PROFESSIONALS AND BUSINESSES PARTICIPATING IN DISCUSSION
Labour Laws & Ir
Korgaonkar K A
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help.jammuEngagement of labour in construction is the criteria for imposition of Cess and there is no exemption therefrom
From India, Jaipur
As we all know this cess is utilized for the welfare of the Building Workers & therefore we do not expect any exemption in not imposing this cess on the employers in SEZ areas by the State where this is applicable. Moreover you can also take the help of labour department for your query.
From India, Delhi
Sorry late joining here.
I would like to ask my friend running BOT project, whether he is employing building workers or not? And whether he is incurring construction cost on the project or not? If the answer is yes then he is an 'employer' within the meaning section 2(1)(i) of the BOCW Act, 1996.
Once we have determined that he is an employer, let us come to the provision of the BOCW Welfare Cess Act, 1996. Here, kindly read section 3(1) of this Act saying: "There Shall be levied and collected a cess for the purposes of the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996, at such rate not exceeding two percent, but not less than one per cent, of the cost of construction incurred by an employer, as the Central Government may, by notification in the Official Gazette, from time to time specify." We already know that the Central Govt has specified this cess @ 1% on the cost of construction vide notification no. SO 2899 dt. 26.09.96. Therefore, now we know that the 'employer' is required to pay cess on the cost of construction @ 1% of the cost of construction.
Coming to the question of exemption aspect from the cess under the Act. The relevant provision in this regard is Section 6 of the BOCW Welfare Cess Act, 1996: "Power to exempt.-Notwithstanding anything contained in this Act, the Central Government may, by notification in the Official Gazette, exempt any employer or class of employers in a State from the payment of cess payable under this Act where such cess is already levied and payable under any corresponding law in force in that State." This clearly shows that the exemption can only be granted by the CENTRAL GOVERNMENT if a similar cess is already levied and payable under any corresponding law in force in that State. If my friend is running BOT project in such a State where a similar cess is already levied and payable under any corresponding law in force in that State, he can apply to the Central Government and may right away walk through green channel. But I believe, that is not the case of my friend; therefore, he cannot escape from this cess.
And let me address to another friend who wants to know the position of an SEZ projects with regard to the payment of cess. With heavy heart, I must say that since the power to exempt lies only with the Central Government, the exemptions granted by any State would also meet the fate of declaring the same as null and void ab initio by a court of law.
Regards & best wishes.
From India, Chandigarh
The person who engages the workers is the contractor, but in some cases the main contractors engage sub-contractors. in this case, the person who is having labour licence in his name will be responsible for obtaining BOCW Registration as well. But the primary condition is that, the wokerers must be more than 10 in numbers.
From India, Vadodara
We are into Construction. We are constructing the buildings purely based on the design drawings and required Construction materials supplied by the Main Contractor/Developer/Land Owner.We are using Laborers for which we are billing the Concerned Main Contractor/Developer/Land Owner. Of course,we have obtained Licence under Contract Labour (R&A) Act and also under Bocw Act.Concerned Statutory Authority has sent notice to us to pay Cess.In this scenario,Can any one please clarify whether we have to pay cess or the Main Contractor/Developer/Land Owner.
From India, Bangalore
korgaonkar k aDear All,
I am also joining you in this discussion very late.
I have discussed on this issue earlier in many threads. Instead of repeating it now, which is not possible also, I request you to view my earlier posts. Some of the links are given below for your ready reference.
From India, Mumbai
Manas Ranjan Pal 2011Dear Mr. Pratap Sir,
I Have Two Querry on BOCW Welfare Cess Act-1996?
1. is Machinery used in Construction industry Includes in BOCW Cess? are some States giving Exemption on Machinery, what is the Position of A.P. & Telangana
2. We have Not Registered under BOCW Act and Not Paying BOCW Cess since last 10 Years, If we will Registered Under BOCW Act and We will Pay BOCW Cess, will they collect Cess From Us For Completed Projects
I want reply at the Earliest.
Thanks & Regards,
From India, Hyderabad
deepak-dulewaleDear Sir, BOCW Register , who can you bocw 1% cess paid the online payment methad ( Demo ) provide
From India, Lonand
jpratapDear Mr. Ranjan,
Answer to you queries is as under:-
1. Cess is not payable on the cost of machinery used in construction. However, the wages paid on operation of such machinery are included in the cost of construction and cess is payable on such paid wages.
2. (a) You are required to get your 'establishment' registered under the BOCW Act, 1996. If you don't, you can be prosecuted.
(b). Although the Cess is payable by employers on the cost of construction of their establishment w.e.f. November 1995 as per BOCW Cess Act, 1996, however, different state governments have started implementing this act on different dates. Hence, in your case, the Cess is recoverable from you w.e.f the dates as notified by the respective State Governments.
Best wishes and regards.
From India, Chandigarh