New Delhi, 27 Oct (KNN) The Karnataka Small Scale Industries Association (KASSIA) has appealed to the State government to extend the Karasamadhana Scheme for at least micro and small scale enterprises (MSEs), from Oct 31, 2021 to March 31, 2022.

This plea comes in wake of MSMEs slow recovery from the impact of pandemic and the second wave of Covid-19 in particular which drastically hit the sector.

In their communique to the Chief Minister, KASSIA pointed out that as per government statistics and data, approximately 7.73 lakh companies had shut down as of 30th September, 2021 due to Covid-19.

“Although the economy is on the rebound, the financial situation of the MSMEs continues to be precarious with delayed payments, scarcity of timely and adequate working capital and funding from banks, worsened by dipping order books and thinning margins at the business end on account of fiercely competitive market conditions,” cautioned KASSIA.

The Association has pressed on the rationale and the relevance for the initial extension of the Karasamadhana Scheme continues to prevail in the present context of the pandemic environment.

KASSIA said urging the state government for extension of Karasamadhana Scheme that the green shoots and the positive signals currently seen in the economy are not by and large in the MSME sector which continues to struggle for survival.

The Karnataka government had launched the Karasamadhara Scheme with a view to reduce the arrears arising out of the enactments administered by the Commercial Tax Department which existed before the introduction of Goods and Services Tax Act.

On collective request by various stakeholders, the government had extended the time for completion of Assessments and Reassessments or Rectification to avail benefits under Karasamadhana Scheme, 2021 from August 31, 2021 to October 30, 2021.