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Realtors evading cess to face music

Comments Off on Realtors evading cess to face music   |   September 30, 2013    09:17am   |Contributed by manoja

VIJAYAWADA: The labour department has decided invoke revenue recovery Act to attach assets of the realtors if they fail to pay labour cess under the Building and Other Construction Workers Welfare (BOCW) Act.

Government has finally decided to crack the whip as builders and contractors have been ignoring the notices issued by the local joint commissioners of labour. Provisions of the revenue recovery Act will be implemented through local bodies, which grant building plans to realtors by keeping assets mortgaged.

According to sources, realtors and infrastructure companies in the state owe nearly Rs 2000 crore as labour cess. Following a directive from the state government, joint commissioners of labour will write to the authorities of local bodies such as municipal commissioners and vice-chairpersons of urban development authorities asking them not to free properties from mortgage of the errant realtors until they paid labour cess.

Sources said the government decided to tighten the noose around the realtors at the level of local bodies as they could not sell until the authorities freed their mortgaged properties. The realtors who secure plans for their apartments and buildings would be mandated to mortgage about 10 per cent of the total property for verification of violations in plan granted by the concerned authorities.

Usually, the authorities, who grant building permissions, do not go for verification after the completion of construction. The builders thus get their mortgaged properties released. However, it would now become difficult for the authorities of the local bodies to free the mortgaged properties unless realtors get a ‘No Objection Certificate’ (NOC) from the labour department.”We have suggested that the VC and MD of Vijayawada-Guntur-Tenali-Mangalagiri urban development authority not to release the assets of at least four big realtors, who owe nearly Rs 4 crore towards labour cess,” joint commissioner of labour K Yella Rao told TOI. Realtors in each district have dues to an extent of Rs 20 to 60 crore. While there are dues to the tune of nearly Rs 50 crore in Krishna district, it is nearly Rs 70 crore in Guntur district. Sources said over Rs 200 crore are due from Hyderabad, Rangareddy, and Visakhapatnam districts each.

Sources said the government took a tough stance in view of general elections as collection of dues will help in filling up of of empty coffers of the state to some extent.


News Published Under:   Hyderabad | Comments Off on Realtors evading cess to face music

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