The Hindu : Saathi warns sari traders

Online edition of India's National Newspaper
Tuesday, Apr 08, 2003

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Saathi warns sari traders

By Our Staff Reporter

NEW DELHI APRIL 7. The Delhi Finance Minister, Mahinder Singh Saathi, today said the Government was carefully studying the problems being faced by the Capital's sari traders with regard to imposition of sales tax from a retrospective date and promised to resolve the issue shortly. But at the same time, he warned them against politicising the issue which could prove to be detrimental to their interests.

Asked about the proposed agitation by the Delhi Mercantile Association to oppose imposition of sales tax on saris and terming them as readymade garments, Mr. Saathi said the traders' grievances have come to the notice of the Delhi Government. "They have met me and the Chief Minister, Sheila Dikshit, over the issue and Ms. Dikshit had promised to look into the entire issue with all sympathy. But these traders seem to have very little patience and they are now trying to politicise the whole issue by reaching out to political people in order to apply pressure on the Government.''

Mr. Saathi said the Sales Tax Department was looking into the whole issue. He sought to put the record straight by stating that the traders knew well in advance about the imposition of tax as they had been negotiating with the officials of the Department for the past one year. He said there could be problems with regard to imposition of sales tax with two years retrospectively but that was no reason for politicising the issue and threatening an agitation.

In fact, he said, he had been instrumental in exempting saris from sales tax in his budget during 2001-02 but a recent court order had changed the situation.

However, the traders see the entire issue differently and term the imposition of sales tax retrospectively as a mischievous move on the part of the officials. The traders were particularly very harsh on the Sales Tax Commissioner, Rahul Khullar, and accused him of misinterpreting court orders to cover up his own follies. The Delhi Mercantile Association president, T.R. Kapoor, said the move would kill the trade and result in escalation of prices. It would also make Delhi an unviable place for the sari trade as a higher sales tax would force the traders to make purchases from adjoining States which do not levy any tax on this commodity. "We have decided to observe a two-day strike on April 11 and 12 in support of our demand and we are ready to go on indefinite strike if the situation is not sorted out,'' he added.

But another office-bearer, Suresh Kumar Bindal, said the question was not about sari trade or imposition of sales tax. The question was of classification of saris as a readymade garments by a wrong interpretation of law. He contested the official claim that the sari was a readymade garment and said the decision to impose sales tax was inspired by a fall in the revenue of the Delhi Government.

Mr. Bindal said the traders were ready for a fight to the finish and said they had met the AICC general secretary in charge of Delhi, Kamal Nath, and the Congress president, Sonia Gandhi, to plead their case. "It is shocking that assessments have been done in previous dates and the traders are being asked to pay taxes from previous dates.''

"We plan to write letters to our customers whose addresses we generally record in order to recover the tax on the saris sold to them during the past two years. They should also come to know that it is the Delhi Government which is making things difficult,'' he added.

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