Legislation is required for direct selling and e-commerce
Updated: Nov 19, 2013 04:57:43pm
New Delhi, Nov 19 (KNN) In the absence of a policy framework for direct selling and E- Commerce, the sector that is worth Rs 6385 crore is currently facing various taxation and other issues that need to be addressed.
IAS, Secretary, Industries, Government of NCT of Delhi, Amit Yadav acknowledged the need for legislation for upcoming retail formats such as Direct Selling and E-Commerce, at a seminar on Emerging Trends in Product Selling: Opportunities and Challenges organised by the PHD Chamber on November-18.
It is important to define the term direct selling, first and the legislation would follow, he said, responding to the need for policy framework for the Direct Selling sector.
While the E-Commerce sector is presently covered under the IT Act, it is still facing several taxation related issues such as Non-uniform VAT rates levied by state governments; CST charge on inter-state sales and the retention of VAT in case of inter-state stock transfers which make it challenging to decide warehouse location, Yadav said.
Offering his views on the sector, “We are witnessing quite a visible change in retailing with Direct Selling and E-Commerce becoming quite popular with the companies as well as consumers. The Indian consumer is gradually moving from the local “kirana” shopping to large convenience stores/ online shopping/ network marketing, that is, direct selling / television based home shopping, etc,” said Chairman, Delhi and NCR Committee, PHD Chamber, Rajnish Goenka.
Significantly, these innovative retail models have initiated a wave of entrepreneurship across the country, attracting heavy investments by individuals as well as private equity firms and are generating considerable employment opportunities.
However, it was agreed that there is a need for a set of guidelines/ regulations so as to create a safe and legally strong business environment for these retail models which shall benefit both business and consumer, equally.
Regional Head (North), Amway India Enterprises Pvt. Ltd G.S Cheema too lamented the fact that there is no specific legislation in India dealing with Direct Selling.
“Unfortunately for the ethical companies, consumer or contractual complaints are registered under the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.This Act gives power of sealing, seizure and arrest, when a complaint is filed,” he said.
He called for some major policy measures by the Union and State Government – such as providing a clear definition of Direct Selling, streamlining the FDI policy and entry route, enacting a Union or State Legislation for the sector and appointment of a Nodal Ministry/ Regulatory Authority so as to give fillip to the Rs. 6385 crore Direct Selling industry in India.
On the other hand, Consumer Policy Expert Bejon Mishra, gave an independent perspective on Direct Selling sector needs for an ethical code in consumer interest.
Indian consumers are demonstrating an increasing interest in online shopping, thanks to the surging number of online users. The growing online retail market has become a very lucrative business for international majors as well.
Meanwhile, Co-Founder and Managing Director, Jabong.com, Praveen Sinha, elaborated upon the promising online retail sector in India, the challenges and the opportunities associated.
India has surpassed Japan to become the world’s third largest Internet user after China and the United States with almost 74 million Internet users.
Internet users in India are going online and ordering all kinds of things from the convenience of their homes: food, home provisions, groceries, automobiles, home electronics, appliances, computers and peripherals, CDs, DVDs, books, cinema tickets, clothes, jewellery, watches, cosmetics, perfumes, flowers, toys, sweets, dry fruits and gifts. (KNN/ES)
IAS, Secretary, Industries, Government of NCT of Delhi, Amit Yadav acknowledged the need for legislation for upcoming retail formats such as Direct Selling and E-Commerce, at a seminar on Emerging Trends in Product Selling: Opportunities and Challenges organised by the PHD Chamber on November-18.
It is important to define the term direct selling, first and the legislation would follow, he said, responding to the need for policy framework for the Direct Selling sector.
While the E-Commerce sector is presently covered under the IT Act, it is still facing several taxation related issues such as Non-uniform VAT rates levied by state governments; CST charge on inter-state sales and the retention of VAT in case of inter-state stock transfers which make it challenging to decide warehouse location, Yadav said.
Offering his views on the sector, “We are witnessing quite a visible change in retailing with Direct Selling and E-Commerce becoming quite popular with the companies as well as consumers. The Indian consumer is gradually moving from the local “kirana” shopping to large convenience stores/ online shopping/ network marketing, that is, direct selling / television based home shopping, etc,” said Chairman, Delhi and NCR Committee, PHD Chamber, Rajnish Goenka.
Significantly, these innovative retail models have initiated a wave of entrepreneurship across the country, attracting heavy investments by individuals as well as private equity firms and are generating considerable employment opportunities.
However, it was agreed that there is a need for a set of guidelines/ regulations so as to create a safe and legally strong business environment for these retail models which shall benefit both business and consumer, equally.
Regional Head (North), Amway India Enterprises Pvt. Ltd G.S Cheema too lamented the fact that there is no specific legislation in India dealing with Direct Selling.
“Unfortunately for the ethical companies, consumer or contractual complaints are registered under the Prize Chits and Money Circulation Schemes (Banning) Act, 1978.This Act gives power of sealing, seizure and arrest, when a complaint is filed,” he said.
He called for some major policy measures by the Union and State Government – such as providing a clear definition of Direct Selling, streamlining the FDI policy and entry route, enacting a Union or State Legislation for the sector and appointment of a Nodal Ministry/ Regulatory Authority so as to give fillip to the Rs. 6385 crore Direct Selling industry in India.
On the other hand, Consumer Policy Expert Bejon Mishra, gave an independent perspective on Direct Selling sector needs for an ethical code in consumer interest.
Indian consumers are demonstrating an increasing interest in online shopping, thanks to the surging number of online users. The growing online retail market has become a very lucrative business for international majors as well.
Meanwhile, Co-Founder and Managing Director, Jabong.com, Praveen Sinha, elaborated upon the promising online retail sector in India, the challenges and the opportunities associated.
India has surpassed Japan to become the world’s third largest Internet user after China and the United States with almost 74 million Internet users.
Internet users in India are going online and ordering all kinds of things from the convenience of their homes: food, home provisions, groceries, automobiles, home electronics, appliances, computers and peripherals, CDs, DVDs, books, cinema tickets, clothes, jewellery, watches, cosmetics, perfumes, flowers, toys, sweets, dry fruits and gifts. (KNN/ES)
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