Empowering MSMEs with News & Insights

Jammu MSMEs meet Rajnath Singh to highlight problems being faced post GST implementation

Updated: Sep 12, 2017 11:21:26am
image

Jammu MSMEs meet Rajnath Singh to highlight problems being faced post GST implementation

Jammu, Sept 12 (KNN) A delegation of Federation of Industries Jammu (FOIJ) met Union Home Minister Rajnath Singh to apprise him of the difficulties being faced by industries especially the MSMEs in the state of Jammu & Kashmir post GST implementation.

The delegation was led by FOIJ Chairman Rajesh Jain.

The Federation also thanked Centre for grant of partial extension of fiscal incentives to the industrial sector under GST regime to J&K, North Eastern states along with other Himalayan states.

The Federation highlighted that the partial extension of fiscal incentives is only confined to the industrial units which are registered under central excise as on June 30, 2017 whereas no relief has been given to the small scale industries exempted under Central Excise Act with a turnover upto Rs. 1.5 crores prior to GST regime as well as unit under substantial expansion and new industrial units.

However, Jain representing FOIJ said GST subsumed Central Excise duty and impacted the area based exemptions allowing refund of excise duty paid.

He said based on Notification No. 01/2010-CE dated 06-02-2010, a sizeable number of units came into production and other units are now in the process of going for substantial expansion by the existing units and production by the new upcoming units.

“The units based their profitability keeping in mind that they would be availing this incentive for a period of ten years from their date of production. There is as on date no clarity as to how and to what extent the area based exemption will continue as promised in the aforesaid notification,” he said.

Further FOIJ said the model of excise duty exemption in J&K was on a refund mechanism and duty had to be first charged, and PLA portion paid in cash in the Government account and amount of duty paid in cash was refunded to the unit.

“This makes the continuation of the incentive under the GST regime possible without contravening the basic principle of GST,” he said.

Jian said the industry understands that Central Government is proposing to curb the existing 100% refund of excise duty to 58% of cash deposited under CGST and 29% of IGST as the case may be.

This amounts to ‘promissory estoppel’. If this is done it will do irreparable harm resulting in closure of large number of industries who have taken 10 year exemption in their fiscal planning, said Jammu entrepreneurs.

The development and promotion of industry in J&K has to be designed keeping in view the State’s unique economic drawbacks arising out of locational disadvantage, militancy affected with cross border terrorism surrounded by hostile neighbours like Pakistan & China, remoteness and poor connectivity, hilly terrain, poor infrastructure and shallow markets coupled with Law and Order situation since 1990 which have resulted in low economic activity, low employment and low income generation, said the entrepreneurs.

The industrialists demanded withdrawal of 100 % Income Tax Exemption for Industrial Units which was withdrawn w.e.f. 01-04-2012 for the Industries of J&K, setting up of Mother Industry etc.

FOIJ sought personal intervention of the Home Minister in the matter for the survival of industries and restoration of fiscal incentives as they existed prior to GST regime. (KNN Bureau)

COMMENTS

    Be first to give your comments.

LEAVE A REPLY

Required fields are marked *