drugs, but not to

the scientists. The drug may have many patents like composition, process, and product etc.

3) Trademarks: Trademark can be a word, name, brand, symbol and label etc. used by a company to create a

unique identity for their product. Trademark can be registered, and then use ™ ®. The registration validity

is for 7 years and renewable after expiry. In India, it is governed by the Trade and Merchandise Marks Act,

1958, which came into force on 25th November, 1959.

4) Trade Secrets: Trade secret is any intellectual work or product used for a business purpose that can be

classified as belonging to that business provided, it is not based on information in public domain.

5) Geographical Indication: This is an indication that originates from a definite geographical area, which is

used to identify natural or manufactured product. For e.g., Darjeeling Tea, Calcutta Katha Sarees, Yevale

Paithani Sarees, Kolhapuri Chappals, Devgad and Ratnagiri Alphonso Mango, Solapur Chaddar etc., qualify

for registration under this category. It is valid for 10 years. The application for registration can be an

association of persons, organization or by producers.

6) Copyright: It is a negative right which prevents copying or pirating an original work, labour or skill of a

person by another person. Copyright is an exclusive legal right to reproduce an original work of an author

fixed in any tangible form of expression, to prepare derivative works based on original work, and to perform

or display the work in the case of dramatic, music, choreographic and sculptural works. Copyright prevents

copying of only the expression, for instance religious holy books like Bhagwat Geeta, Bible, Quran, Granth

sahib etc.

Importance of Intellectual Property Rights:

IPR contributes a lot to national and state economies because it claims originality for nation.

Industrial growth across the world is based on adequate enforcement of their patents, trademarks and

copyrights.

Strongly enforced IP rights helps the consumers in making an informed choice about the guarantee of

quality, safety and reliability of products.

Without protection of novel ideas and inventions of new products, inventors will not enjoy full benefits;

as a result, they will give less importance to further R&D.

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For artistic inventions, an artist will not be fully compensated and de-motivated for further creation if

their art work is not protected legally.

IP intensive businesses create more job opportunities worldwide and pay about 30% to their employees,

vis-a-vis non- IP intensive businesses.

Since the past decade, there is faster employment growth rate of IP intensive industry as compared to

non- IP intensive industry.

Output per employee in IP intensive industry is also higher than the average output of other industries.

1. WTO Agreement on Trade Related Intellectual Property Rights:

World Trade Organization (WTO) came into existence in 1995 by replacing GATT after eight rounds of

negotiations. Its agreement on Trade-Related aspects of Intellectual Property Rights (TRIPS) is one of the

landmarks for IPR protection at the global level. Despite some controversial clauses, it has been accepted by all

WTO members. TRIPS Agreement adds significantly to international standards of the World Intellectual

Property Organization (WIPO) that already existed before the WTO Agreement. It was created by the Paris

Convention for the Protection of Industrial Property like patents, industrial designs, etc and by the Berne

Convention for the Protection of Literary and Artistic Works (copyright).

Features TRIPS Agreement:

It has been in force since 1995 and it is the most comprehensive multilateral agreement on

intellectual property signed by 125 countries.

It introduced global minimum standards for protecting and enforcing nearly all forms of IPRs,

including those for patents. Because, before TRIPS Agreement, over 40 countries in the world did

not grant and specify minimum standards for patent protection particularly for pharmaceutical

products.

It is obligatory upon all WTO member countries to adapt / amend their laws to the minimum

standards of IPR protection. TRIPS Agreement has directed members to change laws to enforce their

TRIPS obligations.

TRIPs allows a degree of flexibility for WTO members to accommodate their own patent and

intellectual property systems and developmental needs. They have some latitude in modifying their

regulations and formulating their laws in order to have a proper balance between providing

incentives for future inventions of new drugs and affordable access to existing medicines.

Intellectual property protection contributes to technical innovation and the transfer of technology.

Moreover, it aims to benefit and enhance economic and social welfare of producers and users.

2. Key Provisions of TRIPS for Patent protection:

1) Protection period of 20 years

TRIPS Agreement made provision of providing protection to patents for a minimum term of 20 years from

the filing date of a patent application for any type of invention including for a pharmaceutical product or

process. Earlier to this agreement, patent duration was very less i.e. in certain developing countries, patents

were granted for terms of 5 to 7 years and many developed & developing countries patent terms was ranging

from 15 to 17 years.

2) Protection for both processes and products

Before TRIPS, many countries only gave process patents and not product patents. After TRIPS all country

have to give protection to both, in all fields of technology. Product patents ensure full protection to the

product, whereas process patents only protect the production technique.

http://www.wipo.org/

http://www.wipo.org/

http://www.wipo.int/treaties/en/ip/paris/

http://www.wipo.int/treaties/en/ip/paris/

http://www.wipo.int/treaties/en/ip/berne/

http://www.wipo.int/treaties/en/ip/berne/

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3) Transition period

The TRIPS Agreement provides transition periods which allow developing and less developing countries

additional time for amendments in their national legislation with TRIPS provisions. There are three main

transition periods.

First was the 1995-2000 transition period, at the end of which countries were required to implement

the TRIPS Agreement.

The second transition period 2000-2005 permitted certain countries a further 5 years delay for

introducing product patent in pharmaceuticals and agro-chemicals. During the transition period,

these countries were required to accept patent applications from 1995 onwards and to keep such

applications pending, in a patent "mailbox" until the mailbox was opened for assessment in 2005.

The third transition period permitted least-developed countries (LDCs) until 2006 to implement the

directives of TRIPS Agreement which was further to 2016 for patents on pharmaceutical products

and exclusive marketing right. This means that pharmaceuticals or medicines patented before

developing countries implemented their TRIPS obligations would not receive patent protection, thus

enabling generic competition.

4) Protection of undisclosed test data submitted for the registration

Before TRIPS, Drug Regulatory Authorities required pharmaceutical companies to submit data that

reflects the safety, quality and effectiveness of the product which was condition for obtaining

permission for sale or marketing of a pharmaceutical product, the said data was not protected against

unfair commercial use. But, as per the TRIPS Agreement WTO members could protect undisclosed

test data against unfair commercial use. All countries could use their discretion to define “unfair

commercial use”; it was argued that countries could meet their obligations to protect test data by

prohibiting “dishonest” use of data. Generic products are concerned, before TRIPS Agreement

coming into force; most of the countries use to approve the generic products of their Originator

Company on the basis of test data. Generic manufacturers needed to prove that their product was

chemically identical to the brand-name, original product, and in some countries it was bioequivalent.

5) Rights for patent owner

The TRIPS Agreement explains the minimum rights that a patent owner must enjoy, it permits

governments to issue “compulsory licenses”, which allow a competitor to produce the product or use

the process under license without the owner's consent.

6) Plant varieties can be protected by patents or by a special system such as the breeder’s rights

provided in the conventions of the International Union for the Protection of New Varieties of

Plants) or by both.

7) If a patent is issued for a process invention, then the rights must extend to the product directly obtained

from the process.

3. Key Provisions of TRIPS for Protection of Copyrights, Trademarks and GI protections:

1) The TRIPS Agreement ensures that the authors of computer programs and producers of sound

recordings must have the right to prohibit the commercial rental of their works to the public. A similar

exclusive right applies to films where commercial rental has led to widespread copying, affecting

copyright-owners’ potential earnings from their films.

2) Producers of sound recordings must have the right to prevent the unauthorized reproduction of

recordings and broadcast of live performances (bootlegging) for a period of 50 years.

http://www.upov.int/

http://www.upov.int/

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3) The TRIPS Agreement says that any type of signs used for goods as trademarks are eligible for

protection and it offered the minimum rights to their owners. Trademarks / signs which have become

well-known in a particular country can enjoy additional protection.

4) Under the TRIPS Agreement, original or new industrial designs must be protected for at least 10 years.

Patentees must be able to prevent the manufacture, sale or importation of articles bearing or embodying

a design which is a copy or substantially a copy of the protected design for commercial purposes.

5) Undisclosed information includes trade secrets and test data, must be protected against unauthorized use

like breach of contract or confidence or other acts contrary to honest commercial practices. Test data

submitted to governments in order to obtain marketing approval for new pharmaceutical or agricultural

chemicals must also be protected against unfair commercial use and disclosure.

Conclusion:

IPRS agreement has brought a drastic change in the corporate sector worldwide, which has encouraged the

research and development of new ideas and products. It has also improved standard of goods and services for

consumers and widened the scope for ethical business practices. Though this agreement has largely benefited

developed countries, gradually developing and underdeveloped countries may also become competitive,

improve their business standards and enjoy benefits in the years to come.

References:

Globalization and Access to Drugs: Perspectives on the WTO TRIPS Agreement, EDM Series No. 7

Access to Medicines, Intellectual property protection: impact on public health (WHO Drug

Information Vol. 19, No. 3, 2005

National Intellectual Property Rights Policy 2016 document

https://en.wikipedia.org/wiki/Intellectual_property_in_India

https://www.wto.org/ Overview: the TRIPS Agreement

https://www.who.int/medicines/areas/policy/wto_TRIPs

https://www.wipo.int/about-ip/en/

https://www.bits-pilani.ac.in/Uploads/MicroModule/2011-12-12--7-46-19-

276_Patent_ManualOct_25th_07.pdf

https://www.wto.org/english/thewto_e/whatis_e/tif_e/agrm7_e.htm

https://www.who.int/medicines/areas/policy/who-dap-98-9rev.pdf?ua=1

https://www.who.int/medicines/areas/policy/who-dap-98-9rev.pdf?ua=1

https://www.who.int/medicines/areas/policy/AccesstoMedicinesIPP.pdf?ua=1

https://www.who.int/medicines/areas/policy/AccesstoMedicinesIPP.pdf?ua=1

https://en.wikipedia.org/wiki/Intellectual_property_in_India

https://www.who.int/medicines/areas/policy/wto_trips

https://www.wipo.int/about-ip/en/

https://www.bits-pilani.ac.in/Uploads/MicroModule/2011-12-12--7-46-19-276_Patent_ManualOct_25th_07.pdf

https://www.bits-pilani.ac.in/Uploads/MicroModule/2011-12-12--7-46-19-276_Patent_ManualOct_25th_07.pdf

https://www.wto.org/english/thewto_e/whatis_e/tif_e/agrm7_e.htm

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EXAMINATION OF JURISDICTION IN DISPUTES RELATED TO TRADE

MARKS AND COPYRIGHT

Krishna Manhar Mistry

Manager – Legal

USV Private Limited

Abstract:

I) This Article will examine the jurisdiction available to the Plaintiff in the dispute of Trade Marks and Copyright

after considering the additional jurisdiction provided under The Trade Marks Act, 1999 and The Copyright Act,

1957 and this would be in addition to common jurisdiction available under Section 20 of the Civil Procedure

Code (“CPC”). Further, we will discuss the historically judgement passed by the Hon’ble Supreme Court of India

in the matter of Indian Performing Rights Society Ltd (IPRSL) versus Sanjay Dalia & Anr (CIVIL APPEAL

NOS.10643-10644 OF 2010) relating to Territorial Jurisdiction which seeks to curb the abuse of the provision of

Section 62 of the Copyright Act and Section 134 of the Trade Marks Act by the multi-national corporations to

harass the defendant/s. The Trade Marks Act and Copyright Act is a Special Legislation.

II) This Article will also discuss the outcome of the judgement of the Hon’ble Bombay High Court (Nagpur Bench)

in the matter Dhiraj Dharamdas Dewani versus M/s. Sonal Info Systems Pvt. Ltd. (First Appeal No. 1076/2011)

relating to the benefit of registration of Copyright on Territorial Jurisdiction.

I) In Intellectual Property cases, the decision of selecting jurisdiction plays a vital role since the time is very

crucial in opting ex-parte or ad-interim order. In many cases, the Plaintiff go far flung places in order to obtain

ex-parte orders from certain Courts which normally grant relief in such cases and thereby deprive defendant a

remedy and harass them by dragging to distant place. Hence, to curtain down such mischief, the interpretation of

the provision of special statute is very well elaborated in IPRLS (supra) and thereby giving clear intention of the

legislature behind introducing such provisions under The Trade Marks Act, 1999 and The Copyright Act, 1957.

Let us now understand the provisions relating to various statutes in relation to Territorial Jurisdiction.

1) Section 20 of Code of Civil Procedure 1908 states:

“20.Other suits to be instituted where defendants reside or cause of action arises"

Subject to the limitations aforesaid, every suit shall be instituted in a Court within the local limits of whose

jurisdiction-

(a) the defendant, or each of the defendants where there are more than one, at the time of the commencement of

the suit, actually and voluntarily resides, or carries on business, or personally works for gain; or

(b) any of the defendants, where there are more than one, at the time of the commencement of the suit, actually

and voluntarily resides, or carries on business, or personally works for gain, provided that in such case either

the leave of the Court is given, or the defendants who do not reside, or carry on business, or personally work

for gain, as aforesaid, acquiesce in such institution; or

(c) the cause of action, wholly or in part, arises.

Explanation - A corporation shall be deemed to carry on business at its sole or principal office in India or, in

respect of any cause of action arising at any place where it has also a subordinate office, at such place.”

2) Section 134 of the Trade Marks Act, 1999 states:

“134.Suit for infringement, etc., to be instituted before District Court.—

(1) No suit—

(a) for the infringement of a registered trade mark; or

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(b) relating to any right in a registered trade mark; or

(c) for passing off arising out of the use by the defendant of any trade mark which is identical with or deceptively

similar to the plaintiff’s trade mark, whether registered or unregistered, shall be instituted in any court inferior

to a District Court having jurisdiction to try the suit.

(2) For the purpose of clauses (a) and (b) of sub-section (1), a “District Court having jurisdiction” shall,

notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908) or any other law for the

time being in force, include a District Court within the local limits of whose jurisdiction, at the time of the

institution of the suit or other proceeding, the person instituting the suit or proceeding, or, where there are more

than one such persons any of them, actually and voluntarily resides or carries on business or personally works for

gain. Explanation —For the purposes of sub-section (2), “person” includes the registered proprietor and the

registered user.”

(emphasis supplied)

3) Section 62 of the Copyright Act 1957 is extracted:

“62. Jurisdiction of court over matters arising under this Chapter.—

(1) Every suit or other civil proceeding arising under this Chapter in respect of the infringement of copyright in

any work or the infringement of any other right conferred by this Act shall be instituted in the district court having

jurisdiction.

(2) For the purpose of sub-section (1), a “district court having jurisdiction” shall, notwithstanding anything

contained in the Code of Civil Procedure, 1908 (5 of 1908), or any other law for the time being in force,

include a district court within the local limits of whose jurisdiction, at the time of the institution of the suit or other

proceeding, the person instituting the suit or other proceeding or, where there are more than one such persons, any

of them actually and voluntarily resides or carries on business or personally works for gain.”

From the above it is examined that Section 134 of the Trade Marks Act and Section 62 of the Copyright Act

confers a special / additional right on the Plaintiff to institute suit at the place where the Plaintiff actually and

voluntarily resides or carries on business or personally works for gain over and above what is provided under

Section 20 of CPC. The multi-national / giant companies have sub-ordinate offices across India which gives them

upper edge to file suit at such subordinate location and thereby harass defendant by dragging to distant place.

Let us now study different judgement on Jurisdiction.

a) Jurisdiction in case of mere advertisement in the Trade Marks Journal:

In Jawahar Engineering Co. and Ord. vs Javahar Engineering Pvt. Ltd., (AIR 1984 Delhi 166, 24 (1983) DLT

129) it was found that the product was not available / sold in Delhi region, even there was no advertisement of the

product in Delhi jurisdiction but the Ld. Single Judge held that the court has jurisdiction on account of the

advertisement having appeared in the Trade Marks Journal and the said judgement was affirmed by the Hon’ble

Division Bench.

An injunction being prohibitive in nature is intended to prevent something that is likely to happen. Once the

plaintiffs have learnt that the defendants have applied for registration of trade mark in Delhi, they can claim an

injunction to prevent any sale of the infringing product in Delhi. In this sense, the Court will have jurisdiction

whether any sale in Delhi has taken place or not.1

b) Jurisdiction in case of Composite Suit:

In M/S. Dhodha House vs S.K. Maingi, case no. Appeal (Civil) 6248 of 1997, this was a composite suit relating

to infringement of Copyright and Trade Marks under Trade and Merchandise Marks Act, 1958 (“1958 Act”) and

protection under common law rights of the Appellant mark “Dhodha House” against of the Respondent mark

Todha with prefix Maingi’s. The Appellant carries on business of sweet meats in the district of Ghaziabad whereas

https://ipandlegalfilings.com/service/copyright-services/

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the Respondent carries on similar business at Kotkapura in the district of Faridkot. The suit was filed before 1st

Addl. District Judge, Ghaziabad and an order of injunction was obtained against the Respondent. The Appeal was

preferred before High Court of Allahabad where it was decided that the Civil Court had no territorial jurisdiction

to try the suit and the same was also affirmed by Hon’ble Supreme Court of India. This is because, as per law as

it stood at the relevant point of time, there was no additional jurisdiction forum conferred under 1958 Act as it is

now conferred in the new 1999 Act. Hence, a composite suit is not maintainable unless the court has jurisdiction

to entertain the entire causes of action in the same suit.

c) Jurisdiction in case of cause of action and office of plaintiff at same location:

The provisions of Jurisdiction is analyse in detailed under the historically judgement passed by the Hon’ble

Supreme Court of India in the matter of Indian Performing Rights Society Ltd (IPRSL) versus Sanjay Dalia &

Anr (CIVIL APPEAL NOS.10643-10644 OF 2010), it is stated that the object of giving additional forum under

Section 62 of the Copyright Act and Section 134 of the Trade Marks Act was to encourage Plaintiff to file suit at

a place where he/she or they resided or carried on business otherwise the Plaintiff in most of the case deterred

from instituting infringement proceedings because the court in which the proceedings are to be instituted are at

the considerable distance. The intention of the legislature for providing additional forum would never being that

the Plaintiff to take undue advantage and drag defendant further away from such a place which would otherwise

convenient to both the parties.

Below is the extract from the IPRSL (supra)

“16. On a due and anxious consideration of the provisions contained in section 20 of the CPC, section 62 of the

Copyright Act and section 134 of the Trade Marks Act, and the object with which the latter provisions have been

enacted, it is clear that if a cause of action has arisen wholly or in part, where the plaintiff is residing or having

its principal office/carries on business or personally works for gain, the suit can be filed at such place/s. Plaintiff(s)

can also institute a suit at a place where he is residing, carrying on business or personally works for gain de hors

the fact that the cause of action has not arisen at a place where he/they are residing or any one of them is residing,

carries on business or personally works for gain. However, this right to institute suit at such a place has to be

read subject to certain restrictions, such as in case plaintiff is residing or carrying on business at a

particular place/having its head office and at such place cause of action has also arisen wholly or in part,

plaintiff cannot ignore such a place under the guise that he is carrying on business at other far flung places

also. The very intendment of the insertion of provision in the Copyright Act and Trade Marks Act is the

convenience of the plaintiff. The rule of convenience of the parties has been given a statutory expression in section

20 of the CPC as well. The interpretation of provisions has to be such which prevents the mischief of causing

inconvenience to parties.”

Conclusion:

That the additional forum provided under the special statute was to encourage the Plaintiff to institute

infringement proceedings where the Plaintiff is residing or carry on business or personally work for gain, however,

such benefits had never been intended to file a suit at distant place where its subordinate office is situated though

at such place no cause of action has arisen.

II) Registration of copyright is compulsory or mandatory for taking recourse to the provisions of Copyright Act.

In the matter Dhiraj Dharamdas Dewani versus M/s. Sonal Info Systems Pvt. Ltd, the question was arisen that

whether registration of copyright is compulsory or mandatory for taking recourse to the provisions of Copyright

Act, 1957?

The answer is in affirmation.

Below is the extract from the Dhiraj Dharamdas Dewani (supra)

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“Such a person who is infringing the copyright in a work must be deemed to have knowledge about the owner of

the copyright and such knowledge cannot be attributed unless the provisions of Chapter 10 regarding registration

of copyright, publication thereof etc. are complied with. Otherwise a person who is innocent can in that event be

easily brought in the net of infringement under civil law or criminally, which can never be the intention of the

legislature. Thus, reading of Section 51 which defines infringement of right conferred by this Act, with Section

45(1) and the word 'may' therein to my mind means; if owner of a copyright wants to invoke the provisions of

this Act for enforcing civil and criminal nature of remedies before the special forum, namely the District Judge

rather than a normal civil Court, he must have the registration.”3

(emphasis supplied)

After analysing various provisions of the Copyright Act, the Court concluded that to avail remedies under the

provisions of the Copyright Act against the defendant for the infringement under Section 51 of the Copyright Act,

the registration of copyright is compulsory.

However, in recent case USV Private Limited vs. Medulla Life Sciences and Anr, Commercial IP Suit (L) No.

1179 of 2019 filed before Hon’ble High Court of Bombay for infringement of the copyright in the artistic packing

/ trade dress of the plaintiff product MYCHIRO. The ad-interim relief was granted in favour Plaintiff as it is

evident that the Plaintiff is the owner of the copyright in the artistic packaging/ trade dress used in respect of its

MYCHIRO product. In this case, the artwork / artistic packaging of MYCHIRO is not registered under the Act

and even the defendant product was not found in the jurisdiction of the Hon’ble High Court of Bombay.

Considering various past judgements, it has been dicey situation were some judgement consider registration of

copyright as mandatory whereas some are not. However, considering the recent Dhiraj Dharamdas Dewani (supra)

the registration of the Copyright is mandatory in order to avail additional forum granted under Section 62 of the

Copyright Act.

References:

In Jawahar Engineering Co. and Ord. vs Javahar Engineering Pvt. Ltd., (AIR 1984 Delhi 166, 24 (1983) DLT

129)

Indian Performing Rights Society Ltd (IPRSL) versus Sanjay Dalia & Anr (CIVIL APPEAL NOS.10643-10644

OF 2010)

Dhiraj Dharamdas Dewani versus M/s. Sonal Info Systems Pvt. Ltd. (First Appeal No. 1076/2011)

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INTELLECTUAL PROPERTY RIGHTS & THE ENTERTAINMENT INDUSTRY

Khushboo Ashok Lala

Bhavan’s College, Andheri West

(M.M. College Of Arts, N.M. Institute Of Science & H.R.J. College Of Commerce)

Abstract:

Intellectual property rights are legal rights governing the use of creations of the human mind. They provide

exclusive right to the creator over their work for a specified amount of time. Intellectual property rights include

patents, copyrights, trademarks, industrial design rights, plant variety rights, trade dress and trade secrets. The

entertainment industry is an avenue for generation of income and revenue by attracting the interest and attention

of an audience seeking joy, delight, leisure and breaking the mundane daily schedules and monotony of highly

stressful and hectic work and personal schedules. The entertainment industry consists of films, print and

electronic media, internet, magazines, newspapers, radio and television. It also comprises digital and social

media such as FaceBook, Instagram, Twitter, Netflix, Amazon Prime Video, Youtube and Hotstar VIP. Their

growth has seen an increase in violation of intellectual property rights, copyright infringement, plagiarism and

content and ownership conflicts and disagreements.

The contractual terms in this industry define and concern the ownership and use of performing art and varied

kind of projects such as songs, movies, books and a variety of theatre and plays are under negotiable conditions

for months with both the artist and the entertainment companies trying to acquire maximum control of the

intellectual property. Being a part of the eminent Asian entertainment industry, India has created instruments to

solve the disputes arising from intellectual property rights violation such as Alternative Dispute Resolution

(ADR) and Online Dispute Resolution. Globally, the World Intellectual Property Organization (WIPO) is a

well-known organization.

The Indian entertainment industry has flourished and developed in terms of content generation, number of

outlets and use of advanced technology. It is estimated to touch Rs. 2.26 trillion by 2020. It also faces many

legal challenges like violation of INTELLECTUAL PROPERTY RIGHTS, cyber laws etc. for this industry,

‘content is king’, as it highly depends on creativity. The Bollywood industry has grown beyond leaps and

bounds over the years, often touching new horizons of success. However it has witnessed some remarkable and

appreciated movies showcasing the society in different fields such as Swades, Bhaag Milkha Bhaag, Dangal and

many others. These have taken the cinema in a whole new different direction allowing cinegoers to enjoy a wide

array of thought provoking and interesting movies.

Often, ideas from film based in foreign countries are implemented in the Indian film context raising an issue of

INTELLECTUAL PROPERTY RIGHTS violation. There are movies released with the same titles in different

years for which film-makers pay a certain minimum amount to acquire the same title, thus not violating any

copyright or trademark law, example, movies in India with the same title like Dostana, Dilwale among others.

Along with the IP law, the entertainment law, also referred to as the media law, are legal services provided to

the entertainment sector, these services overlap with the IP law. Bollywood is frequently seen as a world full of

colorful dreams that are showcased on a big screen. But often, these colorful dreams needs protection against

others who could copy the story song etc and steal the hard work and creativity of others.

Some case studies on INTELLECTUAL PROPERTY RIGHTS violations in the entertainment industry are

noted, one being a recently released Bollywood flick, ‘Judgemental Hai Kya’ which was under the scanner due

to plagiarism accusations over the movie’s poster. A European artist named Flora Borsi claimed that the film-

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makers used her work as reference without giving her due credit. She had accused the film-makers and

producers of making a similar poster to that of one of her works pointing out striking similarities. This film was

also under controversy over its change in title. The original title of the movie was ‘Mental Hai Kya’ which was

later changed to ‘Judgemental Hai Kya’ due to objections from India Psychiatric Society claiming that the

original film title undervalues mental health issues. The Indian film industry is known for having ripped of

Hollywood artists off their work. But this is not only the case with the Indian entertainment industry but also

with the Hollywood movie industry. Hollywood is equally known for getting inspired by Bollywood films. An

example of this is the Bollywood film by the name, ‘Jab We Met’ (2007) and Hollywood flick, ‘Leap Year’

(2010). The latter takes inspiration from the former. ‘Jab We Met’ was about a girl who goes out of the way to

meet her boyfriend but ends up meeting a man who helps her complete her trip and eventually ends up falling in

love with him. ‘Leap Year’ had a similar story line but the director of ‘Jab We Met’ did not file any case of

plagiarism or copyright. However the makers of ‘Leap Year’ claimed that it is not a remake of ‘Jab We Met’.

Along with the entertainment industries, intellectual property law, the copyright law directly addresses the

unique needs of dance, theatre and other performing arts. An important feature of the copyright law applicable

to the entertainment industry is that of derivative works. A copyright holder controls, who may create a project

based on the artist’s original creation. Only with the permission of the copyright holder can another artist create

a project based on the original artist’s work. For instance, a film studio may create a screenplay based on a novel

only with the author’s written permission. In Indian context, novelists Chetan Bhagat, gave the rights of his

book, ‘2 States’, based on his marriage to be made into a movie to a famous production house in India.

The ill effects of INTELLECTUAL PROPERTY RIGHTS in the global film scenario are a part and parcel of

the entertainment industry. Many countries have banned the use of pirated movie content but it is widely

available to the general public thus making it easy for bogus products like movie CDs to sell in the market like

hot cake. Trademarks are not only applicable where films or movie scripts are concerned, even certain

prominent characters like Mickey Mouse, the most recognizable character in the cartoon world was registered as

a trademark back in 1928. Even movie merchandizing is covered under trademarks as an illustration in the case

of the popular movie, ‘Star Wars’, wherein ‘Star Wars’ collectables are worth billions, posing as a highly

lucrative market.

Apart from movies, even the digital content often becomes a victim of copyright violation. One such area is that

of reality broadcasting. This genre of television relies on the concept of competition or challenges faced by the

participants for its dramatic tension and audience interest. Only the most detailed version of the television

scenario can be protected by copyright. Reality singing shows like American Idol broadcasted in the US has its

concept being used in India with a show named, ‘Indian Idol’. As the show creator had no evidence to suggest

that the show was protected under a trade secret, therefore the idea was no longer protected and could be used

across the globe, not facing any kind of violation discrepancies.

INTELLECTUAL PROPERTY RIGHTS are equally important in the world of music. Music once created

should be registered and patented or trademarked under the name of a particular artist, musician or a music

company. Music remixes or recreating the original songs into new versions are a recent trend observed in music.

Such things are possible only when the original artist have protected their craft and can hold responsible anyone

trying to steal any kind of piece of art and call it his or her own.

Protecting INTELLECTUAL PROPERTY RIGHTS in the film industry is necessary to mitigate potential risks

like:

1. Identifying all risks, probability, impact and counter measures.

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2. Conducting regular trademark audits to identify the marks which are currently in use and the

unregistered ones.

3. Formulating IP protection program

4. Identifying IP and ownership according to legal laws and principles.

5. Issuing social media policies encapsulating the use of logos and copyright materials.

6. Including a detailed review of terms and conditions in the official agreement with any third party.

7. Setting up instant response procedures to mitigate potential risks if IP is infringed or abused.

INTELLECTUAL PROPERTY RIGHTS also applied to the digital media content provided by media platforms

like Netflix, Amazon Prime Video and Hotstar among many others. These platforms are gaining momentum and

broadcasting strong global and Indian content gaining patronage from all sections of the society owing to its

easy accessibility and cost effective membership fees. These OTT (Over The Top) platforms plan to adopt self

regulation guidelines for content streamed on their platforms in India in an effort to prevent potential

government censorship. India has films and TV certification bodies that moderate public content but the

country’s laws currently do not mandate any censorship of content on online streaming platforms. But global

video streaming market leader, Netflix was drawn into a legal battle in the past after a complaint that its first

Indian original series, Sacred Games, insulted former Prime Minister and Congress Leader, Rajiv Gandhi. The

battle raised concerns in the industry that the government could look at regulating content on online streaming

platforms. Also now that platforms would prohibit content that shows a child engaged in real or simulated

sexual activities is against India’s culture or any such act that is disrespectful of India’s national flag or that

which encourages terrorism.

INTELLECTUAL PROPERTY RIGHTS have also made their way into the Indian animation industry. There is

a demand for stories which are Indian but need to be presented to the global audience in a way that any kid

living anywhere in the world could easily identify with it. The kids’ animation sector has shown tremendous

growth potential of original domestic content. From story-telling strategies to presentation and consumption of

content, the distribution platforms are now providing such rich variety of content that producers are now spoilt

for choice. OTT platforms like Netflix, Amazon Prime, Hulu have adopted the animation industry both locally

and globally. A classic illustration of this is the movie ‘The Jungle Book’ which is essentially an Indian story

based on Kipling’s work. The Jungle Book has millions of views on each of its episodes and has witnessed

growing subscribers in huge volumes on a daily basis. The Jungle Book is one approach in leveraging and

expanding the monetization venues of an IP.

Conclusion

IP laws is one of the most fluid areas of the law that exists. It is constantly changing and updating to try to keep

up with new technology as well as case law and even industry related compromises. Digital IP laws are still a

nascent subset of IP law and still trying to match the new technology. Today IP plays a huge role and issues

related to it are of great impact at the personal, corporate and state levels. It is very important to understand all

aspects and nuances of in order to avoid problems. IP can be valued by the most significant amounts and make

its owners millionaires. Legal frameworks in the regard are in the process of improvement and modification in

India. Effective use of trademarks, trade secrets, publicity rights, patents and copyrights provides the

infrastructure for various entertainment industries. These legal protections do not define the success and failure

of a project but they play a key role in monetizing the success of the projects and developing revenue streams

from projects that last from production to production and turn books into series. The projects that grow

exponentially from a single book to a juggernaut of films, music, books and games, often best reflect what the

audiences want – an opportunity to be entertained and delighted by characters, stories and artistry, both familiar

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and new. Only artists make this possible, but the legal techniques which empower them to achieve these dreams

are essential.

References:-

www.legalservicesindia.com/article/intellectualpropertyrightsinindia

www.wikipedia.com/IPR

www.vault.com>media&entertainment

law.jrank.org/entertainment-law-intellectual-property.html

researchgate.net/publication/intellectual-property-right-and-indian-entertainment-industry-an-overview

www.wikipedia.com/entertainmentlaw

lawyered.in/legal-disrupt/articles/judgemental-hai-kya-movie-posters-copyright-infringement-or-not/

hotcorn.com/Hollywood-movies-that-were-inspired-by-bollywood

kashishworld.com/blog/intellectual-property-rights-in-film-making/

wipo.int/pressroom/en/stories/ip-and-film.html

www.livemint.com

commerce.gov.in/writereadddata

nopr.niscair.res.in/bitstream/pdf

http://www.legalservicesindia.com/article/intellectualpropertyrightsinindia

http://www.wikipedia.com/IPR

http://www.wikipedia.com/entertainmentlaw

http://www.livemint.com/

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INFRINGEMENT OF TRADEMARK BY COMPARATIVE ADVERTISING

Qureshi Farzin & Mandavkar Swati

Assistant Professor at Elphinstone College, Mumbai.

Abstract:

Intellectual property rights help people to own their creativity and innovations in various domains. There are

many kinds of intellectual property rights and trademark is one of them.

A trademark is a type of intellectual property consisting of a recognizable sign, design, or expression which

identifies products or services. Trademarks can be a name, number, logo, colours or combination of these. In a

highly competitive business environment of India with many local players and growing number of multinational

companies, the space for positioning one’s brand is important for future growth. In such situation infringements

of intellectual property becomes a big problem, so more attention and focus should be given on trademark

infringement and protection. This paper focuses on some trademark infringement cases and does analysis of the

same.

Introduction:

In India Trademarks are protected by The Trademarks Act, 1999 to meet the WTO and TRIPS requirements.

Before filing an application for registration, the mark should fulfil legal requirements such as the selected mark

should be capable of being represented graphically, and then it should be capable of distinguishing the goods or

services. It is best advised to do a trademark search before filing an application for registering a trademark. All

accepted applications are published in the Trademarks Journal. Trademarks convey an organization’s product

having different features. The suffix TM is added to say that the trademark is owned by the company; it is not a

registered one but is in process of registration.

Registering a trademark grants the owner all the exclusive rights to use his mark for goods and/or services.

For registered trademark the symbol ® is used. It is offensive to use any registered trademark to represent

other’s business or goods as its own. Such act is known as passing off.

Some cases of trademark infringement:

Castrol Activ v/s Lumax Active

M/S Castrol Limited (Plaintiff') is the registered proprietor of the mark'CASTROL' and 'ACTIV'. They have

adopted the mark ACTIV in 1999.

The plaintiff owns the trade dress copyright under Section 2 (c) of the Copyright Act, 1957 in the packaging as

it is an original artistic work.

In Dec 2010, the plaintiff found that Mahendra Oil Company (defendant) was selling 4T oil under the trademark

'LUMAX ACTIVE'. It was found that they were imitating the features and layout of the plaintiff’s product by

using red, green and white colours on the label having identical shape of the bottle.

The Plaintiff filed a case against the defendant claiming trademark infringement and passing off, thereby

restraining them from selling and marketing the deceptive trademark. After investigating the case it was found

that the defendant had created a misrepresentation of the product which led to confusion and deception for

prospective customers.

Finally the court was of the opinion that the adoption of the deceptive mark by the defendant was clearly

dishonest and to enrich the goodwill and reputation of the plaintiffs. The court restrained the Defendant for

permanent injunction from using the mark Active and deceptive trade dress and had to pay a sum of INR 2,

00,000 in favour of plaintiff.

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Fevicol v/s Trevicol

Fevicol has registered its trade mark in the year 1960 when it came in the market. Peditile files a suite against

the owner of Trevicol which was a similar and deceptive product. Trevicol started using the trademark in the

year 1985. Both the marks have the suffix “vicol” in common. The Fevicol mark has two elephants pulling a

sphere apart, while Trevicol used two ships instead of elephants. Both these products where purchased by

illiterate people including carpenters and civil contractors.

The judgment was of the opinion that both the marks were similar visually as well as phonetically. Fevicol won

the case with Trevicol being declared illegal and had to discontinue with its products.

KENT v/s KENTECH

In a recent judgment of Trademark infringement KENT v/s KENTECH (19th September. 2017), Delhi High

court ruled that the name of company ‘KENTECH RO SYSTEMS’ and domain name www.kentechro.com is

infringing upon he trademark ‘KENT’.

In this case, the word KENT of the plaintiff is found as subsumed in the word KENTECH of the defendant and

it violates section 29 (2) and 29 (5) of the Trademark Act. The court founded that the defendant’s mark is

visually and phonetically similar to that of the plaintiff, so no further proof is necessary.

The final judgment was in the favour of KENT. The court awarded damages to KENT on the claim of loss of

profit.

American Eagle v/s Pantaloons

The owner of ‘American Eagle’ Outfitters has filed a trademark infringement case in the Delhi High Court

against the Indian fashion retailer Pantaloons. The trendy American retailer, which has registered trademarks for

its brand and logo, has claimed that the mark used by ‘Aditya Birla Group’s Urban Eagle’ (defendant) is

deceptively similar and had filed a case against its infringement.

It was recorded by the Court that 'Urban Eagle' brand and its logo is not deceptively similar to the American

Eagle brand and its logo. Therefore Pantaloons was allowed to continue with its usage of the brand name and its

logo, but it was restrained to use the words ‘Authentic Outfitters’ in its product.

Conclusion:

From the above cases it is observed that in trademark law, many unfair trade practices are commonly found

where one company imitates or copies the name, symbol, size, colour, pattern of another’s good or services,

which misleads the customers.

We have observed that the trademark infringement cases occur due to the following reasons:

To deceive customers by creating confusion in their minds.

To sell cheap quality products in the name of reputed brands.

To generate quick revenues by using someone else’s reputation.

To bring down the image and reputation of a well-known brand/company.

Disclaimer:

The cases mentioned in this paper are referred purely for academic purpose and do not violate or infringe

intellectual property rights of any law firm/website/organization.

https://www.setindiabiz.com/trademark-registration.html

https://us.fashionnetwork.com/tags-logo

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IPR AND PHARMACEUTICALS COMPANIES IN INDIA

Mrs. Zakira R. Matwankar

Assistant Professor(Accountancy),

Sant Gadge Maharaj College Of Com.& Eco, Mumbai.

Abstract:

In India's pharmaceutical industry is now ranked as the third largest industry in the world in terms of volume and

rank is 14th in terms of value. The pharmaceuticals industry consists of drug manufacturers, biotechnology

companies and the distribution and wholesale companies that handle the products produced.The Indian

pharmaceutical industry is a best example of an industry that opens its markets to global trade and is being forced

to revisit its long-term strategies and business models.Patent protection for pharmaceutical products and

processes has become the global standard. For Companies future and success, Intellectual property (IP) and its

protection are most valuable resource for pharmaceutical and biopharmaceutical organizations. Recent

challenges in patents for various new drugs has emphasized that advancement is still required in balancing the

opposing forces of innovation through protection of IP rights, versus the provision of affordable drugs for the

emerging geographical regions across the globe. IP is the backbone and playing crucial role in development of

new drugs. IP is extremely vital to improvise patient care, spurring economic growth and intensifying the

innovation economy. In order to motivate researchers to explore new areas of medical innovation, modern IP

systems and strong protections are crucial. TRIPS agreement of WTO required India to revise its patent law and

introduced product patents in the pharmaceutical field.

This study also covers recent developments in India regarding intellectual property rights and the pharmaceutical

industry. However, the liberalisation of the Indian economy is revolutionising Indian industries as they begin to

emerge from domestic markets and gear up for international competition. This study analyzes the impact of the

revision of the Indian Patent Act (2005) on the Indian pharmaceutical industry

Keywords: Intellectual Property, Pharmaceuticals, Patent Protection, Pre and Post Independence era, Indian

Patent System.

Objectives of the Study:

1. This study is aimed at understanding the impact changes in IPR regime on pharmaceutical business

strategy and public health in developing countries with special reference to India.

2. To find out whether IPR increases the demand of low-value drugs and rapid growth of pharma companies.

3. To analysis the significant impact of IPR in the pharma industry

Introduction:

1. Intellectual Property Rights:

Intellectual Property Rights (IPRs) are the rightsof intellectual property given to the creators (i.e., creations of

minds), which grant exclusive right to the innovator for that product/property for a defined period of time.

Intellectual property refers to the exclusive rights granted by the State over creations of the human mind,

in particular, inventions, literary and artistic works, distinctive signs and designs used in commerce.As per

World Trade Organization (WTO), Intellectual property is divided into two main categories: industrial property

rights, which consistof patents, utility models, trademarks, industrial designs, trade secrets, new varieties of

plants and geographical indications; copyright and related rights, which relates to literary and artistic works.

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Patents provide pharma companies exclusive rights to market drugs and prevent others to manufacture, sell, and

make these drugs for a period of 20 years. IPR is a prerequisite for pharma companies for identification, planning,

commercialization, and protection of invention. IPR is also an important tool to protect investment, time, and

effort and encourages healthy competition which promoting industrial development and economic growth. IPRs

also provide incentives to pharma companies to invest in research and development.

The IPR protection works in numerous ways:

1. Provides fair and effective incentive for innovation

2. Protects pharma companies against potential infringers

3. Provides strong enforcement tools for defending infringed patents

2. Status of Pharmaceutical Companies in India:

In India's pharmaceutical industry is now ranked as the third largest industry in the world in terms of volume and

rank is 14th in terms of value. The pharmaceuticals industry consists of drug manufacturers, biotechnology

companies and the distribution and wholesale companies that handle the products produced.According to the

Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers, domestic pharmaceutical market turnover

reached Rs. 129,015 crore (US$18.12 billion) in 2018, growing 9.4 per cent year-on-year and exports revenue

was US$17.28 billion in FY 2018 and US$19.14 billion in FY 2019. The major pharmaceutical hubs of India are

Hyderabad, Mumbai, Bangalore, Ahmedabad and Sikkim.

The India's domestic pharmaceutical sector contain a strong network of 3000 drug companies and about 10,500

manufacturing units.Out of these, 1,400 units are World Health Organization (WHO) good manufacturing practice

(GMP) approved; 1,105 have Europe’s certificate of suitability (CEPs); more than 950 match therapeutic goods

administration (TGA) guidelines; and 584 sites are approved by the US Food and Drug Administration

(USFDA).Globally,India is the largest provider of generic drugs. Indian pharmaceutical sector industry supplies

over 50 per cent of global demand for various vaccines, 40 per cent of generic demand in the US and 25 per cent

of all medicine in UK.

The pharmaceutical industry in India produces a range of bulk drugs, which are the key acting ingredients with

medicinal properties that form the basic raw materials for formulations. Bulk drugs account for roughly one-fifth

of the industry output while formulations account for the rest.

India is among the leading global producers of cost-effective generic medicines and vaccines, supplying 20% of

the total global demand by volume.Reckoned as a high quality generic manufacturer across the globe; India

exports half of its total production of pharmaceuticals to more than 200 countries in the world.

In 2017-18, India exported pharma products worth US$ 17.27 billion. By 2020, the industry estimates the exports

to grow by 30 per cent to reach US$ 20 billion.The Government started to encourage the growth of drug

manufacturing by Indian companies in the early 1960s, and with the Patents Act in 1970.

3. Patent amendment act 2005

Provision related to black box application shows that any manufacturer (including pharma) who has

made significant investment for the manufacturer of product and has produced and marketed the

product before 1st January 2005 will able to continue the production after 1st January 2005 without

infringing the patent.

Parallel import, greyimports, ”Exhaustion” (including pharma)of rights-reduces the price of the product

in the country to which it is exported. Where the price for the same patented drug is higher because

of parallel or grey market imports

Compulsory licenses (including pharma): Any country having insufficient or no manufacturing

capacity in the pharmaceutical sector for the concerned product to address public health problems,

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provided that compulsory license has been granted by such country." Only it limits the amount they

can export when the drug is made under compulsory licenses. All WTO member countries are eligible to

importunder this decision except 23 developed countries. These countries will not use the system to import

to various countries as they are listed in the decision as announcing voluntarily.

Herbal preparations-Those having medicinal values can be patented under the new amended law.

In the period between 1995-2005 and thereafter, status quo has been seen with respect to cost of the

drug and it is expected to continue that way till 2007. But after 2007,the cost of drug is going to

increase particularly after 2010 as MNC’s and research based companies start launching their

patented molecules.

The availability of drugs in antibiotic segment & other agents for topical infection may not be

affected but the availability of life style drugs will be affected as most of the MNC’s are engaged in

new drug development in this area only but imports will remain constant.

4. Impact of IPRs Protection on Pharma Industry:

1. In a weak IPRs protection economy, generic drug manufacturers emulate biopharmaceutical innovations

without investing time and money to develop new medicines. As a result, branded drug manufacturers

are not able to recover investments in new drug development. So it is very difficult to invest in research

and development (R&D) of new drugs and costly diseases.

2. A stronger IPRs regime is motivate thepharma companies in protecting innovation from the research to

development stage. Creating, managing, and protecting intellectual property are becoming an important

source of raising funds required for investment in R&D. IPRs not only play an important role in mergers

and acquisitions of the target SME but alsoin independent commodities that can be traded by way of

licensing, joint ventures, etc.

3. IPR has a significant impact in the pharma industry from issues ranging from discovering, developing

to pricing, distribution, competition mapping, availability, and pricing of new medicines. The pharma

companies are growing at a rapid rate with stronger IPR protection in developed countries. On theother

side, developing countries criticize patent system as it creates monopoly in the market and leads to higher

prices of drugs.

5. Impact of IPRs Protection on Pharma Industry:

1. In a weak IPRs protection economy, generic drug manufacturers emulate biopharmaceutical

innovations without investing time and money to develop new medicines. As a result, branded

drug manufacturers are not able to recover investments in new drug development. So it is very

difficult to invest in research and development (R&D) of new drugs and costly diseases.

2. A stronger IPRs regime is motivate thepharma companies in protecting innovation from the

research to development stage. Creating, managing, and protecting intellectual property are

becoming an important source of raising funds required for investment in R&D. IPRs not only

play an important role in mergers and acquisitions of the target SME but alsoin independent

commodities that can be traded by way of licensing, joint ventures, etc.

3. IPR has a significant impact in the pharma industry from issues ranging from discovering,

developing to pricing, distribution, competition mapping, availability, and pricing of new

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medicines. The pharma companies are growing at a rapid rate with stronger IPR protection in

developed countries. On theother side, developing countries criticize patent system as it creates

monopoly in the market and leads to higher prices of drugs.

4. Impacts on Social Policy: The GATT-TRIPs rules prohibit member countries from

discriminating, in granting patents, "as to the place of invention" and the "field of technology."

These criteria will constrain Countries in their use of IPRs as tools for development.

5. Collaboration: Many companies are collaborating in joint R&D and product and process

development to synergise their knowledge-base and effectively exploit available human

resources and infra-structure.

6. Institutions: The Indian companies and Institutions having technological capabilities

whichhave attracted leading MNCs to start R&D joint ventures, commission contract research

and set up R&D centres. Indian companies are setting up research canters and conducting trial.

6. Economic Performance of 10 Largest Pharmaceutical Companies

Companies Name

Sales In Rs (Crores) Sales In %

2004-2005 2005-2010 2010-2015 2015-2019

2004-

2005

2005-

2010

2010-

2015

2015-

2019

Sun Pharma 1110 1891.16 27570.88 9,783.29 100 170% 1458% 517%

Piramal Enter 1387 2,711.74 2,315.49 3,600.14 100 196% 85% 133%

Cipla 1842 5,657.85 5,657.85 11,974.92 100 307% 100% 212%

Biocon 501.88 1,158.35 2,173.60 2,640.20 100 231% 188% 228%

Cadila Health 1091 1,908.00 4,763.60 6,207.00 100 175% 250% 325%

Lupin 1180 3,723.96 9,705.05 11,031.56 100 316% 261% 296%

Dr Reddys Labs 1933 4,469.60 10,010.40 10,572.90 100 231% 224% 237%

Aurobindo Pharm 1260 3,319.60 8,167.75 11,938.70 100 263% 246% 360%

Divis Labs 302.83 937.2 3,099.24 4,737.22 100 309% 331% 505%

Torrent Pharma 460.58 1,441.18 3,417.69 5,556.72 100 313% 237% 386%

0

5000

10000

15000

20000

25000

30000

Sales In Rs (Crores) 2004-2005




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7. Conclusion:

1. New IP regime has encouraged inventive and innovative activity in the Indian health care sector.

2. Strategic thrust of foreign nations to acquire technology and consolidation in the domestic market

seem to be a prerequisite for Indian firms to deal with the increasing technology-based

competition.

3. The emergence of IP-based startups and social ventures in the health care space is noteworthy

and appreciable.

4. The multinational corporations have complained about the criteria of patentability (Article 3[d])

and compulsory licensing (Article 84), some small firms seem to have suffered with respect to

the confusion regarding the validity of the patents granted (Section 13[4]).

5. It is a learning phase for the country and the State should be flexible enough to change policy to

balance the twin objectives of creating incentives for invention and providing affordable health

care.

6. A patent is considered a major incentive for technological development,not only for being an

official document that grants legal protection tothe invention but also for being the greatest

source of information ontechnological innovation in the world.

7. India has begun to see somepositive results as awareness of the need for greater IP protection

hasincreased.

8. Educating all the pharma professionals from manufacturerto innovators to industry players is

vital for achieving the benefits of IPregime as well as for standing strong among global

competing players.

References:

www.moneycontrol.com

Pharmaceuticals and Cosmetics Export Promotion Council, Bombay. Government of India.

Association for Accessible Medicines. (2017). Generic drug access & savings in the U.S., report prepared by the

IMS Health Institute. Accessed from: https://accessiblemeds.org/sites/default/files/2017-07/2017-

AAM-Access-Savings-Report-2017-web2.pdf

European Commission. (2018). Report on the protection and enforcement of intellectual property rights in third

countries, SWD(2018) 47 final, Accessed

from: http://trade.ec.europa.eu/doclib/docs/2018/march/tradoc_156634.pdf

Indian Patents Act. 1970. [Last updated on 2017 Jun 23; Last accessed on 2018 Jun 27]. Available from:

http://www.ipindia.nic.in/writereaddata/Portal/IPOAct/1_113_1_The_Patents_Act_1970_._Updated_till

_23_June_2017.pdf .

Nair GG. Impact of TRIPS on Indian pharmaceutical industry.J Intellect Prop Rights. 2008;13:432–41. [Google

Scholar]

Nilesh Zacharias and SandeepFarias, Nishith Desai Associates India(2019): Patents And The Indian

Pharmaceutical Industry

http://www.moneycontrol.com/

https://accessiblemeds.org/sites/default/files/2017-07/2017-AAM-Access-Savings-Report-2017-web2.pdf

https://accessiblemeds.org/sites/default/files/2017-07/2017-AAM-Access-Savings-Report-2017-web2.pdf

http://trade.ec.europa.eu/doclib/docs/2018/march/tradoc_156634.pdf

https://www.mondaq.com/content/author.asp?author_id=1911318&article_id=865888

https://www.mondaq.com/Home/Redirect/1911322?mode=author&article_id=865888

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Chaudhry R. Compulsory licensing of patents in India. Pharm Pat Anal 2016;5:401-6.

Special 301 Report 2019: A Deliberate attempt to weaken India’s Patents Act and to tarnish Indian generic

pharmaceutical industry

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saMp%tI AdRSya mhNajao AmaUt- sva$pacaI Asato. %yaamauLo itcaI vyaa#yaa krtaMnaa i@lYTta inamaa-Na haoto. mauLat navao SaaoQa ¸navao

saRjana¸ navaIna inaimatI-¸ navyaa rcanaa hyaa vya@tIcyaa bauiwma%tocao AivaYkar Asatat jyaasaazI %yaa vya@tInao maohnat GaotlaolaI

Asato. %yaamauLo %yaavar %yaacaa h@k Asatao¸ hI baaba hyaa saMklpnaot AiBapot Aaho. Aqaa-t ha h@k kayamasva$pacaa nasaUna

ivaiSaYT kaLasaazI idlaa jaatao %yaamauLo saMbaMiQat kaLat %yaapasaUna haoNaaro Aaiqa-k laaBa %yaa saMSaaoQakasa imaLt Asatat %yaa

zraivak kaLanaMtr maa~ hI saMp%tI saava-jainak KulaI haoto.

manauYyaacyaa baaOiwk pirEama ikMvaa saja-na xamatomauLo paPt haoNaarI saMp%tI mhNajao baaOiwk saMp%tI haoya. jaagaitk baaOiwk saMpda

saMgaznaanao baaOiwk saMpdocaI vyaapk sva$pat vyaa#yaa kolaI Aaho yaat saaih%ya klaa¸ sava- pkarcao maanavaI SaaoQa¸ Saas~Iya SaaoQa¸

AaOdyaaoigak saMklpica~o¸ vyaapar icanho¸ saovaa icanho¸ klaocao saadrIkrNa¸ BaaOgaaoilak ivaSaoYata¸ saMgaNakacaI Aa&avalaI¸saUxma va

jaOivak saMpda prMpragat &ana AadIMcaa samaavaoSa kolaa Aaho. qaaoD@yaat maanavaI manaacyaa va bauwIcyaa madtInao inamaa-Na JaalaolaI

maalama%ta mhNajao baaOwIk saMpda haoya.

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ASaI saMp%tI Qana ikMvaa maaOlyavaana vastUcyaa $pat maaNasaajavaL nasatI tr manauYya Aaplyaa baaOiwk maohnatIcyaa pirNaamaavar ikMvaa

flaavar AiQakar saaMgat Asatao va %yaa AaQaaro %yaalaa BarpUr Qana ikMvaa pOsaa kmaavata yao} Saktao ]da. vaO&ainak saMSaaoQana¸

saaihi%yak AaiNa klaa%mak AivaYkar hI maanavaacaI baaOiwk saMp%tI Aaho. icaMtnaSaIla baaOiwk xamatayau@t tk-saMgat ivacaar

krNaarI vya@tI bauwIjaIvaI maanalaI jaato.%yaatUna inamaa-Na Jaalaolyaa ]jao-tUna eKadI rcanaa klaakRtI¸ isaQdant¸ t%va&ana Aqavaa

ivacaaratUna bauiQdjaIvaI Qanaaja-na k$ Saktao ikMbahunaa ASaI klaa%mak rcanaa ihca saMpda %yaacyaajavaL Asato

qaaoD@yaat bauwIcyaa jaaoravar Aatapya-Mt Aist%vaat navhtI ASaa sva$pacaI baaOiwk saMp%tI ³'navao SaaoQa¸ navao ilaKaNa¸ navyaa

klaakRtI navao saRjana¸ navyaa pQdtI [.´ inamaa-Na k$na %yaaMcao kayadoSaIr h@k saMpadna krNao mhNajao baaOQdIk saMpda inaima-tI

haoya.hyaa pik`yaomaQyao saMSaaoQakanao Aaplaa vaoL¸ pOsaa¸ AayauYya¸ bauwI Kca- k$na navao SaaoQa ikMvaa navainaima-tI kolaolaI Asato.

%yaamauLoca saahijakca %yaacao laaBa %yaalaa imaLNao AavaSyak Aaho. naahItr navapvat-naalaa KIL basaola mhNaUna kahI zraivak

kaLasaazI %yaaMcyaa prvaanagaIiSavaaya tI saMpda kaoNaalaahI vaaprta yaot naahI %yaacaa Aaiqa-k maaobadlaa¸ rayalTI ikMvaa SaulkaMcyaa

sva$pat %yaa saMSaaoQakasa imaLtao. %yaamauLo saMSaaoQanaasa navainaima-tIsa caalanaa imaLto tr dusaáyaa baajaUnao hIca saMpda ivaiSaYT

kalaavaQaInaMtr savaa-saazI KUlaI haoto %yaamauLo samaaja¸ Aqa-vyavasqaa¸ jaagaitk patLIvar savaa-Mnaa %yaacao laaBa maaoft imaLtat.

baaOiwk saMpda AiQakaraMcao sva$p (Nature of Intellectual Property Rights) Á

baaOiwk saMpda AiQakar yaa saMklpnaocao sva$p pahta baaOiwk saMpda AiQakar hI AaMtrraYT/Iya vyaapk saMklpnaa Aaho. Pa%yaok

raYT/ ho Aaplyaa doSaatIla baaOiwk saMpdobaabat kayado banaivato prMtU jaagaitk patLIvar baaOiwk saMpda kayado ho jaagaitk

baaOiwk saMp%tI saMGaTnaa ³WIPO´ maaf-t inayaMi~t kolao jaatat. [.sa 1883 maQaIla AaOdyaaoigak maalama%tocyaa saMrxaNaasaazI

prIsa yaoqaIla AiQavaoSana AaiNa [.sa 1886 maQaIla saaih%ya klaa xao~atIla baaOiwk saMpdabaabat 'bana- knvaoSana' yaa daona

AiQavaoSanaatUna baaOiwk saMp%tIcaI saurxaa krNyaacao mah%va AaoLKlao haoto. ho daonhI krar qaoT WIPO cyaa vyavasqaapnaaKalaI

Aahot. baaOiwk saMpda h@kaMt puZIla baabaIMcaa samaavaoSa haotao.

1. laoKaiQakar ³Copy Rights´ Á

eKadyaa navainaima-tIvar inamaa-%yaasa Ananya AiQakar pdana krtao. ha AiQakar saja-naSaIla baaOiwk ikMvaa klaa%mak sva$pacyaa

navainaima-tIsa laagaU haotat. pNa kaoNatIhI saMklpnaa ikMvaa maaihtI yaavar navho tr %yaaMcyaa vaOiSaYTpUNa- maaMDNaIsaazI ho AiQakar

doNyaat yaotat. yaatIla kaoNa%yaahI SaaoQaacaa vaapr krNyaasaazI maUL maalakaMcaI prvaanagaI AsaNao AavaSyak Aaho. %yaacyaa

prvaanagaI iSavaaya [traMnaa %yaa saaih%ya kRtIcao [traMnaa p`kaSana krta yaot naahI. yaat ]cca naOitk maUlyao AsaNaarI vya@tI yaa

kayadyaaMcao ]llaMGana krNyaacao TaLto hyaa saMdBaa-t Baartat 1957 cyaa kapIra[-T kayada Aist%vaat Aaho yaa kayadyaat

1983¸ 1984¸ 1992¸ 1994 AaiNa 1999 ASaI pacavaoLa du$stI krNyaat AalaolaI Aaho.

2. poToT ³Patents´ Á

baaOiwk saMpdocaa ha ek mah%vaacaa AiQakar Aaho.yaa AiQakaranausaar jaao kaoNaI eKada vastUcaa¸ pìk`yaocaa ikMvaa tM~&anaacaa

ikMvaa saovaocaa SaaoQa laavatao %yaaMcao poToMT kolyaanaMtr %yaa vastUcaI kaoNaIhI kapI k$ nayao yaabaabatIt kayadoSaIr saMrxaNa imaLto.

jar kapI krNaaáyaanao poTMT QaarkacaI prvaanagaI GaovaUna %yaasa yaaogya tI rayalTI idlyaasa %yaa vastUMcao ]%padna k$ Saktao.

%yaamauLo poTMT Qaarkalaa %yaacyaa SaaoQaacaa Aaiqa-k laaBa Gaota yao} Saktao. tsaoca ASaa vastUMcao poTMT kolyaanaMtr sarkarlaa

navyaanao laagalaolyaa SaaoQaaMcaI maaihtI imaLto.SaaoQak%yaa-nao %yaanao laavalaolyaa SaaoQaacaI naaoMd SaasanaakDo krayalaa hvaI. %yaaiSavaaya

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%yaalaa yaa kayadyaacao fayado Gaota yaot naahI. poTMT kolaolyaa vastUcaa jar kaoNaI prvaanagaI iSavaaya baokayadoSaIr vaapr krIt

Asalyaasa %yaavar kayadoSaIr karvaa[- kolaI jaato.

3. AaOdyaaoigak iDJaa[-na ³Industrial Design´ Á

saamaanyatÁ iDJaa[-na yaacaa Aqa- kaoNatI yaaojanaa ikMvaa saRjanaa%mak klaa Asaa haotao prMtu kayadyaacyaa BaaYaot yaacaa Aqa- vaogaLa

haotao jaao rijasTDM iDJaa[-na va iDJaa[-na AiQakaraMSaI saMbaiQat Asato. vastUcaI dRSyarcanaa vaaprNyaacaa ek sava- saamaanyapNao yaalaa

rcanaa AiQakarhI mhTlao jaato AaOdyaaoigak iDJaa[-namaQyao saaOdya-maUlya AsalaolaI rMga rMgaacaI va AakaracaI vaOiSaYTpUNa- rcanaa¸

Aakar ¸iBaimatIya rcanaa Asato. ek ]%padna¸ AaOdyaaoigak vastU ikMvaa hstklaa inaima-tIsaazI daona va i~imatIya rcanaa ]%padna

AakYa-k krNyaasaazI vaaprNyaat yaotao.

4. vyaaparIicanho ³Trademarks´ Á

eKadyaa vastUcao baajaaratIla maUlya zrivaNyaat 'ba`nD' kSaI madt krtao AaiNa yaa ba^nDcao saMrxaNa krNaarI To/Dmaak- hI ek

mah%%vaacaI saMpda Aaho. sava- baaOiwk saMpda h@kaMmaQyao T/oDmaak- ha savaa-t dRSyamaana va naohmaI ]llaoiKlaolaa h@k Aaho. T/oDmaak-

va$na tI vastU ekdma AaoLKta yaoto %yaacao naava¸ gauNava%ta¸ ivaSvaasaah-ta¸ iTka}pNaa yaa vaOiSaYTyaaMSaI inagaDIt Aaho palao-jaI

%yaacyaa T/oDmaak-mauLo sava-~ paohcalao Aaho tsaoca bajaaja¸ iklaaoskr¸ irlaayansa AaiNa AmaUla yaa saarKI Anaok ]%padnao¸ vastU sava-

~ paohcalyaa Aahot ivaSaoYa vyaavasaaiyak¸ ]%padk ikMvaa saovaa pda%yaaMcyaa ]%padnaaMcaI ikMvaa saovaaMcaI [tr ]%padnaapoxaa vaogaLI

AaoLK inamaa-Na krNaaro ek AaoLKNyaayaaogya icanh¸ iDJaa[-na ikMvaa saaMkoitk rcanaa mhNajao T/oDmaak-.

5. BaaOgaaoilak ivaSaoYata Á

Anaok p`karcyaa ]%paadnaaMnaa tao jyaa BaaOgaaoilak pdoSaat ]%paidt haotat %yaa naavaanao AaoLKlao jaatat eKadI vastU kaoNa%yaa

izkaNaI ]%paidt JaalaI yaalaa KUp mah%%va Asato ivaiSaYT Baagaat ]%paidt haoNaaáyaa fLacaI ek ivaiSaYT cava Asato ASaa

]%padnaalaa toqaIla BaaOgaaoilak ivaSaoYata laaBalaolaI Asato va %yaaivaYayaI gaahkaMnaa ivaSaoYa AakYa-NahI Asato eKadI vastU ivaiSaYT

izkaNaI ]%paidt JaalaolaI Asaola tr tI ]%kRYTca Asato ]da. kaolhapUrI caPpla¸ vaokTigarI saaDI¸ mhOsaUr isalk¸ daija-laIMga

caha yaa ivaiSaYT BaaOgaaoilak pdoSaatIla vastU Aahot. ASaa vastuMcyaa baabatIt baáyaacada %yaa ivaiSaYT izkaNaI ]%paidt Jaalaolyaa

nasalyaa trI %yaa toqaoca ]%paidt Jaalaolyaa Aahot Asao dSa-vaUna ivaklyaa jaaNyaacaI Sa@yata Asato %yaamauLo ASaa BaaOgaaoilak

ivaSaoYataMnaa saMrxaNa doNyaacyaa dRYTInao jaagaitk vyaapar ivaYayak baaOiwk saMpda AiQakarI TRIPS krarat 22 to 24 klamao

samaaivaYT krNyaat AalaI va %yaanausaar jaagaitk vyaapar saMGaTnaocyaa sava- saBaasad doSaaMnaa BaaOgaaoilak ivaSaoYataMnaa saMrxaNa doNyaacyaa

dRYTInao kayada krNao AavaSyak krNyaat Aalao. %yaacaaca Baaga mhNaUna Baartat 1999 maQyao Baart sarkarnao jaagaitk vyaapar

saMGaTnaocyaa QaaorNaanausaar kayadyaat bahla kolaa Aaho.

yaaiSavaaya sauxmajaIva jaMtUsaazI poTMT¸ raopaMcyaa navaIna jaatI À namaunyaaMnaa saMrxaNa AaiNa prMpragat &anaBaaMDarasa saMrxaNa [%yaadIMcaa

doKIla baaOQdIk saMpda h@kaMt samaavaoSa haotao.

baaOQdIk saMpda h@kacyaa samasyaa (Problems of Intellectual Property Rights) Á

navao saMXaaoQana navaI ]%padnao AaiNa navyaa pNaalaI yaaMcyaa maaQyamaatUna doXaacyaa Aaiqa-k ivakasaalaa caalanaa imaLt Asato %yaa dRYTInao

baaOQdIk saMpdocao doXaacyaa Aaiqa-k ivakasaatIla mah%va laxaat yaot Asalao trI baaOQdIk saMpda h@kaivaYayaIcaa kahI samasyaa

inamaa-Na haotat %yaa puZIlap`maaNao.

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1. baaOQdIk saMpda AiQakaramauLo Saasana saMsqaocyaa madtInao ta%purtI ma@todarI inamaa-Na haoto. SaaoQakta- ikMvaa baaOiQdk

saMpdocaa maalakacaI ma@todarI inamaa-Na Jaalyaasa %yaaMcyaakDUna AiQak nafa imaLvaNyaasaazI laaokaMcao Aaiqa-k SaaoYaNa kolao

jaavaU Sakto.baaOQdIk saMpda AiQakaracyaa kayadyaamauLo laaokihtalaa baaQaa inamaa-Na haoto karNa kahI kaLapurto ka

hao[-naa ma@todarIlaa p/ao%saahna dotat.

2. Anaok laaokaMmaQyao saja-naSaIlata Asato. to satt kahInaa kahI navainamaI-t krIt Asatat. ParMtu %yaaMnaa baaOQdIk saMpda

h@kaivaYayaI jaaNaIva nasalyaanao sadr saMSaaoQana %yaaMcyaa purtoca mayaa-idt rahto. ASaa saMSaaoQanaapasaUna %yaaMnaa Aaiqa-k laaBa

imaLt naahI %yaaMcyaa navainaima-tIcaa samaajaasa va doSaasa ]pyaaoga va fayada haot naahI.

3. baaOQdIk saMpda AiQakaratIla poTMTcao AiQakar AmaoirkokDo Asalyaanao %yaaMnaaca %yaacaa fayada hao[-la Aivakisat doSaaMnaa

haoNaar naahI. bahuraYT`/Iya kMpnyaakDo poTMTcao AiQakar Asalyaanao %yaaMcaa jagaat pBaava inamaa-Na hao[-la karNa Aivakisat

AaiNa ivaksanaSaIla doSaaMcyaa baajaaratUna yaa kMpnyaa nafa imaLvatIla.

4. BaartatIla ivaivaQa vastUMcyaa baajaarpoza yaa bahuraYT/Iya kMpnyaa kabaIja krtIla %yaaMcaa BaartIya baajaarpozot iSarkava

vaaZola %yaacaa pirNaama BaartIya vastMUvar hao[-la.

5. baaOQdIk saMpda h@kaivaYayaI Baartat laaokaMcaI maanaisakta hI Aaiqa-k laaBa imaLvaNyaapoxaa inaima-tIcao Eaoya imaLvaNao hI

Asato BaartIya laaok prMpravaadI¸ AlpsaMtuYT Asalyaanao baaOiQdk h@k imaLNyaabaabat farsao ]%sauk nasatat. tsaoca

baaOiQdk saMpda h@k pàPt krNyaacyaa pikyaoivaYayaI maaozyaa p,maaNaavar A&ana jaaNavato tsaoca hI pik`yaa ikcakT¸

gauMtagauMtIcaI¸ vaoL#aa} Aaho.

6. Pa%yaok doSaacyaa saMdBa- ibayaaNao¸ paLIva pàNaI¸ vanasptI yaaMcyaabaabat jaI doSaI vaaNaacaI jaI japNaUk haot haotI tI hyaa

tM~&anaacyaa vaapracyaa spQao-t haoNaar naahI.doSaIya vaaNa¸ p`jaatI naYT haoNyaacaI isqatI inamaa-Na JaalaI Aaho %yaacaI jaagaa

navyaa saMkirt vaaNaaMnaI GaotlaI Aaho. jao saMsqaa%makdRYTyaa caaMgalao maa~ gauNaa%makdRYyaa kmakuvat Aaho.

7. ivaksanaSaIla doSaatIla SaotIcyaa ]%padna #acaa-t hyaa poTMTmauLo vaaZ JaalaI Aaho. jaagaitk spQao-t iTkNyaasaazI

saMSaaoQanaavar AfaT #aca- kolaa jaatao. %yaamauLo saMSaaoQanaatUna pàPt rasaayainak #ato¸ fvaarNaIcaI AaOYaQaI¸ vaaNa¸ ibayaaNao

hI do#aIla mahaga haot Aahot. caIna saar#aa doSa baaOQdIk saMpdomaQyao Baartapoxaa 28 pTInao puZo Aaho.

BaartatIla baaOQdIk saMpda inado-SaaMk isqatI:(Status of Intellectual Property indicators in India) Á

jaagaitk baaOQdIk saMpda saMGaTnaocyaa 2018 cyaa Ahvaalaanausaar BaartamaQyao doNyaat Aalaolyaa baaOQdIk saMpda AiQakaramaQyao sana

2016 cyaa tulanaot sana 2017 maQyao 50 T@kaMnaI vaaZ JaalaI Aaho. sana 2016 maQyao Baartat ekUNa 8248 baaOQdIk saMpda

AiQakar bahala krNyaat Aalao haoto. %yaamaQyao vaaZ hao}na sana 2017 maQyao ekUNa 12Â387 baaOQdIk saMpda AiQakar doNyaat

Aalao haoto.

sana 2016 maQyao ekUNa 1¸115 BaartIya AaiNa 7¸133 prdoSaI naagairkaMnaa À GaTkaMnaa baaOQdIk saMpda AiQakar doNyaat Aalao

haoto. tr 2017 maQyao ekUNa 1712 BaartIya AaiNa 10¸675 prdoSaI naagairkaMnaa À GaTkaMnaa baaOQdIk saMpda AiQakar

doNyaat Aalao haoto. mhNajaoca BaartIya naagairkaMpoxaa prdoSaI naagairk ikMvaa GaTkaMnaa doNyaat Aalaolao baaOQdIk saMpda AiQakar

jaast Aahot.

baaOQdIk saMpda h@kabaabat Baartanao 2008 to 2017 yaa kalaavaQaIt kolaolaI pgatI mah%%vaacaI Aaho. tsaoca koMd sarkarnao

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2016 cao navaIna baaOQdIk saMpda QaaorNa¸ naagairkaMmaQaIla baaOQdIk saMpda h@kabaabat vaaZtI janajaagaRtI¸ Saasana AaiNa BaartatIla

ivaivaQa ivaVapIzo yaaMcao saMSaaoQanaalaa idlao jaaNaaro pào%saahna¸ BaartIya samaajaacaI vaaZtI saMSaaoQak vaR%tI yaa sava- karNaaMnaI yaoNaaáyaa

kaLat baaOQdIk saMpda h@kaMcaa maaQyamaatUna BaartIya saMSaaoQak AaiNa ]Vaojak Baart doSaalaa inaiScatca ek Aaiqa-k mahasa%ta

mhNaUna naivana ivakisat Baart inamaa-Na krtIla ASaI Apoxaa k$ yaa.

inaYkYa-:

1. baaOQdIk saMpda %yaacao sva$p va samasyaa laxaat Gaota jaagaitkIkrNaa naMtrcyaa kaLat bahuraYT/Iya kMpnyaa hyaa poTMT

yauQdacyaa maaQyamaatUna jagaavar Aaiqa-k vaca-sva inamaa-Na krNyaasaazI sajja Jaalyaa Aahot.

2. baaOQdIk saMpda AiQakar imaLivaNyaasaazI vayaacao baMQana nasato %yaamauLo baalavayaatIla mauLo sauQda Aaplyaa manaatIla klpnaaMcao

BaaMDvala k$ Saktat.

3. ivaksaIt doSaacaa saMSaaoQana¸ nava p`vat-na yaavar haoNaara #aca- laxaat dota %yaaMcaIca ma@todarI baaOQdIk saMpdocaa saMdBaa-t AsaNaar

yaat SaMka naahI.

4. maaQyamaaMmauLo baaOQdIk saMpda AiQakar GaoNaaáyaa vya@tIlaa saMrxaNa imaLto tsaoca kaoNaI Aaplyaa klpnaocaa vaapr krIt

Asalyaasa %yaaMcaIhI maaihtI imaLto.

5. poTMTmauLo ma@todarI vaaZt Aaho. %yaamauLo ivaksanaSaIla doSaatIla Aqa-vyavasqaocaa kNaa AsaNaaro kRYaIxao~alaa svast Aayaat

SaotImaalaaSaI spQaa- mahagaDyaa ibaÁ ibayaaNao¸ #ato¸ jaMtUnaaSako yaaMnaa taoMD Vavao laagat Aaho.

6. raYT/Iya baaOQdIk saMpda AiQakaramauLo Baartalaa jagaat Aaplao sqaana Ba@kma krta Aalao.

7. baaOQdIk saMpda AiQakaracaa vaapr k$na doSaatIla tLagaaLatIla vya@tIMnaa Aaplao saMSaaoQana jagaasamaaor p`diSa-t krNyaacaI

saMQaI imaLto.

saMdBa- :

1. Intellectual Property Rights Nature and Problem, Prashant Publication’s Feb – 1919. 2. dOinak laaoksa%ta id. 7 iDsaoMbar 2018¸ 12 iDsaoMbar 2018

3.Da^. maRdulaa vaoLo kqaa Aklaocyaa kayaVacaI¸ rajahMsa p`kaSana.

4. www.wikipedia.org

5.Aqa-saMvaad eip`la jaUna 2005¸ KMD 25¸ AMk 1

6.Aa@Taobar¸ iDsaoMbar 2005 KMD 25¸ AMk 3 7. http://onlinetyari.com./marathi/latest-newarticles-2016.

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February 2020


INFRINGEMENT OF TRADEMARK BY COMPARATIVE ADVERTISING

Mrs. Gandhali C. Abhyankar

Research Scholars, J.J.T.U. University

Abstract

Trademark is a name & the reputation of the company. Company spend considerable amount of money for making

a name or a symbol and they make it popular through various media of advertising. As a result the trade mark

may acquire grate reputation and become stamp of quality and a symbol of origin. The trade mark gives assurance

to the purchaser about quality and faith of the product. Trade mark is the soul of the company. Manufacturer or

trader who has built up a reputation for his trademark would obviously be protective against piracy. Registering

trademark is not compulsory in India however it depends upon how well known or reputed the brand is. Moreover,

once the trademark is registered then it would be easier to prove its originality. There are certain Trademarks

which have established themselves extremely well. For example, right sign of Nike, star of Mercedes Benz etc.

However, there is likelihood that the trademarks may be copied by certain companies to take undue advantage of

the already established brands. Hence, registering the Trademark is advisable and ensured that the undue

advantage is not taken by any other company. However, everyone must ensure that their originality is maintained

rather than copying anyone.

The main object of this paper is to identify the reasons, implications and 5damages of infringement of Intellectual

Property Rights.

Key Words : Comparative advertisement, infringement, trademark, criminal as well as civil proceedings, copy

INTRODUCTION

Trademark is symbol, sign, design, clour, picture, sound, smell or combination of either of them. Its basically a

graphical representation of a particular product, service or a Company. It also includes signature, name, brand etc.

A trademark usually distinguishes goods and services of one company from another.

If the historical background of trademark is perused then it spreads across the span of Roman Empire. During this

period the Blacksmith used to manufacture swords and used to put a symbol for the identification of the

manufacturer. This is being considered as the first ever use of trademark. The first legislation pertaining to the

Trademark was passed in the year 1266 during the tenure of King Henry III. According to this legislation it was

required that the bakers of England were asked to use a specific distinctive mark on the breads they sold.

In India if history of trademark is studied then it can be seen that the during olden days without knowledge peopled

used to use certain symbols which eventually became trademarks. For example, certain set of people used to wear

a specific type of mark on forehead like trishul (ψ) and these people were the devotees of Lord Vishnu.

Whoeverwore this type of mark on forehead were considered as devotees of Lord Vishnu. Similarly, devotees of

Lord Shiva wore three horizontal white stripes. Similarly, during era of kingdoms, various kings had their own

stamp which was called as “Ramjmudra”. Thus, Trademark is not a new concept in India.

However, in recent times due to revolution in Communication sector many incidences of infringement of

Intellectual Property Rights have been noticed. Several cases have been registered across the country in various

courts after since India became a member of Madrid Protocol in July, 2013. Since then the awareness about the

trademark as well as rights associated with its infringement has increased. It is really shocking that more than

7000 cases are still pending in various courts across the country however, yet Trademark Registration hasn’t been

made compulsory.

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Lethargic approach of registering Trademark

In Indian context per se the Trademark Registration hasn’t been seen mandatory requirement of the business.

Though that awareness is being generatednow a day due to entry of multinational companies and overall growth

of the market. Nevertheless the lethargic approach could be a possibility.

Unawareness about the legal Approach: The companies are being formed, products being designed, brands

being established etc. However, overall awareness about the Trademark Registration and its legal implications

etc are not being known. Moreover, it is seen that Indian mentality is to carry forward the business of the

family. Younger generation is little aware about these legal rights. However, older generation may find it

unimportant or tedious.

Legal Implications : As of now there is very little awareness of legal complications or implications which

are associated withthe piracy of trademark. Now a days companies are not continuing with the same brands.

Due to competition there is definitely brand extension and brands development being done by companies.

However, overall aware ness pertaining the necessity of Trademark Registration and enforcement of those

rights associated with registration is missing.

The Technical Complications: There is lot of paper work which is required to be done for the Registration of

Trademark. It also demands for initial survey to find our viability of ones trademark. There could be chances

of rejection of trademark due to similar Trademark being registered already. Under the circumstances

entrepreneur or the promoter of the company will avoid into going into these complications.

Expenses: Entire procedure for the Registration of Trademark is little tedious and little expensive. General

approach would be not to get into these complications and also to pay money for the same.

There are so many unexplainable reasons for not registering the trademark.

Importance of registering Trademark

Even though the Trademark Registration is an extremely important aspect of any business conglomerate there are

several advantages associated with it. Some of the advantages and important aspects could be studied as under:

Goodwill: Registering trademark means having exclusive rights on particular graphic design. Registering

trademark improves the overall value of the company and its products as it’s creating goodwill among the

customers and rivals.

Differentiation : Registration of the Trademark is not only little complicated procedure but also little

expensive and hence registration of the Trademark shows different approach of the company towards its

products compared to products or companies which has not registered the Trademark.

Identity of the Product: Registration of the Trademark helps to identify origin of the product. Trademark can

be an extremely effective communication tool between buyer and the company. Being registered and

established the Trademark can protect a particular brand too.

Recognition: Now a days number of products in the similar category are available in the market. Moreover,

substitutes are also available in ample numbers. After the Registration of the Trademark and its use, the

customers can easily recognize and associate themselves with the Product/Brand/Company. Trademark can

helpthe product or brand to stand differently in this market.

Reputation: As stated above the Customers immediately identify themselves with the

Product/Company/Brand. Customers after viewing a trademark know who they are dealing with.The

reputation of the Company grows higher if the trademark is registered and its being treated as the asset.

Legal protection: If the Trademark of a particular product/brand or company is registered then it cannot be

used by someone else. In case it has been found out that someone else is using the trademark already registered

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February 2020


then the penal charges are very high. The Company could be reimbursed with all the losses they have incurred

so far. A Company could be protected from the serious offenses like piracy of brands or products.

Other: Trademark allows business to effectively utilize the Internet and social media. Registered Trademark

would allow a Company to advertise the Products or brands via social media.A customer can identify the

product from anywhereby identifying the trademark. Trademark can inspire positive feelings amongst the

people at large and as a result it would entail people to work in the Company thereby granting employment

opportunities to the youth.

Protectionof Trademark from infringement

The Protection of trademark starts immediately after starting of the new company or new business.One should be

very careful while choosing company’s name, design or graphics of logo, packaging etc. It is a difficult task to

choose the logo of choice to protect it from infringement. To choose correct appropriate Trademark and get it

registered consumes lot of time. The ultimate aim is to protect the Company/Brand/Product of the company being

misused by anyone else.

Steps to protect thetrademark:

1. Registration of the trademark: Once the Company/Business is started the process of Trademark registration

should be started. It would suffice two basic purposes viz, protection from infringement of the Trademark

which is already registered and protection of our trademark which may be misused in future.

2. Always do market homework: To avoid legal complications associated with the infringement of the

Intellectual Property Rights, one should always do homework of the market. All the aspects pertaining to the

availability of the similar products/services and their legal position pertaining to the registration of the

Trademark etc should be studied in advance.

3. Legal Advice: One should always seek support from the legal advisor associated with this field. Hiring of

such legal advisor though costly, helps in protection of several legal complications in future pertaining to

infringement of Intellectual Property Rights.

4. Avoid assumptions: Trademark registration is absolutely legal and transparent. It would enable one not only

to identify which are already registered trademarks in the same field but also would protect the registered

trademark from being infringed. Hence there is no need to go into certain types of assumptions. On the

contrary the legal steps must be adopted to find out the reality. Also, one should never assume that the his/her

registered trademark cannot be copied.

5. Monitor Internet and social media: Now a days Internet and Social media are available on figure tips. It must

be continuously monitored to find out whether the Trademark is being infringed or has any of the rules and

regulations of Intellectual Property Rights have been violated.

6. Activate Google alerts: Technology has really grown very high and several technologies could be adopted to

find out infringement of any rights associated with the Intellectual Property. For example, a simple tool

available on the internet is Google alerts which can give intimation pertaining to the copy of the trademark

on social media or any other means on Internet.

7. Professional support: Right from the registration of the Trademark to its protection in future it is necessary to

seek professional support from the legal advisors of the field. It may incur expenses on the part of the company

however, to really enjoy the advantages of the legal proceedings of the Trademark, the expenses could be

considered as investment.

Impact of infringement Trademark

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Trademark is anasset of the company. Infringementof Trademark could lead to confusion with in the customers

and it may damage the reputation of the original company.This can cause development of unethical practices.

Consumers can get dummy products due to infringement trademark.Infringementof Trademark can call for severe

legal action and may lead to monitory losses in terms of pecuniary damages.

Example cases of Infringement Trademark

1. Apple inc.Vs Samsung Electronics Co. Ltd (06/12/2016): Several cases have been going on between two big

players of the mobile sectors over the issues related to Patents. This is a huge financial burden for both the

companies as both the companies are fighting this battle across the globe.

2. Adidas America Inc. et. al. v. Sketchers USA Inc.: In this matter the Sketchers USA Inc had misued the logo

of Adidas for its benefit. The only difference they made was keeping the colour of the logo light. The matter

is currently in the courts however, Adidas got stay from lower court over the use of the logo by Sketchers

USA till the finalization of the case. Moreover, legal panel is of the opinion that Adidas is likely to succeed

in the case and can recover heavy damages from Sketchers US.

3. Pirus Auto Industries Ltd. &Ors. Vs. Toyota Jidosha Kabushiki Kaisha (23/12/2016) : In this matter the

Toyota company had filed a case against Pirus Auto Industries for misusing the name Toyota for selling their

accessories. The lower court gave judgement in the favour of Toyota and directed Pirus Auto Industry to pay

damages to the tune of Rs. Ten Lakh to the parent company. Pirus Auto has filed an appeal and the appeal is

pending.

4. Arun Chopra v. Kaka-kaDhaba Pvt. Ltd. and Ors. (28/11/2018): In this case the proprietor of Kaka kaDhaba

a chain of restaurants have claimed that the Plaintiff had misused their name and style to their advantage. It

was claimed that KakKaDhaba was the name being used to run hotel since the year 1931 and has got branches

in New Delhi and Lahore. It was copied by one Mr. Arun Chopra. Lower court gave verdict in favour of Kaka

KaDhaba and matter is pending in appeal.

5. Crocs IncUsav. Bata India Ltd &Ors (24/01/2019) : In this case basically Crocs Inc had filed cases against

several manufacturers thereby claiming that two of its products had unique style, design, pattern, shape and

configuration. It was claimed that these products were registered under Intellectual Property Rights. It was

alleged that these products were copied and hence litigations were filed against these companies for copying

these products. Appeal is pending before Hon’ble High Court.

Above all cases shows there are battles between reputed companies for Infringement of Trademark rights. It also

shows how much Trademark is important for companies

SUGGESTIONS:

1. Many companies avoid legal aspects pertaining to the Trademark registration and thereafter infringement.

That must be avoided and trademark registration should be made compulsory.

2. Companies should adopt state of the art technologies to protect their own trademarks.

3. More means must be used to spread awareness pertaining to the trademark registration and its benefits.

CONCLUSION:

In my view the Trademark as Intellectual Property is not seen with serious tone. It hasn’t been considered as the

significant aspect of the business. Hence, the awareness is required to be generated amongst the youth who are

interested in starting of business and/or company. The legal implications, procedures etc. shall be made easily

available to the public at large. Students should be compulsorily be made to study these subjects to the level of

understanding etc.

REFERENCES :

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Marketing Management Coses and Concepts by NikhileshDholakia, RakeshKhurana, LabdhiBhandari,

Abhinandan Jain.

Modern Advertising Management Principles and Techniques J. N. Jain and P. P. Singh.

Principles of Advertising by Monl Lee and Carla Jhonson.

Preamble ,Trade Marks Act, 1999

Narayanan, P. (2004). Law of Trade Marks and Passing off (6Ed.)

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EXPECTATIONS ON GST COMPENSATION TO THE STATES AND INDIAN FISCAL

FEDERALISM

Mr. Sachin D. Bansode

Assistant Professor, Department in Commerce

P.D. Lions College of Commerce, Malad, Mumbai

Abstract

GST regime came into existence on 1/7/2017 by submerging several state & local governments owned taxes by

101stConstitutional Amendment. GST replaced all indirect taxes levied on goods and services by the central and

state governments with certain exceptional goods & services still in the hands of state government.

Certainly due to the GST regime every state and local self government lost permanently use tax revenues therefore

GST compensation to state act look after the revenue loss compensation to the state by creating GST compensation

fund by imposing GST compensation cess on certain category of product.

Hence in reality still there is a mismatch and gap between the promised to relief for or the revenue loss and the

Expectations of the state government from the actual receipt of GST compensation. Therefore it is time to review

the GST implementation and expectations of the states under the fiscal federalism as prescribed under the

constitution of India to improver the revenue relationship, especially after completion of the transition period i.e.

30/6/2022.

Key Words: GST- Compensation, Cess, Transition Period, Indirect Tax Revenue, Fiscal Federalism.

Introduction

Part VI of the Constitution of India deals with governance of the State governments wherein Article 198,

199 provide legislative power to the State government regarding any taxation. Whereas Part IX deals with

governance of the Panchayat local self government wherein Article 243-G, 243-I provides taxation authorisation

and assigned the shares from State government to the Panchayat. Whereas Part IX-A deals with governance of

the Municipalities local self government wherein Article 243-W, 243 -X provides taxation authorisation and

assigned the shares from State government to the Municipalities. The XI schedule of the Constitution of India

provide 29 functional areas for the Panchyat administration and XII schedule provide 18 functional areas for the

municipal administration.

GST (Goods & Service Tax) is one of the indirect taxes which replace the several taxes earlier exclusively

levied by the State government and the Local Self-government like VAT, Entry tax, Octroi, etc. The Maharashtra

government in the year 2015-16 out of its total revenue receipt of Rs 1,40,031.12 crore allotted Rs.18,239.92 crore

to the Panchayat local self government which share to 13.02% of total budget provision. Whereas allocation for

the Municipalities were of Rs 9,187.23 crore which share to 6.56% of the total budget provision.

Upto year 2020 GST implementation completed it certain issues and scope for developing the spirit of

the fiscal federalism asenshrined in the constitution of India while achieving the objectives of GST.

Concept compensation in GST is provided to the states for the loss of revenue due to the implementation

of GST in which various State governments levied taxes till 30/6/2017. Whereas GST implemented started on 1st

July 2017.Five years is the period describe for the compensation as per the GST Council among this period first

three years 100% compensation will be provided to the state on this fourth year 75% compensation will be

provided and on the fifth year 50% of the compensation will be given to the state government.

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Comptroller and Auditor General of India has highlighted certain issues regarding the slow growth rate of indirect

taxes, declining in the collection of the revenues by the Central government, short call of the GST compensation

cess collection and GST compensation to be paid to the state governments.

Report of The Comptroller and Auditor General of India for the year ended March 2018 made

observations about the indirect taxes specifically on the GST. 5.80% slow down in collection of indirect taxes at

2017-18 compared with 2016-17 the growth rate was 21. 33% of the indirect taxes collection, it reduced at 15.

53% was growth rate in 2017-18. The net collection of indirect taxes in 2016-17 was Rs. 8.47 lacs crore, whereas

the central revenue on GST has declined of 10% in 2017-18, in the same year Rs. 6,466 crores was short transfer

of GST Compensation Cess into the Public Account.

Literature Review

Studied topic is new and in process of evolution only little literature and study is conducted:

Sacchidananda Mukherjee and Kavita Rao (2019) in their Background Paper prepared for the 15th Finance

Commission on “Fiscal Implication of introduction of GST in India” stated the methodology on estimation of

GST revenue collection and GST revenue sharing among Central and different state governments. They analyses

the published data of GSTN for understanding revenue implications of GST and it also forecast with revenue

collection from the Petroleum taxes and thereby understand the fiscal implications of GST on the different states

revenue collection and they also forecast the Revenue under Protection and possibility of fulfilling expectations

on collection of GST Compensation Cess and distribution of the GST Compensation among different States.

Sacchidananda Mukherjee(2020) produce a working paper on “Possible Impact of Withdrawal of GST

Compensation Post GST compensation period on Indian state finances” he has prescribed a possible impact of

withdrawal of GST Compensation after completion of Transition Period on 31/06/ 2022, on finances of the state

governments he also tried to find out impact on the Fiscal Management and Microeconomic stability on States.

He highlighted on an inability of the Central government to provide GST compensation to State governments at

14% of growth rate in an uncertain situation and of less GST collection. He recommended a new model of GST

Compensation Cess to overcome the problem of Revenue Protection and to incentive the States to take extra tax

collection efforts to reduce pressure on GST Compensation Cess for providing GST Compensation to States.

Sacchidananda Mukherjee(2020) write an article on “Compensation to Cantonment Boards for Revenue

Loss on Account of GST’ he specify a historical journey of taxation of the local bodies like Cantonment Boards

and its power of taxation under the Constitution of India. Post introduction of GST, resulted in a permanent

revenue loss and perpetual budgeted stress on the fiscal administration of Local Bodies. After an analyses of the

Maharashtra GST (Compensation to the Local Authorities) Act, 2017 he suggested a model for Revenue

Compensation to the Local Bodies which has not yet been considered under any of the State Compensation Acts

to compensate Local Bodies, even though it is considered in the Central Compensation Act. Therefore he

suggested Permanent Compensation to the Local bodies for loss of revenue which has a joint responsibility of the

Central and State government or assign new sources of revenue to Local bodies from the State government to

reduce its fiscal burden.

Sacchidananda Mukherjee(2019) wrote an article on ”Whether States Have Capacity to Sustain Projected

Growth in GST Collection During the GST Compensation Period?” he discuss on harmonisation of ‘One Nation

One Tax One Market’ GST regime that introduced in 2017 by curtailing fiscal autonomy of the States with

submerged several taxes of State and Local Bodies, many States resisted GST mainly due to permanent loss of

revenue. Therefore to develop common consensus on GST regime, Revenue Protection is allowed in the form of

GST Compensation for five years to cover the loss of revenue. He further explained how the GST Compensation

mechanism will bring stability in States finance. He described that each State government will depend on own

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capacity and efforts to increase taxation at 14% growth on the base year revenue in comparing submerged taxes

during a GST compensation period.

Lekha Chakraborty (2019) prepared a working paper on “Indian Fiscal Federalism at The Cross-roads:

Some reflections” analysed the fundamental institutional changes in Fiscal Federalism by scrapping of Planning

Commission, setting NITI Aayog, GST Council and GST regime by way of the Constitutional Amendments. She

emphasis debate to link GST Council with Finance Commission and transfer focus from Revenue Sharing to

Resource Sharing to equalise services in States and Centre. She find discussion in GST Council mainly on fiscal

issues rather political so expects, Terms of Reference of 15th Finance Commission shall be drafted by GST

Council or by empower finance ministers of States and shifting of ‘Tax Sharing’ to ‘Grant Equalisation’ model

and needed a permanent Finance Commission.

Objectives of the Study

The present study is undertaken with the following objectives:

1) To study the revenue implications on the Maharashtra state, post-implementation of GST.

2) To study the expectations on the GST compensation to State after the transition period.

3) To study the impacts of GST regime on revenue relationship of Indian federal structure.


In the present qualitative study, the secondary sources of information such as minutes of the GST Council, GST

published data, Budget analysis papers, GST press release, CAG reports, Research Papers, Economic survey of

Maharashtra & Constitution of India are used. Whereas the research tools and techniques like critical evaluation,

Contain analysis, rational inductive reasoning methods are used for subjective interpretation and finding

conclusion descriptively.

Discussion

With the available data of last three years on GST are adequate to analysed the trends and to understand

the direction given to the Indian Federalism and its issues and resolutions. Present study focus exclusively on

issues of GST compensation to States and Local Bodies which was considered at the Central level but yet not

completely resolves the issues of Local Bodies it should be consider under the concept of “State”. The original

three tier system of governance as described in the Constitution like, Central, State & Local self governance, in

GST regime only two tier system is considered i.e. Central and State/UT, creates fiscal issues.

Analysis

As discussed above, certain issues create in a Fiscal federalism which needs to solve.

Table No- 1: GSTCC Collected, Released and Pending Amount (Rs. Crore):

Period Collected Released Balance / Pending

July- 17 to Mar- 18 62,616 48,178 14,438

Apr- 18 to Mar- 19 97,369 62,243 35,126

Apr- 19 to Dec- 19 55,977 81,042 -12,721

(Ref.: NIPFP, Table No.- 1, Pg.- 4)

Above Table-1 shows first two year was pending GST Compensation but in third year excess amount

paid which should be Rs. 25,065 Crore but show only Rs. 12,721, its mean there is discrepancy find of Rs. 12,344

Crore, without any noting or the relevant information.

Table No- 2: Quarterly Shares of Top 5 Major States in Total State GST Collection (%):-

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States July-

Sept-17

Oct-Dec-

17

Jan-

Mar-18

Apr-

Jun- 18

July-

Sept- 18

Oct-

Nov- 18

Average

Share %

Maharashtra 19.47 17.66 17.02 16.47 16.30 16.40 16.39

Uttar Pradesh 8.24 8.50 8.76 9.08 8.77 8.87 8.90

Karnataka 8.63 8.12 8.35 8.27 8.26 8.36 8.30

Tamil Nadu 9.47 8.50 7.91 8.11 8.54 7.83 8.16

Gujarat 7.66 7.35 7.57 7.29 7.11 6.94 7.11

(Ref.: NIPFE Table No- 19, Pg. 26)

Above Table-2 highlighted that Maharashtra is still highest in proportion of GST collection over the other

states but does it mean that Revenue Sources lost permanently will it compensate only in the form of increasing

revenue collection need to be consider differently.

As per the Maharashtra State Budget 2016-17 budgeted estimation of tax revenue was Rs.1,44,222 crore,

out of which Sales Tax collection Rs. 81,438 crores having a share 56.5% and Stamp Fees collection Rs. 23,548

crore having a share 16.3%.

Table No- 3: Growth rate of tax revenue receipt of Maharashtra:

Items 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19

Tax Revenue 1,25,228 1,32,694 1,54,714 1,70,331 2,05,151 2,30,982

Growth

Amount

6,588 7,466 22,020 15,617 34,820 25,831

% Growth

Rate

5.55 5.96 16.59 10.09 20.44 12.60

(Ref.: Maharashtra Economic Survey – 2018-19, Pg. 96)

Above Table-3 states the total revenue receipts, growth amount and percentage of growth rate gives an

idea that in post GST period except 2017-18 other two years had less than 14% growth rate as guaranteed upon

the base year 2015-16, this issue must be concern.

Table No- 4: Details of GST Compensation Released to Maharashtra (FY – 2017-18):

State July &

Aug-17

Sept. &

Oct- 17

Nov. &

Dec- 17

Jan. &

Feb.- 18

Mar.- 18 April &

May- 18

Total

Maharashtra 0 834 0 654 1,589 0 3,077

Total GSTC

Released

10,805 13,694 3,898 13,085 6,696 3,899 52,077

(Ref.: Press Information Bureau, GOI, Date: 10/08/2018)

Above Table-4 shows that Maharashtra gets only 5.90% of the total distributed GST Compensation

inspire of fact (see table-2) that Maharashtra contributed highest on revenue collection which gives thought on

need to assign more sources of revenue to Local Bodies, on whose cost and consent GST started, so that LBIs be

consider in GST Compensation to State.

Table No-5: Projection of SGST Revenue of Maharashtra as per GSTN Database (Rs. Crore):

State 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25

Maharashtra 102,039 113,468 126,744 141,826 141,826 177,430


Above Table-5 projected on SGST Revenue collections till 2025 but SGST collected in 2018-19 was Rs

2, 30,982 (see table-3) crore therefore all projections made underestimated.

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Table No- 6: Shortfall to Provide GST Compensation to Maharashtra (GSTN Database) (Rs. Crore):

State 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25

Maharashtra NA -2682 -5667 -9122 -13378 -18742


Above Table- 6 estimated shortfall to provide GST Compensation to Maharashtra are continuously

increase in spite of the positive projection in the SGST collection, emphasis on Revenue Protection needed in

form of GST Compensation as a permanent fiscal arrangement.

Conclusions

After going through all above material, data and information analysis I understand the strong financial

position of Maharashtra but we interpreted that still GST Compensation must be made a permanent by GST

Council by considering the permanent loss of not only of Revenue amount but lost the Revenue Sources

permanently which are affecting on the fiscal relation of the State and Local Bodies more and also it is against the

Constitutional mandate of Fiscal Federalism enshrined in the Articles 198, 199, 243-G, 243-I, 243-W and 243 -X

and other original parts dealing with Fiscal Federalism must be uphold in the right spirit and text. Therefore I

suggest that GST Council must extent the transition period permanently and LBIs must be consider in term ‘State’

to directly distribute GST Compensation to State/UT & LBI.

References

Sacchidananda Mukherjee and R. Kavita Rao, 2019, Fiscal Implications of Introduction of Goods and Services

Tax in India, NIPFP, New Delhi.

Sacchidananda Mukherjee, 2020, Possible Impact of Withdrawal of GST Compensation Post GST Compensation

Period on Indian State Finances, NIPFP, New Delhi.

Report of the Comptroller and Auditor General of India, Report No. 11 of 2019, GOI, Department of Revenue

(Indirect Taxes – Goods and Services Tax).

Chakraborty, Lekha S, 2019, Indian Fiscal Federalism at the Crossroads: Some reflections, MPRA Paper No.

93516, posted 01 May 2019 16:29 UTC.

Sacchidananda Mukherjee, 2019, Review of Market Integration, Sage Pub, India, 1–24.

Report of the Comptroller and Auditor General of India on Local Bodies, Report No. 5 of 2017, Government Of

Maharashtra.

Vijay Kelkar, 2019, Working Paper No. 252, Towards India’s New Fiscal Federalism, NIPFP, New Delhi.



https://cbic-gst.gov.in/compensation-cess-bill-e.html

https://www.thehindubusinessline.com/opinion/columns/slate/all-you-wanted-to-know-about-compensation-

cess/article30321925.ece

https://mahades.maharashtra.gov.in/files/publication/ESM_18_19_eng.pdf

https://www.thehindu.com/books/books-reviews/indian-fiscal-federalism-review-a-shift-towards-the-

centre/article27022638.ece

http://www.levyinstitute.org/pubs/wp_937.pdf

https://mpra.ub.uni-muenchen.de/93516/2/MPRA_paper_93516.pdf

https://prsindia.org/parliamenttrack/budgets/maharashtra-budget-analysis-2018-19



https://cbic-gst.gov.in/compensation-cess-bill-e.html

https://www.thehindubusinessline.com/opinion/columns/slate/all-you-wanted-to-know-about-compensation-cess/article30321925.ece

https://www.thehindubusinessline.com/opinion/columns/slate/all-you-wanted-to-know-about-compensation-cess/article30321925.ece

https://mahades.maharashtra.gov.in/files/publication/ESM_18_19_eng.pdf

https://www.thehindu.com/books/books-reviews/indian-fiscal-federalism-review-a-shift-towards-the-centre/article27022638.ece

https://www.thehindu.com/books/books-reviews/indian-fiscal-federalism-review-a-shift-towards-the-centre/article27022638.ece

http://www.levyinstitute.org/pubs/wp_937.pdf

https://mpra.ub.uni-muenchen.de/93516/2/MPRA_paper_93516.pdf

https://prsindia.org/parliamenttrack/budgets/maharashtra-budget-analysis-2018-19

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IMPACT OF GST ON RESIDENTIAL PROPERTY PRICES IN MUMBAI

Prof. CA Nishant U. Parikh

Assistant Professor in Accountancy

Siddharth college of Commerce & Economics, Fort, Mumbai-400001

Abstract:

The President of India approved the Constitution Amendment Bill for Goods and Services Tax (GST) on 8

September 2016, following the bill's passage in the Indian parliament and its ratification by more than 50% of

state legislatures. This law will replace all indirect taxes levied on goods and services by the central government

and state government and implement GST by April 2017. The implementation of GST will have a far-reaching

impact on almost all the aspects of the business operations in India especially the residential property market.

This study will answer the questions regarding the prices in the residential property segment in the Post GST era

. This new GST law has given greater push to the government’s vision of ‘Housing for all’ providing good

affordable houses to the masses.

INTRODUCTION

The current real estate scenario in Mumbai and the Mumbai Metropolitan Region (MMR) is making a paradigm

shift in the similar manner as we witnessed after a Tsunami of reforms were launched in quick succession from

the implementation of The Real Estate (Regulation and Development) Act, 2016 (RERA), the Goods and Services

Tax (GST), to Insolvency Bankruptcy Code, among others. The RERA Act brought in transparency and

accountability to real estate sector and boosted home buyers' confidence not just in Mumbai and the MMR, but

across the country. So far as Mumbai and the MMR are concerned, these regulatory changes brought in consumer

protection and fairness in the way property is bought and sold.

In sync with these transformations, the emerging focal points of the future real estate market is also evolving and

changing, so suburb locations like Powai, Andheri are becoming "premium pin code destinations". Thane is the

'happening' real estate hot-spot in the present-day scenario while Navi Mumbai's peripheral areas, including

NAINA and Panvel are already making their mark as center-points of the future. It is a story being scripted with

a slew of mega infrastructure projects like Mumbai Trans-harbour link, the Navi Mumbai International Airport,

Metros and CSMT-Panvel fast lane railway linkages, which along with expressways, freeways and waterways

will enhance the connectivity, and make the daily commute a breeze. Among the categories of real estate,

Affordable Housing is the new buzz. Even in a luxury real estate destination like Powai, demand for boutique

luxury homes that are unique, elegant and compact in size is fast moving, while in Thane's plush market, Studio

Apartments and 1 BHK apartments are among the fastest moving in below Rs 1 crore segment.

The new economic growth driver in the form of retail and commercial realty in Thane has resulted in the city

gaining in terms of attractiveness to investors, given the relocation of Mumbai's BFSI and IT sector as also

corporate entities to the city. As an evolving Global City within the MMR, Thane has experienced a

comprehensive makeover, backed by a series of infrastructure development and economic growth opportunities.

A clear winner when it comes to being the choice of aspiring home buyers, Thane rightly tops the league in terms

of residential, commercial and retail spaces, offering the right mix of socio-civic infrastructure and plush

amenities, which are reflected in its standard of living and the enriched quality of life.

Among the leading Emerging Business Districts (EBDs) in the MMR, which are making their presence felt, Panvel

is ideally located at the Mumbai - Pune IT corridor. Fast emerging as the favorable 'future perfect' office location

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for many Indian industry leader companies including MNCs, BFSI, IT and ITeS companies, Panvel also offers

residential options which are ideal homes for those having an aspiration-based lifestyle.

From just being a sleepy town situated at the tri-junction of roads that connect Mumbai Goa and Pune, Panvel has

fast morphed into a 'central location' in the MMR, and with planned infrastructure, all is set to enhance transport

linkages. It is well on its way to becoming the real estate hot-spot of Mumbai's peripheral areas. From capital

value appreciation to rental income, also a combination of both, the residential segment in Panvel offers some

lucrative investment opportunities. Township projects from reputed real estate developers offer a wide array of

options and the investor will most likely have a tough time selecting which project to opt for.

That said, Mumbai's vibrant real estate will continue to grow and evolve across newer locations, that too with the

same level of safety and confidence that property buyers are expecting in the new regulatory era.

UNIVERSE OF THE STUDY

For the present research work universe is the entire real estate sector in Mumbai.

POPULATION OF THE STUDY

The population of the study includes all real estate players which includes companies in the listed space on the

recognized stock exchange as well as private limited companies and partnership firms in Mumbai.

SAMPLE OF THE STUDY

The researcher has collected primary data from Rutugroup of Companies who are prominent real estate players

in Thane district and Kalyan. Data is also collected from Harasiddh group of companies having real estate presence

in the state of Maharastra for more than 40 years.

The researcher has taken information from annual reports of various real estate players like Godrej Properties,

Oberoi Realty and Puravankara which are listed on the recognized stock exchange. The annual reports used for

the study has been audited by a chartered accountant thereby ensuring accuracy, integrity and authenticity of

information.

IMPACT OF GST ON RESIDENTIAL PROPERTY PRICES

The following table provides a comparative analysis of the expected impact in the respective project segments:

Table 1: Comparative Analysis of Expected Impact of GST

Factor Affecting

Property Prices

Affordable Housing

Segment

Mid Segment Property Luxury and Ultra Luxury

Segment

Rate of output

tax

Gain :

Lower output GST

rate of 12% on

affordable houses

constructed, leading

to an effective rate

of 8% under the

‘Housing for All’

(Urban) Mission/

PradhanMantri

AwasYojana and

on low-cost houses

having a carpet

area of 60 sq m/house

Loss:

The output GST

rate of 18% (with

effective rate of 12%)

on houses under this

segment will have an

additional tax burden

on property prices,

as compared to the

affordable housing

segment

Loss:

The output GST

rate of 18% (with

effective rate of

12%) on houses

under this segment

will pose an

additional tax burden

on property prices,

as compared to the

affordable housing

segment

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SUGGESTION

To boost demand in the real estate sector, the GST Council, on February 24, 2019, slashed tax rates for under-

construction flats to five per cent and affordable homes to one per cent, effective April 1, 2019. Currently, the

Goods and Services Tax (GST) is levied at 12 per cent with input tax credit (ITC) on payments made for under-

construction property or ready-to-move-in flats, where the completion certificate is not issued at the time of sale.

For affordable housing units, the existing tax rate is eight per cent.

This is the right step taken by the GST council to boost the real estate sector which is already crippled with a lot

of inventory and lack of liquidity in the system post demonetization. However, there are some issues that remain

which needs to be addressed soon .

After speaking to few real estate developers, the following are the concerns:

1. Align land ready reckoner rates with the actual rates prevailing in the market to arrive at a realistic land cost

(GST is levied after one-third deduction for land).

2. Land cost deduction should be allowed on the basis of actual cost of land and not one-third, especially in cities

like Mumbai as the land cost is often 50–60% of the total cost incurred by a developer.

3. Instead of applying GST @18% and then availing of input tax credit, a flat rate of 5% without tax credit should

be levied. On 24th feb,2019 this has been implemented on under construction property.

4. Clearly outline the methodology to be adopted for allocating the benefit of input tax credit to the final price of

the apartment given the fact that raw material expenses are incurred over an average project life cycle of 4–5

years.

Developers feel that the exact impact will be understood only after a thorough analysis of the implications on each

input cost (in the form of labour and raw material, namely steel, cement, bricks, etc.). With regard to other raw

material inputs—namely cement, steel, bricks, tiles, etc.—the challenge lies in estimating the cost of these

commodities over the entire life cycle of the project. Since the purchase of these supplies is linked to construction

progress , it is difficult for developers to estimate upfront the costs and input tax credit received for the same. This

becomes specially challenging because unlike products with an MRP, real estate experiences price fluctuations

and the developer can only estimate the average price of the apartment and work out the average costs. In addition,

there is the complexity of being on the right side of the NAA by passing on the benefit of input tax credit to the

customers, despite an increase in any other costs. There is no specific mechanism for offsetting any other increase

in cost against benefits of the input tax credit.

With lack of clarity on various parameters of GST, developers were hesitant to comment outright on too many

detailed queries. The general consensus, however, is that the impact on pricing will not be much. The larger forces

of demand and supply will continue to determine pricing. What is definitely evident is that the issues developers

have need to be addressed with clarity, so as to enable them to carry on their business confidently.

CONCLUSION

While GST has simplified the tax treatment for the realty sector and has resolved some of the long-standing issues

appears to be only with regard to increased input credit on the procurement of materials. The rate of GST on

residential contracts has not necessarily reduced to a large extent. The increase in input credit should ideally

reduce the construction cost. However, in an apartment, in addition to construction cost, the land cost also plays

a significant role. The maximum benefit under GST would be available only to projects that are mostly or entirely

executed post implementation of GST. In the case of projects which have already commenced and are nearing

completion close to the GST start date, there might not be significant benefits that the developer can pass on to

the end customer. In any case, for most projects, the estimated benefit may not exceed 3% of the overall

construction cost. This benefit may not translate into a significant reduction in prices for consumers.

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The effective rate of tax has not seen too much deviation, with the earlier rate ranging from 10–15% and now

moving to 12% under GST. Therefore, it may appear that GST would result in savings of at least 3–4% to the end

customer; however, the ground-level reality may be different. The cost of land involved in the project would

significantly impact the ultimate savings the end customer may derive under GST. In projects where the land cost

is low, the savings on account of GST may not be significant. closer to the estimated savings. However, where

the land cost is high, the savings on account of GST may not be significant.

In summary, end customers may be technically entitled to some amount of relief, and builders would be better

off explaining the rationale behind their position depending on their fact pattern.

REFERENCES

http://naredco.in/notification/pdfs/RealEstate_Annual_Handbook_2018.pdf

Annual reports of Listed Public Companies

Real Estate (Regulation and Development) Act, 2016

https://housing.com/news/gst-real-estate-will-impact-home-buyers-industry

Real estate report by IEBF (India Brand Equity Foundation)

An article co-authored by PWC and JLL on the impact of GST on the residential market.

People's Education Society's Siddharth College of Commerce ...

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