Builders’ Association of India (All India Association of Construction Contractors & Builders)

Registered & Head Office: Delhi Office: G-1/G-20, Commerce Centre, J. Dadajee Road, D1/203, Aashirwad Complex Tardeo, Mumbai – 400 034 Green Park Main, New Delhi – 110 016 Tel : (022) 23514134, 23514802, 23520507 M : 09555448763 Fax : 022-23521328 Telefax: (011) 26568763 E-mail : [email protected] E-mail: [email protected]

ESTD . 1941

76th

Annual Report and Accounts

2016–2017

www.baionline.in

Builders’ Association of India (All-India Association of Engineering Construction Contractors & Builders) G-1/G-20, 7 th Floor, Commerce Centre, J. Dadajee Road, Tardeo, Mumbai – 400034 Estd. 1941 Tel: 91-22 23514134 , 23520507, 23514802 Fax: 23521328 Web Site : www.baionline.in E-mail: [email protected]

N O T I C E

The Seventy Sixth (76 ) Annual General Meeting of the Members of Builders’ Association of India, will be held on Saturday 22 nd July, 2017 at 4.00 P.M. at Hotel Novote l, Hyderabad Airport, Hyderabad. to transact the following business : -

1. To c onfirm the Minutes of the Seventy Fifth Annual General Meeting held on Saturday, 2 nd July 2016 at 4.00 P.M. at Hotel Express Inn, Nashik. (Minutes have already been circulated to Members and also printed in Indian Construction Journal , September 2016 issue – Page no.64 to 66 and also hosted on BAI website www.baionline.in ).

2. To c onfirm the Minutes of the Special General Meeting held on Sunday , 6th November 2016 at 4.00 P.M. at ITC Grand Chola, Guindy, Chennai (Minutes have already been circulated to Members and also printed in Indian Construction Journal, December 2016 issue – Page no.85 to 91 and also hosted on BAI website www.baionline.in ).

3. To take note of the result of BAI Or ganisat ional Election for the year 201 7-18 (Enclosed).

4. To take note of the result of BAI Trustee South Zone Election for the year 2017 -19 (Enclosed).

5. To consider, and if thought fit, adopt the Annual Report of the Association for the year ending 31st March 2017.

6. To consider, and if thought fit, adopt the Audited Balance Sheet and Income & Expenditure Account of the Association for the year ending 31st March 2017.

7. To appoint Auditors to audit the accounts of the Assoc iation for the year 2017 -18 and fix their remuneration.

8. To consider, any other item, with the permission of the chair.

C. G. DEOCHAKE HON . GEN . SECRETARY BUILDERS ’ ASSOCIATION OF INDIA Place : Mumbai Dated : July 1, 2017 Note: (i) Queries on Accounts and Reports should be communicated to BAI Headquarter on or before 15th July 2017. Centres Chairmen are requested to kindly circulate this information amongst their members. Please note no floor queries on accounts will be entertained.

(ii) Please bring this copy of Annual Report.

Delhi Office: D1/203, Aashirwad Complex, Green Park Main, New Delhi 110 016 ¥ 26568763 E-mail: [email protected]

BUILDERS’ ASSOCIATION OF INDIA MANAGING COMMITTEE 2016-2017

Estd. 1941

President Mr. Avinash M. Patil

Vice Presidents Mr. Mu. Moahan Mr. R. N. Gupta Dr. Rajiv B. Krishnani Mr. Ravindra Pradhan

Hon. Gen. Secretary Hon. Gen. Treasurer Mr. C. G. Deochake Mr. Neerav Parmar

Imm. Past President Mr. Lal Chand Sharma

State Chairman - Andhra Pradesh State Chairman - Chhattisgarh Mr. CH Ramakotaiah Mr. Alok Shivhare State Chairman - Gujarat State Chairman - Jharkhand Mr. Nitin M. Shah Mr. Devendra Tiwary State Chairman - Karnataka State Chairman - Mr. K. S. Someshwara Reddy Mr. John Paul K. State Chairman - Maharashtra State Chairman - Tamil Nadu Mr. Suresh B. Patil Mr. M. Thirusangu State Chairman - State Chairman - Mr. B. Sugunakar Rao Mr. Sanjay Tyagi State Co-ordinator - Assam State Co-ordinator - Madhya Pradesh Mr. Kulesh Goswami Mr. Suresh Vaswani State Co-ordinator - Rajasthan State Co-ordinator - West Bengal Mr. Ravi Kumar Kheria Mr. Sudip Kumar Dutta

Members of the Managing Committee representing Centres

Mr. Amar Bawa Mr. Ashok Agarwal Mr. Bhopinder Lal Mr. D. Kempanna Mr. G. Thilagar Mr. Harshad N. Bhayani Mr. Jaiprakash Bhatia Mr. Jawahar Mutha Mr. K. Annamalai Mr. K. Mathiyalagan Mr. L. Shantakumar Mr. Mahesh R. Mirani Mr. M. Dhandavakrishnan Mr. Mathew Alex Vellapally Mr. Mohan S. Kataria Mr. Mohinder Rijhwani Mr. Narendra P. Patel Mr. Naresh Kumar Agarwal Mr. Neelkanth S. Joshi Mr. P. Parameswaran Mr. Prabir Kumar Mukherjee Mr. Prince Joseph Mr. R. Ethirajan Mr. R. Krishnaswamy Mr. S. Prakash Mr. S. Ramaprabhu Mr. Sanjay Laxman Patil Mr. T. V. Chandrasekaran

Members of the Managing Committee representing Patron Members Mr. A. Chamaraja Reddy Mr. A. Puhazhendi Mr. Abhay M. Garde Mr. Baburao L. Shakkarwar Mr. Basavaraj S. Totad Dr. D. Thukkaram Dr. Dharmesh C. Awasthi Mr. H.N. Vijaya Raghava Reddy Mr. Jagdish M. Parekh Mr. K. J. George Mr. K. Ramanujam Mr. K. Subramani Mr. L. Venkatesan Mr. M. G. Sundar Mr. Mohan D. Bhate Mr. N. Ramalingam Mr. Narendra Kumar Mr. O. K. Selvaraj Mr. P.P. John Mr. Pratap B. Salunkhe Mr. S. Ayyanathan Mr. S. Ganapathi Mr. Srinivasa Reddy Dr. Tarro T. Manghnani Mr. Y. Ishwar Rao

Members of the Managing Committee representing Affiliated Associations Mr. Atul Vijaykant Moog Mr. E. Manohar Mr. N. Velayutham Mr. R. R. Shridhar

Special Invitees Mr. A.K. Srivastava Mr. A.N. Balaji Mr. Anthony Rathnam Mr. Arvindbhai V. Patel Mr. B. Adinarayana Reddy Mr. B. Babu Rao Mr. C.S. Parhar Mr. D.P. Balaji Mr. G.M. Ravindra Mr. H.V. Nagesh Mr. Harkant G. Vachharajani Mr. I. Nepolian Mr. J. Dhanasekar Mr. Jacob Mathew Vellapally Mr. Jaideep P. Raje Mr. Joshy Joseph Mr. K. Chinnaswamy Mr. K. Rajakumaran Nair Mr. K. Rajavel Mr. L.D. Kotwani Mr. M. Rajendran Mr. Mahesh G. Mahajan Mr. Manesh K. Mr. Milind T. Patil Mr. MVG Jawagar Mr. N.M. Krishnamurthy Mr. N.P. Vishwanath Mr. P. Shahin Mr. P.K.P. Narayanan Mr. Paresh Vachhani Mr. Praksh N. Dewalkar Mr. Pratap S. Rananaware Mr. R. Manohar Mr. R. Saravanan Mr. R. Sivakumar Mr. Rahul B. Vakharia Mr. Rajendra K. Mutha Mr. Rajendra M. Upadhye Mr. Ramdas R. Jagtap Mr. Ramesh P. Marda Mr. S. Pandiyen Mr. S.M. Sait Mr. S.R. Swamy Mr. Sanjay Shah Mr. Sharad D. Kharade (Patil) Mr. Stanley Scaria Mr. Sunil Kokitkar Mr. Suresh Moorjani Mr. Tarak R. Mamlatdarna Mr. Uday N. Gokhale Mr. V. Narasimhan Mr. V. Sivarajan Mr. V.L. Muniraja Mr. Vinit Patel

B UILDERS ’ A SSOCIATION OF INDIA (All-India Association of Engineering Construction Contractors and Builders) G-1/G-20, 7th floor, Commerce Centre, J. Dadajee Road, Tardeo, Mumbai 400034 Tel : (91-22) 23520507, 23514134, 23514802 Fax: 23521328 Web Site : www.baionline.in E-mail : [email protected] th Ref.: 607/M/2015-16 dated 30 March 2016

TO:

THE TRUSTEES THE VICE -PRESIDENTS THE STATE CHAIRMEN / CENTRE CHAIRMEN THE MANAGING COMMITTEE AND THE GENERAL COUNCIL MEMBERS

Dear Sirs,

The election process for 2016-17 of Builders’ Association of India has been completed on 30 th March 2016. Following are the election results: -

President : Shri Avinash M. Patil [Nashik Centre]

Vice Presidents : 1. Shri Ravindra Pradhan 2. Shri R.N. Gupta [Jharkhand (Ranchi) Centre] [Delhi Centre]

3. Shri Mu. Moahan 4. Dr. Rajiv B. Krishnani [Southern (Chennai) Centre] [Pune Centre]

Hon. Gen. Secretary : Shri C.G. Deochake

Hon. Gen. Treasurer : Shri Neerav Parmar

State Chairman (Andhra Pradesh) : Shri CH Ramakotaiah (Visakhapatnam Centre)

St. Co -ordinator (Assam) : Shri Kulesh Goswami (Guwahati Centre)

State Chairman (Chhattisgarh) : Shri Alok Shivhare (Durg -Bhilai Centre)

State Chairman (Gujarat) : Shri Nitin M. Shah (Baroda Centre)

State Chairman (Jharkhand) : Shri Devendra Tiwary ( Jharkhand (Ranchi) Centre )

State Chairman (Karnataka) : Shri K.S.Someshwara Reddy (Karnataka ( Centre)

State Chairman (Kerala) : Shri John Paul K (Kottayam Centre)

St. Co-ordinator (Madhya Pradesh) : Shri Suresh Vaswani (Bhopal Centre)

State Chairman (Maharashtra) : Shri Suresh B. Patil (Sangli Centre)

St. Co -ordinator (Rajasthan) : Shri Ravi Kumar Kheria (Rajasthan (Jaipur) Centre)

State Chairman (Tamil Nadu) : Shri M. Thirusangu (Tiruchirappalli Centre)

State Chairman (Telangana) : Shri B. Sugunakar Rao (Karimnagar Centre )

State Chairman (Uttar Pradesh) : Shri Sanjay Tyagi ( Muzaffarnagar Centre )

St. Co-ordinator (West Bengal) : Shri Sudip Kumar Dutta (Eastern (Kolkata) Centre

Members of the Managing Committee representing Centres:

1. Shri Amar Bawa 2. Shri Ashok Agarwal 3. Shri Bhopinder Lal 4. Shri D. Kempanna 5. Shri G. Thilagar 6. Shri Harshad N. Bhayani 7. Shri Jaiprakash Bhatia 8. Shri Jawahar Mutha 9. Shri K. Annamalai 10. Shri K. Mathiyalagan 11. Shri L. Shantakumar 12. Shri M. Dhandavakrishnan 13. Shri Mahesh R. Mirani 14. Shri Mathew Alex Vellapally 15. Shri Mohan S. Kataria 16. Shri Mohinder Rijhwani 17. Shri Narendra P. Patel 18. Shri Naresh Kumar Agarwal 19. Shri Neelkanth S. Joshi 20. Shri P. Parameswaran 21. Shri Prabir Kumar Mukherjee 22. Shri Prince Joseph 23. Shri R. Ethirajan 24. Shri R. Krishnaswamy 25. Shri S. Prakash 26. Shri S. Ramaprabhu 27. Shri Sanjay Laxman Patil 28. Shri T.V. Chandrasekaran

Members of the Managing Committee representing Patron Members:

1. Dr. D. Thukkaram 2. Dr. Dharmesh C. Awasthi 3. Dr. Tarro T. Manghnani 4. Shri A. Chamaraja Reddy 5. Shri A. Puhazhendi 6. Shri Abhay M. Garde 7. Shri Baburao L. Shakkarwar 8. Shri Basavaraj S. Totad 9. Shri H.N. Vijaya Raghava Reddy 10. Shri Jagdish M. Parekh 11. Shri K. Ramanujam 12. Shri K. Subramani 13. Shri K.J. George 14. Shri L. Venkatesan 15. Shri M.G. Sundar 16. Shri Mohan D. Bhate 17. Shri N. Ramalingam 18. Shri Narendra Kumar 19. Shri O.K. Selvaraj 20. Shri P.P. John 21. Shri Pratap B. Salunkhe 22. Shri S. Ayyanathan 23. Shri S. Ganapathi 24. Shri Srinivasa Reddy 25. Shri Y. Ishwar Rao

Members of the Managing Committee representing Affiliated Associations:

1. Shri Atul Vijaykant Moog 2. Shri E. Manohar

3. Shri N. Velayutham 4. Shri R.R. Shridhar

The new office bearers will assume charge of their respective offices with effect from 1 st April 2016 for a period of 1 year as per the BAI Constitution.

Thanking you, Yours faithfully,

RAJU JOHN RETURNING OFFICER BAI ORGANISATIONAL ELECTIONS 2016-17

Copy to: 1. Shri V.M. Fazal Ali 2. Shri J.R. Sethuramalingam Board of Scrutineers, BAI Organisational Elections 2016-17 3. Shri A.B. Chitale

BUILDERS ’ ASSOCIATION OF INDIA (All -India Association of Engineering Construction Contractors and Builders) G-1/G-20, 7th floor, Commerce Centre, J. Dadajee Road, Tardeo, Mumbai 400034

Estd. 1941 Tel : (91-22) 23520507, 23514134, 23514802 Fax: 23521328 Web Site : www.baionline.in E-mail : [email protected]

Ref.: 555/M/2016-17 dated March 30, 2017 TO : THE TRUSTEES THE VICE -PRESIDENTS THE STATE CHAIRMEN / CENTRE CHAIRMEN THE MANAGING COMMITTEE AND THE GENERAL COUNCIL MEMBERS

Dear Sirs,

The election process for Trustee – South Zone-I & II of Builders’ Association of India for two year term i.e. 2017 -2019 ha s been completed on 30 th March 2017. The Result of the Election is as follows: --

Shri K. Ramanujam has been unanimously elected as Trustee – South Zone-I and II for 2017-2019.

The new Trustee will assume charge with effect from 1 st April 2017 for a perio d of 2 years as per the BAI Constitution.

Thanking you, Yours faithfully,

RAJU JOHN RETURNING OFFICER BAI TRUSTEES ELECTIONS 2017-19

Copy to: (1) Shri V.M. Fazal Ali } (2) Dr. D. Thukkaram } Board of Scrutinisers. (3) Shri A.B. Chitale } (4) All General Council Members Elect 2017 -18

Report of the President and Managing Committee of Builders' Association of India for the year 2016-17

Friends, The National Highways Authority of India (NHAI) plans to award projects in a robust mix of EPC, build-operate-transfer The President and the Managing Committee have great (BOT) and HAM modes. Over 8,300 km of roads have been pleasure in presenting the 76th Annual Report of the identified for development in the north eastern region by 2022, Association along with the Statement of Accounts and the at an investment of at least Rs. 864 billion. Auditors’ Report for the year 2016-17. At the state level, EPC opportunities look promising with Abundant Opportunities Uttar Pradesh, Maharashtra and Bihar recomdelling big projects on an EPC basis instead of through PPs. New Infrastructure sector to provide impetus to construction opportunities have also been showcased by states such as activity Telangana, Chhattisgarh, West Bengal and Odhish. Overall, the stte governments will spend over Rs. 7.4 trillion for the On the back of the government’s renewed focus on development of roads and bridges, which are expected to add a infrastructure development, contractors are likely to witness a length of around 35,000 km. significant increase in construction opportunities. The government is expected to pump in more funds into the Power infrastructure sector, which is likely to attract private Power generation capacity along with the associated investment too. Roads, railways power, ports and airports are transmission and distribution network has increased manyfold likely to be key growth drivers for the construction over the years. The availability of funds plays a crucial role in sector.Indian infrastructure looks at construction opportunities meeting the capacity addition requirement. across various sectors. According to the Natinal Electricity Plan, 2016, power Roads and bridges generation projects will witness a total capacity addition of Roads development has been a key focus area of the 72,495 MW during the period 2017-22. Of this, 50,025 MC government. Big-ticket initiatives such as the launch of the capacity will be added in coal and lignite-based power station, hybrid annuity model (HAM) coupled with the approval of 4,340 MW in gas-based power stations, 15,330 MW in nuclear conducive policies to debottleneck the sector are expected to generation and 2800 MW in nuclear generation. Besides this, provide an impetus to construction activity. Besides this, the there has been a big push by the government for setting up launch of an online marketplace for cement procurement renewable power generation capacity of 175000 MW by the (NAM PRO) is likely to give a further push to construction year 2022, of which 115326 MW is expected to be set up activity by focusing on the construction of concrete roads. during 2017-22 (59674 MW has already been set up). Significant opportunities will also be offered through programmes such as Bharat nectivity project and Setu Based on the likely capacity addition for the period 2017-22, Bharatam. as well as year-wise expenditure phasing in the same period for advance action on projects coming up during 2022-27, the According to India Infrastructure Research, the road sector total fund requirement is estimated to be Rs. 10.33 trillion. will offer a construction opportunity of over of Rs 7 trilion till The figure comprises Rs. 8.59 trillion for conventional power 2022. As per research conducted, 710 projects spanning a generation (72495 MW) and renewable energy addition length of over 58,000 km, spread across the national highway (115326 MW), as well as Rs. 1.74 trillion for the advance and state highway segment, are in the pipeline. The total action plan for 2022-27. investment likely to be mobilized by 2022 is expected to be at least Rs. 12 trillion. Typically, construction works accounts for 65-70 per cent of the total project cost of a hydro power project. The Contractors will have both indirect and direct opportunities construction component in thermal power accounts for about since the government has stated its intent to award projects 40 per cent of the total project cost, while that in nuclear irrespective of the award mode. Hence, besides engineering, power plants is about 20 per cent. In contrast, renewable procurement and construction (EPC) projects, the public- energy projects offer relatively meager construction private partnership (PPP) model could also slowly make a opportunities. comeback. In terms of the pipeline of projects considered, construction India Infrastructure Research complied an indicative list of opportunities to the tune of Rs. 2453.15 billion will be on offer upcoming projects at the nation level. Overall, 244 projects in the power sector till 2022. Of this, opportunities worth Rs. valued at over Rs. 4 trilion are in the pipeline. Going forward, 1400.7 billion will be in the thermal segment, Rs. 996.45 the targets for 2016-17 are ambitious. The government aims billion will be offered by hydro projects, and the remaining to award 25,000 km and construct 15,000 km of road during Rs. 56 billion worth of opportunities will be in the nuclear the year. Overall, the national highway segment will offer power segment. project opportunities worth Rs. 1.5 trillion in the next year.

Ports Another focus area for IR is the development of HSR projects. According of India Infrastructure Research, projects worth Rs. The eight proposed HSR corridors of 4,215 km length 356.91 billion related to the construction of berths and translate into a financing requirement of over Rs. 421 billion. container terminals are on the anvil at existing ports. Of these, The first HSR in the country will run on the Mumbai- projects worth Rs. 74.75 billion are at the bidding stage, while Ahmedabad section and will involve an investment of Rs. 980 projects worth Rs. 249.94 billion have been announced. Type- billioln. Recently, in December 2016, the Japan International wse, brownfield projects entail an investment of around Rs. Cooperation Agency inked a tripartite consultancy pact with 197.7 billion in states such as Tamil Nadu, Kerala, Odisha and the Ministry of Railways (MoR) and the National High Speed Gujarat. Rail Corporation of India for the project. Besides, nine corridors, have been identified for the development of semi- Sagamala, the flagwhip programme of the Ministry of HSR corridors in a phased manner involving the introduction Shipping, is expected to provide an impetus to the of express trains running at 160 kmph. Additional expenditure development of three major ports –at Vadhava, Maharashtra; will be incurred towards increasing speeds on select existing Sagar, West Bengal and Colachel, Tamil Nadu. The Sagar routes. port project involves the development of a deep-sea port at an investment of Rs. 120 billion. In October 2016, the central Besides this, IR’s station redevelopment and modernization government approved a grant of Rs. 5.15 billion to make the plan is likely to create huge construction opportunities. In project financially viable. Vadhavan port, entailing an July 2015, the central government approved IR’s proposal to investment of Rs. 92.97 billion for Phase I, will be able to offer A-1 and category stations (407 stations) for handle 40-60 million tones 9mt) of cargo every year. The redevelopment. An expenditure of Rs 1 triion has been project will be developed by a joint venture of the envisaged by IR for station redevelopment and logistics parks Maharashtra Maritime Board and the Jawaharlal Nehru Port development by 2021-22. A $5 billion fund for the Trust. The Colachel port project involves an investment of redevelopment of railway stations called the Railways of India Rs. 275.7 billion and will be implemented on a PPP basis. Development Fund has been proposed by the MoR. Of this, The Union cabinet gave in-principle approval for setting up a the MoR will seek $500 million from the World Bank, $1 major port at Colchel in July 2016. In addition, new port billion from the Ministry of Finance and the remaining from projects, targeted to add over 370 mt of capacity, worth at pension and sovereign funds, Japan has evinced interest in least Rs. 779 billion are coming up across various states. funding station redevelopment projects. Construction accounts for nearly 65 percent of the total project cost (rough estimate) of a port project, while the remaining Airports comprises electrical and mechanical costs. The actual cost, In the aviation sector, the National Civil Aviation Policy, 2016 however, depends on several factors, including the type of has been released and air traffic is once again on a growth cargo facility (brownfield or greenfiled), project scope, path. India is projected to become the third largest aviation location, etc. market by 2020, behind only China and the US. Although most metro airports do not have current expansion plans, there Assuming a construction component of 65 per cent. India is abundant opportunity in Greenfield and existing Airports Infrastructure Research has estimated a construction Authority of India (AAI) airports. opportunity of Rs. 738.66 billion at existing a new ports by 2022. According to India Infrastructure Research, there are 22 key airport projects in the pipeline. Of these, eight projects are Railways likely to add a capcitiy of about 150 million passengers per (IR) aims to invest Rs. 8.56 trillion in new annum (mppa). (The planned capacity addition figures of the tracks, faster trains and station redevelopment by 2020 and, other 14 are not available.) therefore, plans to increase debt to help fund this unprecedented modernization plan. To meet this objective, Of the 22 projects in the pipeline, 18 have an investment around Rs. 2.5 trillion ($37 billion) of debt is required till requirement of at least Rs. 547 billion (the cost of four 2020. IR has prepared a prioritization plan where the focus is projects is not available). Of this Rs. 547 billion, some on longer loops, line doubling and electrification projects. portion is expected to be mobilized through AAI funds, as it Doubling projects on high-density routes are likely to get plans to invest Rs. 83 billion in the next greefield works. priority. The easing of foreign direct investment norms permitting overseas investments in high speed rail (HSR) Type-wise, over 62 mppa of capacity is likely to be added development is a good sign for the sector. through eight brownfiled projects, followed by over 87 mppa through the development of new airports. Some big-ticket projects such as the dedicated fright corridor (DFC), the Mumbai-Ahmedabad HSR, semi-HSR project, and With regards to project status, most of the projects have been station redevelopment and modernization have been announced. Another three are under bidding (such as Navi undertaken to transform the railways sector. With an Mumbai airport), while the Mopa airport project has recently investment of over Rs. 800 billion, the DFC project is one of been awarded to GMR. (It has been considered as being in the the biggest ongoing infrastructure project in the country. pipeline for the purpose of this analysis despite being awarded because sub-contracting opportunities still exist).

State-wise, Andhra Pradesh and Maharashtra both have three On the basis of projects tracked by India Infrastructure upcoming projects, followed by two in Tamil Nadu, Other Research. It is estimated that an investment of over Rs. 540 states that will witness airport development works are Gujarat, billion is expected in 96 water supply and sanitation projects. Karnataka, Madhya Pradesh, Punjab, Nagaland, Odisha, Overall, projects in the pipeline are expected to create more Telangana and Goa. than 5,200 million liters per day (mid) of additional treatment capacity. Most of the opportunity exists in the 86 greenfiled On average, the share of construction in the total cost of an projects. In the waste management segment, 10 project have airport project pertaining to terminal expansion and been announced entailing an investment of around Rs. 23.25 construction is about 66 per cent; the construct ion share in billion. These projects are coming up in states such as works like aprons, runways, taxiways and allied works is 90 Gujarat, Andhra Pradesh, Maharashtra, Bihar and Rajasthan per cent; and in new air traffic contral towers it is 45 per cent. among other. Given these assumptions, the airport sector represents a construction opportunity of Rs. 361.02 billion. It is difficult to Drinking water supply and waste water treatment projects ascertain the construction opportunity individually for have a construction component of 66 per cent. As per India brownfiled and greenfiled projects since AAI has laid out its Infrastructure Research, the water supply and waste capex plan based on the state of infrastructure only in cities management segments together will offer a construction where it has projects. opportunity of around Rs. 371.74 billion by 2022.

Urban In the next few years, prospects appears to be good for Civil construction has a huge share in the total cost of urban developers, contractors and technology providers. However, transport projects, especially metro and projects. As issues that restrict private participation and delay project cities increasingly come up with decongestion plans, the urban implementation need to be addressed to maintain growth transport sector will continue to offer a lot of opportunity. momentum in the construction sector.

As per India Infrastructure Research, bases on investments entailed by projects that are coming up (yet to be awarded) Scenario during XII th Plan Period (2012-17) Vis–a - vis & between 2017 and 2022, investments worth Rs. 3.36 trillion Nationl Highway Development Project. are in the pipeline for this sector. About 48 metro/light/mono rail projects are currently in the pipeline. These include During 2012-16, period Private Investment of Rs.75-63 billion greenfiled projects as well as extensions to currently was realized. However award of projects came down to 2552 operational network and cover a total length of about 1,828 K.M. compare to 11574 K.M. during 2012-16 given below in km. of these, the maximum investment will be in the Table ‘A’ , comparative statement of year wise award and development of 37 metro rail projects. Most of the completion of projects. investment in these projects is likely to be mobilized by 2020- 21. Table A

Of the total investment requirement of Rs. 3.63 trillion, over Fiscal Project Project Project Award Award Project half (about Rs 2 trillion) will be for greenfiled urban transport Year awarded completed completed of of Awarded in K.M. in K.M. In project project target in projects, while the remaining will be invested in the expansion percentage on BOT on K.M. of existing metro/light/mono rail projects by 2022. in KM EPC in K.M. The construction component of a metro/mono rail project 2005- 1608 753 47 - - - based on the civil engineering works required accounts for 2006 2006- 1390 636 45 - - - about 50 per cent of the total project cost. Based on this 2007 estimate and the robust project pipeline, India infrastructure 2007- 1146 1682 140 - - - Research has estimated that the sector will provide a 2008 2008- 643 2205 390 - - - construction opportunity of about Rs. 1.82 trillion by 2022. 2009 2009- 3360 2893 80 - - - 2010 Water supply and waste management 2010- 5083 1784 35 - - - 2011 The water supply sector continues to receive significant 2011- 6491 2249 35 6419 - - 2012 central support in the form of appropriate policies, budgetary 2012- 1116 2844 250 1116 - 8100 support as well as new programmes and schemes. At the 2013 2013- 1436 1901 140 223 1215 2844 central level, programmes such as the Atal Mission for 2014 Rejuvenation and Urabn Transformation, the Swachh Bharat 2014- 7980 1600 100 732 2434 8500 Abhiyan and the Smart Cities Mission have been launched. 2015 2015- 10098 8217 - 8790 1360 3750 Besides, state governments and local bodies are undertaking a 2016 number of water supply and sewerage projects to improve 2016- 25000 15000 60 11250 3750 10000 service delivery. These projects are expected to give a push to 2017 Total 65351 41764 - 28530 8759 33194 construction activates in the sector.

For 2016-17 projections programme in March 2016. The programme entails the During 2014-15, N.H.A.I. did not receive any bid for 16 construction of RoBs or underpasses at all 208 level crossings projects invited on BOT basis. Hence about 2300 k.m. out of in the country at an investment of Rs. 208 billion. Of the 208 total 3067 k.m. were awarded on E.P.C. basis. During the projects, 33 bridges have been proposed in Andhra Pradesh, period January 2014 – June 2016, only 14 National Highway 22 in West Bengal and 20 in Bihar. As of March 2016, the Projects were able to achieve financial closure. Out of 14 MoRTH has completed the preparation of detailed project projects, seven projects achieve financial closure had debt reports (DPRs) for 73 RoBs. Besides, the programme’s scope component of 60.75% against earlier 75%, due to reluctance also includes the upgradation and improvement of about 1,500 of banks. Some of the project that achieved financial closure old bridges at a cost of Rs. 300 billion. had to be terminated and rewarded due to implementation issue. However with sign of Economic recovery as evident Further, the MoRTH also launched an Indian Bridge from G.D.P data, bidders are expecting traffic volume to pick- Management System (IBMS) on 1 October 2016, to undertake up and also expect better cash flow. As a matter of fact during inventory management of all national highway bridges. 2014-15, there was 5-6% increase in traffic compare to dip in Conceptualized in August 2015, the IBMS will help create a the previous year. Road sector has certainly started showing database of defiant bridges in the country and suggest revival after slowdown in last three years. The initiative taken remedial measures for them. The system has been developed by Ministry have begun to show quantifiable results. Road by IDDC Engineers Private Limited. projects execution picked up pace with 5.5 km per day completed in first quarter of 2015, a considerable jump Housing for all by 2022 compare to earlier year. This is reflected in revival of BOT mode for building highway. In the current fiscal eight bids At the inaugural function of Vibrant Gujarat Global Summit covering 1000 k.m. distance costing Rs.13406/- crores were 2017 on 9 th January 2017 at Gandhi Nagar Hon’ble Prime received partly on BOT basis with a viability gap funding i.e. Minister said that, Government is striving to provide a roof for subsidies, Condition and partly on giving premium to N.H.A.I every one by 2022. Indian Construction is presenting Housing as per detail given in Table ‘B’ below: Scenario from article prepaid by (KPMG) “Decoding Housing for all by 2022”. Table B Sr. Name of Length Project Name of Premium offered Report of the Technical group on Urban Housing shortage No. Highway Project in k.m Cost in Company OR viability gap Rs. Cr funding in Cr. (2012-2017) and working group on Rural Housing (2012- 1 Raipur -Bilaspur 126 1479.32 Essel Project 449 (V G F) 2017) submitted the same in 2011 to their respective in Chattisgarh 2 Mukarba Chowk 70.5 2128.72 Essel Infra 189 (V G F) ministries. Report estimated that almost a quarter of Indian Panipat in Haryana households lack adequate housing facility. Country is on the 3 Agra -Etawali 124.5 1650.20 IRB 81 (Premium) verge of large scale urbanisation over the next few decades. Bypass in U.P. Infrastructure 4 Bioara -Dewas in 141.26 1583.79 Oriental 252.83 As per 2011 census, country’s population was 121 crores and M.P Structural (V G F) expected to reach 150 crores by 2050. Present urbanisation Engineers 5 Guna -Bioara in 93.5 1012.90 Dilip Buildcon 27 (VGF) rate of 28% in 2011 is to accelerate to 52% by 2050. Urban M.P 6 Fagne - 140.79 1885.74 ITNL 245.14 (VGF) population from 41 crores in 2014 expected to rise to 58.30 Maharashtra- crores by 2030 and ultimately reaches to 81 crores by 2050 as Gujarat Border 7 Amravati -Chikhli 194 2288.18 ITNL 183.50 (VGF) per “KPMG India Analysis July 2014”. Housing is a basic in Maharashtra need for humans. Central Government acknowledges the 8 Solapur -Bijapur - 109 1377.39 Uniquest 6.8 (Premium) in Maharashtra Infraventure importance of housing and aims to provide housing to all it’s Total 999.65 13406.24 citizen by 2022. In order to fulfill this vision, additional 4.63 VGF: Viability Gap Funding crores urban houses and 6.70 crores rural houses are required to be constructed. Government is planning to provide 6 crores It can thus be seen that N.H.A.I. shall receive Rs.87.80 crores units whereas balance 5.33 crores is to be provided in private as premium called negative grant from Developers and shall sector partnership. Details of statewise urban and rural have to pay Rs.1446.47 crores by way viability Gap Funding. housing requirement is given in Table ‘A’ below:- Recently Ministry is given authority to sanction Rs.1000/- Crore project on EPC basis without cabinet approval. Most Table ‘A’ disturbing facts is that about 112 cases of arbitration involving Details of Statewise Urban and Rural Housing Requirement Rs. 25000/- crores are pending under arbitration between (Figures are in lakhs) Sr. Name of State No. of Urban No. of Rural Total N.H.A.I. and developers as of April 2015. Arbitration awards No. Housing Housing Units Housing were routinely challenged by N.H.A.I. in courts. Units required in Units required in 2022 required by 2022 2022 Nevertheless the road sector continues to face some key 1. Uttar Pradesh 54 146 200 issues. Land Acquisition is area of concern for many projects. 2. Madhya Pradesh 22 51 74 There is a need for effective dispute resolution mechanism, 3. Rajasthan 21 45 66 4. Delhi 30 3 33 proper project development and preparation and more balance 5. Haryana 11 14 25 risk allocation. 6. Punjab 10 13 23 Northern Region 148 272 421 7. Maharashtra 50 55 105 In a bid to make all national highways free of railway level 8. Gujarat 29 21 50 crossings by 2019, the ministry launched the 9. Goa 2 1 3

Western Region 81 77 158 envisaged. These investments need to be complemented with 10. A.P. including Telangana 37 40 77 11. Tamil Nadu 39 18 57 additional investments of about USD1.5 trillion in urban 12. Karnataka 28 21 49 infrastructure and commercial real estate. Thus, a total 13. Kerala 27 9 36 investment of over USD3.5 trillion may be required for urban Southern Region 131 88 219 14. Bihar 19 69 88 housing and supporting infrastructure. Though, housing deficit 15. West Bengal 34 42 76 is much wider in rural areas compared to urban areas, it 16. Orissa 9 26 35 requires only a small portion of total investments envisaged 17. Jharkhand 11 18 29 18. Chhattisgarh 8 14 22 till 2022, which can be meted out without much difficulty. In Eastern Region 81 169 250 our view, the central government with participation from state 19. Hilly Region 22 44 65 governments, drafting a plan of delivering three crore houses All India 4.63 crores 6.50 crores 11.33 crores 20. Demand between 2014 2.73 crores 2.70 crores 5.43 crores in rural areas with an investment of INR3.45 lakh crore and 2022 (USD58 billion) by 2022 is a good start. 21. Urban Housing shortage 1.055 crores of E.W.S. in 2012 22. Shortage of LIG in 2012 0.741 crores With the current set of housing development policies in place 23. Shortage of M.I.G. in 0.082 crores and assuming an annual growth in investments by about five 2012 1.878 crores to six per cent in the housing sector (as witnessed since 24. Investment required upto 1.80 Trillion 0.20 Trillion 2.00 Trillion FY08), the required investments may fall short by about 2022 Dollar Dollar Dollar USD500 to 600 billion. This gap in funding would likely be restricted due to several structural issues in the sector such as Source:- Report of the working group on Urban Housing high gestation period of housing projects, limited and shortage (2012-2017), Ministry of Housing & Urban Poverty expensive liquidity, spiralling land and construction cost, high Alleviation. Working group on Rural Housing for XII Five fees and taxes, unfavourable development norms, and Year Plan, Ministry of Rural Development 2011. Census 2011 affordability vis-à-vis housing prices for EWS/LIG KPMG in India Analysis. households.

Note :- Above estimate reveal that 75 percent of housing Mobilisation of such huge resources (funding, construction requirement until 2022 would be concentrated in ten states of capacity, labour, technology, etc.) for mass scale affordable U.P, Maharashtra, Bihar, West Bengal, Andhra Pradesh housing development by the central and state governments (including Telengna), Madhya Pradesh, Rajasthan, Tamil may be difficult, without participation from the private sector. Nadu, Gujarat and Karnataka. The private sector, which is often better in term of managing construction risks and project delivery, should be encouraged The total housing requirement of 11.33 crores by 2022 by central and state governments, by addressing several includes housing shortage of 5.90 crores as on 2014. The structural issues break-up of current housing shortage, requirement between 2014 and 2022 is given in Table ‘B’ below :- Since the beginning of the twenty first century, a slew of regulatory reforms such as allowing foreign direct Table ‘B’ investments, improving access to credit by households, Sr. Particulars Urban Rural Total providing tax incentives on housing loans, developing special No. Housing Housing Housing Units in Units in Units in economic zones and thrust on infrastructure development, crores crores crores coupled with high economic growth, have propelled private 1. Shortage of Housing 1.90 4.00 5.90 sector participation in urban housing development. However, Units in 2014. it has largely resulted in the development of Middle Income 2. Demand between 2.73 2.70 5.43 2014 and 2022. Group (MIG) and High Income Group (HIG) houses, leading Total 4.63 6.70 11.33 to significant shortage of EWS/LIG or affordable houses. As Source :- Report of Urban Technical Group (TG-12) on Urban per the report of the Technical Group on Urban Housing Housing shortage (2012-2017), Ministry of Housing & Urban Shortage, EWS/LIG houses constitute more than 95 per cent Poverty Alleviation September 2012. of the housing shortage in 2012 as per detail given in Table ‘C’ below:- As per K.P.M.G’s estimates, development of such large quantity of houses may require investments of over USD2 Table ‘C’ Urban Housing Shortage 2012 trillion i.e. Rs. 120/- lakh crores (dollar at Rs. 60). This Sr. Classification of Housing Number of Shortage in translates to about USD250 to 260 billion annually i.e. Rs. No. Units Units in percentage term 15/- lakh crores to Rs. 15.60 lakh crores, more than double the Million annual investments witnessed in FY14. About 85 to 90 per 1. Economically Weaker 10.55 56.18 cent of the total investments would be required for developing Section (EWS) 2. Low Income Group 7.41 39.44 urban housing, where development costs are high due to 3. Middle Income Group & 0.82 4.38 factors such as land prices, construction cost, fees, and taxes. above Within urban housing, it is the affordable housing (houses for Total 18.78 100.00 EWS/LIG households) which require attention on priority Source:- Report of the Technical Urban Group (TG-12) on basis, as it alone would require about half of the total Urban Housing Shortage 2012-2017. Ministry of Housing & investments and 70 per cent of urban housing needs Urban Poverty Alleviation September 2012.

Government has changed yearly income bend for besides slowing down or delayed completion of E.W.S./LIG/MIG in July 2015, which is as per Table C-1 housing projects. below :- 6) Several indirect taxes such as VAT, stamp duty, Table C-1 service tax together add to about 35% of property cost. Details of various taxes to be paid are as per Sr. Category Yearly Housing Revised yearly No. of Housing income Bend shortage as income bend as Table ‘D’ below :- earlier in Rs. per Technical on 8.7.2015 in Rs. group on Table ‘D’ urban List of direct and indirect taxes imposed on real estate Housing shortage 2012 development 1. EWS 60000 10.55 million Upto 3.00 lakh 2. LIG 60000 to 1.20 7.41 million Bet. 3.00 to 6 lakh Sr. Tax Percentage of lakh No. property cost 3. MIG Above 1.20 0.82 million Above 6 lakh 1. Development agreement stamp duty 5 lakh 2. Stamp duty on purchase of property 5 18.78 million 3. Registration charges 1 4. Value added tax on purchase of construction 1 Despite such huge demand for all type of housing and more material 5. Service tax to contractor on service component 2.6 particularly for EWS and LIG, development of urban 6. VAT to contractor on goods component 4 affordable houses has been limited due to several structural 7. Other levies such as service tax 2.6 issues making it unfeasible business proposition for the private 8. Excise and custom duty 15 sector. Major structural issues restricting private sector Total 35 participation in urban affordable housing are depicted below:- Source :- KPMG in India analysis, 2014; NAREDCO – 1) Real Estate is a low volume, high margin business Funding the vision – Housing for all by 2022. requires very high long term capital requirement for purchase of urban land at high price. Its working Note :- Stamp Duty is charged on Stamp Duty Ready capital requirement is low. Any given project has Reckoner rate or jantry rate. gestation period of 6/8 years. Most of real estate players are in unorganized sector. There are hardly 7) As per KPMG’s estimate urban housing need would 50/60 listed companies on Mumbai Stock Exchange. require 1.7 to 2.00 lakh hectars of land to meet the housing need till 2022 as per detail given in Table 2) Town planners all these years prescribed horizontal ‘E’ below :- development of cities with low or restrictive FSI/FAR in order to reduce migration into cities. Horizontal expansion of cities resulted in resource Table ‘E’ starved local urban bodies unable to provide civic infrastructure in terms of roads, water mains, This analysis is based on a FAR/FSI of 1.5 times the land area. sewerage, and health/educational infrastructure. The actual requirement of land may decrease. If the India’s per capita urban infrastructure spending even unoccupied houses of about 94 lakh, as mentioned earlier, are otherwise is about 17 dollar against requirement of occupied. 100 dollars. Urban housing land requirements

EWS LIG MIG HIG Total 3) Currently 30/40 N.O.C. are required from various Housing Crore 1.7-1.9 1.3-1.5 0.8-1.0 0.4-0.5 4.4-4.8 departments / authorities / organisation which takes need till more than 18 months before approval of building 2022 Super- Sq.ft 300 650 1,000 1,500 plan. This delay add to the cost of project by way of built up interest burden. area Land Crore 510- 850-980 800- 600-700 2,700- required sq.ft 570 1,000 3,200 4) Migrant could not find flats at affordable price in Land Hectare 47,000- 78,000- 74,000- 55,000- 250,000- formal housing sector ultimately purchased in required 53,000 90,000 93,000 64,000 300,000 FAR/FSI# X 1.5 1.5 1.5 1.5 informal housing sector. This resulted in proliferation Land Hectare 31,000- 52,000- 50,000- 37,000- 170,000- of slums in all big towns. required 35,000 60,000 62,000 43,000 200,000

5) Real estate being high capital intensity business with long gestation period, has to depend on high interest Source:- KPMG in India analysis rate, short term loans, either from Banks or from private source in absence of institutions of such as In view of revised income bend for EWS/LIG/MIG as stated pension funds, PF funds offering long terms loans at in Table C-1, revised requirement of area / land is as per low interest rate. This add to overall project cost Table E-1 below :-

Table E-1 high FAR/FSI. This would bring down cost of Requirement of area under various categories providing civic infrastructure, since urbanization area would be reduced. Sr. Category Area for Housing Total Under Total No. of each shortage area new area B) The present building approval plans by Housing household require- income required as per 2012 ment in bend as per Municipalities is not only time consuming but requirement million total new cumbersome. Real estate developers have to obtain sq.mt. housing definitio minimum 30 N.O.C’s from different department / shortage n Organisation, resulting in cost escalation. Many of in million N.O.C’s are irrelevant and are duplication. It is 1. EWS 30 sq.mt. 10.55 316.50 17.96 17.96x30 suggested that a single window clearance system million =538.80 connecting regulatory authorities at Central, State and million Urban Local Body level, supported by a technology sq.mt. 2. LIG 60 sq.mt. 7.41 444.60 plat form would help reduce complexities and delay. million 3. MIG C) There is dire need to reduce indirect taxes 761.10 aggregating to 35% as shown in Table ‘D’ by all authorities to incentivise affordable housing FAR/FSI varies in different cities according to urban development to improve housing affordability. infrastructure and for calculation purpose has been assumed at 1.5 times the land area. D) The Land Acquisition Rehabiliation & Resettlement Act 2013, is expected to have a majot impact on large Note:- Land Acquisition Act 2013 has ensured urban land scale township and affordable housing projects. price shoot up. Needless to state that few provision of LARR Act 2013 are deleted or be suitably amended to achieve In view of above mentioned scenario, question that arises is housing target. whether Real Estate and construction Industry is capable of delivering of about 70 lakh housing units every year from E) Ministry of Skill Development & Entrepreneurships 2015 to 2022, more so in the background of fact that present realesed a report in April 2015 stating therein that deliverable capacity may be maximum upto 8/10 lakh units building construction and real estate sector employed yearly. Comparative statement of progress under various 45.40 million people in 2013 which is expected to Social Housing Scheme is as per Table F below :- reach to 76.60 million by 2022. Most of construction workers are not skilled. It is therefore necessary for Table ‘F’ Construction Skill Development Council of India Comparative statement of progress under various social (CSDCI) to undertake onsite training of construction schemes workers. State governments should realese 20% of Sr. Name of No. of Completed Under Shortfall building & other Construction Workers Welfare Cess No. scheme housing to houses in construction in be number in number number collected at rate of 1% on construction contract constructed amounting to Rs. 13000/- crores as on March 2015. as This would enhance productivity of worker and approved saving in wastage of construction material. 1. Rajiv 120000 in 1154 18281 100565 Awas 16 cities Yojna F) Present cast-in-situ construction system need to be changed to errection of readymade various building 2. Affordable 20472 4528 2200 13744 component such as beam, column, slabs Housing manufactured in factory. It is necessary to standardise

3. Jawaharlal 1440000 831000 36100 248000 design parameters. Alternatively main construction Nehru contractors need to promote specialised foundation, under superstructure and finishing contractors for timely Renewal and faster completion project. Mission

Though the task is stupendous, but can be achieved if not by G) Increased environment concern has reduced 2022 but by 2030 subject to all the stake holders i.e. availability of natural sand and coarse aggregate, Government both Central, States and Local self, real estate delaying housing projects. Ministry of Housing of developers, professionals such as engineers, architects and states and centre jointly with trade bodies such as construction contractors come together and initiating BAI, CREDAI, CFI, NHBF fund research on use of following steps to achieve result. alternative such as construction waste, flyash, slag from steel plant in place and steal of natural sand. A) Town planning departments need to change concept

from low rise horizontal development of cities into H) Housing Regulatory Authorities to be formed in each high rise vertical development with higher density i.e. state to regulate real estate sector and bring about

transparency. There has to be “carpet area” Some states have enacted laws to regulate real estate projects. norm/standards for building approval plan by Urban This Bill differs from these state laws on several grounds. It Local Bodies, sale on carpet area basis by real estate will override the provisions of these state laws in case of any developers to avoid possible litigation on charged inconsistencies. area for flat. It should also be made mandatory for registration and grading of real estate developers for The Bill mandates that 70% of the amount collect from buyers professionalisation of real estate business. of a project be used only for construction of that project. In certain cases, the cost of construction could be less than 70% I) Provident Fund corpus & Insurance Funds be and the cost of land more than 30% of the total amount invested in housing projects either through collected. This implies that part of the funds collected could instrumentality of REITS or other specially created remain unutilized, necessitating some financing from other bonds by RBI. This will provide long term funding sources. This could raise the project cost. requirement to housing sector at lower interest rate than that of Banks. Housing Finance Companies need The Standing Committee examining the Bill has made several to increase home loan tenure from 20 years to 30 recommendations. These include: (a) the Bill should also years, so as to reduce equated monthly installments. regulate commercial real estate, (b) smaller projects should (EMI) to be paid by flat purchasers. Necessary tax also be covered, and (c) all real estate agents must be required incentives to be given to all the schemes. to register.

The Real Estate (Regulation and Development) Bill, 2013 The real estate sector has some other issues such as a lengthy process for project approvals, lack of clear land titles, and The Real Estate (Regulation and Development) Bill, 2013 was prevalence of black money. Some of these fall under the State introduced in the Rajya Sabha by the Union Ministry of List. Housing and Urban Poverty Alleviation on August 14, 2013. PART A : HIGHLIGHTS OF THE BILL The Standing Committee on Urban Development (Chairperson : Mr. Sharad Yadav) submitted its report on February 13, Context 2014. Real estate involves the sales, purchases and development of land for residential, commercial and industrial purposes. Highlights of the Bill Different aspects of real estate are regulated by different levels The Bill regulates transactions between buyers and promoters of government. Real estate projects are currently regulated by of residential real estate projects. It establishes state level state government under their respective state town and country regulatory authorities called Real Estate Regulatory planning or apartment ownership Acts. Typically, town and Authorities (RERAs). country planning Acts regulate land use and development. Apartment Ownership Acts regulate individual ownership of Residential real estate projects, with some exceptions, need to apartments in buildings with multiple apartments, approvals be registered with RERAs. Promoter cannot book or offer for construction of real estate projects are primarily given at these projects for sale without registering them. Real estate the local and state level. Certain approvals are given by the agents dealing in these projects also need to register with central government. Consumer grievances may be redressed RERAs. through forums established under the Consumer Protection Act, 1986. Unfair trade practices may be challenged under the On registration, the promoter must upload details of the Competition Act, 2002. projects on the website of the RERA. These include the site and layout plan, and schedule for completion of the real estate Several court cases have addressed issues in the sectors such project. as unfair buyers' agreements and illegal construction. 2 The Competition Commission of India has pointed out that the 70% of the amount collected from buyers for a project must be absence of a single regulator for the real estate sector is partly maintained in a separate bank account and must only be used responsible for poor grievance redressal. 3 In 2013, the for construction of that project. The state government can alter Committee on Streamlining Approval Procedures in the Real this amount to less than 70%. Estate Sector recommended making the sector more

transparent, with information on real estate projects made The Bill establishes state level tribunals called Real Estate easily available. It also recommended strengthening grievance Appellate Tribunals. Decisions of RERAs can be appealed in redressal mechanism in case of non-compliance with building these tribunals. 4 standards or contracts. Key issues and analysis One may question Parliament's jurisdiction to make laws In 2009, the Ministry of Housing and Urban Poverty related to real estate as "land" is in the State List of the Alleviation had published a Model Real Estate Regulation and Constitution. However, it may be argued that the primary aim Development Bill, to regulate and promote real estate and of this Bill is to regulate contracts and transfer of property, ensure consumer protection. 5 The Model Bill provided a both of which are in the Concurrent List. legislative framework which state governments could choose to adopt while enacting their own laws. Some states have • State governments can establish a lower limit for the enacted laws or are in the process of enacting laws to regulate exemption. Where a project is developed in phases, each the real estate sector, along the lines of the Model Bill. 6 phase must be registered separately. In order to register, the promoter must provide details such as the layout plan The Real Estate (Regulation and Development) Bill, 2013 of the project, and the carpet area of property for sale to seeks to regulate contracts between buyers and sellers in the the RERA. real estate sector to ensure consumer protection, and standardization of business practices. It establishes regulatory • If the applicant does not hear back from the RERA authorities at the state level to register residential real estate within 15 days of the application for registration, the projects. The Standing Committee examining the Bill project will be considered registered. Registration may be revoked after giving 30 days notice to the promoter. submitted its report on February 13, 2014. 7 In case of revocation, the RERA can recommend the

completion of the project through the competent Key Features authority or association of buyers or in any other

manner. Here, competent authority refers to the local Real Estate Regulatory Authorities, Appellate Tribunals authority responsible for land development. All States and Union Territories (UTs) must establish state level regulatory authorities, called Real Estate Regulatory • Real estate agents must register with a RERA in order to Authorities (RERAs) within one year of the Act coming into facilitate the sale or purchase of property in real estate force. Two or more states or UTs may set up a common projects that have been registered. Registered agents RERA. A state or UT may also establish more than one must not facilitate the sale of unregistered projects or RERA. mislead buyers regarding services offered.

• Functions of a RERA include: (a) ensuring that Duties of the promoter and the buyer residential projects are registered, and their details • On registration, the promoter shall upload details of the uploaded on the RERA website, (b) ensuring that buyers, project on the website of the RERA including the sellers, and agents comply with obligations under the number and types of properties for sale, and quarterly Act, and (c) advising the government on matters related updates on the status of the project. In addition, the to the development of real estate. promoter must make the site and layout plans of the

project, and the schedule of completion of the project • Each RERA will consist of a chairperson and at least available to the buyer. In case a buyer incurs a loss two full time members with experience in sectors such as because of false advertising, and wishes to withdraw real estate, urban development, law and commerce. from the project, the promoter must return the amount

collected, with interest. • One or more tribunals, called Real Estate Appellate

Tribunals, will be established in States and Union • 70% of the amount collected for the project from buyers Territories to hear appeals against decisions of RERAs. must be used only for construction of that project. The One Tribunal may be established for two or more states. state government can change this amount to less than Each Tribunal will consist of a chairperson and two 70%. The promoter shall not accept more than 10% of members, one with a judicial background and one with a the total cost of the property as an advance payment technical background. without entering into a written agreement.

• If a RERA observes that an issue impacts competition, it • The promoter shall: (a) obtain a completion certificate may refer the case to the Competition Commission. from the relevant authority, (b) form an association or

society of buyers, and (c) provide essential services till • A Central Advisory Council, consisting of the association of buyers takes over the maintenance of representatives from union ministries, state governments, the project. If the promoter is unable to give possession RERAs and representatives of the real estate industry, of the property, he shall be liable to return the amount consumers, and labourers will be established. The received by him for the property, with interest. Council will advise the central government on major

questions of policy, and protection of consumer interests. • The buyer must make required payments within the term

specified in the agreement signed with the promoter. He Registration of real estate projects and agents will be liable to pay interest for any delay in payment. • The Bill requires that all residential projects, with some Buyers must participate towards the formation of an exceptions, be registered. Promoters cannot book or association/society/cooperative society. offer these projects for sale without registering them.

Registration is not required for projects that: (a) are less PENALTIES than 1000 square metres, or (b) entail the construction of • In case the promoter fails to register the property, he less than 12 apartments, or (c) entail may be penalised up to 10% of the estimated cost of the renovation/repair/re-development without re-allotment project. Failure to register despite orders issued by the or marketing of the project. RERA will lead to imprisonment for up to three years,

and/or an additional fine of 10% of the estimated cost of States such as Punjab, West Bengal and Uttar Pradesh have the project. The promoter will have to pay up to 5% of stated that they would prefer to continue existing laws to the estimate cost of the project if he violates any other regulate real estate 12 . We compare the Bill with certain state provisions of the Act. laws in the Annexure.

• Real estate agents will have to pay a fine of Rs 10,000 70% of amount collected from buyers to be used only for for violating any provisions of the Act, for each day the construction violation continues. Clause 4(2)(i)(D) PART B: KEY ISSUES AND ANALYSIS The cost of a real estate project includes the cost of land and Jurisdiction of Parliament to legislate on real estate the cost of construction (and the profit margin). The Bill The Bill seeks to regulate transactions between buyers and mandates that 70% (or less, determined by states) of the promoters of residential real estate projects to ensure: (a) amount collected from buyers for a particular project be consumer protection, and (b) standardisation of business deposited in a separate bank account and be used only for practices in the sector. It does so through establishment of real construction of the project. The provision seeks to address the estate regulatory authorities at the state level. practice of builders using money from an existing project for

other projects, resulting in delays in completion 7. However, Currently, real estate projects are primarily regulated by state this provision could lead to an increase in the cost of the governments as land and land improvement are in the State project. List of Seventh Schedule of the Constitution. Under Entry 18 of the State List, states can make laws related to land, or rights In some cases, the cost of land may be higher than 30% and in or over land; land improvement; and colonization of land. the cost of construction less than 70% of the total cost of the In response to parliamentary questions, the Ministry has stated project. Mandating that 70% of the amount collected from it is primarily the responsibility of state governments to buyers for a project should be used only for construction of regulate real estate and that states must monitor real estate that project, could lead to part of the money collected 8 projects. remaining unutilised. At the same time, the developer may need to borrow funds to finance the cost of purchasing land. However, the scope of this Bill is limited to contracts between The interest cost on these funds would increase the project buyers and promoters, and transfer of property. Both these cost, which may have to be borne by the buyers. items fall within the Concurrent List 9. A government press release also states this position. 10 Similar legislation has addressed the issue differently. The Model Bill (2009) states that the entire amount collected from Inconsistencies with state laws regulating real estate buyers be kept in a separate account and be used for purposes collected, allowing for greater flexibility in its usage. 5 The Clause 78 of the Bill Maharashtra Act (2012) does the same. 6 The draft Haryana Bill (2013) mandates that 70% be collected and that this The Bill provides that states can continue to apply their laws amount be used for the real estate project. 6 regulating real estate, to the extent that these laws are not inconsistent with the Act. However, several states have Key recommendations of the Standing Committee enacted or are in the process of enacting laws that have The Standing Committee on Urban Development submitted its provisions that are inconsistent with the Bill. These provisions 7 will be superceded by the Bill. Some examples are listed report on the Bill on February 13, 2014. Key below. recommendations relate to:

While the central Bill mandates establishing a statutory • Commercial and industrial real estate: The current Bill regulatory authority to register projects in a state, West Bengal seeks to regulate only residential real estate. The Bill should regulate commercial and industrial real estate as has delegated this function to a government department. 11 well. While the central Bill mandates that 70% (or less, as determined by state governments) of the funds collected from • Exclusion of certain projects: The exclusion of projects buyers of a project be used only for construction of that smaller than 1,000 square meters or 12 apartments from project, certain state governments have allowed for greater the purview of the RERA could lead to the exclusion of flexibility in usage of funds. The Maharashtra Housing a large number of small housing projects. This limit Regulation and Development Act, 2012 mandates that the should be lowered to 100 square meters and three entire amount collected from buyers be kept in a separate apartments. 6 account and be used for purposes collected . The draft Haryana Real Estate (Regulation and Development) Bill, 2013 • Registration of all real estate agents: All real estate mandates that 70% of the amount collected from buyers for a agents should be required to register with a RERA and project be used for that particular real estate project. 6 not just those facilitating the sale of a project covered by the Bill.

• Single window system for project approvals: A new Ref: 11/A/20146-17 dated April 12, 2016 provision should be inserted to allow RERAs to give directions to state governments to establish a single The Joint Director (Com III) window system for providing clearances for projects. A Rajya Sabha Secretariat, time limit should be specified for state and local Room No. 212A, Parliament House Annexe, authorities to issue completion certificates. New Delhi – 110001

• Definition of carpet area: The Bill defines carpet area as Sub: BAI’s comments on the Real Estate (Regulation and 'net usable floor area' of an apartment, excluding the area Development) Bill – 2013 (RERA) covered by its walls. The term 'net usable floor area' should be defined in the Bill. Dear Sir,

• Structural defects: The Bill specifies that a promoter Builders’ Association of India (BAI) is an apex all India must rectify any structural defect which is brought to his body of Engineering Construction Contractors and Real Estate notice within two years of allotment. This term should Companies founded in 1941, with more than 15,000 business be increased to five years. entities as members through its 154 plus Centres (Branches) throughout the country. Regional Associations Affiliated to Other key issues in the real estate sector BAI form indirect membership of more than 1,00,000. The fundamental aim of the Association is to bring about all round Several committees and government agencies have outlined improvements in the construction sector, while striving major challenges in the real estate sector. 4,15,16 However, it towards resolution of operational as well as policy level is unclear if a central law can address these issues, given that problems faced by the construction industry. some of these items fall under the purview of the state government. 2. BAI believes itself to be the chief vehicle of delivering the national objective of housing for all by 2022. • Lengthy approval process for project clearances: In Construction of 50-60 million units that it entails is possible 2012, the Committee on Streamlining Approval only with involvement of real estate developers. Given the Procedures for Real Estate Projects recommended high income and employment multiplier of housing, real estate establishing a single window clearance system for development needs to be actively promoted. Housing approvals. It noted that up to 50 approvals are required development also reduces income inequalities. For all these for projects, across three levels of government, taking up reasons, real estat development needs a supporting policy environment. Our view on RERA set out below emanate from to four years. 4 this sense of responsibility.

The Bill allows RERAs to make recommendations to 3 The precise objective for RERA needs to be well state governments regarding measures to improve the thought out. Regulation for the sake of regulation would only approval process. However, the Standing Committee has add one more layer of approvals, increase transaction cost, and recommended that a new provision be inserted to allow make housing even more expensive for the ultimate consumer. RERAs to direct state governments to establish a single As it is, real estate is regulated by a multiplicity of laws. 7 window system. Consumer rights are adequately safeguarded through the Consumer Protection Act, 1986. The Bill is weak on the • Lack of clear land titles: The Planning Commission has issues to be addressed an lumps all projects together. pointed out that unclear land titles and lack of transparency in real estate transactions are detrimental to 4. The Bill proposes to cover “Commercial/industrial the development of the real estate sector. 13 In 2010, the and other related projects”, alongwith Residential projects. centre published a Model Bill, the draft Land Titling Commercial sector and other related segments have resources Bill, to reform the land titling system. 14 In 2012, the and expertise to evaluate and conduct required due diligences Standing Committee on Rural Development suggested and are safeguarded by the provision in various other laws. that modernisation of land records, including land titles, Hence, if there be an issue that requires regulation, it may at would be useful for land based developmental and best relate only to the residential projects and not commercial 15 or industrial projects. Accordingly, the Bill should focus on regulatory activities. the Residential projects and leave all other projects out of its coverage. Prevalence of black money: • In a 2012 paper on black money, the Finance Ministry pointed out that the real 5. The Bill proposes to cover all ‘existing projects’, estate sector, which constitutes about 11% of the GDP of where the completion certificate has not been received. It is the country, is particularly vulnerable to black money not clear, how the projects which are already on-going can be through under reporting of transaction prices while made to comply with the registration and other requirements paying taxes. 16 without leading to delay, cost overrun and customer harassment. Further, the requirement to bring projects which are ongoing within the coverage of the Bill is also arbitrary.

Thirdly, including the existing as well as under development diluted. Hence, it is urged that the Bill restricts its scope only projects within The Bill would create a huge backlog. Hence, to “Developer-Buyer” and any activity beyond the handover it is only the “Green Field” projects (i.e. projects launched and of the real estate project to the ‘Buyer’ should stay outside the registered after notification of the RER&D Act), that may be ambit of the bill. appropriately covered under the proposed Bill. 10. Some of these suggestions are further elaborated in 6. Under the provision of the Bill, registration is online the attachment and some technical aspect are also commented and deemed in 15 days but the regulator will subsequently upon. ALLOT a user log in ID until when the sales cannot be made. We are concerned, as to how would deemed registration in 15 11. It is requested that the above suggestions may please days help if developers still have to wait for the log in ID. On be given serious consideration for bringing the bill in the other hand, the regulator will subsequently scrutinize all alignment with its objectives as well as the goal of housing for documents and can cancel registration if he thinks they are not all by 2022. in order. The question which arises is that if there is deemed registration, how subsequent scrutiny can may be effected Best Regards only if there is a subsequent infraction or misdemeanor. Yours sincerely,

7. Revocation of registration cannot be arbitrary. According to Section 7(a), the Real Estate Regulatory Authority may revoke the registration upon being satisfied that Avinash M. Patil the promoter has made willful default in doing anything President required of him by or under the Act or the rules and Builders’ Association of India regulations made thereunder. However, willful default is not defined in the Act. This implies possibility of completely arbitrary principles in determining what the willful default is. Hence, it is requested first of all that what constituted willful default may need to be clearly defined. Secondly, for the Attachment – 1 process of revocation to be equitable, it should be made clear Suggestion on Real Estate (Regulation and Development) Bill, 2013, in that the process of revocation would follow the principal of consideration of 2015 Amendments natural justice and provide for the promoter being given adequate opportunity of being heard. S. Provision in Provision in Issue/Suggestion Remarks / No. 2013 Bill 2015 / Objection Reasons1 Amendment 8. Section 5 in its current form restricts the validity of 1 S.2(i) Sr.No.8 The explanation Carpet area needs registration to be conterminous with the likely period of time under the to be considered within which the completion of the project is envisaged by the Definition of and should be in promoter under provision of 4(2)(i)(c). it does not take into “Carpet area” line with the should include the regulations account other stakeholders like the ‘competent authority’ or area accessible (Development functional agencies or financial agencies who are not within the Control apartment, Regulations) answerable to the Regulatory Authority which results in the excluding wall framed under any delays on the project. On the other hand, the ‘promoter’ is thickness law which are in force in the made solely responsible and liable to be penalized for delays respective areas of and non-compliance. Hence, it is necessary to bring all the respective entities associated with grant of approval for the projects such States as Urban Local Bodies into the ambit of RERA, and in 2 S.2(zf) Sr.Nos.19,20 The Definition of - The Definition particular Section 5 to enable the Real Estate Regulatory “promoter” includes and needs to be considers a buyer Authority to issue appropriate direction to them for the sake of reconsidered, who purchases in timely completion of projects. The grant of occupancy especially bulk resale inclusion of the certificate/completion certificate/plinth certificate should be buyers who - Although some provided for on a time bound and automatic basis. Further, it purchases in bulk amendments are should be explicitly provided that the project promoters are for resale, should proposed, as to be removed from who, for the not liable for delays on account of want of approvals from the definition. purpose of this statutory authorities. Act, will be considered a buyer who 9. It is also feared that including “Tenants”, within the purchase in bulk for resale, it is not ambit of the Bill, would drift the focus away from the core of enough to exactly the Bill to streamline and cover the “Developer-Buyers” clarify obligations, relationships. “Tenants” enter into a property only after the if any, cast upon him as ‘promoter’ Developer has acquired the “Occupancy Certificate’ and then the “Apartment” is handed over the “Buyer”. By involving - Actually, the obligations of “Tenants”, who are temporary occupants on rent (for a limited such bulk-buyer time period), the Bill’s “Developer-Buyer” mandate would get are not same like

that of the apartments or promoter under plots are the Bill, such as different), as seeking approval they are in no of plans, way connected development in with accordance with development such approved activities of the plans, registration promoter of project, completion of - Such persons project, formation only find of association, prospective execution of buyers for conveyance etc. purchase of the apartments, plots - Such bulk-buyer or buildings would buy only as constructed/deve an investment loped by the purpose, with promoter and are intention to resale defined as ‘real the flats purchased estate agents’ at by him in bulk. If S.2 (zh) of the they are included Bill in the Definition of promoter and - It is erroneous to are to be treated at include such par with the persons in the promoter, then definition of the their roles should ‘promoter’ also be implying that specifically they shall be defined. liable to However, such discharge all the inclusion will obligations of adversely impact the promoter as the investment specified in the opportunities Bill, although impact the they do not play investment any role in opportunities that construction of the bulk buildings or purchasers would other related pre- be looking at construction or - Further, there is post- no procedure construction prescribed under activities the Bill for resale undertaken by of flats/apartments the promoter, by such bulk- which are being buyer to sought to be respective regulated by the individual Bill purchasers and no obligation is cast - More so, the role on him in this of such persons, regard too commonly known as - In such an brokers and real eventuality, the estate agents, is functions and/or separately obligations of the regulated/govern promoter under ed by section 9 the Bill and that of and 10 of the the bulk-buyer are Bill totally different - Hence, the and hence, its functions and/or inclusion in the obligations of definition of the promoter promoter is not under the Bill appropriate and and that of the should be person who removed ‘sells’ the apartment, plot 3 Explanation Where the person - The Explanation or building are u/s (below) who constructs or to this section totally different s.z (zf) (vi) converts the should also and hence, their building in to exclude inclusion in the apartment or reference of the definition of develops a plot person who promoter is not for sale and the ‘sell’ the appropriate and person who sells apartments should be apartments or (where the removed plots are different person who persons, both of develops the 4 Proviso now Sr. No. 26 Addition of - Bringing the them shall be apartment or plot added u/s 3 Proviso u/s 3 (a): ongoing projects deemed to be the and the person This addition of within the promoters who sells the Proviso now purview of the

brings the Bill or making removed approvals and ongoing projects the Act commencemen within the applicable to t certificates purview of the such projects were received Bill, which was will create lot of prior to absent in the impracticalities commencemen earlier Draft. t of this Act, - The projects in were rightly respect of which excluded from commencement the certificate will requirement of have been registration. issued, should be Hence, the kept outside the amendment in purview of the this regard in requirement of 2015 registration as amendments ongoing project should be removed that - Development of S.3(b) should the projects be restored which will have been governed - For other under the reasons, see the respective State Remarks at Acts on the date item No. … of the Central hereinabove Act coming into for registration force, will have of ongoing been done as per projects and different the same be respective treated as provisions of the reproduced State Acts here respectively applicable to 6 S.4(2)(b), Enclosing - The requirement them. It would S.4(2)(c) and documents with of submitting an not be possible S.4(2)(d) the application for authenticated to govern the registration of real copy of remaining estate projects, commencement project under the such as certificate issued provisions of the - commenceme by competent Bill under nt certificate authority is too Central Act in [S.4 (2) (b)], harsh and far- total disregard of - layout plan fetched the State Acts for the entire project [S.4 - At the time of - More so, (2) (c)], making an because the - plan of application for modalities for development registration of sale of works to be the project, the apartments, executed in Promoter should specific the proposed be required to undivided rights project and submit only the in common proposed proof of having areas, formation facilities to submitted the of associations, be provided plans of the execution of [S.4 (2) (d)] project for Conveyance etc. approval of the are varying from competent State to State authority, and may not be authenticated by as are envisaged an architect. The and/or proposed approval and to be stipulated sanction from by the Act the competent authority, - It is not including practically commencement possible to certificate, as govern one and when project by two available, different obtained in provision of law accordance with at different times the building during its regulations and development. other laws as Hence this applicable, Provision should should be be removed uploaded on website within a 5 S.3(2)(b) Sr. No. 27 Requirement of - The provision specified period having received as it was, viz. of obtaining the the Completion S.3 (b) was same form the Certificate by the clear enough respective promoter prior to and the authorities commencement of projects where the Act, should be all the - The reason

behind this approval and being, if the sanction. This Promoter will be should be required to wait required to be till issue of submitted along commencement with the certificate, it will submission of not only delay the commencement commencement of the project, it certificate as will also indicated tremendously hereinabove escalate the cost of project; the 7 S.4 (2) (i) Sr.No.35 To submit a - However, there interest burden (D) Declaration that is no provision on the Promoter fifty percent or under which the shall also such lesser promoter would increase which percent as may be be required to will ultimately notified by the comply with this result in increase Appropriate obligation of the cost of the Government shall apartment or plot be deposited in a - Also, there is no or building. This separate account provision will work to to be maintained stipulating any disadvantage of with a Scheduled mechanism for the allottee, for Bank to cover the use of such whose benefit, cost of amount by the the entire construction and promoter construction to be used for that activity is sought purpose - for construction to be regulated as stipulated in by this Bill the Bill

- Layout plan - for operation of required to be such separate submitted, account for should only be construction that of the Phase (essentially for of the project which, it is to be which may be used), or under registration and - in the event of not the plan of revocation of the entire layout. registration of The very reason the project by that where the the Competent layout is to be Authority, or developed in phases, each - phase shall be considered as a - in the event of stand along the allottee project and the cancelling the Promoter shall transaction or the obtain promoter registration of terminating the each phase Agreement on separately [see account of Explanation u/s default by the 3], is that each allottee in Phase is to be payment of registered installments, and separately. In the amount such an event, required to be requirement of refunded to such submission of allottee, on the plan for account of such entire layout is cancellation or contradictory to termination, as the spirit of the the case may be Bill and therefore, should 8 S.5(2) Sr. No. 37 If the Authority There is no clarity be removed would fail to grant about who shall the registration as grant the - Further, plan of provided us 5(1) registration the development the project shall number, Login Id works to be be deemed to and password to the executed and have been promoter for the proposed registered purpose as facilities to be enumerated in provided, also S.5(1), if the project may not be ready shall be ‘deemed to at the time of be registered’ registration of the project, when 9 Explanation Sr. No. 38 Extension or The circumstances the plans would u/s.6 registration beyond the control have been of the promoter submitted for

should also be and buildings included in and as available for sale, the ‘force majeure’ approximate time circumstances e.g. for completion of scarcity of steel, project, general cement, other facilities and construction amenities intended materials, strike, to be provided by labour issues, the promoter etc., change in which will give a government basic and general policies or court idea about the orders etc. Which project may adversely affect development - If any person who of the projects, would be which may not be interested in attributable to the knowing the Promoter and further details which may be such as status of unforeseen by the the project, cost of promoter in the apartments, beginning of the detailed amenities project and facilities to be made available 10 Proviso u/s 8 Obligation of - The proviso etc., can be Authority under Section 8 permitted to be consequent upon should also seen by the lapse of or on include the Promoter after revocation of words “and no verifying registration appeal has been credentials and filed during such genuine intention period”, after the of such person as words “….under a prospective the provisions of buyer. For this this Act”. purpose, the Promoter would 11 S.11 Promoter’s - The details filled give password obligation to in by the Promoter (with a limited create his web on his webpage validity period for page and entering should not be use thereof) to all details of the made accessible such person to proposed project and visible to access the upon receiving his public at large. webpage upon Login Id and The web page such person’s password from the should be making an Authority maintained by the application to the Authority, which Promoter, on should permit the charging nominal basic details and fees general information about - If the above or any the project to other measures are public, necessary not adopted and for them at the webpage is not preliminary level kept secured, then there are chances - All further of misuse of the information and information about other details the project being should be made available permitted to be and unscrupulous obtained or elements can take provided only by undue advantage the Authority, which may cause upon receipt of loss and damage cost specified by to the Promoter. it, to the persons Also, the who would apply Promoter’s trade for the same, with secrets and genuine intentions designs and patents and other - Or in the intellectual alternative, if the properties would web page has to be stolen, causing be maintained by irreparable the Promoter, the damage to the Promoter should Promoter be permitted to

show only general information about the project such as geographic location, size, umber of buildings, variety of apartment, plots

Decoding the real estate Bill provision, he adds. Factoring in the historical cost of land, in Some key legal and regulatory challenges facing the proposed cases where the promoter has a land bank build over years, is real estate regulator another issue that could become contentious, feel experts.

When does the regulatory authority come into effect? Can state governments change the 70-30 provisions?

The central and the state governments must establish the The Real Estate Bill falls under the Concurrent List and state authority within one year of the proposed Act coming into governments are entitled to legislate. However, any force. Each government could establish one or more authority amendment to a central legislation by a state government will within a state or Union territory. If they deem fit, two or more require presidential assent if the amendments are inconsistent states or Union territories could establish a common regulator. with the provisions under the central law. "Technically, we could have one regulator and an appellate tribunal in each district, if the state so decides," says Gulam "In theory, state governments could change the 70-30 rule, Zia, executive director, Knight Frank India. however, we expect them to uphold the provisions of the bill," says Yogesh Singh, partner, Trilegal. How is the real estate regulator different from regulators in other sectors like insurance and telecom? Does the proposed law have overriding provisions over existing laws? The real estate regulator will have no price determining powers. It also does not have any control over clearances and The provisions of the proposed Act come into effect in approvals developers need for starting a project. addition to the provisions of any other law that are in force. So the central and state laws continue to be in force. However, the "It does not address a long-standing demand of developers for proposed Act expressly repeals the Maharashtra Housing a single-window clearance," says Kalpesh Maroo, partner, (Regulation and Development) Act, 2012. Legal experts point BMR & Associates. out that many provisions of the Maharashtra Act have been incorporated in the proposed central bill. However, the regulator could suggest to the government to create of a single-window system to ensure time-bound project Within the first two years of notification of the proposed Act, approvals. the central government is allowed to make necessary changes in the provisions to remove operational difficulties. However, How are promoters granted registration of a project? these changes have to be ratified by Parliament.

No promoter is allowed to advertise, market, book, sell or Legal experts feel a significant amount of alignment will be offer for sale, or invite persons to purchase any plot, apartment needed between the central legislation and laws already in or building, in a project without registering with the authority. place in various states. Formulation of laws related to land, or rights in or over land, land improvement and colonisation of The regulator, within a year of its establishment, must have an land falls in the State List. Typically, town and country online system for submitting applications for registration of planning legislations of respective states regulate land-use and projects. The authority must grant registration to a project development. Approvals for construction of projects are within 30 days of receipt of an application provided it meets primarily granted at the local and state level. the rules. In an ongoing project, the promoter has to apply for registration within three months of commencement. Moreover, rights of individual owners of apartments in large complexes are governed by the respective apartment What are the legal challenges to the 70-30 rule? ownership laws.

To prevent diversion of funds from a project, the proposed Act What are the penalties for non-compliance? prescribes that 70% of the amount a project developer receives from allottees be deposited in a separate bank account to cover Promoter: For non-registration of a project, a promoter is the cost of construction and the land cost. liable to a penalty that may extend up to 10% of the estimated cost of the project, as determined by the authority. If a The promoter is allowed to withdraw the amount to cover the promoter does not comply with the orders, decisions or cost in proportion to the percentage of completion of the directions issued by the authority, he is punishable with project. The account has to be audited every financial year by imprisonment of up to three years. a chartered accountant. Any withdrawal from the account has to be certified by an engineer, an architect and a chartered Similarly, non-compliance with any orders of the appellate accountant. tribunal is punishable with imprisonment that may extend up to three years, or with a daily fine that may cumulatively According to Anil Harish, partner, DH Harish & Co, the rules extend up to 10% of the estimated project cost, or both. for valuation of land will play a key role in making the 70-30 provisions effective. Each state may come out with different Allottee: If any allottee fails to comply with, or contravenes rules on valuation of land, leading to ambiguity in the any of the orders, decisions or directions of the authority, he is liable to a penalty that may extend up to 5% of the cost of the Employment Scenario – 2022 plot, apartment or building, as determined by the authority. Union Ministry of Skill Development and Entrepreneurships Non-compliance with any order of the appellate tribunal could released a report about likely employment scenario by year attract prison terms of up to one year, along with a fine that 2022 in April 2015. Report shows that 461 million people may cumulatively extend up to 10% of the cost of the plot, were employed in 24 major sectors in 2013 and projected to apartment or building. grow to 591.70 million people by 2022 i.e. increase of 30% in

Company: When a company is found to have committed an a years as detail is given in Table below :- offence, every person responsible for the conduct of the Sr. Name of sector No. of Percentage No. of Percentage Increase in business is deemed guilty and liable to be proceeded against No. people of people of employment and punished accordingly. However, it has to be proved that employed employed likely to employed percentage in million to total in be to total by over 2013 the offence was committed with the consent, or connivance, of in 2013 2013 employed 2022 in million or is attributable to any neglect on part of the person. by 2022

1. Agriculture 240.40 52.30 215.60 37.30 - Will the proposed Act increase the cost of compliance for 2. Building 45.40 9.90 76.60 13.20 55 the promoter and the buyer? Construction and Real Estate It will increase compliance requirements for promoters, as 3. Retail 38.60 8.40 55.70 9.60 50 4. Transportation 16.70 3.60 28.40 4.90 57 each project has to be vetted by chartered accountants, and Logistics lawyers, tax experts, engineers, apart from other professionals. 5. Textile & 15.20 3.30 21.50 3.70 27 "It is likely that any increase in the cost of a project on Clothing 6. / Skill 13.00 2.80 17.30 3.00 26 account of additional cost of compliance, paperwork and Development manpower requirements, will be passed on to the allottees," 7. Handloom & 11.70 2.50 17.80 3.10 50 says Rajesh Chavda, partner, Luthra & Luthra Law Offices. Handicraft 8. Auto & Auto 11.00 2.40 14.90 2.60 26 Component SKILL DEVELOPMENT IN CONSTRUCTION SECTOR 9. Construction 8.30 1.80 11.00 1.90 24 Material Government of India established National Skill Development 10. Security 7.00 1.50 11.80 2.00 51 st Corporation (NSDC) on 31 July 2008 as not for profit 11. Food Processing 7.00 1.50 11.40 2.00 51 company licensed under Section 25 of the Companies Act, 12. Tourisam, 7.00 1.50 13.40 2.30 54 Hospitality & 1955. NSDC has targeted to train 150 million people by 2022, Travel out of incremental demand of 240 million. 13. Domestic Help 6.00 1.30 10.90 1.90 75

14. Gems & 4.60 1.00 8.20 1.40 70 As mandated under NSDC’s programme Construction Jewellary Industry need to form a Construction Skill Development 15. Electronics & IT 4.30 0.90 8.90 1.50 100 Council to establish occupation standards, operations and Hardware 16. Beauty & 4.20 0.90 14.30 2.50 300 delivery mechanism, certification and accreditation and Wellness Labour Market Information System (LMIS). Ultimately in a 17. Furniture & 4.10 0.90 11.30 2.00 75 meeting held on 23 rd August 2012 in the office of Shri Furnishing 18. Healthcare 3.60 0.80 7.40 1.30 100 Ramadorai, the then Adviser to Prime Minister on Skill 19. Leather & 3.10 0.70 6.80 1.20 100 Development and present Chairman of National Skill Leather Goods Development Corporation, Construction Sector Skill 20. IT & ITES 2.80 0.60 5.10 0.90 100 21. Banking & 2.60 0.60 4.30 0.70 70 Development a Council of India was formed jointly by four Finance Associations namely Builders’ Association of India (BAI), 22. Telecommunicat 2.10 0.50 4.20 0.70 100 Construction Federation of India (CFI), Confederation of Real ion Estate Developers Association of India (CREDAI), and 23. Chemicals & 1.90 0.40 3.60 0.60 100 Pharmaceuticals National Highway Builders’ Federation (NHBF). Members of 24. Media & 0.40 0.10 1.30 0.20 300 the Governing Council are as follows:- Entertainment Total 461.00 100.00 591.70 100.00 Name of Member Name of Organisation Shri Ajit Gulabchand Chairman, C.F.I. Shri S.N. Subramanian C.F.I. From the figures it is to be noted that increased productivity in Shri B. Seenaiah Past President, BAI Shri Sushanta Kumar Basu Past President, BAI farm sector would render 24.80 million farm labour surplus, Shri Lalit Kumar Jain Chairman, CREDAI which will be absorb in construction – real estate, Shri C. Shekar Reddy President, CREDAI transportation, and domestic help sectors. Further construction Shri V.C. Verma President of NHBF Col. Surinder Kuda of NHBF sector will employ 76.60 million more workman by 2022 i.e. M/s. Ashoka Buildcon 56% more compare to 45.40 million in 2013. Construction Shri Niranjan Hiranandani Additional Industry Nominee Industry therefore need to concentrate more on skill training to Shri Phillie Karkaria Additional Industry Nominee Shri Devendra Choudhary, Planning Commission Nominee improve productivity to bring down labour cost and wastages Additional Secretary, Ministry of power in material. More than 200% increase of employment in Shri J. Ganguly Additional Industry Nominee Tourism, Beauty and wellness, furniture & furnishing and Technical Adviser to be decided by Governing Council later. entertainment, suggest that households by 2022 shall have Technical Adviser to be decided by higher disposable income to spend on this sector. Governing Council later.

Skill Development of Construction Workers 28 CON/Q0305 Scaffolder - System L4 29 CON/Q0307 Chargehand Scaffolding - L4 System 30 CON/Q0309 Foreman - Scaffolding L5 1) Construction Skill Development Council of India is a 5 Construction 31 CON/Q0601 Helper Electrician L2 non profit making company, registered under section Electrical 8 of the companies Act 2013. It is registered on 11 Works 32 CON/Q0602 Assistant Electrician L3

September 2013 with Registrar of Companies at 33 CON/Q0603 Construction Electrician - L4 Delhi, having it’s address at 204, Aashirwad LV 34 CON/Q0604 Foreman - Electrician L5 Complex, D-1, Green Park, New Delhi – 110016. It works (Construction) is formed by four construction related trade 35 CON/Q0605 Supervisor - Electrical L6 associations with equity participation as per table Works 6 Construction 36 CON/Q0501 Helper Construction L1 below :- Painting Painter 37 CON/Q0502 Assistant Construction L2 Sr. Name of Trade Equity Name of Directors Painter & Decorator No. Association Capital from each Associations 38 CON/Q0503 Construction Painter & L3 1. Construction Federation Rs. 15/- lakh Shri Ajit Gulabchand- Decorator of India Chairman 39 CON/Q0504 Chargehand - Painting & L4 Shri S.N. Subramanian Decorating 40 CON/Q0505 Foreman - Painting & L5 2. Builders Association of Rs. 20/- lakh Shri S.K. Basu Decorating India Shri B. Seenaiah 7 Quality 41 CON/Q0401 Helper - Laboratory and L2 3. Confederation of Real Rs. 20/- lakh Shri C.K. Reddy Assurance and Field Technician Estate Developers Shri J.M. Thakkar Quality Control 42 CON/Q0402 Construction Laboratory & L4 Association of India Field Technician 43 CON/Q0403 Quality Technician L6 4. National Highway Rs 5 Lakh Shri V.C. Verma Builders Federation. Shri S. Kuda 44 CON/Q0404 Construction UT Tester L3 Total 60 Lakh 45 CON/Q0405 Construction MPT Tester L3

2) C.S.D.C.I. got approved by NSDC / curriculum in 46 CON/Q0406 Construction DPT Tester L3 respect of following trades : Occupation S. QP Code Job role NSQF 47 CON/Q0407 Assistant Paint Inspector L5 S. No. Level No 8 Rigging 48 CON/Q0701 Khalasi (Assistant Rigger) L2 1 Masonry 1 CON/Q0101 Helper Mason L1 49 CON/Q0702 Rigger - Structural Erection L3 2 CON/Q0102 Assistant Mason L2 50 CON/Q0703 Rigger - Precast Erection L3 3 CON/Q0103 Mason General L4 51 CON/Q0704 Rigger - Piling L4 4 CON/Q0104 Mason Tiling L4 52 CON/Q0705 Chargehand - Structural L4 5 CON/Q0105 Mason Concrete L3 Erection 53 CON/Q0706 Chargehand - Precast L4 6 CON/Q0106 Mason Marble, Granite and L4 Erection Stone 54 CON/Q0707 Chargehand - Piling L4 7 CON/Q0107 Mason - Special Finishing L4 55 CON/Q0708 Foreman - Erection L5 8 CON/Q0108 Mason Form Finished & L4 Special Concrete 56 CON/Q0709 Supervisor - Erection L6 9 CON/Q0109 Foreman Wet Finishing and L5 Flooring 57 CON/Q0710 Supervisor - Piling L6 10 CON/Q0110 Foreman - Concrete L5 9 Fabrication 58 CON/Q1201 Helper Fabrication L1 11 CON/Q0111 Supervisor Structure L6 59 CON/Q1202 Assistant construction L2 12 CON/Q0112 Supervisor Finishes L6 Fitter 60 CON/Q1203 Grinder - Construction L2 2 Bar Bending 13 CON/Q0201 Helper Bar Bender and L1 and Fixing Steel Fixer 61 CON/Q1204 Gas Cutter - Construction L2 14 CON/Q0202 Assistant Bar Bender and L2 Steel Fixer 62 CON/Q1205 Construction Fitter L3 15 CON/Q0203 Bar Bender and Steel Fixer L4 63 CON/Q1251 Tack Welder L3 16 CON/Q0204 Reinforcement Fitter L4 64 CON/Q1252 Construction Welder MIG L4 17 CON/Q0205 Foreman Reinforcement L5 – L4 65 CON/Q1253 Construction Welder TIG - L4 3 Shuttering 18 CON/Q0301 Helper Shuttering L1 L4 Carpentry Carpenter 66 CON/Q1254 Construction Welder L4 19 CON/Q0302 Assistant Shuttering L2 SMAW - L4 Carpenter 67 CON/Q1207 Plasma Cutter L4 20 CON/Q0304 Shuttering Carpenter - L4 System 68 CON/Q1206 Fabricator L4 21 CON/Q0310 Shuttering Carpenter - L4 Conventional 69 CON/Q1208 Foreman Fabrication L5 22 CON/Q0306 Chargehand - Shuttering L4 Carpenter -system 70 CON/Q1255 Senior Construction L5 23 CON/Q0311 Chargehand - Shuttering L4 Welder MIG – L5 Carpenter- Conventional 71 CON/Q1256 Senior Construction L5 24 CON/Q0308 Foreman Formwork L5 Welder TIG – L5 72 CON/Q1257 Senior Construction L5 4 Scaffolding 25 CON/Q0314 Assistant Scaffolder - L2 Welder SMAW – L5 system 73 CON/Q1209 Supervisor Fabrication L6 26 CON/Q0313 Assistant Scaffolder - L2 conventional 10 Prestressing 74 CON/Q0801 Assistant Technician - L2 27 CON/Q0312 Scaffolder Conventional L4 Prestress

75 CON/Q0802 Technician - Prestress L4 5) C.S.D.C.I’s financial performance is as under :-

76 CON/Q0803 Senior Technician - L6

Prestress Sr. Financial Amount Amount Amount Deficit Surplus 11 Surveying 77 CON/Q0901 Assistant Surveyor L2 No. year received from disbursed disbursed NSDC / to T.P. to 78 CON/Q0902 Surveyor L6 Government assessors 12 Roads & 79 CON/Q1001 Assistant Pavement Layer L2 1. 2013 -14 32,000,000 136050 1723953 (1380738) - Runway 2. 2014 -15 - 2457658 8333873 (1625469) - Construction 80 CON/Q1002 Pavement Layer L4 3. 2015 -16 - 2705360 32227832 - 3530786 4. 2016 -17 - 58400 11365548 - 911273 81 CON/Q1003 Foreman - Roads & L5 Runways 82 CON/Q1004 Supervisor - Roads & L6 CONSTRUCTION SKILL DEVELOPMENT COUNCIL OF Runways INDIA 13 Interior & 83 CON/Q1101 Helper Interior Finishes L1 Exterior Finishes 84 CON/Q1102 Helper Façade Installer L1 AFFILIATION CERTIFICATE VER 1.0 85 CON/Q1103 Assistant False Ceiling and L2 Drywall Installer Builders Association of India 86 CON/Q1104 Assistant Façade Installer L2 G-1/G-20, 7 th Floor, Commerce Centre, 87 CON/Q1105 Doors & Windows Fixer L3 J. Dadajee Road, Tardeo, 88 CON/Q1106 Façade Installer L3 MUMBAI – 400 034  (022) 23514802, 23514134, 23520507 89 CON/Q1107 False Ceiling & Dry Wall L3 Installer (M) 9323576860 90 CON/Q1108 Chargehand - Façade L4 Installer 91 CON/Q1109 Chargehand - False Ceiling L4 PROVISIONAL AFFILIATION CERTIFICATE: & Drywall Installer ASSESSMENT BODY 92 CON/Q1110 Foreman - Facade L5 Installation 93 CON/Q1111 Foreman - False Ceiling L5 1. This is to inform you that documents submitted by you have and Dry wall Installer 14 Draughting 94 CON/Q1301 Draughtsman L5 been found in order except the documents given below:-

15 EHS 95 CON/Q1401 EHS Steward L4 (a) Submission of Application duly completed in all 96 CON/Q1402 Supervisor - Site EHS L6 respect.

16 Store Keeping 97 CON/Q1501 Store Assistant - L2 (b) Submission of list of CSDCI certified assessors, Construction preferably ten. However, to start with minimum six 98 CON/Q1502 Junior Store Keeper - L5 Construction CSDCI certified assessors are required. 99 CON/Q1503 Store Keeper -Construction L6 (c) Submission of assessment methodology.

17 Masonry -Rural 100 CON/Q3603 Rural Mason L4 (d) Submission of question bank of all job roles as applied for. (e) Agreement between assessors and the affiliated body. 3) All these sanctioned curriculum are to be developed (f) Payment of affiliation fee of Rs. 40,000/- after into a “Content Books”, which is mandatory for conditions mentioned in para 1 (b) have been complied trainee, trainers and master trainer. Certificate to with. successful candidate issued by C.S.D.C.I. is recognised by National Skill Qualification 2. Based on your documents, you are provisionally Committee. Notification in this regard is issued by affiliated as an Assessment Body with Construction Joint Secretary to the Government of India, Ministry Skills Development Council of India (CSDCI) for the of Skill Development & Entrepreneurship and job Roles as given in the MoU. However, it does not published in Gazette of India. Extra -ordinary Part I – give you the authority to carry out assessment till Section 2 on 17-3-2015. This in effect means that conditions mentioned in para 1 above are complied and certificate shall have pan India value. a certificate declaring you as an Assessment Body issued. The certificate issued will be valid for one year.

4) C.S.D.C.I. has registered number of training providers, assessors and established or helped in 3. This provisional certificate is valid for three months within which all the above conditions mentioned above establishing training centres at various places. Detail have to be complied with. of as per table ‘A’ below:-

Financial Training Registered Number Registered Number of Number of year centres in training workers assessors in workers certificates Date: 02 July 2016 Authorized Signatory numbers providers trained numbers assessed by issued Sd/- by T.P. Assessor Place: New Delhi CEO, CSDCI 2013-14 16 12 4856 63 614 569 2014-15 19 97 7769 26 7867 7912 Construction Sector Skill Development Council - an update 2015-16 533 87 71597 110 55382 8588 2016-17 79 7 6921 4 3054 20072 1. Pradhan Mantri Kaushal Vikas Yojna 2.0

TOTAL 647 203 91143 203 66917 37141 The PMKVY 2.0 was launched on 15.06.16. The new scheme requires the training centres to be uploaded and approved through the SMART NSDC portal

(http://www.smartnsdc.org/) which is now active and national standard. The MoRD has also requested CSDCI ready. The training providers have been requested to to develop QPs for Rural Mason Level 2 &3. MoRD start uploading the details on the portal, once approved aims to construct 33 lacs houses under Pradhan Mantri and physically verified the training provider can upload Awaas Yojna (PMAY) in the current financial year. data. During the soft launch CSDCI has received 4500 Statewise details are attached* for your perusal. numbers for Asst. Electrician and Mason General job roles. The model envisages selection of the Training Partners through EOI, giving them a cluster of houses in a As per the guidelines, The SSC will get the assessment District, employ their certified Lead Trainers and fees paid only for the appeared candidates after the Demonstrators for construction of the houses through results have been uploaded and approved by the SSC on local masons of the Panchayat and beneficiaries. The the SDMS. houses will be constructed in 45 days employing five masons and two beneficiaries. Post the construction of 2. PMKVY – Technical Institutes the houses all the masons and the beneficiaries will get The National Steering Committee has sanctioned 1273 assessed by the CSDCI certified assessors for which the Polytechnics / Engineering college in 19 sectors with assessment money will be paid from the PMAY funds. approved 80368 students in phase 1. As next step, the The payment to the TPs will be as per the common selected Polytechnics/ Engineering colleges have now norms. asked to enrol the students as per the allocation and sanctioned trade/ QP. The data captured in the AICTE The role of the CSDCI is to build capacity of the website will be merged into NSDC SDMS portal so that Trainers, Assessors and State Quality Control the assessment and certification by the respective SSC Organisations through ‘Train the Trainers Program’, get can happen seamlessly. In the first phase AICTE has the trainees assessed by the CSDCI Assessment Bodies approved construction QP mainly for concrete mason, and certify them. general mason, Asst Laboratory Technician, Asst. Electrician etc, (NSQF level 3&4 only) and they are So far CSDCI has assessed 205 candidates in the States planning to train approximately 16000 in construction of Jharkhand, Uttarakhand, Maharashtra, Chhattisgarh only in the first phase. The assessment and certification and Gujarat who had participated in the pilot phase. The to be done by CSDCI and the certificate will bear States of MP, Odisha, Rajasthan, Assam and Punjab will AICTE &CSDCI logo. More on http://www.aicte- be commencing the Pilot Project soon. india.org/pmkvy.php Handling this Project sensitively will give us inroads to 3. Ministry of Road Transport and Highways (MoRTH) skilling the rural masons at the source and add huge National Highways and Infrastructure Development numbers, which everyone is looking at. These will be Corporation is a fully owned company of the Ministry of outside the PMKVY. Road Transport & Highways, Government of India. The company promotes, surveys, establishes, designs, builds, 5. State Engagements: operates, maintains and upgrades National Highways a. Punjab State Skill Development Mission and Strategic Roads including interconnecting roads in (PSDM): CSDCI had signed a MOU with PSDM parts of the country which share international boundaries last year, Through the BOCW fund, the first batch with neighbouring countries. CSDCI has signed a MoU of 30 is getting assessments under the RPL with NHIDCL for implementation of the programme for programme. 600 candidates as per the PMKVY 2.0 – Special Project guidelines for NE regions (Nagaland, Arunachal b. Madhya Pradesh Council for Vocational Pradesh, Guwahati and Assam). CREDAI National and Education and Training (MPCVET): MPCVET Drishtee Skills (TPs) have submitted proposal for had enrolled 6300 candidates under the RPL conducting training in these states. programme last year. The CSDCI has assessed 4. Rural Housing – Ministry of Rural Development 5000 candidates; the certificates of the passed The Ministry of Rural Development (MoRD) has a candidates (2650) are under the process of target of constructing 30 million houses upto FY 2022 generation. on self-help basis. It envisages that the beneficiary and the local masons of the panchayat/block to be skilled and c. Advanced Skill Acquisition Programme construct the houses on self-help basis. The mason is (ASAP): The state of Kerala under the ASAP supposed to be multi skilled ie have skills in mason, bar mission has enrolled 590 candidates who are now bending, shuttering carpentry and plumbing. ready for assessments and certification. Accordingly, Construction Skill Development Council of India with support of MoRD developed a Rural 6. Industry Engagements: Mason Qualification Pack (QP) which has been MOUs have been signed with the following validated by 28 Sates and approved by the NSDC. It organisations as Associate CSDCI Partners. shall be put up to the National Skill Qualification a. NAREDCO Committee (NSQC), NSDA for approval to become a b. Saint Gobain

c. Ambuja Cements Sr. Financial Training Registereed Number Registered Number of No. year Centres taaining of assessors certificates d. Kushal Credai in proiders workers in issued e. Stellar Group numbers trained numbers by T.P. f. Oriental Structures 1 2013-14 16 12 4856 63 569 We seek support of our Promoters like BAI for reaching 2 2014-15 128 97 11490 26 7912 the goal of 500 industry members. 3 2015-16 597 197 77286 111 35332 4 2016-17 158 27 14223 76 3750 TOTAL 899 333 107855 276 47563 7. International Engagements a. UK-India Research Initiative(UKIERI) -2.0 : A proposal has been submitted for benchmarking five LABOUR LAW MATTERS job roles with our standards.

(i) PROVIDENT FUND MATTERS 8. Operations Brief

a. Training of Trainers/ Assessors Courses: 20 Union Ministry of Labour & Employment has introduced a Train the Trainers /Assessors program as against ‘EPF Amnesty Scheme for Companies’ vide its Notification 11 courses conducted last year. The details are: dated 30 th December 2016. We are printing herein below the i. Nominations: 419 said notification. ii. Certified Trainers:91

iii. Certified Assessors:75 The salient features of the Notification can be summarised as iv. Demonstrators (Rural mason) :33 under:-

b. UP – Job Melas: All the SSCs are participating in a) Companies which have not enrolled their employees as various commissionaires of the UP for job melas in members under the Employee Provident Fund (EPF) November 2016. It entails gathering of the certified scheme will now get a chance to do so, against payment candidates and connect them with the employers. of a minimal damage fee of Rs.1/- per year of default. We will be participating in four Job Melas in UP in

Gonda, Gorakhpur, Noida and Ghaziabad b) Additionally, if the employee wasn't enrolled earlier and commissionaires. his/her share of contribution was not deducted from

salary, the employer company had to pay this sum also in c. PMKVY Stand-alone Centres – 42 Centres have addition to the past defaults of its own contribution. Now been identified as PMKVY 2.0 standalone centres; under the amnesty scheme, only the employer's out of these 38 are ready for inspection. These will contribution has to be deposited. act as Hub for the identified commissioners and

will help in deeper penetration of the region c) The objective of the amnesty is to ensure enrolment of through the Spokes. employees and spread the benefit of the EPF scheme.

Companies having 20 or more employees are required to d. Centres of Excellence : Under the World Bank mandatorily enrol those employees under the EPF Project, every SSC is expected to set up a Centre of scheme who have a salary of up to Rs 15,000 per month. Excellence (CoE). This has to be a state of the art The EPF scheme is optional for those drawing a higher facility, which not only functions for training of salary. However, once an employee opts for the scheme, trainers and assessors but also acts as a he or she cannot opt out. experimentation ground for new job roles, new

technologies that need to be introduced in the skill d) Both the employer and employee are required to ecosystem in that sector. contribute 12% per month towards EPF against the

employee's basic salary plus dearness allowance. e. Non PMKVY: Over 15000 enrolments have been However, under the amnesty, interest at the rate of 12% done under various programmes like DDUGKY, on the amount due for delayed deposit of the contribution NULM, CSR and Non PMKVY. will be payable for the period of delay. This amnesty

scheme, which comes into force from January 1, is open f. MOUs Following MOUs have been signed: until March-end. "The main purpose of the amnesty is to i. Jharkhand State Skill Development Mission expand coverage of the EPF scheme," said a government ii. National Highway Infrastructure and official. Development Corporation (NHIDCL)

e) "Companies that had not enrolled employees under the g. Audio Visual film: The film has been completed EPF scheme for the period beginning April 1, 2009 to and is submitted to NSDC. December 31, 2016 can take advantage of the amnesty

scheme by making a declaration to the regional CSDCI has registered a number of Training Providers, employee provident fund office." Assessors and established or helped in establishing Training

Centres at various places, details of which are given below. f) "The employer will be required to deposit the required

sum, which denotes its share of contribution, employee's

share of contribution only if deducted from employee's Provided that employer shall not be required to pay salary but not deposited, interest and a nominal damage the employee’s contribution if the same has not been charge within 15 days of making the declaration. The deducted from the wages of the employee. biggest largesse under the amnesty is that the company doesn't have to make good the share of the employee's (4) The employer shall, after complying with sub- contribution." paragraph (2) and sub-paragraph (3), file a return in such form as may be specified by the Central Provident Fund Commissioner, to the Regional MINISTRY OF LABOUR AND EMPLOYMENT Provident Fund Commissioner. NOTIFICATION New Delhi, the 30th December, 2016 (5) The employer shall specify the date of eligibility in respect of each employee for membership in the G.S.R. 1190(E).— In exercise of the powers conferred by declaration referred to in sub-paragraph (2): section 5 read with sub-section (1) of section 7 of the Employees’ Provident Funds and Miscellaneous Provisions Provided that such declaration shall be valid only in Act, 1952 (19 of 1952), the Central Government hereby makes respect of employees who are alive as on the 1st day the following Scheme further to amend the Employees’ of January, 2017 and no proceedings under section Provident Funds Scheme, 1952, namely:–– 7A of the Act or under paragraph 26B of this Scheme or under paragraph 8 of the Employees’ Pension 1. (1) This Scheme may be called the Employees’ Provident Scheme, 1995 have been initiated against their Funds ( Seventh Amendment) Scheme, 2016. establishment or employer, as the case may be, to determine the eligibility for membership of such (2) It shall come into force on the 1st day of January, 2017 and employees. shall cease to operate on the 31st day of March, 2017, except as respects things done or omitted to be done before such (6) If the employer fails to remit the contribution, interest cessation. and damages payable by him as referred to in sub- paragraph (3), then, the declaration sent by the 2. In the Employees’ Provident Funds Scheme, 1952, after employer under sub-paragraph (2) shall be deemed to paragraph 82, the following paragraph shall be inserted, have not been made by such employer under this namely:–– Scheme.

“82A. Special provision in respect of Employees’ (7) Where a declaration under sub-paragraph (2) has Enrolment Campaign, 2017.––(1) The Employees’ Enrolment been made by misrepresentation or suppression of Campaign, 2017 shall come into force on the 1st day of facts, such declaration shall be void and shall be January, 2017 and shall cease to operate on the 31st day of deemed to have not been made under this Scheme March, 2017. and the person making such declaration shall be liable to penal action in accordance with the (2) Every employer who has failed to comply with the provisions of the Act and the Schemes made provisions of this Scheme in relation to membership thereunder. of employees and contribution thereto to the Fund, shall furnish a declaration in such Form as may be (8) The exceptions and modifications subject to which specified by the Central Provident Fund the provisions of this Scheme shall apply, in relation Commissioner, in respect of membership of the to the employees’ whose membership have been employees, who were required or entitled to become declared under sub-paragraph (2) as per the members of the Fund for the period beginning the 1st Employees’ Enrolment Campaign, 2017, shall be as day of April, 2009 and ending the 31st day of follows, namely:–– December, 2016 but were not enrolled as members for any reason, to the Regional Provident Fund (a) in paragraph 30, after sub-paragraph (1), the Commissioner. following proviso shall be inserted, namely:––

(3) The employer shall, within fifteen days from the date “Provided that, for the purpose of increasing of furnishing the declaration referred to in coverage and extension of benefits under the Act and subparagraph (2), remit the employer’s contribution Schemes made thereunder, the member’s payable in accordance with the provisions of this contribution is waived under Employees’ Enrolment Scheme and the employee’s contribution deducted Campaign, 2017 for the period beginning the 1st day from the employee’s wages along with interest of April, 2009 and ending the 31st day of December, payable in accordance with section 7Q of the Act and 2016 : damages : Provided further that such waiver shall be applicable only if the member’s contribution has not been recovered from such member’s wages.”.

as of utmost concern. Head Office has been continuously (b) in paragraph 32-A, in sub-paragraph (1), for issuing instruction and guidelines on the matter. the Table, the following Table shall be substituted, namely:– Thus it becomes imperative that this work is accorded top priority and taken up in right earnest, duly engaging all the TABLE stake holders, including the various Trade Unions and Industry (Applicable for remittances in respect of valid Associations/Bodies, BOCW Board of the State Secretary declarations under Employees’ Enrolment Campaign, 2017) Labour & Employment has already written to the Chief Secretaries of all states to extend cooperation in this regard. It is requested to kindly ensure that the matter of enrollment of construction workers and allotment and activation of UAN Period of default Rate of damages receives the personal attention of Officer In-charge. A (1) (2) consolidated report on the action taken so far may be Between the 1st day of April, One rupee per annum.”. forwarded to Head Office as per the enclosed format through 2009 to the 31st day of ACC (Zone) on [email protected] within next 7 December, 2016. days for further action at this end.

(c) for paragraph 39, the following paragraph Kindly consider it urgent and important shall be substituted, namely:–– Yours faithfully,

“39. Fixation of administrative charges.–– (Gautam Dixit) The administrative charges payable under Regional PF Commissioner-I (Compliance) Employees’ Enrolment Campaign, 2017 for Copy to:- the period 1st April, 2009 to the 31st 1. PS to CPFC/ACC (HQ)/FA&CAO/CVO - for kind December, 2016 under sub-paragraph (1) of information. paragraph 38 shall be nil.”. 2. All ACC (Zones) for information & with the request to ensure submission of the required report Zone-wise. [F. No. S-35012/13/2016-SS-II] 3. RPFC (NDC) for webposting. 4. (OL) for Hindi version. R. K. GUPTA, Jt. Secy. Rs 43,000 crore lies in inoperative EPF accounts: GoI Note: The principal scheme was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section About Rs 43,000 crore is lying in inoperative Employees' (i) vide notification number S.R.O. 1509, dated the Provident Fund accounts and interest would be credited to 2nd September, 1952 and was lastly amended vide such accounts, government of India said on Monday. notification number G.S.R. 1065(E), dated the 11th November, 2016. Minister of state for labour and employment, Bandaru Dattatreya told Lok Sabha that 118.66 lakh claims were settled by the Employees' Provident Fund Organisation (EPFO) in EMPLOYEES’ PROVIDENT FUND ORGANISATION 2015-16, adding that 98 per cent of them were settled within (Ministry of Labour & Employment, Govt. of India) 20 days. Head Office Bhavishya Nidhi Bhawan, 14, Bhikaji Cama Place, New Delhi - 110 "There is around Rs 43,000 crore in inoperative (EPF) 066 accounts," Dattatreya said during Question Hour. No. letter No. C-111/110001/4/3(71) Misc/2013/DL/Vol.11/21830

Dated: 22.01.2016 Listing the steps taken, the minister said it has been recently To, decided to credit interest to the inoperative accounts. All Regional PF Commissioners, In-charge of Regions/Sub-Regional Offices, Emphasising that there is a lot of confusion about inoperative and unclaimed accounts, he said that the government has Sub.: Coverage of construction workers under launched the initiative for one member, one EPF account. EPF & MP Act, 1952 - reg. EPFO has allotted Universal Account Number (UAN) for portability and consolidation of all previous accounts. In 2015- Madam/Sir, 16, 118.66 lakh claims were settled by the EPFO while the numbers stood at Rs 130.21 lakh and Rs 123.36 lakh in 2014- Please refer to HO Circular No. C-111/110001/4/3(71) 15 and 2013-14, respectively. Misc/2013/DL/27618 dated 15.10.2015 and No. 21432 dated 18.01.2016 regarding coverage of construction workers under According to the minister, Rs 1.18 lakh claims were pending the EPF & MP Act, 1952 and registration on UAN platform. for settlement in 2015-16. In this regard, it is informed that the matter is being monitored at the highest level in government and this is an area flagged

He also said that prosecution would be initiated against those 2. In 1991, twenty four members of the Petitioner violating EPFO norms. Association approached the High Court of Delhi by filing CWP No. 792 of 1991 challenging the vires of the Responding to supplementaries regarding the unorganised Notification dated 19.10.1990 issued by the Government sector, Dattatreya said that the government has given priority of India in exercise of its powers conferred by Sec. 5 to construction workers in this segment. They would be given read with Sec. 7(1) of the Employees’ Provident Fund UAN so that they can avail the benefits, he added. Besides, and Miscellaneous Provisions Act, 1952 containing a pilot projects would be started in Delhi and Hyderabad for Provident Fund Scheme for the benefit of employees in auto-rickshaw drivers and rickshaw pullers, the minister said. factories or other establishments in terms of which a certain percentage of wages payable to each employee Dattatreya said that the priority would be for anganwadi, mid- was required to be deducted by the employer and day meal scheme and Aasha workers. deposited with the Provident Fund Authorities irrespective of nature and duration of employment. As He said Online Transfer Claim Portal has also been the Scheme was prima facie defective, on 13.3.1991 a introduced. Division Bench of the Delhi High Court was pleased to issue Rule and grant interim stay of the Notification. On Further, Dattatreya said employees whose Aadhaar or 23.10.1991, the Division Bench recorded the statement Permanent Account Number (PAN) have been seeded in their of the Respondents, namely the Union of India, the Chief UAN and activated by their employers, may submit claim Provident Fund Commissioner and Regional Provident forms directly to the EPFO without attestation of their Fund Commissioner that they were willing to modify the employers. Scheme so as to make it less cumbersome for the beneficiaries to obtain the amount of Provident Fund and BAI achieves breakthrough in Supreme Court make the Scheme workable.

Background of Supreme Court Judgement on PF 3. Subsequently the Respondents filed an Affidavit proposing to issue passbook to every employee which BAI Delhi Centre filed Civil Writ Petition No. 3588 of 2002 in was not accepted by the Division Bench, because in the Delhi High Court, praying inter alia for a writ of mandamus very nature of things a migrant labourer would not be directing EPF authorities to evolve a modified scheme and able to withdraw the money due to him. implement it and create a mechanism for this purpose. By an order dated 29.08.2014, learned single judge dismissed the 4. On 27.11. 1991, the Division Bench directed the Writ Petition. Being aggrieved by the said order, BAI Delhi Respondents to consider the problem and to file an Centre filed Letter Patent Appeal (LAP) No. 728 of 2014 effective proposal for modifying the abovementioned before a Division Bench of Delhi High Court. This was also scheme. In their Affidavit dated 22.5.1992, the dismissed by the Division Bench on 16.10.2015. BAI filed a Respondents stated that they had formulated a revised Special Leave Petition (SLP) No. CC 8035 of 2016 in Supreme accounting procedure with respect to the peripatetic Court against the order of Divisional Bench, along with employees of the Construction Industry and annexed the request for condonation of delay. The matter was heard on minutes of meeting of the Central Board of Trustees with 02.05.2016 and the Write Petition was disposed off by the whom the funds are vested. Under the revised Hon'ble Supreme Court. formulation, the employee would be given a permanent number of ten digits which will help him to receive the Main Points of SLP filled before the Hon’ble Supreme Court benefit under the Scheme eventually wherever he may against the judgment on order dated 16.10.2015 of the Delhi be. High Court in LPA No. 727 of 2014. 5. By an order dated 2.5.1995, a Division Bench of the High Court while vacating the order of interim stay, 1. This SLP seeks enforcement of a mandatory direction issued the following direction: given by a Division Bench of the Delhi High Court in a “We however, direct that on Respondents 1 and 2 Writ Petition on 2.5.1995 in terms of which the liability complying with modified Scheme the Petitioner shall to deduct employees’ contribution to the Provident Fund deduct the Provident Fund and deposit the same with would commence only after the Respondents complied Respondent No. 1 and 2 in respect of casual workers with the Scheme as modified having regard to the also.” suggestions made by the Court during the pendency of This direction was not subsequently modified. The the Writ Petition filed by some members of the Petitioner compliance took place only in the year 2014 when the Association. The Respondents complied with the Respondents allotted permanent numbers to each Scheme only in the year 2014 after the lapse of about 19 construction company or building contractor for years. Now they are initiating proceedings for recovery distribution to their employees from 2014 in terms of the of the wages not deductable in terms of the High Court order dated 2.5.1995, the members of the above order for the period prior to 2014. The liability sought to Petitioner Association have been deducting the be imposed is without the authority of law. contribution of employees and depositing the amount with the Respondents.

view of its tremendous contribution and importance to the 6. In violation of the direction given by the Division Bench economy. on 2.5.1995, the Respondents have started initiating At the outset, we express our sincere gratitude to you and to action under Section 7 (a) of the Act for recovery of the the Hon’ble Prime Minister of India for launching ‘Universal employees’ contribution for the period prior to 2014 Account Number (UAN)’ on 14 th July 2014 to all when there was no liability on the part of the employer Employees’ Provident Fund Subscribers. Operation of UAN including members of the Petitioner Association to number will not only serve as a unique identification number deduct and deposit the amount with the Respondent but also will help the beneficiary of Provident Fund Scheme to towards Provident Fund. The Petitioners therefore filed avail various facilities. CWP No. 3588 of 2002 in the Delhi High Court praying inter alia for a writ of mandamus directing the Sir, issue of UAN number will be more helpful to the Respondents to evolve a modified Scheme and Construction Industry as it will help in identifying the implement it and create a mechanism for this purpose. construction workers who are mainly consists of peripatetic By an order dated 29.8.2014, a learned Single Judge and casual in nature. It is also admitted fact that, after issuance dismissed the Writ Petition. On 16.10.2015, a Division of UAN number, there is a marked increase of coverage of Bench of the High Court was pleased to dismiss the LPA construction workers in E.P.F. Scheme as both the contractors No. 727 of 2014 preferred by the Petitioners herein. and the workers are now ensured of receiving the benefit. Hence this SLP. Sir, some of the members from Southern part of the country 7. It may be stated that because of the faulty Scheme, have reported to us that, Provident Fund officials visit their amounts deducted and deposited with the Respondents sites and insist for covering the construction workers by by some other builders have accumulated to the tune of assessing the Provident Fund contribution from the Balance Rupees Twenty six thousand crores as per the balance Sheet. In this regard, you also appreciate the fact that, the sheet of the concerned Provident Fund Authority, as Hon’ble Supreme Court in its order dated 2 nd May 2016 beneficiaries of the Scheme were not able to receive their emphasised the requirement of identifying the workers for Provident Fund due. receiving the benefits before deducting such contribution.

8. The Scheme which was intended to provide social In addition, there are certain irritants in better implementation security for employees has turned out to be for the of Act, stated as below :- benefit of the Respondents. a) As per para 80 of EPF Rules, Newspaper employee and 9. This Special Leave Petition merits consideration in cine workers are having similar working conditions. general public interest. Despite this Newspaper employees are granted a qualifying period of three months continues working with one establishment for becoming a P.F. beneficiary. Ref: 214/J/2016-17 dated 27 th July 2016 b) As per para 81 of EPF Rules, Cine workers are given a To, qualifying period of completing not less than three The Hon’ble Minister of Labour & Employment feature film with one or more producers for becoming a Government of India, P.F. beneficiary. Shram Shakti Bhavan, NEW DELHI In view of above, BAI request your Honour to :-

Respected Sir, i. Implementation of Act to construction site workers be made effective from 14.7.2014 (the date when UAN is Sub:- Applicability of Employee Provident Fund Scheme launched) for better implementation of scheme by to Construction Workers. ensuring that P.F. benefit reaches to them.

Builders’ Association of India (BAI) is an apex all India body ii. Construction workers be treated at par with cine workers of Engineering Construction Contractors and Real Estate & News paper employee by giving three months Companies founded in 1941, with more than 16,000 business qualifying period to become beneficiary for P.F. Scheme. entities as members through its 156 plus Centres (Branches) throughout the country. Regional Associations Affiliated to Thanking you. BAI form indirect membership of more than 1,00,000. The fundamental aim of the Association is to bring about all round Yours truly, improvements in the construction sector, while striving towards resolution of operational as well as policy level problems faced by the construction industry. This involves making efforts to obtain from policy makers and authorities, AVINASH M. PATIL the level of attention that the construction industry deserves in President Builders’ Association of India

1. (1) These rules may be called the Employees’ State Copy to : Insurance (Central) Third Amendment Rules, 2016. 1) Mr. Shankar Agarwal, I.A.S., Secretary, Ministry of Labour & Employment, (2) They shall come into force from 1st day of January, Government of India, 2017. Shram Shakti Bhawan, Rafi Marg, 2. In the Employees’ State Insurance (Central) Rules, 1950, New Delhi - 110 001. in rule 50, for the words “fifteen thousand rupees” occurring at both the places, the words ‘twenty one 2) Dr. V. P. Joy, I.A.S., thousand rupees” shall be substituted. Central Provident Fund Commissioner, Employees Provident Fund Organisation, [F. No. S-38012/02/2013-SS-I] Bhavishya Nidhi Bhawan, Bhikaji Cama Place, RAJEEV ARORA, Jt. Secy. New Delhi – 110 066. Note: The principal rules were published in the Gazette of India vide notification number S.R.O. 212 dated the 22nd June, 1950 and lastly amended vide notification (ii) ESIC MATTER number G.S.R. 959(E), dated the 6th October, 2016.

Union Ministry of Labour & Employment Government of Nishok Kumar Paria India vide its Official Gazette Notification dated 22nd Digitally signed by Nishoke Kumar Paria December 2016 enhanced the wage limit from Rs.15,000 to Date: 2016.12.26 19:52:40 Rs.21,000 for covering workers in ESIC Scheme. The +05’30’ notification will be effective from 1st January 2017. BAI immediately took up the matter with the Ministry raising No.BAI/DO/03/2017 13 th February, 2017 concerns of the construction industry. We are printing herein below the said notification and the letter written by BAI To President. Mrs. Satyawati , Hon’ble Union Labour Secretary MINISTRY OF LABOUR AND EMPLOYMENT Ministry of Labour & Employment, Shram Shakti Bhawan, Rafi Marg NOTIFICATION New Delhi-110001

New Delhi, the 22nd December, 2016 Respected Madam,

G.S.R. 1166(E).—Whereas certain draft rules further to amend Subject: BAI’s representation on ESI Coverage to the Employees’ State Insurance (Central) Rules, 1950 were Construction Sites and Benefits under ESI Act Vis A Vis published in the Gazette of India, Extraordinary, Part-II, BOCW Act. section 3, sub-section (i) vide number G.S.R. 957(E), dated the 6th October, 2016, as required by sub-section (1) of Builders’ Association of India (BAI) is an apex all India body section 95 of the Employees’ State Insurance Act, 1948 (34 of of Engineering Construction Contractors and Real Estate 1948), inviting objections and suggestions from all persons Companies founded in 1941, with more than 16,000 business likely to be affected thereby before the expiry of a period of entities as members through its 160 plus Centres (Branches) thirty days from the date on which the copies of the Official throughout the country. Regional Associations Affiliated to Gazette in which the said notification was published were BAI form indirect membership of more than 1,00,000. The made available to the public; fundamental aim of the Association is to bring about all round improvements in the construction sector, while striving And whereas, the copies of the said Official Gazette were towards resolution of operational as well as policy level made available to the public on the 6th October, 2016; problems faced by the construction industry. This involves making efforts to obtain from policy makers and authorities, And whereas, objections and suggestions received from the level of attention that the construction industry deserves in persons likely to be affected thereby have been considered by view of its tremendous contribution and importance to the the Central Government; economy .

Now, therefore, in exercise of the powers conferred by section At the outset, we welcome the decision of the apex body of the 95 of the said Act, the Central Government, after consultation ESIC to provide the ESI Facilities for construction workers with the Employees’ State Insurance Corporation, hereby thereby enabling them to avail benefits of complete medical makes the following rules further to amend the Employees’ care from primary to tertiary medical care as well as range of State Insurance (Central) Rules, 1950, namely:- cash benefits in times of exigencies of employment injury, death, disablement & employment. The construction workers

are considered to be part of un-organised sector but keeping in Safety & Welfare benefits pertaining to Building/ view the fact that they are highly prone to accidents, sickness Construction Workers the provisions of the said Act would etc. the ESIC has decided to go ahead for extending the override the provisions of the other Acts wherever there arises coverage of RSIC Social security to them. Construction a conflict & interpretation. Thus there cannot be two activity has been covered by the ESIC under sec 1(5) treating interpretations of as the legislature thought it fit to cover them as commercial establishment. The coverage under ESIC Building & other Construction Workers under Workmen to a construction site will be extended u/s 2(12) also, if in any Compensation Act & not otherwise. Such a beneficial piece of part of the construction unit, manufacturing process as defined legislation has to be construed in its correct perspective so as under Factory act is carried on. to fructify the legislative intention underlying its enactment. The Apex Court has rightly held in number of cases that when The ESI Corporation vide press release dated 17 th July & 23re two views are possible on its applicability to a given set of July `2015 made a declaration that they intend to cover the employees, that view which furthers the legislative Intention construction site under the provisions of ESI Act which was should be preferred to the one which frustrate it. not the case till then in view of the guidelines issued by ESI in 1999. The ESI Corporation also came out with a circular dated 5) Sec 58 of BOCW Act also states that “the provisions of 31 st July `2015 about the same & in fact to override the Workmen Compensation Act, 1923 shall apply to building notification issue of promulgation, they came out with the plea workers as if the employment to which this Act applies had of interpreting the guidelines issued them in 1999 & stated been included in the second schedule to that Act”. that [quote from circular point no (1]) “All the construction agencies which have already been covered u/s 1 (5) ,their 6) Employees Compensation Act,1923 Schedule II defines list site workers also be covered & other construction agencies of employees who, subject to the provisions of [Section which may now come under coverage by adding 2(1)(DD) ] ARE INCLUDED INTHE DEFINITION OF construction site workers. [EMPLOYEES] that is to say any person ---- (viii )“employed in the construction, maintaince, repair or demolition of --- Difficulties in Implementation :- a) Any building which is designed to be or is or has been more ESI Act is essentially for organised work force, inspite of the than one storey in height above the ground or twelve feet or term otherwise in Sec 1(4). Payment of contribution, more from the ground level to the apex of the roof; or submission of returns, reporting of accidents, submission of returns,& many other formalities would show that that the b) Any dam or embankment which is twelve feet or more in scheme is employee centric. Yet the ESIC could not extend height from its lowest to its highest point; or the scheme to construction sector because of many practical considerations. That precisely was the reason for so many c) Any road ,bridge, tunnel or canal; or tripartite talks in decades. Summary of those facts have been recorded in the Annual standard Notes also. Few of the d) Any wharf, quay, sea-wall or other marine works including additional points which need to be clarified /discussed with the any moorings of ships ; authorities are cited below as they are in conflict with the circular issued. 7) The BOCW Welfare Cess Act Lays down the payment for Corpus to be maintained for Welfare Board. Thus when the 1) The ESI Act is a statute which is applicable by the appropriate Building workers are to be covered under ESI ACT THEN Government on the basis of the Gazette Notification issued for WHAT PURPOSE THE Cess remains & for what purpose the Coverage. In the present case no notification has been issued welfare Board would be required to collect the money because as yet. the workers would be entitled to benefits under ESI Act. Further the question arises that whether the statute passed by 2) As the Construction Site is neither a “FACTORY” nor an Act of Parliament can be subrogated by issuance of “COMMERCIAL ESTABLISHMENT” , hence do not Circular? come under the definition of ESI Act as the said Act is only applicable on the aforesaid. 8) It is also to be noted that whether the practise of registering the Building workers would be continued or there shall be no 3) Since the ËSTABLISHMENT” I s covered under BOCW more Registration under welfare Board. If that be the case then Act, then the office of the Construction Site can be termed as how come the benefits would be passed on by the welfare establishment only under BOCW Act which means “Any Board to the Building workers & whether that would not establishment ------who employs building workers in amount to taxing the Employer twice for the same contract?. any building or other construction works------“. Such establishments are covered under BOCW Act & not under 9) As per Regulation 4 of the ESI Regulations 1950 which Shop & Commercial Establishment Act. provides for Contribution & Benefit period. The benefits being passed on to the Insured person for the first time would be 4) As per the OBJECTS & REASONS of the BOCW Act,1996 only after nine months as corresponding Contribution & it clearly lays down the “Application of the Workmen Benefit period are different. For eg. The Person being Compensation Act to building & other Construction registered in the Contribution period for the first time in April Workers ‘. This being a subsequent legislation for the health, can avail the benefits from following January & not before.

Similarly for availing sickness benefit the Insured person has 3) The ESIC vide press release dated 7 th April`2015 discusses to pay minimum contribution for 78 days in a contribution amendment in the ESI Act ,1948 for providing option to period otherwise the benefit cannot be availed & is foregone. employees to choose either ESI or Health Insurance product services recognised by IRDA in 165 th Meeting of the ESI 10) Benefits being provided under the Construction Welfare Corporation held on 7 th April `2015.This option will not only Board are in few cases more than prescribed under ESI Act. provide the facilities to the door steps of the workers but For availing the benefits under BOCW Act a nominal amount would also help the employers from unnecessary paper of contribution (@Rs 25/-pa (presently applicable in Delhi for documentation as all the workers engaged at the site can avail coverage under Delhi Construction welfare Board) is paid by the facilities from single source. This would also not only be the Beneficiary for availing the benefits provided by the an effective mechanism but would also be rid of the Construction Welfare Board. The benefits being paid are in bureaucratic hassles. few cases for Natural death, self marriage, children marriage etc. (which is not covered under ESI Act) apart from skill The nitty gitty of the scheme may be changed depending upon development benefits in the form of financial assistance to the discussions with the stakeholders as on one side it will such beneficiaries. leave the government from day to day monitoring & maintaining a workforce to maintain records while on the 11) As per Regulation 103-B an Insured person shall continue to other it will also provide leverage to the employers to have a receive medical benefit for himself & his / her spouse till the common scheme for all the employees engaged at the site date on which he would have vacated the employment on without any worry of the wage ceiling or see if the area is attaining the age of superannuation had he not sustained such coming in implemented / non implemented area. disablement if he produces a certificate from the employer. This is not practicable as the employees at the construction Now let us dwelt on the benefits prescribed under ESI Act vis site are engaged for the period of contract awarded which is a vis BOCW ACT & in brief the details are as under ;- time specific ,hence the Employer cannot provide certificate for such person till the age of superannuation, therefore in the Comparison Statement of ESIC and BOCW ACT absence of that certificate his claim would be discontinued. Benefits & Contributory Benefits & Contributory Conditions BAI’s PROPOSAL :- Conditions UNDER ESI ACT: UNDER BOCW ACT: An interesting feature of the ESI Section 12 (1) of the BOCW Act “ every Scheme is that the contributions building worker who has completed At this juncture we should not forget about the view are related to the paying capacity eighteen years of age ,but has not completed propounded by Prof Adharkar, the visionary who was as a fixed percentage of the sixty years of age ,& who has been engaged instrumental in bringing the concept of ESI at the very workers wages, whereas, they in any building or other construction work are provided social security for not less than ninty days during the beginning. Prof. Adharkar has rightly said that when a scheme benefits according to individual preceding twelve months shall be eligible is proposed it must be workable in the “peculiar circumstances needs without distinction. for beneficiary under this Act.” of Indian labour & Industry”. So, if necessary a separate structure may be evolved the way it was done in late nineties Section 46 of the Act envisages Section 12(2) says that “every application following six social security shall be accompanied by such documents for cashew workers in Kerala. The scheme was ultimately benefits :- together with such fee not exceeding fifty discontinued by ESIC. The documents that show why that rupees as may be prescribed.” scheme meant for cashew workers had been dispensed with (a) Medical Benefit : may also be gone through, in the present context. Otherwise it Full medical care is provided to Section 11 lays down that ‘ subject to the an Insured person and his family provisions of this Act,every building worker will be meeting the same fate as has happened in the Medical members from the day he enters registered as a beneficiary under this Act college matter where ESIC is hell bent on medical colleges insurable employment. There is shall be entitled to the benefits provided by when they know that their financial position would nose drive no ceiling on expenditure on the the Board from its fund under this Act. very seriously in the year 2016-2017 if they continue to run treatment of an Insured Person or his family member. Medical care Section 22 lays down functions of the them?. is also provided to retired and Board :- permanently disabled insured The proposals being put forth are in tune with the views of the persons and their spouses on (1)The Board may:- ESIC, as can be evident from the points elaborated below. payment of a token annual premium of Rs.120/- a) Provide immediate assistance to a beneficiary in case of a accident. 1) Recommendations of the Conference Committee on social (b) Sickness Benefit(SB) : security for Organised, Unorganised & Migrant International Sickness Benefit in the form of b) Make payment of pension to the Workers held at Vighyan Bhawan Hall no 4 on dated cash compensation at the rate of beneficiaries who have completed the age 70 per cent of wages is payable of sixty years. 21.07.2015 contains other recommendations particularly to insured workers during the relating to for Construction Workers ,there should be periods of certified sickness for a c)Sanction loans & advances to a single Contribution from Employer ( Point no XI ). maximum of 91 days in a year. beneficiary for construction of house not In order to qualify for sickness exceeding such amount & on such terms & benefit the insured worker is conditions as may be prescribed; 2) As per the recommendations that ESIC should be expanded at required to contribute for 78 a fast pace & the ESIC should directly run the health services days in a contribution period d)Pay such amount in connection with at all the states. Further ESI coverage for round the clock of 6 months. premia for Group Insurance Scheme of medical benefits. (Point no VII c,d &f ) . the beneficiaries as it may deem fit; 1.Extended Sickness Benefit(ESB) :

SB extendable upto two years in e)Give such financial assistance for the of physical disablement due to 1996 and Welfare Cess Act, 1996”. the case of 34 malignant and education of children of the beneficiaries employment injury. long-term diseases at an ass may be prescribed; enhanced rate of 80 per cent of Old Age Medical Care : wages. f) Meet such medical expenses for For Insured Person retiring on treatment of major ailments of a attaining the age of 2.Enhanced Sickness Benefit : beneficiary or such dependants as may superannuation or under Enhanced Sickness Benefit equal be prescribed; VRS/ERS and person having to to full wage is payable to insured leave service due to permanent persons undergoing sterilization g) Make payment of maternity benefits to disability insured person & for 7 days/14 days for male and the female beneficiaries; and spouse on payment of Rs. 120/- female workers respectively. per annum. h) Make provision & improvement of such (c) Maternity Benefit (MB) : other welfare measures & facilities as may Rajiv Gandhi Shramik Kalyan Maternity Benefit for be prescribed. Yojana : confinement/pregnancy is This scheme of Unemployment payable for three months , allowance was introduced w.e.f. which is extendable by further As per the Delhi Construction Welfare 01-04-2005. An Insured Person one month on medical advice at Board which is functioning , under the aegis who become unemployed after the rate of full wage subject to of Delhi government, the following benefits being insured three or more contribution for 70 days in the are mentioned on the registration card of years, due to closure of preceding year. the construction workers registered at the factory/establishment, Board are being provided by them to the retrenchment or permanent (d) Disablement Benefit : registered workers ;- invalidity are entitled to :- 1.Temporary disablement benefit (TDB) : From day one of 1) Old Age pension. •Unemployment Allowance entering insurable employment 2) Family pension. equal to 50% of wage for a & irrespective of having paid 3) Disablement assistance & maximum period of upto one any contribution in case of pension year. employment injury. Temporary 4) Housing loan for construction & Disablement Benefit at the rate purchase. •Medical care for self and family of 90% of wage is payable so 5) Scholarship for children from ESI /Dispensaries long as disability continues. 6) Loan for purchase of Tools during the period IP receives 7) Assistance for marriage unemployment allowance. 2.Permanent disablement Benefit 8) Medical assistance (PDB) : 9) Medical assistance in case of •Vocational Training provided The benefit is paid at the rate of accident for upgrading skills - 90% of wage in the form of 10) Maternity benefits Expenditure on fee/travelling monthly payment depending 11) Funeral expenses allowance borne by ESIC. upon the extent of loss of earning 12) Assistance in case of death capacity as certified by a 13) Other benefits being in vogue by Incentive to employers in the Medical Board the Board. Private Sector for providing regular employment to the (e) Dependants' Benefit(DB) : persons with disability : DB paid at the rate of 90% of In the last hearing at the Delhi High Court wage in the form of monthly the Hon`ble Court was very particular about •Minimum wage limit for payment to the dependants of a the benefits being provided to the Physically Disabled Persons for deceased Insured person in cases construction workers engaged at the site & availing ESIC Benefits is where death occurs due to therefore has impleaded Delhi Construction 25,000/-. employment injury or Welfare Board as an additional party & occupational hazards. asked them to file an affidavit in detail the •Employers' contribution is paid steps taken by them for the welfare of by the Central Government for 3 (f) Other Benefits : Construction workers. years. Funeral Expenses : An amount of Rs.10,000/- is Reference is also cited of the two Supreme Thanking you, payable to the dependents or to court judgments the details in brief are as the person who performs last under :- Yours Faithfully, rites from day one of entering insurable employment. 1)In Regional Director, Employees State Insurance Corporation, Trichur v. Ramanuja Confinement Expenses : Match Industries , the Court pointed out that An Insured Women or an I.P.in “there is no doubt that beneficial respect of his wife in case legislations should have liberal construction Avinash M. Patil confinement occurs at a place with a view to implementing the legislative President where necessary medical intent but where such beneficial legislation Builders’ Association of India facilities under ESI Scheme are has a scheme of its own there is no warrant not available. for the Court to travel beyond the scheme Copy to : and extend the scope of the statute on the Shri Ajay Malik In addition, the scheme also pretext of extending the statutory benefit to Under Secretary (SS-1) provides some other need based those who are not covered by the scheme”. Social Security Division benefits to insured workers. 2) In Lanco Anpara Power limited vs State Ministry of Labour & Employment, Vocational Rehabilitation : Of Uttar Pradesh & others the Hon`ble Shram Shakti Bhawan, Rafi Marg To permanently disabled Insured Apex Court has held that “ Construction New Delhi-110001 Person for undergoing VR workers not covered by the Factories Act, Email – [email protected] Training at VRS. 1948 and are entitled to the welfare measure Physical Rehabi litation : In case specifically provided under BOCW ACT,

Employees’ State Insurance Corporation date of hearing the impugned letter dated – applicability to construction site 31st July 2015 shall remain stayed. Renotify workers on 22nd November 2016. BAI / like minded Trade Bodies /Members have filled the 6. Confederation of Rajasthan By Order dated following writs and obtained stay. Real Estate High Court, 23.8.2016, Circular Developers Jaipur. Write dated 31.7.2015 stayed Sr. Name of Name of Date of Order and Association of Petition No. qua the members of No. Petitioner Courts and Remark India 6303 of 2016. Petitioners subject to Appeal / Writ the verification of the Name fact that, they have 1. Builders’ Madurai By Order on 21.9.2015, made payments due Association of Bench of Interim Stay Order under the Act of 1996. India Madras High granted, which is For the purpose of Court. W.P. continuing. verification, requisite (MD) No. details be submitted to 16996 of the competent offices 2015. of the respondent. 2. Gujarat Gujarat High By Order dated 7. Builders’ Delhi High Case is admitted and Contractors’ Court. Special 20.1.2016, Court stated Association of Court W.P. adjourned to 12th July Association Civil. Special "Rule" - During India No. 2011 of 2017 for hearing. No Civil pendency of Petition, 2016. stay is granted. Application no coercive steps shall No. 18467 of be taken against Ref: 399/N/2016-17 dated November 25, 2016 2015 Petitioner pursuant to To: the impugned circular. Shri Bandaru Dattatreya 3. Confederation of Karnataka By Order on 21.1.2016, Hon’ble Minister of State for Labour & Employment Real Estate High Court, Court directed (Independent Charge) Developers Bengalore. implementation of Association of Writ Petition circular dated Government of India Indi No. 1652 of 31.7.2015 in abeyance, Room No.120, Shram Shakti Bhawan, 2016. pending issue of Rule. Rafi Marg, 4. B.G. Shirke Employees Praying for suspension NEW DELHI – 110 001. Construction Insurance of visit by Social Technologgy Pvt. Court, Security Officer and his Respected Sir, Ltd. Hyderabad. note. By Order dated I.A. No. 99 of 26.4.2016, District & Sub: Revision of enhancing the wage limit for coverage of 2016 E.I.C. Session Judge allowed Construction Workers under ESIC Scheme from Rs.15,000/ to No. 140/2016. the petition and Rs.21,000/-. directed E.S.I.C. not to take any coercive steps Reg: Notification dated 6 th October 2016 issued by the Ministry till disposal of main of Labour & Employment, Government of India, New Delhi. E.I.C. 5. Tata Projects Ltd. Delhi High This Court by it's order Builders’ Association of India (BAI) is an apex all In joint venture Court W.P. on 10.8.2016 stated India body of Engineering Construction Contractors and Real with Gangdon (C) No. 6338 that, since the interest Yuten of 2016. and benefit of the Estate Companies founded in 1941, with more than 16,000 Engineering Co. workmen already business entities as members through its 158 plus Centres stands secured through (Branches) throughout the country. Regional Associations subsequent statutes Affiliated to BAI form indirect membership of more than and/or statutory 1,00,000. The fundamental aim of the Association is to bring schemes (read Building about all round improvements in the construction sector, while and Other Construction striving towards resolution of operational as well as policy Workers Regulation of level problems faced by the construction industry. This Employment and involves making efforts to obtain from policy makers and Conditions of Service Act 1996), the authorities, the level of attention that the construction industry impugned letter would deserves in view of its tremendous contribution and result in duplication of importance to the economy. benefits resulting in a piquant circumstances, Sir, at the outset BAI endorse the concern of the i.e. imposing a double Ministry on the social security coverage of construction obligation on an workers. While appreciating the stand, we would like to bring Employer, which is not to your kind attention the difficulty and concern of mandated in law. Therefore, till the next

Construction Industry on the increased wage limit coverage together the resources at their disposal by providing all the under ESIC Scheme. benefits to the existing beneficiaries before embarking on making new beneficiaries as members without first looking at It is a known fact that, the ESI has not been able to the resources at their disposal. upgrade either the infrastructure & other basic medical facilities required by the workers for availing the benefits It will be our honour to brief you on this matter in under the ESIC Scheme. In the circumstances, enhancement of person, if you kindly grant us an audience at any date and time wage ceiling amount would ensure that workers would not be convenient to you. able to avail the benefits. We strongly feel, ESI facilities at the moment are not adequate and adding more members to it Thanking you, would result into further deterioration of the services without Yours truly, corresponding benefits to new members.

ESI coverage area is also being enhanced by adding new districts. This covering of new areas without AVINASH M. PATIL corresponding increase in infrastructure facilities like new PRESIDENT hospitals or clinics won’t serve the desired purpose. This will BUILDERS’ ASSOCIATION OF INDIA only add contribution to ESIC without getting the required benefits to the workers. Gearing up for GST Further the rate of contribution for new member is reduced for coverage. This scenario creates two classes of BAI continues to engage Government of India, for sorting out employees for obtaining the benefits, that is , one who pay the problem areas in the impending GST vis-à-vis real estate and contribution @ 6.50% (4.75%--Employer`s Share + 1.75% - contracting construction industry. Employee`s share) and the other @ 4% ((3%--Employer`s Share + 1% -Employee`s share) for availing the same benefits. Revised Model GST Law published by Union Ministry of This is unethical as the mandate of ESI is to provide benefits Finance in first week of November 2016, has specific section from the contributions being paid by beneficiaries & therefore concerning construction contracts which reads as under:- charging different rate of contribution from Employers & Employees would tantamount to treating two equal unequally. Section 186 :- Treatment of Long term construction / works contracts Sir, you also agree to the fact that, in remote places where the construction projects are undertaken the required The goods and/or services supplied on or after the appointed medical facilities are non-existing. Companies have to provide day in pursuance of a contract entered into prior to the Doctor with first aid facilities to staff & workers. In view appointed day shall be liable to tax under the provisions of this thereof, enhancing the ceiling for coverage would not serve Act. purpose except additional burden of 4.75% on Employers. (CGST Law)

It is known to one and all that, the present status of The goods and/or services supplied on or after the appointed ESI hospitals & dispensaries is pathetic, hence before day in pursuance of a contract entered into prior to the embarking on new member’s coverage the ESI Authorities appointed day shall be liable to tax under the provisions of this should try to first cater to the existing members to the fullest Act. extent and create a goodwill with both Employees and (SGST Law) Employers. After this, they should try to enhance the wage ceiling for new member’s coverage. It can thus be seen that from appointed date all ongoing projects irrespective of waiver of Service Tax or Excise Duty, Construction Workers are migratory and not having shall be subject to GST. BAI therefore made a representation permanent address to avail of medical facilities. In fact, they to Union Revenue Secretary, who is also defacto Secretary of have to to travel a lot of distance for basic things. GST Council, which is reproduced below :-

Even for availing the benefits the insured person or his family members have to cover a lot of distance for availing Ref: 379/N/2016-17 dated 17 th November 2016 the benefits as the ESI hospitals or dispensaries are situated at a place for which the workers find it difficult to commute in To, the case of disability. They would have to incur expenses on The Revenue Secretary, the same, hence instead of going there the workers try to seek Ministry of Finance, assistance from the government hospitals / dispensaries for Government of India, which a nominal amount is charged & they find it convenient. North Block, New Delhi. In view of the aforesaid, it is therefore suggested that, the ESI Authorities or the Government should first try to put Respected Sir,

Reg .: GST Regime – to conform the Construction Business B. On 26.08.2008 , further to above, once again a division bench of apex court on the prescription for With the passing of 101 st Constitution Amendment Act on 16 th computation of taxable turnover under the statute of Sept.2016, tax administration concept in India thus been State sales tax clarified the correct legal position in redefined. The striking aspect of changes is attributable to the L&T case with regard to allowable deduction on sub- prevalent different statutory levies since been subsumed into a contractor turnover; single levy titled as Goods Service Tax (GST). C. On 20.08.2015, similarly, apex court relating the levy Builders Association of India, as an apex body of the members of service tax on works contract services for prior involved in Construction business, apprehend that GST system period prior to 1.6.2007, in L&T case, had clarified as conceived does not adequately address issues as are unique that the levy is sanctioned prospectively for the period and peculiar to the construction business. In past too, with after 1.6.2007and levy for the prior period is without every change in tax systems the construction sector have the sanction of law: adversely suffered due to lack of statutory clarity, uncertainty & contingency , ill drafted provisions etc. The above dates of event context to the unique nature of construction business need to be appreciated on the Therefore, BAI while represents to the GOI/GST Council on serious adverse position to which the members of the select aspects about the GST regime impacting on the construction industry were been subjected. It had construction business, cites the following past adverse caused situation of uncertainty in conducting the experience only to reiterate the concern. business, undesired commercial disputes with the client/contractee, statutory dispute with dept., adverse Adverse Taxation Situation financial implication etc. To dwell on continuous adverse and volatile taxation situation to which the construction business was subjected, BAI It may be relevant to highlight that in given such attributes to the influence of the Govt. policies, contingency or situation, neither the client/contractee nor the uncertainty in administration of tax laws and unworkable respective government could come to the aid or extend prescription of statutory procedure, both under Central or State any support to the members of construction industry domain. To suffice the descripted adverse situation, the instead pushing them to financial orphanage and to following among others are self acknowledgement. find their own possible solution.

On 3.2.1983 the 46 th Constitution Amendment Act 1982 was passed and the States legislature enacted their follow-up BAI’s concern under GST regime : legislation from the year 1985 onwards to impose works BAI thus is seriously concerned about the implication of GST contract tax i.e. deemed sales. Similar exercise for purpose of system on construction business, specific to the following levy on inter-state sales involved in execution of works position:- contract was carried by the Central Govt, by amending the CST Act 1956 in the year 2000. 1. PROJECT UNDER EXECUTION: On the other hand, Parliament to levy service tax on works contract service amended the Finance Act 1994 to insert a new The project work inherently holds the following section 65(105)(zzzza) effective from 1.7.2007 and also unique but significant elements with reference to prescribed the mechanism to compute taxable service taxation bearing and cannot be overlooked or turnover. This raised legal issues as to legal sanction to levy compromised for more than one reason: service tax on the works contract services prior to 1.7.2007. BAI members were dragged into undesired litigation, a) The project construction period is generally commercial disputes with clients as well as serious financial longer, so also the contract value wider and, hardship. therefore, all the stakeholders of such project Notably for the above situations the compliance with statutory are invariably mandated to bear any requirement was a nightmare for members of Industry for the situational impact and without an exception following representative situation:- to implication of taxation;

A. On 17.11.1992 a Constitution bench of apex court in b) In recent time the execution of projects is Gannon Dunkerly & Co case prescribed the legal patterned differently e.g. principal to guidelines for computation of taxation turnover for principal, Public-Private-Participation (PPP) , works contract which to be adopted by State BOLT/BOOT etc. and the exercise of project legislature and reiterated the mandatory requirement to costing or finalization of the contract price provide for deduction of turnover on inter-state/import factors into it such eligible exemption, and sales outside as covered by section 3,4,& 5 of concession etc. In these cases any additional CST Act 1956 for the above purpose of computation financial implication cannot be any of taxable turnover under State Act. contractual compensation by the concessionair.

c) These aspects have a specific bearing on the Even a works contract awarded to the main-contractor, construction value of Power projects i.e. may not be the works contract when a portion of the thermal, nuclear, hydro, solar, wind mill etc., work when awarded to sub-contractors. railway, port etc since the benefits of exemption or concession on customs, excise The above aspect may have bearing on different pattern duty or service tax etc as accorded since to of contracting method presently in vogue e.g. have factored accordingly. consortium, Special Purpose vehicles (SPV), Joint ventures, etc. d) Many project works presently under execution are parked at various stages of On the above and apprehending of the GST execution and for its purpose could have legislation under IGST/CGST or SGST, may not entered into a long term MOU with overseas take a different route to ascertain the nature client Plant & equipment vendors or similarly order, it is imperative to provide for a binding specialized service providers. Apart from any statutory guidelines be provided to attain uniformity commercial bearing on such long term across the country. arrangements, therefore, the financial burden in view of unveiling of GST system on such 3. PROCEDURAL COMPLIANCE: procurement viz import sales or services may lose eligible financial benefit. The construction business operates on geographically spread-out basis and any prescription for the procedural e) The above description may also percolate compliance need to be on accommodative basis. down to the sub-vendors or sub-contractors, Under Finance Act 1994 a contractor can have one including on the pattern of statutory composite registration on centralized basis and carry the compliance under each statue as to have been statutory compliance accordingly. opted. BAI, therefore, registration under GST regime may BAI is seriously concerned on the aftermath consider to a status quo to avoid any operational implication of GST scheme on the contracts complication. under execution or presently pending for commencement or the construction is BAI also highlights the fact of many contracts awarded by incomplete. Any consequential additional the clients, including Govt and PSU etc which provides financial bearing on the members of the contract value inclusive of all taxes & duties. The construction industry deserves protection, following position on contractual status as could prevail including for the factored concessional CST between the client/contractee & contractor OR contractor benefit against ‘C’ Forms, import sales & sub-contractors OR the contract cost of execution work qualifying for exemption, etc. The as to have factored with eligible exemption/concession stakeholders are not alone domestic but etc. foreign, including with regard to investments for projects under banner of PPP, BOT, Any converse position to above under the GST regime BOOT etc. could have serious financial implication on the members of industry unless the same is addressed before GST is put BAI recommends for having a status quo to administration. with regard to all such project work either under execution, incomplete or to be BAI on a review of GST scheme as available in public commenced earlier to the effective date of domain, underlines the fact of deficiency attention given GST levy both under IGST/CGST and to taxation aspect as adoptable to construction industry SGST. and therefore look forward for your favourable consideration to above suggestions and also request for 2. WORKS CONTRACT-NATURE: sanction for a suitable personal audience with make our submissions to deserving position. The GST model law proposes to hold works contract to be “service”, instead duel component of (supply) sale of Thanking you, goods and rendition of service. Yours truly,

The nature of contract to be “works contract” or otherwise depends upon various aspects and there is no uniform guidelines to determine the nature of Avinash M. Patil construction contract to be works contract. PRESIDENT BUILDERS ’ ASSOCIATION OF INDIA

Registering under GST Further, it is mandatory for every person to register if the annual turnover is more than Rs 20 lakh, the exemption limit. The migration of existing taxpayers into the new GST system #Point 2 – Provisional ID and password: Before visiting the has started. Given below is the full schedule of migration for GST system portal, you must have the provisional ID and various States as well as Service Tax registrants. password given to you by your concerned state authorities.

STATES START DATE END DATE #Point 3 – Documents and information required: To complete Pondicherry, Sikkim 08/11/2016 23/11/2016 the registration procedure, you must have the following Gujrat, Maharashtra, information: Goa, Daman and 14/11/2016 29/11/2016 Diu, Dadra Nagar  Provisional ID as explained in point 2.

Haveli, Chhattisgarh  Password as explained in point 2.

Odisha, Jharkhand,  Valid email address (it should not be off professional – Bihar, West Bengal, Use your own email ID)

Madhya Pradesh,  Valid mobile number

Assam, Tripura,  Bank account number 30/11/2016 15/12/2016 Meghalaya,  IFSC code Nagaland, Arunachal Pradesh, Further, also carry the following documents which needs to be Manipur, Mizoram uploaded on the website: Uttar Pradesh,  Proof of constitution of business: Jammu and Kashmir, Delhi,  In case of partnership deed – partnership deed (PDF or Chandigarh, JPEG in maximum file size of 1 MB). 16/12/2016 31/12/2016 Haryana, Punjab,  In case of others: registration certification of the business Uttarakhand, entity (PDF and JPEG format in maximum file size of 1 MB). Himachal Pradesh, Rajasthan  Photograph of promoters/partners/Karta of HUF (JPEG format in maximum file size of 100 KB). Kerala, Tamil Nadu,  Proof of appointment of authorised signatory (PDF and Karnataka, 01/01/2017 15/01/2017 JPEG format in maximum size of 1 MB). Telangana, Andhra  Photograph of authorised signatory (JPEG format in Pradesh maximum file size of 100 KB). Service Tax 01/01/2017 31/01/2017  Opening page of passbook/statement containing the Registrants following information: Delta All  Bank account number Registrants (All 01/02/2017 20/03/2017  Address of branch Groups)  Address of account holder  Few transaction details The migration will help current taxpayers under the existing (PDF and JPEG format in maximum file size of 1 MB). indirect taxes to enroll themselves under the new GST regime in a smooth manner and help them to prepare for the 1st April, #Point 4 – Fill information and submit: After you submit the 2017 date when the new GST regime is expected to come into form with all the information and documents, an force. acknowledgement number will be generated. Save that number for future correspondences. The enrollment is common for both Central and State GST. The system envisages common registration, common returns, Here are some points which may help you during enrollment common challans for both State as well as Central GST. process:

Before enrollment on the Common GST Portal, it is necessary Q) What to do in case I have not received the ID and to secure a Provisional ID and password from the password? Central/State authority. Alongwith the Provisional ID and A) In case you have not received the provisional ID and password and certain other prescribed details and documents, password, kindly contact your concerned authorities. the taxpayer can enroll at the Common GST Portal. Q) Who can be primary authorised signatory? Procedure for enrollment under GST System Portal A) A primary authorised signatory is the person who is #Point 1 – Paperless procedure: The whole system of primarily responsible to perform action on the GST System enrollment will be paperless; hence, no hard copies shall be Portal on behalf of the taxpayer. All communication from the entertained by the department. Further, all the aforesaid GST System Portal relating to taxpayer will be sent to him. registered taxpayers will need to visit the GST system portal.

For example, in case of proprietor, the proprietor himself or from sale of building any person authorised by him; in case of partnership, any of 3 Section 15 – Suitable Refer SC judgement in the partner authorised or any person authorised; in case of Value of amendment Larsen & Toubro – vs. State taxable should be of Karnataka in 2014 (303) Company/LLP, Society, Trust, the person who is authorised supply r.w. made in E.L.T. 3 (S.C.) by Board or Governing Body, etc., can act as primary Valuation valuation of authorised signatory. A copy of authorisation needs to be Rules works contract Under State to deduct the uploaded. VAT laws value of works benefit of contract till the deduction on buyer enters Q) Which details are prefilled in the enrolment application for account of into enrolling with GST? stage of agreement. A) completion Following details are auto-populated in the enrolment on application based on your existing data: construction  PAN of the business is available 4. Section - ITC should be Will result in increased cost  Legal name of the business 16(9) In allowed on all of construction of the  State admissible supplies which immovable properties ITC, expect go into  Reason of liability to obtain registration in case of construction of  Email and mobile number ‘plant and immovable machinery’ property ITC not including for Q) Can I make changes in in my legal name, state name and allowed on commercial, PAN in the enrolment application? construction industrial or of units incl. renting A) You cannot make changes to legal name, state name and commercial / purpose. The PAN as appearing in the enrolment application. These details industrial term, galas even ‘immovable have been migrated from existing tax systems of State or when used property’ Center, as the case may be. for dutiable should be production, defined in the office for Act. The term, Sr. Provision Points for Remarks providing ‘plant and No. under the representatio services, machinery’ Model GST n renting of should be Rule premises (all defined in the 1 Section 15 – Clarity Hon’ble SC held that in taxable Act. Value of required on tax absence of deduction of land manufacture, taxable on deduction and mechanism of its services), supply r.w. of value of valuation the levy under ITC is not Valuation land sub-clause. (zzq), (zzzh), allowed if the Rules transferred (zzd), (zzh) & (zzzza) of premises is Valuation under works S.65(105) levy fails. Refer given on mechanism contract and Larsen & Toubro vs. CCE renting not for deduction provisions may Kerala [2015] 60 allowable to of land value be made for taxmann.com 354 (SC) and traders not provided mechanism of Delhi High Court in Suresh 5. ITC used for Important for its valuation K Bansals case in W.P.(C) infrastructure infrastructure Nos. 2235 & 2971 Of 2011 projects project like June 3, 2016 reported in port, airport, [2016] 70 Taxmann.Com 55 railway, roads, (Delhi) SEZ etc., 2 Section 13 – In which of should be zero Time of these cases the rated supply of transaction is 6. Tax on TDR It should be Under Model GST law service liable in GST not covered specifically ‘service’ is defined to be No clarity on and if yes, VAT and provided that “anything other than goods”. taxability of provision may service tax service would Issue may arise whether Joint be made for law (TDR not include right in immovable and Development value and being ‘right immovable immovable property itself Agreements timing of in immovable property or may be covered under the including payment property’) rights attuned definition of ‘service’ i)land owner it. and developer TDR or any jointly other right in develop immovable building property may wherein the be exempted developer from definition gives some of service developed area to the In the alternate land owner in if GST is lieu of land payable on contributed TDR, ITC of by him GST may be ii) land allowed to the owner and developer developer 7. Section-17 – Credit should jointly Distribution be transferred develop of ITC by the head building and Distribution office where it share revenue

of ITC by is earned to the stock held mechanism locations to prior to of ISD ensure registration if optimum the utilization registration is 8. Section 159 – Provisions Taxability on going works not obtained Treatment of should also contract is dependent on within 30 Long term include when receipt of consideration and days from the contracts the supply is payment of tax or duty on date it Transition made and the appointed day becomes provisions invoice is liable for -taxability of issued (within registration ongoing a specified 13. Section - Credit should works period) or 16(11) – be allowed as contracts payment is conditions to and when the received prior claim ITC goods are to appointed When the received in lots day. Present goods against provisions of the invoice service tax in are received relation to in lots or ‘continuous installments, supply of the taxable service’ may person shall be be entitled to incorporated take credit on 9. Section 145- As the supply Under the Model GST law, last lots or Credit post the credit is denied unless it is installments available on appointed day allowable both in the old 14. Section - The condition In central excise and service inputs in is liable to and new law 16(11) – of payment of tax, availment of credit is stock GST, ITC shall be GST by not dependent upon Transition appropriate allowed only supplier should payment of tax by the provisions provision if the be done away supplier - utilization should be supplier has with as the This provision may result of credit of made to allow made claimant into denied of legitimate goods held ITC of goods payment of would have no credit to the receiver or by the lying in stock GST should control over block of huge funds if the service of the service be done away payment of supplier default in payment provider provider on the with like in GST by of GST appointed day case of supplier and he 10. Section 159 – Window of Excise and may not be in a Treatment of two years service tax at position to Long term should be present enforce the contracts provided for compliance of Transition review of the law by its provisions - existing supplier taxation of contracts - till 15. Taxability of Provision VAT is payable when the ongoing long than status quo retention should be invoice is issued. Service term works as per the money – made to pay tax is payable based on contract present law to GST is GST when contractual terms be maintained payable when retention 11. Section 13(3) Time of supply the supply is money is due – Continious in case of made, to the supplier. supply continuous hence, GST In case GST is Time of supply of has no levied, ITC continuous service should connection should be supply of be aligned with with granted service - the Point of contractual immediately taxation Rules, terms In case of 2011 where in continuous case of 16. Liability of GST Provision proforma invoice / RA bills supply of continuous tax on payable on should be are issued based on finality service time supply of proforma supply made in line of invoice by the recipient of service service the invoice / RA made, with service (issue of Revenue shall be the provision of all bills – based hence tax, Point of Recognition / AS – 7) due date if or part of on finality of liability Taxation ascertainable service is invoice by may arise Rules. Further from a determined the recipient even on there will be contract. periodically on (issue of issue of mis-match of However, if completion of Revenue proforma invoices not an event in Recognition / invoice between the ascertainable, terms of AS – 7) supplier and it is earliest contract, which receiver of date of require the resulting into receipt of receiver of denial of ITC. payment or service to Mechanism date of issue make any should be of invoice or payment as provided to completion service avoid of event provider unintended 12. Section - Input tax credit mis-match. 16(2A) - ITC should be In case GST is Input Tax allowed levied, ITC Credit (ITC) irrespective of should be - ITC shall date of granted not be registration immediately. allowed on

GST - STATUS UPDATE th  GST Rules 20 March, 2017 The new indirect tax regime also has nine set of rules and regulations, out of which the GST Council has already  The Goods and Services Tax (GST) Council, in its th approved rules for Registration, Payment, Invoices, meeting held on 4 March, 2017 in Vigyan Bhawan in Returns and Refund. New Delhi under the Chairmanship of the Union Minister for Finance & Corporate Affairs, Shri Arun Jaitley has Now, the GST Council will work out Rules on approved the draft CGST Bill and the draft IGST Bill as Composition, Valuation, Input Tax Credit (ITC) and vetted by the Union Law Ministry. Key Features of the Transitions. In the next meeting on March 31, 2017, the Central GST Bill and the Integrated GST Bill are given in Council will take up the Rules on four categories and any the Annexure. changes to the already cleared Rules on five issues.

th  The Goods and Services Tax (“GST”) Council, in its 12  Fitment of commodities in GST rate slabs meeting held on March 16, 2017, has approved the Draft Bills for implementing GST in States and Union After March 31, the GST Council will take up the Territories (“UTs”). The UTGST Draft Law is for the exercise of fitment of various commodities in the GST tax Union Territories like Andaman and Nicobar Islands, slabs – 5%, 12%, 18% and 28% besides the nil rate. The Lakshadweep, Daman and Diu and Dadra and Nagar officials have already started the fitment process, which Haveli, which do not have legislative assemblies and thus will be put up for discussion and approval before the GST not covered under the constitutional meaning of ‘State’. Council.

 Previously, the GST Council had also approved a Draft  Cabinet Approval Bill to compensate States for any revenue loss arising out of GST for a period of five years. The Union Cabinet in its meeting on 20 th March, 2017 has approved the following four GST related bills:  Cess on luxury goods and demerit goods 1. The Central Goods and Services Tax Bill 2017 (The The GST Council also cleared a proposal to cap the cess CGST Bill) on luxury cars and aerated drinks at 15% over the peak rate of 28%. However, the ceiling for the cess on “sin” 2. The Integrated Goods and Services Tax Bill 2017 (The goods would be much higher. It was said that for paan IGST Bill) masala, the cap would be 135%. On tobacco and cigarettes, the cap would be 290% or Rs. 4,170 per 1,000 3. The Union Territory Goods and Services Tax Bill 2017 cigarette sticks. A call is yet to be taken on whether or not (The UTGST Bill) a cess would be imposed on bidis. The cess on coal and lignite (environment cess) would have an upper limit at 4. The Goods and Services Tax (Compensation to the Rs.400 per tonne. States) Bill 2017 (The Compensation Bill)

The actual cess on demerit goods, which will help create a The CGST Bill makes provisions for levy and collection corpus for compensating states for any loss of revenue of tax on intra-state supply of goods or services for both from GST implementation in the first five years, may be by the Central Government. On the other hand, IGST Bill lower than the cap as the Council has kept a "little" makes provisions for levy and collection of tax on inter- headroom for future exigencies, Finance Minister Shri state supply of goods or services or both by the Central Arun Jaitley said. Government.

The UTGST Bill makes provisions for levy on collection Giving an example, he said if a luxury car at present of tax on intra-UT supply of goods and services in the commands a total tax of 40%, under the new indirect tax Union Territories without legislature. Union Territory regime, a GST of 28% plus 12% cess would be levied to GST is akin to States Goods and Services Tax (SGST) keep the tax incidence at the same level. which shall be levied and collected by the States/Union Territories on intra-state supply of goods or services or The GST Council has opted to levy cess on five category both. of products - pan masala, chewing tobacco and cigarettes, luxury cars, aerated drinks and mineral water, and coal The Compensation Bill provides for compensation to the and lignite - to create a fund with a corpus of around Rs states for loss of revenue arising on account of 50,000 crore for meeting a potential liability. implementation of the goods and services tax for a period of five years as per section 18 of the Constitution (One The GST Council has, however, kept the option of adding Hundred and First Amendment) Act, 2016. more items to the list later.

Upto date Brief Report of the Cement are of very substantial nature. The total penalties would come in the range of Rs.6000 crores. While inflicting the penalties, Cartlization Case the CCI has also taken into consideration, not only the 10% Filed in Competition Commission of India turnover, gross-turnover and other factors, it has also taken Case No 29/2010 dated 20.06.2012 & into consideration the net profits earned by these appellants, RTPE/2006 dated 30.07.2012 which are to say the least fabulous. The Commission has chosen to impose the penalty at 0.5 times of the net profit for Under Section 53B of the Competition Act, 2009-10 that too from 20th of May, 2009. It is pointed out by 2002 the Commission that the amount of 3 times of net profit calculated, is higher than 10% of the average turnover. In that Builders Association of India (BAI) filed a view, the Commission has inflicted the penalties of 0.5 times of complaint with the Monopoly & Restrictive Trade Practice the net profit for one year that is from 2009 to 2010 that too Commission (MRTPC Commission) in February 2006 with taking from 20th May, 2009 and 2010-11. Under such regard to involvement of cement manufacturers in unfair trade circumstances, we would chose to grant stay to the penalties, practices / cartelization and requested the Commission to however with a condition that the appellants deposit 10% of investigate the matter. Later on Commission sought some the penalties inflicted. We make it clear that the deposit of the more information in support of complaint which were made penalty should be within one month from today. We also make available to them in November 2006. MRTPC registered the it clear that if the penalties are not so deposited, the appeal complaint vide case RTPE-52/2006. Consequent upon shall be treated as dismissed without further reference to the coming into existence Competition Commission of India Court. (CCI) in the year 2009, the case was transferred to CCI. Thereafter, all the cement companies approached the Supreme Court of India for seeking stay on the orders of the In July 2010, BAI filed another complaint with the th CCI alleging unfair trade practices being adopted by the Tribunal dated 17 May 2013 to deposit 10% of penalty amount imposed by the Commission, The matter was heard in Cement manufacturing companies in jacking up artificially the th price of cement. CCI registered the complaint as Case detail on 12 June 2013 but the Hon’ble Court refused to intervene in to the interim orders but extended the last date of No.29/2010 and investigated the matter. The Director General th th (Investigation) investigated the matter and submitted his report deposit of the penalty amount from 16 June 2013 to 24 June to CCI. CCI forwarded the investigation report to the 2013 with the directions that the amount of penalty may be respective companies and directed them to file their replies / kept in the form of Fixed Deposits in the separate accounts of objections with the findings of the DG(I). The case was heard the each company by CCI on 21 st , 22 nd & 23 rd February 2012. CCI passed the order dated 20 th June 2012, declaring 10 cement companies The matter was argued in detail on the technicalities, along with Cement Manufacturers Association indulging into in the Tribunal in October / November 2015 and the Tribunal th unfair trade practices and ordered to deposit Rs.6307.32 in its order dated 11 December 2015, allowed the appeals and Crore, as penalty within 90 days from the date of the order remanded the orders of the Commission for passing fresh and directed companies to “Cease and Desist” from indulging orders. The relevant portion of the orders are reproduced in such activities in future below :-

CCI by its order dated 30 th July 2012, in the case of 98. In the result, the appeals are allowed. The impugned order RPTE-52/2006 , found 12 cement companies to be indulging is set aside and the matter is remitted to the Commission for into unfair trade practice. Since penalties were already fresh adjudication of the issues relating to alleged violation of imposed on 11 companies including CMA other than Shree Sections 3(3)(a) and 3(3)(b) read with Section 3(1) of the Act Cement Ltd. in Complaint No.29/2010, a penalty of by the appellants. The appellant shall be entitled to withdraw Rs.397.51 Crore was levied on Shree Cement Ltd. with the amount deposited by them in compliance of the interim “Cease & Desist” order for not indulging in such practice, in order passed by the Tribunal. future.

All the cement companies, aggrieved with the 99. The Commission shall hear the advocates/representatives orders of CCI, approached to Competition Appellate Tribunal of the appellants and BAI and pass fresh order in accordance to seek a stay on deposit of the penalty amount and for setting with law. We hope and trust that the Commission shall pass aside the orders of “Cease & Desist” in June / July 2012. fresh order as early as possible but within a period of three months from the date, which may be notified after receipt of this order. On 17 th May 2013, the Competition Appellate Tribunal passed the interim order of depositing 10% of the penalty amount imposed by the Commission (relevant portion 100. The parties shall be free to advance all legally of the order is given below) permissible arguments. They may rely upon the documents, which formed part of the record of the Jt. DG or which may have been filed by them before the commencement of hearing “In that view, we find that there is a prima-facie case on 21.02.2012. The parties shall also be free to press the for granting of stay at least in respect of the penalties, which applications already filed before the Commission. However, no application, which may be filed hereinafter for cross- Ref :210/J/2016-17 dated 13 th July 2016 examination of the persons, whose statements were recorded To, by the Jt. DG or for any other purpose shall be entertained by the Commission . The Hon’ble Members of Parliament,

The CCI, in its meeting held on 17 th December 2015, Dear Sir/s, discussed the orders passed by the Tribunal on 11.12.2015 and Sub: Appointment of Cement Regulatory Authority. in accordance with the directions contained at Para No.99, listed the matter for final hearings from 19 th Jan to 21st Jan Builders’ Association of India (BAI) is an apex all 2016\, as conveyed vide CCI Letter No.1(29)/2010Sectt & India body of Engineering Construction Contractors and Real 1/RTPENo.52)/2006/Sectt dated 11.01.2016. Since the Estate Companies founded in 1941, with more than 16,000 arguments could not be completed in three days as scheduled, business entities as members through its 155 plus Centres CCI allowed the arguments to continue on 22 nd January 2016 (Branches) throughout the country. The fundamental aim of which was kept reserved day for continuing the arguments in the Association is to bring about all round improvements in case the arguments are not completed in 3 days. the construction sector, while striving towards resolution of operational as well as policy level problems faced by the The Competition Commission of India have passed construction industry. fresh orders on 31.08.2016 and have found cement companies of guilty of acting in concert and involved in the Country embraced to ‘Market Economy’ from the cartel. The Commission have kept the amount of penalty, ‘Command Economy’ in 1991. Industrial licensing and price same for all the companies, as imposed on them in its earlier controls were dispensed with. As a result, economy moved up order in the year 2012 and directed them to deposit the penalty from “Hindu Rate of Growth” to a healthy 7% to 8% GDP amount within 60 days from the date of order. growth. In Market Economy more competition is imperative and to keep a watch on the market players for not indulging in unhealthy business ethics, the Government appointed The Cement companies have started filing appeal in Regulatory Authorities from time to time for certain sector Competition Appellate Tribunal against the order of CCI such as : dated 31.08.2016. The Tribunal have directed all the cement companies to deposit 10% of amount of penalty imposed by (a) Security Exchange Board of India (SEBI) in the CCI before their appeals are taken up for consideration. 1992 for stock markets. Accordingly, the cement companies have deposited the 10% (b) Telcom Regulatory Authority of India (TRAI) in of the amount of penalty amount as reflected in the orders of 1997 for Telecom Sector. the CCI with the Tribunal. All the appeals, filed so far, are (c) Insurance Regulatory & Development Authority listed for hearing in the Tribunal on 7 th December 2016. On th th of India (IRDAI) for Insurance Sector in 1999. the 7 December 2016 the matter was adjounred to 8 March (d) Real Estate Regulatory Authority (RERA) in 2017. 2016 for Real Estate Sector.

th Arguments have started in the Tribunal from 8 Infrastructure and Housing Sectors being an enabler March 2017. As agreed by all the cement companies except of economic growth and enhancer of quality of life have high M/s. Shree Cement Ltd., the issue of Ambuja Cements priority in Governments action plan. Cement is part of core Limited in Appeal No.61/2016 will be treated as lead case and industry and is a basic input for construction sector. Cement other componies will be arguing the matter before the Industry players continue to indulge in anti-competitive Tribunal, if required, only on specifrc point which have not practice since long as can be seen from following:- been convered in the arguments made by the couonsel of M/s. Ambuja Cement Ltd. M/s. Shree Cement Ltd. will argue the (a) In Enquiry No.RTPE 99/1990 on 28 th November matter separately. 2006, Monopolies and Restrictive Trade Practices Commission directed cement companies ‘cease The matter was again listed for hearing on 11 th , 12 th and desist order’. The Hon’ble M.R.T.P. & 13 th April 2017. When the proceedings in the Tribunal Commission again in Enquiry No.RTPE 21/2001 begin, Shri T. Srinivasa Murthy, learned counsel for M/s. decreed on 29 th February 2008 observed that, Ramco Cements Limited (Appeal Nos. 54 and 64 of 2016) “Cement companies are guilty of forming informed the Tribunal that in Civil Appeal Nos. 4300-4301 of cartel and issued to cease and desist order. The 2017, the Hon’ble Supreme Court has stayed further M.R.T.P. Commission also directed them to proceedings till the next date of hearing i.e. 2nd May, 2017. file the Affidavit with effect that, they won’t do cartelisation again” . BAI President has written a representation to all members of Parliament requesting to constitute a (b) On 20 th June 2012, The Hon’ble Competition “Cement Regulatory Authority” which is reproduced Commission of India in case No.29/2010 filed by below. BAI conclusively found the existence of cartel arrangement amongst the Cement Manufacturers resulting the manipulation of sale price of cement,

and imposed a penalty of Rs.6,307.32 Crore on In Cement related matter, the Director General 10 Cement Manufacturers plus Cement Supplies & Disposal, Haryana suo moto took and Manufacturers Association (CMA) and also decided: issued ‘cease and desist order’.

(c) Parliamentary Standing Committee of Ministry of Cement bid-rigging / Cartel Case No. 05/2013 Commerce presented its 95 th Report on

“Performance of Cement Industry” on 24 th 1) Director General Supplies & Disposal, Haryana, February 2011 to Rajya Sabha, recommended invited tender being tender No. 4/HR/RC-E-2/2012- Vide No. 25 “The Committee is dismayed to note 2013 for supply of 4 lakh M.T. of Cement in State to that that one of the reasons for price rise of various department / agencies of Government in cement is profit motive of the cement companies. August 2012. The calculation of fair price and the average retail

price, gives a fair idea about the extent of profit 2) Nine cement manufacturers responded to the tender per bag will only add to the burden of the however two withdraw their offer, leaving seven in consumer i.e. the common man. This will also the fray. After opening of the tender, D.G. observed affect the infrastructure industry. The Committee, that cement companies indulged in bid-rigging and therefore, strongly recommends that the quoted higher rate by forming cartel D.G., therefore Government should establish a statutory complained to Competition Commission of India. regulatory authority to regulate the price of C.C.I. after considering the entire material available cement to curb the tendencies of market on record vide it’s order on 2.1.2014, passed U/S dominance, under-utilization of capacity and 26(1) of the Act directed Director General artificial scarcity. (Para 3.24) Investigation of Commission to investigate the matter and report back to C.C.I. (d) Cement Industry’s installed capacity is 382.19 million tonnes in 2015-16. As a result of merger 3) During the course of investigation, D.G. called and acquisition in last three years, 235.80 million representatives of all seven companies, seeking tones i.e. 60% of installed capacity is in hands of various details from them. D.G. of C.C.I. investigated six major players (enclosed list). This increases the matter and submitted his report on 8.12.2015. danger of continuing cartelisation. C.C.I. in its ordinary meeting held on 23.12.2015, considered the report and forwarded to it to Cement BAI therefore request you to impress upon Companies for their response / replies / objection. government to enact a Regulatory Authority for cement sector and oblige. 4) After 23.12.2015, Cement Companies filed their Thanking you, responses against observation / report of D.G., C.C.I. Yours faithfully, after hearing arguments passed order U/s. 27 of competition Act. On 19.1.2017

285. The Opposite Parties (OP) are directed to cease and AVINASH M. PATIL desist from indulging in the acts/ conduct which have PRESIDENT been found to be in contravention of the provisions of BUILDERS ’ ASSOCIATION OF INDIA the Act.

List of six biggest Cement producers 286. The Commission, for the reasons recorded below, with their installed capacity th finds the present case fit for imposition of penalty. as on 4 July, 2016. Under the provisions contained in Section 27(b) of the Act, the Commission may impose such penalty Sr. Name of Installed Remarks No. Company Capacity in upon the contravening parties, as it may deem fit Million which shall be not more than ten per cent of the tonnes average of the turnover for the last three preceding 1. Ultratech 91.20 Fine Rs. 1175.49 crores by financial years, upon each of such person or Competition Commission. enterprises which are parties to such agreement or 2. Holceim 68.00 Controls A.C.C. and Ambuja Cement fined Rs. 2311.50 abuse. Further, in cases of cartelisation, the crores by C.C.I. Commission may impose upon each such cartel 3. Shree Cement Ltd 25.60 - participant, a penalty of upto three times of its profit 4. Dalmia Bharat 25.00 - for each year of continuance of the anti-competitive Cement Ltd. 5. India Cement Ltd. 15.50 Fine Rs. 187.48 crores by agreement or ten per cent of its turnover for each year C.C.I. of continuance of such agreement, whichever is 6. Jaiprakash & 10.50 Fine Rs. 1323.60 crores by higher. Associates Ltd. C.C.I. Total 235.80 287. It is evident that the legislature has conferred wide Total Installed 382.19 Capacity discretion upon the Commission in the matter of

imposition of penalty. It may be noted that the twin deciding the quantum of penalty. The Commission objectives behind imposition of penalties are: (a) to has also taken note of submissions made by the reflect the seriousness of the infringement; and (b) to learned senior counsel appearing on behalf of ACC/ ensure that the threat of penalties will deter the ACL that they are subject to an intensive and robust infringing undertakings. Therefore, the quantum of competition law programme through Lafarge penalties imposed must correspond with the gravity Holcim’s Fair Competition Review Programme, the of the offence and the same must be determined after purpose whereof is to create awareness and impart having due regard to the mitigating and aggravating training to key employees. The employees have to circumstances of the case. undertake regular competition law training and assessment of their business dealings and practices. 288. The Commission has given its thoughtful The learned counsel appearing on behalf of JAL also consideration to the issue of quantum of penalty. The pointed out that it has put in place a competition impugned tender was for entering into annual rate compliance programme through which employees are contract with respect to cement by DS&D for supply being imparted knowledge on competition law. to various Departments and Statutory Bodies of the Government of Haryana. It is not in dispute that due 291. On a careful consideration of the pleas advanced by to the anti-competitive conduct of OPs, the impugned the OPs and the peculiar conditions of the tender, the tender had to be cancelled forcing the State to start Commission finds it appropriate to impose a penalty the process to procure cement- a critical input for on OP-1 to OP-7 at the rate of 0.3 % of their average infrastructure, afresh, resulting in possible delay in turnover of the last three financial years based on the timely supply for the execution of public financial statements filed by them. Details of the infrastructure projects which may result in time and quantum of penalties imposed on the OPs are set out cost overrun. below:

289. At the same time, the Commission is cognizant of the Sr. Name of Turnover Turnove Turnover Average @0.3% peculiarities of tendering process which have been No. Ops for r for for turnover of pointed out by some of the OPs (ACL, ACC). It has 2012-13 2013-14 2014-15 for average Three turnover been submitted by the parties that the NIT issued by Years the DS&D advertised the tentative quantity based on 1. Shree 5778.58 6072.25 6591.42 6147.41 18.44 estimated figures of cement requirement by various Cement Ltd. departments/ boards (i.e. direct consumers) during 2. UltraTech 21622.68 21974.92 24699.04 22765.54 68.30 Cement Ltd. the course of the tender year. The DS&D does not 3. Jaiprakash 13512.08 13327.02 11185.73 12674.94 38.02 disclose (i) the total quantity that will be finally Associates purchased, (ii) the quantity of cement that will be Ltd. 4. J.K. Cement 2960.76 2844.12 3458.67 3087.85 9.26 required at each of the specific destinations, (iii) the Ltd. type of cement to be supplied at each of these 5. Ambuja 9583.05 10424 9834.56 9947.20 29.84 destinations, and (iv) the quantity requirement at a Cement Ltd. particular destination. Therefore, at the time of 6. ACC Ltd. 11392.73 12006.49 11916.18 11771.80 35.32 submitting bids, a bidder is not aware of the quantity 7. J.K. Lakshmi 2110.40 2100.87 2335.26 2182.17 6.55 Cement Ltd. that any Department or Board would procure for a destination. Further, in practice, the consignee is not 292. Accordingly, a penalty of Rs. 18.44 crore, Rs. 68.30 under an obligation to purchase the specific quantity crore, Rs. 38.02 crore, Rs. 9.26 crore, Rs. 29.84 amount even thereafter. It has been argued that it is crore, Rs. 35.32 crore and Rs. 6.55 crore is imposed entirely possible that when final orders are placed, upon OP-1 to OP-7 respectively. (Aggregate penalty demand at one destination may be nil and at the other is Rs. 205.73 crores). destination, it may actually double vis-a-vis the original quantity. Further, the consignee is not obligated to purchase the entire quantity from the 293. The Commission directs the above OPs to deposit the specific L1 bidder identified by the HPPC. penalty amount within 60 days of receipt of this order.

290. Having said that, it is not in dispute that in the instant

case, the impugned tender was cancelled and fresh bids invited by re-tendering. Though competition law Standardising of Bidding Documents frowns upon even the agreements which are ‘likely’ to cause appreciable adverse effect on competition, Construction Industry Development Council (CIDC) has while quantifying penalties, a distinction has to be initiated a 'High Powered Working Group to harmonise and made between the agreements which actually cause standardise National Bidding Documents'. BAI President is a appreciable adverse effect on competition and the Member of this Working Group. The first meeting of the High agreements which are likely to cause such effects. Powered Working Group (HPWG) was held on 24th January The Commission is also not oblivious of the total 2017 at the Conference Room of CIDC in Delhi. quantity of the procurement requirement while

Those present in the meeting were : 9) Safeguards for the lenders / Bankers &F.Is Mr. Pradip Bhargava, Former Addl. Chief Secretary, Govt. of MP….Chairman Mr. Divakar Garg, Former Director General, CPWD ………………. Convener & 10) Insurance products (Tailor made) Co-Chairman 11) Penalties & Bonuses Mr. Ashok Pradhan, Financial Advisor, Commissioner of Industries, Govt of Rajasthan ……………………………………………………. Member 12) Cash flows & payments to be released. Dr. M. K. Datar, Sr. Advisor, Indian Banks Association……………. Member 13) Pre-engineered & pre-fabricated Construction Mr. Anil Kumar, Director, Ministry of Railways ………………….... Member 14) Material Specifications Mr. Anupam Agarwal, CPWD . …………………………………….. Member Mr. P. C. Sunoj, Dy. General Manager, State Bank of India ………... Member Mr. Asheesh Sengupta, DGM (C&P), Engineers India Ltd………….. Member A base Model Bidding Document* was circulated to all the Mr. Ashok Kr. Vartia, AGM, Exim Bank……………………………. Member Mr. Avinash M. Patil, President, BAI………………………………... Member participants and Chairman advised all of them to send their Mr. Chander Verma, Director, Continental Construction Ltd……….. Member suggestion/feedback to CIDC Secretariat, considering all the Mr. P. V. Rao, Managing Director, PebsPennar……………….………Member Mr. Akhilesh Kumar Srivastava, CGM (CMC), NHAI ……………… Member above issues and add other issues which they feel important. It Dr. Prakash Mathur, Dy. Director, Pidilite Industries Ltd. ……………Member was further requested to send the same by 25th February, Col. Bishwajeet Choubey, CCE, DRDO……………………………… Member 2017, enabling the secretariat to compile the same. Upon Mr. Suman Singh, Chief of Marketing, Tata Steel Ltd.………………..Member compilation, it will be circulated to all members and the next The following were also present in the meeting : meeting shall be held soon after that. Mr. R. N. Gupta, Vice President, BAI Mr. Raju John, Executive Secretary, BAI Once a Model document is ready as per the deliberations in Mr. S. S. Arora, Executive Secretary, BAI next few meeting, it will be sent to MOSPI for consideration. Mr. B. K. Singh, DRDO Mr. Pankaj Kumar Ojha, Tata Steel BAI Submitted its comments on CPWD Matters which is Mr. Sunil Mahajan, ADG, CIDC represented below Dr. P. R. Swarup, DG, CIDC Ref. No. BAI/DC/03/2016/43 Dated, 2 nd September 2016 While welcoming the participants, Mr. Bhargava explained the background of the constitution of the HPWG by CIDC and The Director General said that it has been formed to evolve a set of bidding and Central Public Works Department, contract documents, which would include the General 1st Floor, ‘A’ Wing, Nirman Bhawan Conditions of Contracts, Standard Technical Conditions and New Delhi-110011. Standard Operating Procedures (SOPs), which are in sync with today's infrastructure and construction needs. He added that a Subject - Request for solution to problems being faced by preliminary meeting had been already held wherein some key Contractors in CPWD in general. issues have been identified which have been placed before the members. He then requested Dr. P. R. Swarup, DG, CIDC to Dear Sir, apprise the participants about the objectives of the HPWG, historical background and the actions proposed to be taken. We convey our sincere thanks and gratitude for

accepting our request for holding a meeting in your office, on Dr. Swarup presented an overview of the formation of the th Council in 1996 and previous work done by CIDC towards Friday, the 9 September 2016, to discuss / consider various harmonization of Contract/ Bidding Conditions, which were issues being faced / confronted by the contractors in day to approved by the Committee of Secretaries of Government of day execution of works. We humbly request that the India under the auspices of Union Ministry of Statistic and Department may consider the following points, and points Programme Implementation (MOSPI) in 2001 and later which have already been sent to your esteemed office vide our letter No.BAI/DC/03/2016/05 (Annexure – I), (Annexure – revised in 2005. He apprised that as directed by Committee of th th Secretaries, these documents were widely circulated by CIDC II) & (Annexure – III) dated 6 April 2016 and 6 June 2016 to all the Government agencies, and the Public Sector respectively (copies enclosed for ready reference), in this Enterprises, as the model guidelines and has helped many meeting. We are sure that solution to these problems will be Project Authorities to develop their Contract documents and in the interest of the Department / progress of work in works manuals. He further said that in present scenario particular and the Contractors in general as well as help in because of many new conditions being introduced from time avoiding disputes and litigation up to great extent. to time, there is a need to re-develop National Bidding Documents and therefore this HPWG has been formed. Dr. 1. Time bound Approval of Extra / Substitute Items, Swarup explained the following identified key issues and Extention of Time & Release of with-held amount - Due alsodetailed the terms of reference of the Working Group. to delay in giving sanction / approval by Engineer in Charge for the following items to avoid held up amount of contractors 1) Lowest price syndrome / loss to contractors, delay in execution of work. 2) Capability assessment of the service provider. 3) Dispute resolution - Arbitration 1.1 Delay in sanction of Extra, Substituted and 4) Engagement of skilled workers deviation items inspire of provision in Clause 12 5) Engagement of Professional engineers of agreement. 6) Engagement of screened & credible vendors 7) Safety, health, & Environment concerns. 1.2 Delay in releasing the withheld amount for 8) Project export issues. milestones because the Engineer-In-charge insists

that EOT must be granted before releasing the work even in the case when reasons of delay are withheld amount. It is practically very difficult and attributed to the department. Thus the contractors are time consuming. It is proposed to delete the penalized for the faults on the part of department. condition for withholding amount for milestones. This is unfair, unreasonable and illegal. The condition for freezing the cost indices need to be 1.3 Delay in making payment of RA bills and Final removed and escalation to actual cost indices should bill inspite of the specified provisions in the be paid from the day of start of work and upto the agreement. actual date of completion of work.

1.4 Delay in payment of escalation under Clause 10 of 6. Compensation on Foreclosure of Work - In case of agreement for labour fore-closure of the work by the Department, Clause materials, etc. 13 provides to compensate the contractor for expenditure incurred on preparation for execution of 1.5 Denial / delay in payment of escalation for cement the work but restricts the amount of compensation to consumed in RMC. only 2% which is found to be too small in many cases putting the contractors to heavy losses for no 1.6 Denial / delay in payment for VAT for extra, fault on their part. It needs to provide to pay substituted and deviation items compensation /loss of profit to contractor and payable at market rates. increase limit to minimum 5%.

1.7 Denial / delay of payment for GRIHA compliance 7. Interest on Delayed Payments - It will be fair and for agreement items, extra, reasonable to provide in the contract for payment of substituted and deviation items. compensation/interest for delay in payment to the contractors for the reasons attributed to the (Note – Kindly direct the Senior Officials / Field Staff to department or clients for not making available the follow the instructions / provisions in the Manual / OMs. funds or decisions or otherwise. In many cases, the Issued by your office from time to time) contractors suffer heavy losses on this account. It leads to litigation and the department is made to pay 2. Performance, Security and Retention Money - interest for whole period of delay including long Presently Performance Gurantee of 5% is taken on period of litigation. awarding of the contract and Retention Money @ 2.5% is deducted from the R.A. bills, which is too 8. Milestone - Milestone are also derived from the high and un-necessary forced to add the cost of time limit which is insufficient and the target is not money / bank charges / margin money to project. achieved in the given time and contractor s are When contracts are only given to registered and pre- penalized which again affect the cash flow and qualified contractors, there is no point in putting a progress of work. Werequest that sufficient time of burden of this money on project with no advantage to completion of work be given. anybody. Hence Performance Security and Retention Money combined should not be more than 2.5% . 9. Implementation of Safety Measures at Work Sites - This reduction from 7.5% to 2.5% will also help to It is the responsibility of the contractor working on a maintain the cash flow of the contractor. project to implement, enforce the safety policies and should be emphasized over the duration of the 3. Deposit of EMD - EMD is deposited in any one of project. In order to facilitate the same effectively, the divisions. Some divisions decline to receive Safety must be an item in the agreement schedule EMD. It is released after receipt of clearance from such as providing barricades, installing sign boards, the Tenders Calling Division which takes long time providing external protection by netting etc. and delays refund of EMD. It is proposed that the divisions collecting the EMD should transfer the 10. Simplification / Relexation of Conditions - amount to the division calling the tenders which Simplification of stipulated condition in NIT in shall refunded to all the tenders except L-1 after respect of eligibility of contractors enlisted in Class - opening of the Tender. 1A, 1AA and 1AAA categories.

4. Mobilization Advance - Bank Guarantee from the 11. Nomination Clause in the Agreement - In the Contractor should be insisted upon for the amount eventuality of the death of a contractor, both the and the period which has been requested for by the department and contractor’s mainly are put to lot of Contractor and not for the full amount / completion hardship to carry out further works. Besides it time of the contract. becomes an ordeal for the family members to get back the investments. In such cases, a clause in the 5. Freezing of Cost Indices - As per Clause 10 of the agreement nominating a person to carry on the agreement, cost indices for payment of escalation are project will make the job easy. This is more vital in frozen as on the stipulated date of completion of the individuals taking contracts and in partnership firms.

Engineer-in-Charge regarding the stepping, sloping or shoring 12. A circular has been issued that the Clause – 10CC / to be done for excavation deeper than 2 metres. 10CA is not applicable on the amount of substituted items. The substituted items are being prepared on or Under item 2.11.1.2 it specifies that In case of open footings / above the quoted rates so the Clause 10CC / 10CA Rafts at a depth of more than 1.5 metre, alround excavation of has to be paid on substituted items deemed to be on 75 cm shall be measured for payment to make allowance for quoted rates. centering and shuttering. Additional excavation beyond this limit shall be at the risk and cost of the contractor and shall not 13. As per new rules framed in CPWD recently, the be measured for payment. contractors who have not executed even a single work in Government organizations, have been 2.0 For item of earth work for major works, item No. allowed for tendering although they are not 2.22.1 says that, excavation shall be undertaken to the width of experienced, conversant with the rules, regulations the Basemen t / Retaining wall footing including necessary and procedures of CPWD. It also deprived the margins for construction operation as per drawing or directed enlisted and experienced contractors. It needs to be otherwise. Where the nature of soil or the depth of the trench reviewed and modified. and season of the year, do not permit vertical sides, the contractor at his own expense shall put up the necessary Any other point with the permission of the Chairman shoring, strutting and planking or cut slopes with or without of the meeting. steps, to a safer angle or both with due regard to the safety of Yours faithfully, personnel and works and to the satisfaction of the Engineer. Sd/- Measurement of plan area of excavation for payment shall be R N Gupta permitted only. Vice President Builders’ Association of India The specifications covered at Sr. No. 1.0 above allows for Encl : As above. payment with a slope of 1:4 for excavations more than 2.0 metres plus alround working margin whereas the (Annexure – I) specifications covered at Sr. No. 2.0 above only refers to drawing without any indication for side slopes essentially No.BAI/DC/03/2016/05 Date : 6 th April 2016 to be maintained as in no case vertical cutting is possible. The ambiguity in provisions as detailed above need clarifications. The Chief Engineer (CSQ) Central Public Works Department 3.0 In CPWD specifications under Sr. No.0.6, it is First Floor, ‘A Wing’, Nirman Bhawan, stated that, Specific provision shall be made in the estimate Maulana Azad Road, for such situations where the foundation level is more than 3 New Delhi-110011. (three) metre depth from the plinth for all types of structures mentioned above. No specific provisions are made by any NIT Subject : Regarding CPWD Contract Condition approving authorities as observed in the tenders floated by Sir, various authorities.

Some of our members / construction companies have The payment for the works to be executed below ground approached us to take up the matter with CPWD for the should be made in the same way as these are made for contradictory provisions in specifications of items covered superstructure works defined by levels, i.e. extra for works under CPWD specifications are observed. Also there are upto two basements, extra for works two to four items in Delhi Schedule of rates which need to be modified. basements and so on. Some of the items where clarifications / corrections needed are submitted for your kind consideration. 4.0 For marble work in steps, jambs, columns and other plain work under clause 8.5 of the specification Earth Work describes for measurement of stone as “In the case of radially dressed or circular stone used in the work, the dimensions of 1.0 For item of excavation of earth, item No. 2.7.3 says the circumscribing rectangle of the dressed stone, shall be that In firm soils, the sides of the trenches shall be kept measured correct to a centimetre and thickness, correct to 0.5 vertical upto a depth of 2 metres from the bottom. For greater cm” and for wall lining/veneer work under clause 8.6 depths, the excavation profiles shall be widened by allowing measurement of stone is to be done as “The length and breadth steps of 50 cms on either side after every 2 metres from the shall be measured correct to a cm. In case of radially dressed bottom. Alternatively, the excavation can be done so as to give or circular slabs used in the work, the dimensions of the slope of 1:4 (1 horizontal : 4 vertical). Where the soil is soft, circumscribing rectangles of the dressed stone used in the loose or slushy, the width of steps shall be suitably increased work, shall be measured & paid for. The area shall be or sides sloped or the soil shored up as directed by the calculated in sqm nearest to two places of decimal”. No such Engineer-in-Charge. It shall be the responsibility of the mode of measurement has been given in the specifications contractor to take complete instructions in writing from the under clause 11.19 when marble stone is used for flooring.

(Annexure – II) Mode of measurement for both i.e. for vertical use as well as for horizontal use of marble should be same. No. BAI/DC/03/2016/05 Date: 6 th June 2016

DSR items which need clarifications Chief Engineer – CSQ Central Public Works Department 1.0 Item No.22.7 in the DSR is executed for water First Floor, ‘A Wing’, Nirman Bhawan, proofing treatment at terrace which says that, p roviding and New Delhi-110011. laying integral cement based water proofing treatment including preparation of surface as required for treatment of Subject : Regd applicability of VAT on Items used in roofs, balconies, terraces etc ------. Projects

This item is executed at terrace without any extra payment for Respected Sir, its execution in high rise building. For execution of this item in high rise building, provision for extra rate for extra This is regarding the percentage of VAT /WCT as height more than level 5 to be made as is available in DSR considered by the department in the analysis of rate (AR). At for RCC and brick work etc. present, the department considers the VAT percentage as applicable on individual items on supply / purchase. However, 2.0 Similar provisions are needed for item No. 22.14 as per the directions issued by the Department of Trade & Grading roof for water proofing treatment with .14.1 Taxes, Government of NCT of Delhi (in the year 2013) the Cement concrete 1:2:4, Cement mortar 1:3, Cement department is required to levy VAT @ 12.5% on all the mortar 1:4 materials used, including profit, in the construction except iron & steel, where the VAT is applicable @ 5% if and only if the 3.0 Item 5.22 and 5.22A of DSR, Steel reinforcement for iron & steel is used in same form in the project. Maximum R.C.C. work ---has two rates , one for reinforcement below items of wood, marble, electrical items VAT applicable is 5% plinth level and another for above plinth level but the Analysis but contractor suppose to pay 12.5% WCT all items. of rate of both these items is same which is not correct. Benefit of its execution at height shall be made part of item. It will be appreciated that in view of the above irrespective of different VAT rates applicable for different 4.0 Item 13.22 of Sub head finishing says that , Rates for items the liability of the contractor is @ 12.50% including external plaster are for height upto 10m from ground level and profit on assessment of WCT except for the Iron & Steel. extra is payable for every additional height of 3m or part thereof.. No such provision has been taken in the rate for You are, therefore requested do the needful at your execution of items in external finishing . Provision of extra end. rate for executing all external finishing items for height more than 10 metre should be made part of these items. Thanking you, Yours truly, 5.0 Item of structural glazing has been included in DSR 2014. As per item No. 26.3 of DSR, measurement for payment of glass says that “only the actual area of glass on face # 1 of Sd/- the glass panels (excluding the areas of the grooves and R N Gupta weather silicone sealant) provided and fixed in position, shall Vice President be measured in sqm”. Same is the case with item No. 26.8 Builders’ Association of India which also states that “For the purpose of payment, actual elevation area of Glazing including thickness of joints and the portion of Glass panel inside the SS channel shall be OFFICE OF THE COMMISSIONER measured”. These provisions seem to be in order for DEPARTMENT OF TRADE & TAXES, VYAPAR rectangular or square areas. But for non regular size of glazing BHAWAN, such as circular, trapezoidal or such other shapes, provision of I.P. ESTATE, NEW DELHI IS code ------shall be made part of this item. No. F.Policy/IAT/2013/1449-60 Dated : 28 th March 2013 It is, therefore, requested to look into the matter and do the needful at an early date. The Executive Engineer Central Public Works Department, Thanking you, 335-A, Nirman Bhawan, Yours truly, New Delhi – 110011

Sd/- Sub: Effect of Taxes R N Gupta Ref: Letter No. DJB/CE (Dr) P-1/F.2 (4)/2013/838 dated Vice President 26.02.2013 Builders’ Association of India

Sir, 6. PS to Commissioner, SDMC, Civic Centre, Minto Road, Delhi – 110001 Please refer to your letter vide no. CSQ/CM/18 7. PS to Commissioner, EDMC, Patparganj Industrial (2)/2013/341 dated 08.03.2013 on the above noted subject. Area, Delhi – 110092 8. PS to Commissioner, NDMC, Civic Centre, Minto 2. In this connection; I am directed to inform you that in Road, Delhi – 110001 a works contract transaction, the net VAT liability involved is 9. PS to Vice Chairman, DDA, Vikas Sadan, INA, New to be calculated on the value of contract deducting there from Delhi the amount involved in labour, services and other like charges. 10. PS to Commissioner, Trade & Taxes, Alternatively, the VAT liability can be estimated on the value 11. Joint Commissioner, Special Zone Trade & Taxes of materials adding therein the contractor’s margin/ profit Deptt. percentage. The rate of tax on such amount is to be calculated @ 12.5% irrespective of tax rates on individual items except for the amount of Iron & Steel to be used in the same form in (Annexure – III) the project. Such amount of Iron and Steel attracts VAT @ 5%. No. BAI/DC/03/2016/23 Date: 6 th June 2016 3. As far as addition of 2% of VAT is concerned, it is submitted that as per DVAT Act, 2004, no commodity attracts Chief Engineer – CSQ VAT rate of 2%. However, as per Section 36A of DVAT Act Central Public Works Department 2004, the contractees are required to deduct TDS on account First Floor, ‘A Wing’, Nirman Bhawan, of VAT from the payments made to the contractors. It is New Delhi-110011 clarified that said 2% (now 4% w.e.f. 1601.2013) does not affect the VAT liability in the transactions since this amount is Subject : Regarding required amendments in DSR / only the tax deducted at source on account of VAT which is Analysis of rates ultimately adjusted by the contractor while discharging his VAT liability. In other words, the contractor discharges his Respected Sir, VAT liability to the Delhi Government after deducting the TDS amount deducted by the contractee. Hence, it is clear With regards to the subject matter and as discussed that the 2% TDS which is the subset of the VAT liability to be with you personally, we wish to bring to your kind notice that accrued in the contract, is not required to be added at the end the rates/ coefficients of some of the items in the ‘Analysis of of justified cost when the said cost (as per Delhi Schedule of Rates’ need to be amended in line with the prevailing market Rules) is already inclusive of VAT liabilities. rates. The items requiring a relook are mentioned below:-

4. It is important to mention that if the contract is 1. Item no. 8.6, vol-I :- Mirror Polishing inclusive of taxes and 2% TDS is added in the value of the The Item description shall be ‘Extra for’ Mirror Polishing. contract, then the contractor is unjustifiably paid VAT at a This is in line with the rates and coefficients considered in higher rate of 2% than he is actually required to be paid and the Analysis of rates. ultimately, the contractor is benefited by pocketing this extra • Hence, ‘Extra for’ needs to be added in the 2% amount. You are, therefore, advised to make necessary description of the item. amendment in the CPWD Works Manual. Also, in public interest, you may like to reduce any extra loading done on this 2. Item no. 8.12, pg.327, vol-I :- Granite Stone flooring account in already prepared justified Rates / Awarded Works. Labour rate considered – Rs. 1136.80 for 10sqm Therefore, Rs. 113.68 for 1 sqm and Rs. 10.56 for 1 sqft (C. Arvind) Addl. Commissioner (Policy) • However, the prevailing labour rate for Granite stone flooring is Rs. 50 per sqft. Hence, Copy for information to:- amendment needed.

1. PS to Secretary, PWD, GNCTD, Delhi Secretariat, 3. Item no. 11.23.1, pg583, vol-I:- Marble Stone flooring I.P. Estate, New Delhi -110002 Labour rate considered – Rs. 1180.00 for 10sqm 2. PS to CEO, DJB, Varunalaya Phase – II, (522+329+329=1180) Jhandewalan, Karol Bagh, New Delhi – 110005 Therefore, Rs. 118.00 for 1 sqm and Rs. 3. PS to Secretary, Irrigation & Flood Control 10.97 for 1 sqft Department, GNCTD, Delhi Secretariat, I.P. Estate, New Delhi - 110002 • However, the prevailing labour rate for Marble 4. PS to MD, DSIIDC, N-36, Bombay Life Building, stone flooring is Rs. 50 per sqft. Hence, Connaught Circus, New Delhi – 110001 amendment needed in cost of labour. 5. PS to MD, DTTDC, 18-A, D.D.A.SCO Complex, Defence Colony, New Delhi - 110024 4. Item no. 11.26, pg587, vol-I:- Kota Stone flooring

Labour rate considered – Rs. 1136.80 for 10sqm The Chief Commissioner of Service Tax has proposed a (478.80+329+329=1180) meeting of the Regional Advisory Committee - Service Tax Therefore, Rs. 113.68 for 1 sqm and Rs. (RAC - ST), to be held on 15.02.2016 at 15.00 Hrs at the 10.56 for 1 sqft Conference Hall, 15th Floor, Air India Building, Nariman Point, Mumbai 400021. • However, the prevailing labour rate for Kota stone flooring is Rs. 25 per sqft. Hence, It is requested to forward fresh points, if any, proposed amendment needed. to be discussed in the RAC meeting, other than those already submitted to this office in response to this office letter of even 5. Item nos. 11.36, 11.37, 11.38, 11.39, 11.40, 11.41.1 to number dated 13.05.2015, to the undersigned on or before the 11.41.4, pg595, vol-I:- Wall Tile & Floor Tile 10th February, 2016 in writing as well as through email at [email protected], so that points could be included in the The percentage of wastage considered in the analysis of agenda and the same could be circulated to all the members to rates is 2.5% wastage. However, in actual scenario 10% enable them to participate in a purposeful discussion. Any wastage is seen in tile work. point / issues received after the stipulated time limit may not be entertained. • Hence the wastage percentage shall be Yours faithfully, considered as 10% in the Analysis of rates for Tile work. (NAVNEET) ADDITIONAL COMMISSIONER You are review the above mentioned points and make applicable amendments/ changes in the upcoming DSR/ BAI accordingly by its letter No. 543/F/2015-16 dated 11th Analysis of rates. February 2016 forwarded points mentioned in Para above (BAI's letter printed hereinbelow). Thanking you, Yours truly, Ref: 543/F/2015-16 dated 11th February 2016 To, Sd/- The Additional Commissioner, Ram Avtar Service Tax, Mumbai Zone, Chairman – Delhi Centre 15th Floor, Air India Building, Builders’ Association of India Nariman Point, Mumbai - 400 021

Service Tax Matters Dear Sir, Sub:- Regional Advisory Committee Meeting for Service

Tax to be held on 15.2.2016 at 15:00 hours BAI being a member of Regional Advisory Committee of in your office. Service Tax - Mumbai Zone was called for meeting to be

held on 15-2-2016 (invitation printed herein below), which Builders' Association of India (BAI) is an apex all India body was subsequently postponed to 26-2-2016, was requested to of Engineering Construction Contractors and Real Estate forward points for discussion. Companies founded in 1941, with more than 16,000 business

entities as members through its 153 plus Centres (Branches) OFFICE OF THE CHIEF COMMISSIONER throughout the country. The fundamental aim of the SERVICE TAX, MUMBAI ZONE Association is to bring about all round improvements in the 15TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, construction sector, while striving towards resolution of MUMBAI-400 021. operational as well as supply level problems faced by the Email: [email protected] Tel No: 022-22049152 construction industry. F.No.IV/16-35/MSTZ/CCO-TECH/2015 Mumbai, the

February, 2016 Technical officer, TRU, issued Report of High Level

Committee's recommendation regarding valuation of flats for To, levy of service tax in letter F. No. 354/311/2015 - TRU dated AS PER LIST 20.1.2016 (Copy Enclosed). This Letter confirms the view

expressed in earlier circular No. 151/2/2012 - ST/10-2-2012 Gentlemen, for valuation of the portion assigned / allotted to the landlord

by the developer in consideration of the land / development Subject : Regional Advisory Committee for Service Tax right as opposed to the view expressed in the Education Guide. constituted under Following points arises out of this circular for your Trade Notice NO. 1/RAC/CCO/MSTZ/2015 dated sympathetic consideration. 12.05.2015 -

Meeting proposed to be held - reg.

a) There is no confusion / doubt between the earlier circular g) The above holds good even for re-development of and in the Education Guide that the consideration for societies building or tenanted buildings where there is construction service provided by the builder / developer reconstruction of flats / tenements for members / tenants. is in form of the development right granted by the landlord. In view of above BAI request you to, b) The valuation of the consideration is required to be 1. Adopt the Stamp Duty Ready Reckoner Rate (SDRR) considered and not the valuation of the construction published by Maharashtra Government every January service. Thus, the development right is required to be for the purpose of arriving valuation of development valued. agreement of the land owner portion and also the portion of free sale component of the developer, also c) The premises that value of "development right" is not land value or F.S.I. value. Income Tax Department ascertainable is incorrect, in as much state governments also adopt SDRR. publishes yearly Stamp Duty Ready Recknor in which cost of land i.e. F.S.I. is stated. In fact this is required for 2. Service tax be payable on completion of service and levy of stamp duty on development right. not at the time of entering into development right agreement. d) The developer purchase TDR and fungible FSI on his account in order to provide the construction service. In The above should apply in both the cases of pure land case of re-development society building, the developer development and re-development also pays some corpus fund to the society, charges for alternate accommodation, shifting allowance to the Thanking you, existing occupants / members. All these expenditure is Yours faithfully, incurred by the developer and does not form a part of consideration flowing from the landlord / society to the developer which is required to be valued for construction service provided by the developer. Hence, such expense AVINASH M PATIL should not be reckoned for the purpose of valuation of President development right as a consideration. Builders’ Association of India e) In view of the forgoing, valuation of flats to be given to land owner can not be similar to the flats being sold to Unfortunately BAI's view point did not find favour with other flat purchasers, for the simple reason that the value Service Tax Dept, as can be seen from Minutes of Regional of flats sold contains the value of land which is very Advisory Committee meeting held on 26-2-2016 substantial in a city like Mumbai. Further, the flats to be (minutes printed hereinbelow). given to land owners are much prior to approval of plans by the municipal corporation. Furthermore, the right to OFFICE OF THE CHIEF COMMISSIONER obtain the flats accrues to the landlord from the SERVICE TAX, MUMBAI ZONE development agreement itself which can never be equated 15TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, with that of sale of flats to the purchasers as lot of MUMBAI-400 021. activities are required to be done in between. It being so, Email: [email protected] Tel No: 022-22049152 the value of flat allotted to land owner is much lower than flat being sold to flat purchasers which takes place after Minutes of The Regional Advisory Committee Meeting commencement of work. It should not be lost sight that Held on 26.02.2016 the service tax is on value of service provided and not of value of land. The first Regional Advisory Committee (RAC) meeting of the Service Tax Mumbai Zone was convened at the, Air India f) So far as the timing of payment of service tax is Building, Conference Hall, 15th floor Nariman Point, Mumbai concerned, the landlord / society absolutely transfer the - 400021 on 26.02.2016 at 15.00 hours. Shri Piyusha Patnaik, development right only after getting the possession and Chief Commissioner, Service Tax, Mumbai Zone, presided making conveyance deed, till then it is merely a license to over the meeting. The meeting was attended by following enter and complete the work in terms of the development officials and representatives of the Trade Associations: agreement. It is done so as the landlord do not wish to alienate with right on the property till the project is 1) Shri R.P. Raheja, Ombudsman, Indirect Tax, complete. Allotment letter / development agreements are Mumbai. mere intentions and right does not pass on parties. There 2) Shri S.K. Das, Commissioner, Service Tax-V & are cases where the High Court has removed the Audit - III, Mumbai. developer on a plaint of a land lord / society for 3) Shri Sanjay Mahendru, Commissioner, Service Tax deficiency in work and new developer is brought in. - I & II, Mumbai. 4) Shri Rajeev Kapoor, Commissioner, Service Tax - VI & VII, Mumbai.

5) Smt. M.R.R. Reddy, Commissioner, Service Tax - a) There is no confusion / doubt between the earlier IV, Audit - I & II, Mumbai. circular and in the Education Guide that the 6) Shri Navneet, Additional Commissioner, CCO, consideration for construction service provided by Service Tax Zone, Mumbai. the builder / developer is in form of the 7) Shri P.H. Thakur, Assistant Commissioner, CCO, development right granted by the landlord. Service Tax Zone, Mumbai. b) The valuation of the consideration is required to be 8) Shri V. Manickam, Secretary General, Life considered and not the valuation of the Insurance Council, Mumbai. construction service. Thus, the development right 9) Shri D.L. Desai, Trustee, Builders Association of is required to be valued. India, Mumbai. c) The premise that value of "development right" is not ascertainable is incorrect, in as much state 2) The Chief Commissioner welcomed Shri R.P. Raheja, governments publishes yearly Stamp Duty Ready Ombudsman, Indirect Tax, Mumbai, the representative Recknor in which cost of land i.e. F.S.I. is stated. of the Trade Associations and the officers present. In fact this is required for levy of stamp duty on development right. 3) At the outset of the meeting, the Chief Commissioner d) The developer purchase TDR and fungible FSI on introduced Shri R.P. Raheja, who has been recently his account in order to provide the construction appointed as Ombudsman, Indirect Tax, Mumbai, and service. In case of re-development of society requested him to give brief guidelines to all the members building, the developer also pays some corpus fund about the functioning of the Ombudsman. to the society, charges for alternate accommodation, shifting allowance to the existing 4) Shri R.P. Raheja, Ombudsman, thereafter gave a gist of occupants / members. All these expenditure is information regarding the powers and functioning of the incurred by the developer and does not form a part Ombudsman and the procedures to be followed by the of consideration flowing from the landlord / complainants and the department for redressing the society to the developer which is required to be grievances in a time bound manner. He also informed valued for construction service provided by the the details of the powers and duties of the Ombudsman, developer. Hence, such expense should not be procedure for redressal of grievances, settlement of reckoned for the purpose of valuation of complaints by agreement and award by the Ombudsman development right as a consideration. which are set out in the indirect Tax Ombudsman e) In view of the forging, valuation of flats to be Guidelines 2011, which are available at the CBEC given to land owner can not be similar to the flats website www.cbec.gov.in. being sold to other flat purchasers, for the simple reason that the value of flats sold contains the 5) After a brief interaction with the representatives of the value of land which is very substantial in a city like trade Shri R.P. Raheja, Ombudsman took leave from the Mumbai. Further, the flats to be given to land proceedings of the meeting. owners are much prior to approval of plans by the Municipal Corporation. Furthermore, the right to The Regional Advisory Committee had listed out the points obtain the flats accrues to the landlord from the submitted by the confederation of Indian Industry (CII), The development agreement itself which can never be Indian Banks Association and The Builders Association of equated with that of sale of flats to the purchasers India in the Agenda for the meeting. However, since the as lot of activities are required to be done in representatives of the CII and The Indian Banks Association between. It being so, the value of flat allotted to were not present for the meeting, the committee only took up land owner is much lower than flat being sold to the points raised by the Builders Association of India for flat purchasers which takes place after discussion. commencement of work. It should not be lost sight that the service tax is on value of service provided I. point sponsored by the Builders Association of India : and not of value of land. f) So far as the timing of payment of service tax is Issue: concerned, the landlord / society absolutely The Technical Officer, TRU, issued Report of High Level transfer the development right only after getting Committee's recommendation regarding valuation of flats for the possession and making conveyance deed, till levy of service tax in letter F. No. 354/311/2015 - TRU dated then it is merely a license to enter and complete the 20.1.2016 (Copy Enclosed). This Letter confirms the view work in terms of the development agreement. It is expressed in earlier circular No. 151/2/2012 - ST/10-2-2012 done so as the landlord do not wish to alienate with for valuation of the portion assigned / allotted to the landlord right on the property till the project is complete. by the developer in consideration of the land / development Allotment letter / development agreements are right as opposed to the view expressed in the Education Guide. mere intentions and right does not pass on parties. Following points arises out of this circular for our sympathetic There are cases where the High Court has removed consideration. the developer on a plaint of a landlord society for deficiency in work and new developer is brought in.

g) The above holds good even for re-development of In view of the above, this office is of the opinion that the societies building or tenanted buildings where there taxable value shall be based on Section 67(1)(iii) read with is reconstruction of flats / tenements for members / Rule 3(a) of the Valuation Rules as specified by the Board's tenants. letter dated 20th Jan., 2016.

In view of above BAI requested to, The issue is regarding the point of Taxation i.e. when the tax liability arises in respect of flats given to the land owner. The 1. Adopt the Stamp Duty Ready Reckoner Rate (SDRR) possible dates of : published by Maharashtra Government every January for the purpose of arriving valuation of development (i) at the time of entering Tri partite agreement; agreement of the land owner portion and also the (ii) at the time of getting approvals from the Competent portion of free sale component of the developer, also Authority; land value or F.S.I. value. Income Tax Department (iii) at the time of actual handing over the completed flat i.e. also adopt SDRR. when the flats are ready for occupation.

2. Service Tax be payable on completion of service and This office is of the opinion that point of Taxation shall be not at the time of entering into development and re- either one or two above, whichever is later because at this time development. only the drawings would have been approved by the Decision: Competent Authority and there is a proper demarcation of flats The matter discussed by the Builders Association of India at to be given to the land owner. point a, b, and c have been addressed to by the Board vide circular issued vide letter F. No. 354/311/2015 - TRU dated Another connecting issue is regarding taxability of flats given 20.1.2016. free to the existing owners of the houses in the case of redevelopment projects. As per the Board's circular dated 10th Further, The Builders Association of India (BAI) have raised February, 2012, there shall be no Service Tax for the period an issue of valuation for the purpose of charging Service Tax before 12th July, in respect of the above flats, but for the post in respect of flats given to the land owner in lieu of period July, 2012, the Service Tax - I commissionerate has developmental rights received from the said land owner. already issued a Trade Notice vide F. No. V/ST-I/Tech-II Basically, the issue pertains to the tri partite construction 463/11 dated 31st August, 2012. Basically, in this model, the business model which has been explained at para 2.1 of the developer spends two monies, one for constructing flats to be Circular dated 10th February, 2012 and also at para 2 of the given free to the existing flat owners and other money for Board's letter dated 20th January, 2016. Vide the letter dated constructing free sale flats. This office is of the opinion that : 20th Jan., 2016, the Board has clarified that in the case of flats given to the land owner, the value of the consideration shall be (i) The point of taxation shall be determined in similar determined in terms of Section 67(1)(iii) read with Rule 3(a) fashion as explained above; of the Valuation Rules. Whereas the BAI in their letter (ii) The service shall be classifiable as works contract requested us to adopt the stamp duty ready reckoner rate service as mentioned at para 6.2.2 of the education published by the State Government for the purpose of arriving guide; at the value for the developmental rights received from the (iii) the value is required to be arrived at as per Sec 67(1)(iii) land owner. The other cost incurred by the developer like corpus fund to The tripartite agreement can be understood in a different way the society charges, alternate accommodation, shifting as explained here. Let us say, the developer purchases the land allowances to the existing occupants are all part of the value from the land owner @ Rs. 100/- and constructs 25 flats over for charging service tax. the said land at the cost of Rs. 100/-. Assuming that he makes a profit of Rs. 50/- on the project, he sells the said 25 flats 7. The meeting concluded with vote of thanks to all the each at Rs. 10/-. Thus, the total sales is Rs. 250/- whereas the members present in the meeting. cost is Rs. 100 + Rs. 100 i.e. Rs. 200/-. Here the said 8. This issues with the approval of the Chief developer pays Service Tax on Rs. 250/- i.e. on each and Commissioner, Service Tax, Mumbai Service Tax Zone. every flat (assuming that each flat has been sold before getting OC). Whereas in the case of tri partite model, the builder does Sd/- not purchase the land but promises to pay Rs. 100 to the land (P.H. Thakur) owners in the form of 10 flats, each valued at Rs. 10/-. Assistant Commissioner Assuming the other parameters like construction cost and profit remaining the same and applying the principles of equity, the Government should get same amount of tax in both F. No. IV/16-35/MSTZ/CCO - Tech/2015/808 the similarly placed situations. If the argument of the BAI is Mumbai, the 22nd March, 2016 accepted, there will be definitely mismatch of the taxable value in respect of flats given to the land owner as compared Copy to : to the actual sale value of those flats. 1. PS to the Chief Commissioner, Service Tax Mumbai Zone.

2. The Ombudsman, Indirect Tax, Mumbai, 3rd floor, 3. The Petitioners are aggrieved by the levy of service tax Utpad Shulk Bhavan, Plot No. C-24, Sector - E, Bandra on services 'in relation to construction of complex' as - Kurla Complex, Bandra (East), Mumbai - 400 051. defined under Section 65 (105)(zzzh) of the Finance Act, 3. The Directorate General of Taxpayer Services, CR 1994 (hereafter 'the Act') and inter alia impugn the Building, IP Estate, New Delhi - 110109. w.r.t. letter explanation to Section 65(105)(zzzh) of the Act F.No.DTPS/5/2015 dated 10.09.2015. (hereafter ‘the impugned explanation') introduced by 4. Commissioner, Service Tax - I/II/III/IV/V/VI/VII/ Audit - virtue of Finance Act, 2010 as being ultra vires of the I/II/III, Mumbai. Constitution of India. The Petitioners also impugn 5. All members of RAC, Service Tax Mumbai Zone. Section 65(105)(zzzzu) of the Act which seeks to subject preferential location charges charged by a builder to service tax. The Petitioners state that their agreement Service Tax on Sale of Under Construction Flat with the builder is a composite contract for purchase of immovable property and contend that in absence of on ownership basis specific provisions for ascertaining the service component of the said agreement, the levy would be Division Bench of Delhi High Court has held that levy of beyond the legislative competence of the Parliament. Service Tax under Sec 66 of the Act read with Section 4. The controversy involved in these petition relates to the 65(105)(zzzh) cannot be levied in respect of composite question whether the consideration paid by flat buyers to contracts, such as 'Agreement of sale of under construction a builder/promoter/developer for acquiring a flat in a flat on ownership entered into by real estate developers with complex, which is under construction/development, flat purchasers'. We are giving below the relevant extracts of could be subjected to levy of service tax. According to the order. the Petitioners, the agreements entered into by them with the builder are for purchase of immovable property and IN THE HIGH COURT OF DELHI AT NEW DELHI the Parliament does not have the legislative competence Judgment delivered on: 03.06.2016 to levy service tax on such transaction. The Petitioners W.P.(C) 2235/2011 further claim that the Act and the rules made thereunder SURESH KUMAR BANSAL ..... Petitioner do not provide any machinery for computation of value Through: Mr Puneet Agrawal and Mr Sahil Kahol, Advocates. of services, if any, involved in construction of a complex versus and, therefore, no such tax can be imposed. UNION OF INDIA & ORS...... Respondents Through: Mr Vivek Goyal, CGSC with Mr. Prabhakar Submissions Srivastav, Advocate for UOI. 5. Mr Puneet Agrawal, the learned counsel appearing for AND the Petitioners contended that the entries relating to W.P.(C) 2971/2011 taxation in List I and List II of the Seventh Schedule to ANUJ GOYAL & ORS...... Petitioners the Constitution of India were mutually exclusive and Through: Mr Puneet Agrawal and Mr Sahil Kahol, Advocates. the Parliament did not have the power to levy tax on versus immovable property; thus, the levy of service tax on UNION OF INDIA & ORS...... Respondents agreements for purchase of flats was beyond the legislative competence of the Parliament. Through: Mr Vivek Goyal, CGSC with Mr Prabhakar Srivastav, Advocate for UOI. 27. It is a usual practice for builders/developers to sell their Mr Sanjoy Ghose, Additional Standing Counsel for the project at its launch. Builders accept bookings from GNCTD with Mr Yash S. Vijay, Advocate for R-3/GNCTD. prospective buyers and in many cases provide multiple options for making payment for the purchase of the CORAM: constructed unit. In some cases, prospective buyers make JUSTICE S.MURALIDHAR the payment upfront while in other cases, the buyers may JUSTICE VIBHU BAKHRU opt for construction linked payment plans, where the JUDGMENT agreed consideration is paid in instalments linked to the VIBHU BAKHRU, J builder achieving certain specified milestones. Whilst it may be correct to state that the title to the unit (the 1. The Petitioners are individuals who have entered into immovable property) does not pass to the prospective separate agreements with a builder (M/s Sethi Buildwell buyer at the stage of booking, it can hardly be disputed Pvt. Ltd. - hereafter 'the builder') to buy flats in a multi- that the buyer acquires an economic stake in the project storey group housing project named – Sethi Group - Max and in one sense, the services subsumed in construction - Royal being developed by the builder in Sector 76, services in relation to a construction the complex - are Noida, Uttar Pradesh. rendered for the benefit of the buyer. However, but for 2. The builder has in addition to the consideration for the the legal fiction introduced by the impugned flats also recovered service tax from the Petitioners, explanation, such value add would be outside the scope which is payable by him for services in relation to of services because sensu strict no services, as construction of complex and on preferential location commonly understood, are rendered in a contract to sell charges. immovable property.

43. For the purposes of ascertaining the value of services, 30. The imposition of service tax by virtue of the impugned the Central Government has made Service Tax explanation is not a levy on immovable property as (Determination of Value) Rules 2006 (hereafter 'the contended on behalf of the Petitioner. The clear object of Rules'). However none of the rules provides for any imposing the levy of service tax in relation to a machinery for ascertaining the value of services construction of a complex is essentially to tax the aspect involved in relation to construction of a complex. of services involved in construction of a complex the benefit of which is available to a prospective buyer who 52. It was stated that an Assessee is entitled to abatement enters into an arrangement - whether by way of an to the extent of 75% and only 25% of the gross agreement of sale or otherwise - for acquiring a unit in a amount charged by a builder from a flat buyer is project prior to its completion/development. charged to service tax. It was suggested on behalf of the Revenue that this indicated that the value of the 35. Having stated the above, it is also essential to examine immovable property as well as the property in goods the measure of tax used for the levy. The measure of tax incorporated in the works would stood excluded. In must have a nexus with the object of tax and it would be our view, this issue also stands concluded against the impermissible to expand the measure of service tax to Revenue by the judgment in the case of Commissioner include elements such as the value of goods because that of Central Excise v. Larsen and Toubro Limited would result in extending the levy of service tax beyond (supra) . In that case, the Supreme Court had its object and would impinge on the legislative fields affirmed the decision of the Orissa High Court in reserved for the State Legislatures. Larsen and Toubro Limited v. State of Orissa and Ors: (2008) 12 VST 31 (Orissa) wherein the Court held 37. Undisputedly, the contract between a buyer and a that Circulars or other instructions could not provide builder/promoter/developer in development and sale of a the machinery provisions for levy of tax. The complex is a composite one. The arrangement between charging provisions as well as the machinery for its the buyer and the developer is not for procurement of computation must be provided in the Statute or the services simplicitor. As noticed hereinbefore, an Rules framed under the Statute. The relevant extract agreement between a flat buyer and a builder/developer from the decision of the Orissa High Court is reproduced of a complex - who is developing the complex for sale below: is, essentially, one of purchase and sale of developed property. But, by a legislative fiction, such agreements, "This Court is of the opinion that if the Act is which have been entered into prior to completion of the unworkable in the absence of necessary Rules, as project and/or construction of a unit, are imputed with a has been held by several judgments referred to character of a service contract; the works involved in above, any assessment under the said Act cannot construction of a complex are treated as being carried by be enforced even if such an assessment order is the builder on behalf of the buyer. However, made by an authority under the Act purportedly in indisputably the arrangement between the buyer and the accordance with the provisions of the Act. The builder is a composite one which involves not only the inherent infirmity of an assessment order passed on element of services but also goods and immovable the basis of circulars which have no statutory property. Thus, while the legislative competence of the sanction cannot be cured by an appellate order. In Parliament to tax the element of service involved other words, if the assessment order itself is not cannot be disputed but the levy itself would fail, if it sustainable on account of unworkability of the does not provide for a mechanism to ascertain the provisions under which they are purportedly made, value of the services component which is the subject no purpose would be served by filing appeal of the levy. Clearly service tax cannot be levied on the against the said order and this question cannot be value of undivided share of land acquired by a buyer decided by the appellate authority under the Act. In of a dwelling unit or on the value of goods which are the instant case, both the assessing officer and the incorporated in the project by a developer. Levying a appellate authority are bound to follow the tax on the constituent goods or the land would clearly instructions contained in the circulars. Therefore, intrude into the legislative field reserved for the no purpose would be served by filing appeal before States under List II of the Seventh Schedule of the the appellate authority. In order to constitute valid Constitution of India. basis for taxation, the rate of deduction, specially a flat rate of deduction cannot be applied to calculate 39. In the present case, we find that there is no the taxable turnover in works contract. So those machinery provision for ascertaining the service circulars cannot hold the field. As stated in the element involved in the composite contract. In order judgments referred to above, in the absence of any to sustain the levy of service tax on services, it is statutory basis for calculation of taxable turnover, essential that the machinery provisions provide for a the Act remains unworkable. Such gap in the mechanism for ascertaining the measure of tax, that statute cannot be filled up by the circulars which is, the value of services which are charged to service are purely ad hoc and administrative in nature and tax. specially so when it relates to taxing law. It is a well-settled principle that in matters of taxation

either the statute or the Rules framed under the 57. The petitions are disposed of in the aforesaid terms. statute must cover the entire field. Taxation by way of administrative instructions which are not backed by any authority of law is unreasonable and is contrary to Article 265 of the Constitution of India. VIBHU BAKHRU, J Therefore, the impugned circulars are set aside as S.MURALIDHAR, J also the impugned orders of assessment. The JUNE 03, 2016 assessee's liability to pay tax remains but in order RK to assess that the State has to act in accordance with the statutory prescription by framing Rules BAI and Union Budget 2016-17 under its rule-making power under Section 29 of the Act and the assessing authority can pass fresh In our March 2016 issue, we had printed 'Union Budget 2016- orders of assessment on the basis of such statutory 17 - a glance'., wherein we gave broad contours of the budget Rules." and information affecting the building and construction industry. 53. As noticed earlier, in the present case, neither the Act nor the Rules framed therein provide for a machinery, In the Union Budget 2016-17, the exemption of Excise Duty on provision for excluding all components other than Ready Mix Concrete was restored, but w.e.f. from 1st March, service components for ascertaining the measure of 2016. service tax. The abatement to the extent of 75% by a notification or a circular cannot substitute the lack of Mr. Anil Zinzuwadia, Vice-President, BAI through the good statutory machinery provisions to ascertain the value of offices of Mr. Narayanbhai Kachhadiya, Member of services involved in a composite contract. Parliament from Amreli, Gujarat, gave a post-Budget memorandum to the Hon'ble Union Finance Minister and also 54...... As stated earlier, service tax is a tax on to the Union Revenue Secretary, wherein he has raised the value addition and charges for preferential location in issue of retrospective exemption of Excise Duty on R.M.S. and one sense embody the value of the satisfaction derived other issues of concern affecting the building and construction by a customer from certain additional attributes of the industry. Also Mr. Nitesh Jain of M/s N. J. Jain & Associate property developed. Such charges cannot be traced and Mr. Gopal Sharma of M/s Kunal Structure from Rajkot directly to the value of any goods or value of land but along with Mr. Narayanbhai Kachhadiya, met the Hon'ble are as a result of the development of the complex as a Union Finance Minister and Union Revenue Secretary on 10th whole and the position of a particular unit in the context March, 2016 and impressed upon them to issue a suitable of the complex. notification exempting RMC retrospectively. We are printing below the said post-beget memorandum. 55. In view of the above, we negate the challenge to insertion of clause (zzzzu) in Sub-section 105 of Section 65 of the Act. However, we accept the Petitioners’ Dated 31st March, 2016 contention that no service tax under section 66 of the Act Mr. Arun Jaitely The Revenue Secretary read with Section 65(105)(zzzh) of the Act could be Hon'ble Finance Minister Ministry of Finance, charged in respect of composite contracts such as the of India Government of India ones entered into by the Petitioners with the builder. The North Block, North Block, impugned explanation to the extent that it seeks to New Delhi 110001 New Delhi 110001 include composite contracts for purchase of units in a complex within the scope of taxable service is set aside. Respected Sir,

56. These petitions were admitted by an order dated Sub.: Post Budget Memorandum 21.07.2011 and the applications for stay of recovery filed along with the petitions were disposed of by As the outset we would like to convey our special regards and directing that if any amount is collected on the basis of gratitude to the Ministry of Finance for positively considering the impugned explanation, the same shall be refunded several suggestions made by us during the pre-budget meeting with the interest in case the Petitioners succeed. held at North Block on 21.02.2016 with your good self. Accordingly, the concerned officer of Respondent No. 1 shall examine whether the builder has collected any This action of the government has had a very positive impact amount as service tax from the Petitioners for taxable on the industry and given it a lot of confidence for the future service as defined in Section 65(105)(zzzh) of the Act both in terms of future interactions with government as well as and has deposited the same with the respondent in terms of continuing to business in such a gloomy authorities. Any such amount deposited shall be environment. It is after a long time that the country has seen refunded to the Petitioners with interest at the rate of 6% such a receptive government at the centre. from the date of deposit till the date of refund. And now continuing our interactions which started with the pre-budget memorandum, we would now like to submit our post budget memorandum containing few more steps to be However our plea is that the same should be exempted considered to achieve the last mile objective of the budgetary retrospectively.We fervently request Government to consider provisions. for issuance of clarification on the availability of central excise exemption for RMC manufactured at site of Please grant us suitable time to personally represent the issues construction and used in the construction work of such site as as per the attached post budget memorandum. This Post presently understood for 'Concrete Mix' in line of Notification Budget Memorandum highlights the suggestions and concerns No. 4/97 CE with effect from 01.03.2011 and under 12/2012 of the members as well as industry. It is requested to consider CE with effect from 17.03.2012. these suggestions so that the same may be taken care of while passing the Budget in the Parliament. Service Tax: 2. Section 67A of Finance Act, 1994 [Clause 148 of If any suggestions or clarifications are desired, then we shall Finance Bill, 2016 and Sl. No. 2(1) of notification No. be pleased to furnish the same. We once again thank you for 10/2016-ST] the opportunity given to us for submitting our views and suggestions. • The present section 67A states that The rate of service tax, value of a taxable service and rate of Anil Zinzuwadia exchange, if any, shall be the rate of service tax or Vice President value of a taxable service or rate of exchange, as Builders' Association of India the case may be, in force or as applicable at the time when the taxable service has been provided or Post Budget Memorandum 2016 agreed to be provided. Now the said sectionis proposed to be amended to obtain specific rule Excise Duty making powers in respect of Point of Taxation 1. Ready Mix Concrete (RMC) manufactured at site Rules, 2011. Point of Taxation Rules, 2011 has Vide Notification No. 12/2016 effective 1.3.2016 RMC also been amended accordingly. manufactured at site has been exempted prospectively by Issue: way of substitution of below entry. • However, when the section 67A gets amended, two Explanations have been added to Rule 5 of Point of Taxation Rules, 2011, wherein it is clarified that the said rule applies also in cases of new levy. The second explanation provides that unless the transaction satisfies the conditions provided in Rule 5, the same shall be taxable. The conditions provided in Rule 5 are reproduced below:

Where a service is taxed for the first time, then, - • no tax shall be payable to the extent the invoice has been issued and the payment received against such Suggestion: invoice before such service became taxable; Excise duty exemption, which was earlier limited to Concrete • no tax shall be payable if the payment has been Mix (CM) only, now being extended to Ready Mix Concrete received before the service becomes taxable and (RMC) manufactured at construction site for construction invoice has been issued within fourteen days of the work. date when the service is taxed for the first time.

This is among the one of the rare scenarios in which Explanation 1.- This rule shall apply mutatis mutandis in case Government has nullified the effect of Supreme Court of new levy on services. Explanation 2.- New levy or tax shall judgement which was decided in favour of revenue earlier. In be payable on all the cases other than specified above. the case of Larsen and Tubro Ltd Vs. CCE, Hyderabad dated • The above explanations have been inserted in Rule 5 06 October 2015, the Apex court adopted strict interpretation vide Notification No. 10/2016 –ST Dated 1-3-2016, for dealing with the Exemption Notification no. 4/1997-C.E. w.e.f. 1st day of March, 2016. (as amended by 12/2012-C.E.) and denied the excise duty • The above explanation raises a fundamental question as exemption on Ready Mix Concrete (RMC). The Apex Court to whether a service which has already been provided held that Concrete Mix and Ready Mix Concrete are separate prior to introduction of levy could be taxed on raising of products, thus exemption available to Concrete Mix can not be invoice or receiving payment subsequently. One needs to extended to Ready Mix Concrete. distinguish between the taxable event (event deciding taxability) vis-à-vis a payment event (event deciding Notification 12/2012-C.E. dated 17-03-2012 has been suitably timing of payment). Further, in the case of Collector of amended vide Notification no. 12/2016-C.E. effective from C.Ex Hyderabad VsVazir Sultan Tobacco Co Ltd 1996 01-03-2016 so as to include Ready Mix Concrete for (83) E.L.T. 3 (SC), it has been held that manufacturing is providing exemption from Excise duty along with Concrete a taxable event whereas payment of excise duty is at the Mix. time of the removal of goods, therefore in a case where

goods have been manufactured at the time when they apply from the date of actual collection and not from the were not excisable, there cannot be a duty liability at the date when the tax is due. time of removal of such goods. • Thus, the date of rendition of service is totally gets 2. Service Tax exemption to canal, dam or other ignored because of above amendment creating a conflict irrigation works with retrospective effect. [ Clauses between Section 67A(1) and 67A(2). 156 of the Finance Bill, 2016 / New section 101 in the Finance Act, 1994 ] Suggestion • Definition of Governmental authority was It is suggested that section 67A of the Finance Act should not amended with effect from 30.01.2014 so as to be amended or any other legislative change may be brought in exempt services provided by way of construction , whereby the supremacy of the time of rendition of service for erection, maintenance, or alteration etc. of various the purpose of taxation remains to be made. works as listed under Entry 12 and 25 of the Mega Exemption Notification. However, services 1. Clarification regarding the meaning of ‘failed to pay provided prior to 30.01.2014 to such bodies amount collected as service tax’ in the Notification remained taxable. The benefit of exemption is No 13/2016-ST dated 01.03.2016 proposed to be extended to the said services • Section 75 of the Finance Act, 1994 prescribes rate provided during the period from the 1 st July, 2012 of interest that is to be paid in case of delay in to 29.01.2014. payment of service tax. The rate of interest was 18% p.a. upto six months, 24% p.a. where the Issue: period of delay is upto six months but upto one Because of the above amendment, only the services of canal, year, and 30% p.a. where period of delay exceeds dam or other irrigation works provided to the Government, a more than one year. Vide Notification No 13/2016- local authority or a governmental authority is covered. Thus, ST, the rate of interest has been amended so as to other services as listed under entry 12 and 25 as on 1.7.2012 state that where a person has collection of any provided to the Government, a local authority or a amount as service tax but failing to pay the amount governmental authority should also be treated at par for the so collected to the credit of the Central purpose of granting this retrospective exemption. Government on or before the date on which such payment becomes due, the rate of interest is 24% Suggestion: and in other cases, it is 15% • It is suggested that the said benefit be extended to all the items covered under Sr No 12 and 25 of Notification No Issue: 25/2012-ST dated 20.06.2012. In the notification, the meaning of the term ‘collection of any amount as service tax’ has not been clarified. As a reason, one 3. Restoration of certain exemptions withdrawn last may take a view that where invoice has been issued and year for projects, contracts in respect of which were service tax is shown separately, then service tax is said to have entered into before withdrawal of the exemption been collected. Further, wherein the consideration charged, the [Clauses 156 of the Bill/ New section 102 in the Finance service tax is not charged separately and amount is received, Act, 1994] then also it will be treated as ‘collection of any amount as • Exemption from Service Tax on services provided service tax’. For example, where an invoice has been made for to the Government, a local authority or a INR 1,00,000.00 and tax rate is 14.5% (including SBC), in governmental authority by way of construction, such case, total value of invoice is INR 1,14,500.00. The erection, etc. of - invoice has been made in December 2016. The due date is 6 th (i) a civil structure or any other original works meant January, 2016. The amount is collected in 15 th August, 2017 predominantly for use other than for commerce, industry, or any other business or profession; and tax has been deposited to the Government on 30 th (ii) a structure meant predominantly for use as (i) an September, 2017. In this case, whether the interest will be educational, (ii) a clinical, or (iii) an art or cultural th th 15% from 6 January, 2016 to 15 August, 2017 and 24% establishment; from 16 th August, 2017 to 30 th September, 2017 or will it be (iii) a residential complex predominantly meant for 24% from 6 th January,2016 to 30 th September, 2017. Further, self-use or the use of their employees or other what will be the situation where only a part of the amount is persons specified in the Explanation 1 to clause 44 collected and remaining amount is not collected? Say a client of section 65B of the said Act; was withdrawn with pays only Rs100,000 specifically stating that the amount effect from 1.4.2015. The same is being restored towards service tax has been withheld in such case, whether for the services provided under a contract which the interest rate will be 15% or 24%. had been entered into prior to 01.03.2015 and on which appropriate stamp duty, where applicable, had been paid prior to that date . The Suggestion: exemption is being restored till 31.03.2020. • It is suggested that a suitable clarification be issued for

clarifying as to when it will be treated as ‘amount

collected as service tax’ and the rate of 24% should

Issue rehabilitation of existing slum dwellers using land as • The exemption is there only when the services has been a resource through private participation’’ under the to the Government, a local authority or a governmental Housing for All (Urban) Mission/Pradhan Mantri authority. Awas Yojana, only for existing slum dwellers. (new • One of the condition is that if the appropriate stamp duty entry at S. No. 13 (ba) of notification No. 25/2012-ST has been paid prior to 01.04.2015. However, as per refers). Article 285(1) of the Constitution of India, ‘The property of the Union shall, save in so far as Parliament may by Issue: law otherwise provide, be exempt from all taxes imposed • A lot of rehabilitation activity is taking place for slum by a State or by any authority within a State’. dwellers where the land is allotted by the government at • Thus, there would not be a case wherein stamp duty has a location distant from the existing slums. Will the above been paid in a contract with the Government. exemption because it carries the words “In-situ” restrict • Similar will be the case for exemption that has been the exemption to only those constructions which take provided to services provided by way of construction, place exactly at the same location of residence of the erection, etc. of original works pertaining to an airport, slum dwellers. Further the condition of ‘‘In-situ port. rehabilitation” and only for “existing dwellers” are not very clear: Suggestion a) The purpose of such project is rehabilitation of • It is suggested that the word ‘and on which appropriate slum dwellers, whether the development is done on stamp duty, where applicable, had been paid before that the same land or at other land. date’ may be deleted from proposed section 102(1) and b) In the event if few of slum dwellers do not agree to section 103(1) in the Finance Act, 1994 as the party accept houses build for their rehabilitation, the Tax issuing the contract is government itself. exemption for entire project should not be disallowed. 4. Service Tax Exemptions to low cost houses (new entry c) What is the meaning of ‘Beneficiary led individual at S. No. 14 (ca) of notification No. 25/2012-ST refers) housing construction’ ? • Services by way of construction, erection, etc., of original works pertaining to low cost houses up to Suggestion: a carpet area of 60 sq.m per house in a housing • In such a scenario we propose to remove the word “in- project approved by the competent authority under situ” for ensuring that the exemption is actually useful. the “Affordable housing in partnership” component of PMAY or any housing scheme of a State 6. Abatement in case of ‘construction services’ Government are being exempted from service tax. [Amendment in entry at S. No. 12 of notification No. 26/2012-ST ] Issue • At present, the abatement available under S. No 12 • These days, many areas are being developed, be it slums of notification 26/2012-ST dated June 20, 2012 for or otherwise, by Government as well as private parties. construction of a complex, building, civil structures However, the exemption is available only when a etc. is 70% for construction other than residential housing project approved by the competent authority properties as well as residential properties having a under the “Affordable housing in partnership” carpet area of more than 2000 sqft or where the component of PMAY or any housing scheme of a State amount charged exceeds Rs 1 crore and 75% in Government. other cases. • Now, a uniform abatement at the rate of 70% is Suggestion: now being prescribed for services of construction a) It is suggested that exemption may be granted in this of complex, building, civil structure, or a part regard to all categories, whether public or private. Also a thereof under Sr No 12 of Notification No. lot of confusion prevails whenever the government uses 26/2012-ST. the words competent authority without properly defining it. The above is one such case, where the project is Issue: awarded but practically no one is aware of who the • The prices of commercial property will be higher competent authority is. It is thus suggested either to drop compared to residential property, as a reason, marginal the word or explain it by way of a definition. Such service would be higher in such case. exemption was there under Notification 25/2012 (clause • Moreover, in case of high valued house i.e., house 14C) but was for those housing projects approved by having a carpet area of more than 2000 sqft or where the competent authority empowered under the ‘scheme of amount charged exceeds Rs 1 crore, in such case, the Affordable Housing in partnership framed by the value of service gets marginally increased. Ministry of Housing and Urban Poverty Alleviation, • Considering this reason, the two rates of abatement Government of India’. would have been made, one for residential as well as other for commercial and high valued residential house. 5. Exemption to 13 (ba) a civil structure or any other original works pertaining to the ‘‘In-situ

• However, now treating all the constructions as same Subject: Pre-Budget Meeting for Union Budget 2017-18. would increase the cost for residential houses and will hit the low and middle income groups. Dear Sir,

Suggestions: Please refer your letter No.334/12/2016-TRU on the • It is suggested that the existing abatement rates of 70% captioned subject. Builders’ Association of India is pleased for construction other than residential properties as well to submit the points for consideration in the Union Budget as residential properties having a carpet area of more with regard to the construction industry / infrastructure than 2000 sqft or where the amount charged exceeds Rs projects. The same are given hereunder :- 1 crore and 75% in other cases be retained.

7. ‘Services provided by Government’ 1. Clarification regarding definition of Government • Section 66D of Finance Act, 1994 provides that service Finance Act 2015 introduced the definition of the term by Government or a local authority excluding support ‘Government’ by insertion of Clause 26A under Section 65B services provided to business entities is exempt from of the which reads as “Government” means the Departments service tax. Finance Act, 2015 has sought to tax any of the Central Government, a State Government and its services provided to business entities. This means the Departments and a Union territory and its Departments, but business entity receiving such service would be person shall not include any entity, whether created by a statute or liable to pay service tax under reverse charge. otherwise, the accounts of which are not required to be kept in • Consequently, notification No. 30/2012-ST is being accordance with article 150 of the Constitution or the rules amended so as to delete the words “ by way of support made thereunder. services appearing at Sl. No. 6 of the Table in the said notification with effect from 1st April, 2016. Issue The definition specifically provides State Governments and Issue: Union Territories to include their departments. However, in • These amendment brings to prominence the importance respect of Central Government, only Departments of the of the concept of “service” in contradiction to the Central Government are covered under the ambit of the term performance of a statutory function. Any function which ‘Government’ and not the term CENTRAL Government. is a statutory function required to be performed by the Government cannot be considered as a rendition of Suggestion service. In fact, it is the necessary requirement of the It is suggested that a suitable clarification be issued as to Government to perform that function and the whether the Central Government would form part of the requirement of the citizen to obtain that function. ‘Government’ or not while interpreting definition of the term • Thus, charges/ Fess/ amount charged by DGFT, MCA ‘Government’ in order to determine taxability of a service for various services provided to business entities have under the Finance Act. been inadvertently proposed to be made liable to Service Tax. This also leads to the conclusion that sovereign 2. Definition of Works Contract functions of the Government will also be liable to As per section 65B (54) "works contract" means a contract service tax which cannot be the intention of the wherein transfer of property in goods involved in the legislature. execution of such contract is leviable to tax as sale of goods Suggestion: and such contract is for the purpose of carrying out • It is suggested that an appropriate clarification in this construction, erection, commissioning, installation, regard be provided. completion, fitting out, repair, maintenance, renovation, alteration of any movable or immovable property or for carrying out any other similar activity or a part thereof in Union Budget 2017-18 and BAI relation to such property

Tax Research Unit, Department of Revenue, Union Ministry of th As per Section 2 of Central Sales Tax Act, 1956 “works Finance vide its letter dated 6 October 2016 called for contract” means a contract for carrying out any work which suggestions from BAI for consideration while framing Union includes assembling, construction, building, altering, Budget 2017-18 vis-a-vis changes in Direct and Indirect manufacturing, processing, fabricating, erection, installation, Taxes. We are reproducing herein below the suggestions sent fitting out, improvement, repair or commissioning of any by BAI. movable or immovable property

th Issue No. BAI/DO/2016 4 November 2016 There exists a disparity between the definition of works

contract between Finance Act, 1994 and Central Sales Tax Shri Abhishek Verma Act, 1956 which leads to different interpretation of the law Budget Officer (TRU) under different statutes. Ministry of Finance, Department of Revenue

Tax Research Unit, 146-G, North Block,

New Delhi - 110011.

Suggestion 4. Levy of Service Tax on amount recovered towards It is suggested that the definition of works contract under penalty, fines, liquidated damages or any other Finance Act, 1994 be amended in line with the definition of recoveries from other person. works contract under CST Act, 1956 to bring in parity Section 66B of the Finance Act provides that service tax is between the two. leviable at the rate of 14% on the value of services, other than those specified in the Negative List, provided or agreed to be 3. Service tax on recoveries towards electricity supplies provided in the taxable territory by one person to another. Section 66D (k) of Finance Act, 1994 dealing with negative list of services lists transmission or distribution of electricity Section 65B(44) of the Act defines the term “service “ to mean by an electricity transmission or distribution utility as one of any activity carried out by a person to another for a the services under Negative List. consideration, including declared services. The term “activity” has not been defined in the Act. The ministry of Further, Section 66B(23) defines ‘electricity transmission or Finance, in the Guidance Note dated 20.06.2012 has observed distribution utility’ as ‘the Central Electricity Authority; a that in the absence of any specific definition the term State Electricity Board; the Central Transmission Utility or a “activity” shall be given the meaning as it is understood State Transmission Utility notified under the Electricity Act, commonly to include an act done, a work done, a deed done, 2003; or a distribution or transmission licensee under the said an operation carried out , execution of an act , provision of Act, or any other entity entrusted with such function by the afacility etc. It is further stated that activity could be active or Central Government or, as the case may be, the State passive and would also include forbearance to act. Government and the definition of services excludes ‘transfer of property in goods’. 5. As per Sec 66E(e) of the Finance Act, 1994, “agreeing to the obligation to refrain from an act, or to tolerate Also, Electricity constitutes “goods” under the VAT and an act or a situation, or to do an act” shall be a Central Excise laws and judicial precedents have upheld this declared service and liable to service tax . view. It is clear form above that in order to attract the levy of service tax, there should be an activity and the activity should be Excisable goods are defined under Section 2(d) of the Central undertaken by one person to another person for another. Excise Act, 1944 as “goods specified in the First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 as Issue being subjected to a duty of excise and includes salt”. The Central Excise Department in some cases is demanding Electricity is though specified in the CETA under Tariff Item service tax on amount recovered towards penalty, fines, 2716 00 00 but thesame is presently not being subjected to any liquidated damages or any other recoveries from other person. duty of excise and, therefore, it does not come under excisable It is important to note that such recoveries done by the goods. customer is not a consideration for any service provided by the customers to its vendors as there exists no reciprocity in such Further, prior to 1.7.2012, activities relating to transmission or cases and the amount recovered from vendor is in the nature of distribution were clearly exempt from service tax and there is compensation only. no reason why State/Central Government utilities should be In contract, compensation is being paid by one of the saddled with litigation on this count as by the statute contracting parties to the other for any loss or injury caused to governing them they cannot carry out any activity except in the latter by some conduct in breach of the terms of the relation to transmission or distribution. Therefore, this contract. exemption for activities relating to transmission or distribution should be restored. CBEC vide Circular No 96/7/2007/-ST dated 23.08.2007 has clarified that an amount collected for delayed payment of Issue: telephone bill is not to be treated as consideration charged for Various developers of real estate parks supply electricity to provision of telecom service and therefore, does not form part their tenants (either generated through the DG sets or obtained of the value of the taxable services under section 67 read with from the state electricity board). However, only electricity Service Tax ( Determination of Value) Rules, 2006. It has transmitted or distributed by an electricity transmission or further been provided that detention charges collected to hold distribution utility is specifically exempted under service tax. a marine container beyond the holding period is determined by No specific exemption has been provided for electricity the shipping companies/steamer agent is not chargeable to supplied by developers to its tenants. service tax, the same being in the nature of a “penal rent” not a consideration for a service. Suggestion It is suggested that to remove the ambiguity, it may be Suggestion clarified that charges/ recoveries for supply of electricity by It is suggested that suitable amendment be made to provide developers is not covered under the purview of service tax. that penal rates, charges, fines, liquidated damages etc. are not liable to Service tax. Alternatively, if the electricity supply needs to be taxed, it be suitably clarified and the valuation mechanism for the same be 6. Manner of determination of Value in case where the suggested accordingly. whole consideration is not in money

Rule 3 of Service Tax (Determination of Value) Rules, 2006 works contract. In case of aforesaid services it may be noted reads as subject to the provisions of section 67, the value of that, cost of material used is on a higher end. taxable service, [where such value is not ascertainable], shall be determined by the service provider in the following manner 70% is already chargeable to VAT and with this amendment :- another 70% is chargeable to Service Tax. This leads to payment of Taxes on 140% of the value which in itself is a (a) the value of such taxable service shall be equivalent to hardship the gross amount charged by the service provider to provide similar service to any other person in the ordinary course of Suggestion trade and the gross amount charged is the sole consideration; It is suggested that taxability of Service Portion of Works Contracts related to maintenance, repair, completion and (b) Where the value cannot be determined in accordance finishing services such as glazing, plastering, floor and wall with clause (a), the service provider shall determine the tiling, installation of electrical fittings of an immovable equivalent money value of such consideration which shall, in property be restored to 60%. no case be less than the cost of provision of such taxable service. Exemptions/ Abatements/ Rebates Issue This method of valuation wherein a comparable price or price 8. Basic Exemption Limit for Small Service Providers equivalent to similar service is taken as the value of the The service tax exemption limit for small service providers in service may lead to different results under different situations. terms of Notification No. 33/2012 ST dated 20.06.2012 is There is no fixed formula for determination of Valueas in the currently limited to ` 10,00,000/-It is proposed to extend the case of Excise Valuation Rules. For Example: in cases where exemption limit due to the following reasons: Corporate Guarantee is provided it is difficult to determine the (i) Small service providers are poor, uneducated and mainly in value of services. the unorganized sector. (ii) Limit was not enhanced since 1st April, 2008 Suggestion (iii) After 1.7.2012 post Negative list era, more services are It is suggested that the provision be amended to provide a under the ambit of service tax, which earlier was not Deemed Consideration Mechanism wherein cost plus some includible in the exemption limit. deemed margin (may be 10%) be taken as value of Services on the similar lines as provided under Rule 8 of Excise Valuation Suggestions Rules, wherein the Value of the Goods is taken as 110% of  It is suggested to extend the exemption limit to ` cost of the Goods. 20,00,000/-. It is suggested to clarify that for calculation of applicability of 7. Value of service portion in respect of certain works SSP exemption limit, the value of service provided would be contracts be reduced taken after the abatement, if any applicable to the service Notification 11/2014- ST dated 11-07-2014 has amended taxability of Service Portion of Works Contracts related to 9. Exemption for Goods Transport Agency (GTA) maintenance, repair, completion and finishing services such as Tax on GTA services was introduced on 01.01.2005 vide glazing, plastering, floor and wall tiling, installation of Notification Nos. 33/2004-S.T, 34/2004-S.T, 35/2004-S.T., electrical fittings of an immovable property with effect from dated 03.12.2004. 1st October 2014. Taxable Value will be 70% of Total Amount Charged for the works contract other than original Clause 21 (b) & (c) of Notification No. 25/2012 dated works. 20.06.2012 exempts taxable services provided by a goods transport agency to a customer, in relation to transport of Before Amendment, Service Portion in respect of Works goods by road in a goods carriage, from the whole of service Contracts related to maintenance, repair, completion and tax leviable thereon where: finishing services such as glazing, plastering, floor and wall tiling, installation of electrical fittings of an immovable the gross amount charged for the transport of goods on property was 60% of Total Amount Charged for the works consignments transported in a goods in a single carriage does contract not exceed 1500/- ; or the gross amount charged for the transportation of all such goods for a single consignee does Issue not exceed 750/-. Most of the States provide standard deduction to the extent of 30% in case of works contract related to maintenance, repair, Suggestion reconditioning or restoration or servicing of any goods or Considering the increase in cost of transportation since 2004, maintenance, repair, completion and finishing services such as it is suggested that the exemption limit be enhanced to 4,000/- glazing, plastering, floor and wall tiling, installation of for single carriage and 2,000/- for a single consignee. electrical fittings of an immovable property. Rest 70% is chargeable to VAT considering the sale of material in case of

10. Clause 25 of Mega Exemption Notification - Services Alternatively, Rule 2(a) of Service Tax (Determination of provided to Government, a local authority or a Value) Rules, 2006 be suitable amended to provide an option governmental authority to reduce the value of land where the Circle rate value of land is more than 75% of the Total value of construction service Clause 25 of Notification No. 25/2012 dated 20.06.2012 including of land. exempts Services provided to Government, a local authority or a governmental authority by way of – 13. Provision for Bad Debts W.e.f. 01.04.2011, payment of service tax has been shifted (a) water supply, public health, sanitation conservancy, solid from receipt basis to accrual basis in case receipts of the waste management or slum improvement and up-gradation; or service provider exceed ` 50 Lakh in thepreceding financial year vide Point of Taxation Rules, 2011. In this system, there (b) repair or maintenance of a vessel; are no provisions for bad debt adjustments and the service providers are forced to pay service tax out of their own Suggestion pockets if they fail to realize the consideration from the It is suggested that all functions entrusted to a municipality clients. For example, if the service is already provided and the under Article 243W of the Constitution be covered in clause invoice has also been issued, service tax would have been paid 25 of the mega exemption notification on the same, at the time when the service is provided or at the time when the invoice is raised, whichever is earlier. But if 11. Manpower Supply Service- appropriate the payment is not at all received subsequently, there is no exemption/abatement be provided provision to claim adjustment / refund of the service tax Any person engaged in providing any service, directly or already paid. indirectly in any manner for recruitment or supply of manpower, temporarily or otherwise to any other person is Such service tax could not be covered under Rule 6(3) of the liable to service tax. Service Tax Rules, 1994 as the service has been provided. It cannot be covered under Rules 6 (4A) / (4B), as it is not a case Issue of any excess payment of service tax. The service has been While providing such manpower services, agency has to pay provided and hence the taxable event has happened. As the salary of its deputed employee and statutory dues such as ESI, point of taxation has also occurred, service tax has also been EPF. Agency collects its fees for supplying manpower from paid. So, it is immaterial, whether the payment is received or the service recipients. not.

Further, no CENVAT credit is accrued on these services due to which cost of supply of manpower is very huge. Unlike goods, which can be taken back in the event of non- payment of the consideration thereof, services, being Suggestion intangible in nature, cannot be reclaimed from the service It is suggested that in respect of Manpower Supply Services, receivers. Further, service providers do not have a lien on the appropriate abatement be allowed in respect of Salary payable, service provided by them the way a seller has a lien on the ESI/EPF or the cost of Salary payable to its deputed employee goods sold by him. There are no documents of title to services by manpower or recruitment supply agency is allowed as which can be put through the bank to make the recoverability deductions from the Gross Value Charged on the concept of certain. The rights of an unpaid seller of goods [Sections 45 to pure agent. . 54 of Sales of Goods Act, 1930] are well guarded and recognized in law as against the rights of an unpaid service provider. Alternatively, it is suggested that only the Agency Charges be made liable to Service Tax. Where such charges cannot be disclosed separately, a Chartered Accountants certificate be Issue obtained for such a purpose. The service provider has to deposit the service tax from his own pocket even though he is unable to recover the value of his taxable services and taxes thereon. 12. Abatement on Construction Services & Inclusion of Land Value in case of Construction of a complex, building, civil structure Suggestion Abatement Notification No. 26/2012 dated 20.06.2012 Rule 6(3) of the Service Tax Rules, 1994 be suitably amended provides regarding abatement of Construction Services. to allow excess payment of service tax in the event of bad debts with a view to mitigate the genuine financial hardships of the service provider as the assessee is required to deposit Suggestion service tax from his own pocket even though he is unable to It is suggested that appropriate mechanism be provided to recover the value of his taxable services. exclude or reduce the value of Land in case of Construction of Complex, Building, Civil Structure etc. where the Circle rate value of land is more than 75% of the Total value of 14. Excise Duty on RMC manufactured at Site construction service including of land. Though the amendment vide Notification 12/2016-CE extends the exemption to RMC, it does not affect the effect of the Supreme Court decision prior to 01st March 2016, as retrospective effect has not been given to Notification exclusions for rent a cab, canteen, setting up of business, 12/2016-CE. The following position emerges in the present Construction of factory building, outdoor catering for situation: employees, employees insurance etc., should be done away with. Any proceeding initiated for period prior to 01-03-2016 would be governed by the SC decision and there may be no It is suggested that definition of ‘input services’ be redrafted exemption to RMC; as “all services procured by assessee which is obtained and used wholly and exclusively for the purposes of the business The department can initiate proceedings for the past years of such provider of taxable services or manufacturer of within the period of limitation; excisable goods” including the Credit on Input Services used for capital structures. RMC is entitled to exemption from 01-03-2016. It is suggested that credit on all inputs, input services and It is also pertinent to note that Notification No 12/2016-CE capital goods except when they are used for personal or has not been provided with express retrospective effect nor employee use be allowed to sizably bring down the litigations can it be termed clarificatory due to the decision of the and promote ease of doing business. Supreme Court in the L&T's case. Further, it is suggested that cross utilization of Credit be Suggestion allowed on all inputs, input services and capital goods without The said exemption which was given on prospective basis restriction on utilization of any type of duties and taxes which needs to be restored on retrospective basis. would help the assessees as the funds would not be blocked and there would be a reduction in transaction/ litigation costs. 15. Definition of input - CENVAT credit on capital structures We hope that the points submitted by Builders’ Definition of “input” specifically excludes any goods used Association of India will get due consideration. inter alia for laying of foundation or making of structures for support of capital goods, except for the provision of service Thanking you, portion in the execution of a works contract or construction Yours truly, service as listed under clause (b) of section 66E of the Finance Act, 1994.

Companies setting up new factories are thus not permitted to avail CENVAT credit on cement, iron, steel, plates etc either AVINASH M PATIL as part of civil structure or supporting capital goods (machines President etc). It results in increased cost of construction. This Builders’ Association of India provision goes against the very spirit of CENVAT. Suggestion It is suggested that definition of input be amended to provide Budget – 2017-18 ( An Overview) CENVAT credit on capital structures etc Indian Construction in February 2017 issue gave broad 16. Definition of input service - Need overview to remove contours of budget. Indian Construction is now giving little anomalies . depth in understanding of budget proposals. Revenue Rule 2(l) defines input service to mean any service: assumption showed 12% growth for 2017-18 against 17% during 2016-17. This under estimation is understandable in “(i)…. view of implementation of GST from 1 st September 2017 as (ii) used by a manufacturer, whether directly or indirectly, in well as firming up of crude oil price in last six months in or in relation to the manufacture of final products and international market. Finance Minister has chosen to maintain clearance of final products upto the place of removal, fiscal deficit at 3.2% despite allocating 10.7% more capital and includes services used in relation to expenditure on infra projects in 53% increase over 2016-17 at modernisation...... and inward transportation of Rs. 23000/- crores under Pradhan Mantri Awas Yojna is first inputs or capital goods and outward transportation upto the step in providing Housing for all. Indian Construction re- place of removal but excludes ...... are used primarily for produces two articles namely “growth engine” end “Building personal use or consumption of any employee. Hopes” from Business Today 26 th February 2017 issue.

Suggestion Growth Engine With the introduction of the new service tax regime based on the concept of a negative list, service tax is leviable on the Building India broad spectrum of all the services except those specified in the  Transportation, including rail, roads and shipping, negative list. When the taxation of services has become has got Rs. 2,41,387 crore, up 10.2% from last year; universal, the credit for input services should also follow the in all, the infrastructure sector has got Rs.3,97,000 same principle and be made available across the board. The crore, 10.5% more than last year.

 The road sector has got Rs. 64,900 crore, 12.5% more funding will enable him to push them further. The Budget also than last year. includes a provision to create a safety fund with a corpus of Rs  Total capital and development expenditure of 1 lakh crore over the next five years. With a decision having railways pegged at Rs. 1,31,000 crore, 8.6% more been taken to buy the best of global equipment to guarantee than last year. safety, the likes of GE, Siemens, Toshiba, Hitachi, Alstom,  Public sector enterprises, especially in the oil sector, Kawasaki and Mitsubishi are likely to be queuing up to offer to be merged, so that they can compete with global their wares. majors. However, it is not the quantity of funding, but that of spending Great emphasis has been laid on infrastructure in the recent the funds allocated that is a challenge for the ministry. Until Budget, with allocations being increased by 10.5 per cent from December 31 last year, only around Rs. 70,000 had been the last financial year to Rs. 3.96 lakh crore. With gross utilised against the annual allocation of Rs. 1.21 lakh crore, domestic product (GDP) growth likely to drop this year, the mainly due to a sluggish economy and expenditure hope is clearly that increased public spending on infrastructure inefficiencies. Among his reforms, Prabhu is keen to introduce will spur private investment as well. accrual-based accounting, create a regulator for the Railways to periodically revise tariffs and set up a new holding There are, however, severe challenges. Three years ago, in company, Rail Holdco, which will govern all the 13 public May 2014, the road sector alone had run up a staggering Rs. sector units under the ministry. Three of these 13 - CONCOR, 74,088 crore of debt, of which Rs. 9,875 crore was at serious IRCTC and IRCON - are also likely to be listed on the bourses risk of turning bad. Since then, Minister of Roads and this year. Highways Nitin Gadkari has evolved a low risk hybrid model by which part of the financial risk of road building is borne by Along with Urban Development Minister M. Venkaiah Naidu, the concerned government organisation - such as the National Prabhu is also finalising a new policy for metro rail networks Highway Authority of India - and only the remaining devolves across the country, standardising requirements and processes. on the private player. In September last year, Welspun Prospective investors are delighted. "If there is clarity on order Enterprises Ltd, which is building the Delhi-Meerut size, it will help us to put together our financial plans Expressway, became the first player to achieve financial effectively," says Mangal Dev, Director and Head of Hitachi's closure under the new scheme. Gadkari's initiative has also Railway Systems Business Unit for India and the South Asian revived the construction equipment market, which after Region. The expansion of railway capacity to manufacture contracting for three consecutive years, reversed the trend and locomotives and coaches will be yet another spur for the steel grew two per cent in 2015/16. It is expected to do even better industry. this fiscal. Power and Oil The Budget has also suggested the merger of state-owned oil The biggest project on Gadkari's plate is the ambitious Bharat companies to create behemoths with greater risk management Mala, which aims to build 6,000 km of highways along the capacity and more clout in international markets. The merger border and coastal roads of North India. Yet another project could not be more opportune at a time when India's oil aims to connect 123 district headquarters and remote tourism demand is rising a robust 8.8 per cent annually. Domestic destinations such as Badrinath and Gangotri. In rural India, private players like Reliance Industries Ltd. have begun around 15 per cent of the total allocation for the rural sector expanding their oil retailing operations. Global players such as has gone to the Prime Minister's Gram Sadak Yojna Rosneft and Trafigura - which took over Essar Oil last (PMGSY). Gadkari had sought an allocation of Rs. 97,000 October as part of a consortium - as well as BP and Saudi crore in the current financial year. Though the Budget gives Aramco, have also been given the go ahead to do the same. his ministry only Rs.64,900 crore, he has the option of raising more through tax free masala bonds. In the power sector, private industry can take comfort from the fact that fears of the coal cess being enhanced further in the The new roads are expected to give a big fillip to the cement Budget have been belied, perhaps because both coal and steel sectors, since most of them will use concrete rather production and electricity demand have been showing a than bitumen - which reduces both construction cost and fuel downward trend. This is mainly due to the poor financial consumption. Around 1,000 tonne of cement is required to health of the state owned discoms, but there is hope that with build a one km long two lane highway, apart from steel, fly more than half the states having joined the Ujjwal Discom ash, sand and water, so the multiplier effect can be imagined. Assurance Yojna (UDAY) by which the states underwrite their discoms' debts, revival is round the corner. A host of Track Changes independent power producers (IPPS) are waiting anxiously for With the railway budget included in the general budget for the the discoms to start buying more power. The Budget also first time, the Ministry of Railways' capital expenditure has provides 25 per cent additional allocation for the Deen Dayal been pegged at Rs. 1.31 lakh crore, of which Rs. 55,000 crore Upadhyay Gram Jyoti Yojna, which too is an opportunity for has been allocated in the Budget proposals - eight per cent IPPS. Renewable energy is also poised to grow, with the more than in the last financial year - while the rest will have to Budget supporting the second phase of building solar parks, be raised by the Railways. Railway Minister Suresh Prabhu which will house capacity of another 20 GW. had already initiated a number of reforms and the generous

Budget 2017 – Housing While allocation of Rs. 1000 crore for a new Credit Linked Building Hopes Subsidy Scheme for middle income groups will also revive Housing for All by 2022” has been a refrain of the Modi demand, there are more incentives in the Budget for the real government. Small wonder, then, that the government estate sector. The duration of holding to avail long term capital announced a number of initiatives to boost the real estate gains benefits is being reduced to two years from the existing sector. Finance Minister Arun Jaitley has given “infrastructure three years. It will lead to faster sales in the secondary market status” to affordable housing, a long standing demand of and increase tax compliance amongst the real estate developers and will translate into cheaper loans for them. stakeholders. Also, the base year for indexation is proposed to Industry players, who have been taking credit at a steep 13-16 be shifted from 1.4.1981 to 1.4.2001 for all classes of assets per cent, term the change significant as it will substantially cut including immovable property. “The shift to the base year for their cost of funds for the vital budget housing segment with indexation will help reduce capital gains liability on the re-financing options by the National Housing Bank. customers. It will encourage faster mobility of assets as the tax liability on capital gain will come down substantially,” says J. Rajeev Talwar, CEO of DLF Limited, India’s largest realty C. Sharma, Vice-Chairman & MD of Bengaluru-based Sobha company, says that the ‘infrastructure status’ will give them Limited. access to capital at far lower interest rates. “Other incentives like change in measurement methodology from built up area to The fresh proposals in the Budget are likely to encourage carpet area and extension of affordable housing scheme leading real estate players to turn their attention to affordable completion to five years from three years will enhance housing. “This Budget has brought us a step closer in demand,” says Talwar. Similarly, Purvankara Projects and achieving the mission of providing housing for all. Shapoorji Pallonji said they will launch new affordable Implementation of these schemes will be essential for its housing schemes. success. Clarity on the definition of ‘affordable housing’ will be useful and beneficial for players like Tata Housing as a Norms under affordable housing have been changed to carpet pan-India developer, which is currently developing more than area – and not built-up – of 30 square metres (sqm) in the four 40 million square feet of affordable housing,” says Brotin metropolitan cities and 60 sqm in other cities. Besides Banerjee, MD & CEO, Tata Housing. attracting more builders, the buyers will benefit from more spacious homes. “The relaxation in measurement will give an The government has also proposed changes in the taxation of additional 25- 30 per cent area to such houses in urban Joint Development Agreement to allow more land owners to settlements, which is a great value proposition to propel partner with developers for lowering project costs. Besides, demand. It will encourage home buyers and further boost the renewed focus on new and existing roads as well as participation from the private players,” says Anshuman expanding coastal connectivity will also boost the real estate Magazine, Chairman, India and South East Asia, CBRE, a sector. multinational consultancy. Also, abolishing the Foreign Investment Promotion Board will Hit hard by demonetisation, the real estate sector also gets a make it easier to get foreign funding through the automatic push from a higher Budget outlay of Rs. 23,000 crore under route. What's more, a boost to real estate can also boost the Pradhan Mantri Awas Yojna, a 53 per cent increase over cement, steel and construction industries, spurring growth the previous year. After the 3-4 per cent interest subvention along with employment. announced by the Prime Minister for low cost housing on December 31, the government is targeting one crore houses in Budget 2017-18 – At Glance rural India by 2019. (Figures are in Rs. crore) Sr. Budget Head Revised Budget Remarks Real estate sector has huge inventories, especially in housing, No. estimate estimate driven by years of low demand. In the largest Delhi- NCR 2016-17 2017-18 1. Net Tax Revenue 1088792 1227014 Gross tax revenue to market alone, there is an inventory overhang of over 2,50,000 of centre grow at 12.2% against unsold flats, denting developer sentiments. A big relief to 2. Non-Tax Revenue 334770 288757 17% in 2016-17. developers will come from the budgetary proposal of allowing 3. Recoveries of 11071 11932 Other receipt represents the notional rental on unsold stock to be assessed only after loans disinvestment of public one year of completion, which will bring down their inventory 4. Other receipts 45500 72500 sector undertakings. 5. Borrowings and 534274 546532 Net tax revenue and push sales. other liabilities increase at 11.25%. Borrowing is Meanwhile, the government plans to give a big push to marginally increased infrastructure which could be good news for the real estate shows fiscal prudence. Total Receipt 2014407 2146735 sector as well. A whopping Rs. 3,96,135 crore has been allocated for infra projects in the 2017/18 Budget. Now, the 6. Revenue 631511 674057 Railways allotted Rs. correlation between a boost to infrastructure and real estate Expenditure on 136000/- crores for growth is a well established fact and the government has Scheme capital expenditure in 7. Revenue 1103049 1162877 2017-18, against Rs. already made public its intention to provide houses to all in the Expenditure other 121000/- crores in next five years. than schemes 2016-17. It will raise 8. Capital A/c 238336 271021 Rs. 18000/- crores as

Expenditure on loan from LIC and Rs. institutional partnerships with 320 counterpart organizations in scheme 22000/- crores from 106 countries, CII serves as a reference point for Indian 9. Capital A/c 41511 38780 Bonds N.H.A.I. allotted Expenditure other Rs. 64900/- crores in industry and the international business community. than scheme 2017-18 against Rs. 52447/- crores in 2016- 2. About Indian Green Building Council (IGBC) 17. N.H.A.I. will raise Rs. 59300/- crores through bonds Prime The Indian Green Building Council (IGBC), part of CII was Minister Gram Sadak formed in the year 2001 and since then, with the support of the Yojna allotted Rs. stakeholders is playing a catalytic role in spearheading the 27000/- crores in 2017- Green building movement in the Country. 18, same as was in 2016-17. Total 2014407 2146735 IGBC is a consensus based, not-for-profit organization, Expenditure representing stakeholders of building industry comprising of- Government, architects, designers, consultants, corporate, 10. Revenue Deficit 310998 321163 nodal agencies, institutions, builders & developers, product 11. Revenue deficit as 2.1 1.9 percentage of manufacturers, suppliers, facility managers, etc., G.D.P. 12. Fiscal deficit as 3.5 3.1 The vision of the Council is ‘ To enable a sustainable built percentage of environment for all and facilitate India to be one of the global G.D.P. leaders in sustainable built environment by 2025’.

As on January 2017, IGBC has facilitated over 4.48 billion BAI has signed a Memorandum of Understanding (MoU) sq.ft of green building footprint go the green way. This in turn between Builders’ Association of India (BAI) represented by has enabled India become the 2ns country in the world in Shri Avinash M. Patil, President, BAI and Indian Green terms of largest green building footprint. Building Council (IGBC) represented by Dr. Prem C. Jain,

Chairman, IGBC, in presence of Shri Tathagata, Governor IGBC has launched 18 Green building rating systems to suit of Tripura. IGBC is a wing of Confederation of Indian various building types. IGBC Green Building Rating Systems Industry (CII) which is reproduced below are based on the five elements of the nature ( Panchabhutas)

and are designed to address National priorities. Over 3,900 Memorandum of Understanding projects are adopting IGBC Green Building Rating Standards. Between

CII’s Indian Green Building Council (IGBC) IGBC aspires to facilitate 10 billion sq.ft of green building And footprint by 2022 (75 th year of Independent India). Builders’ Association of India (BAI)

For 3. About Builders’ Association of India (BAI). A Partnership

Builders’ Association of India (BAI) is an apex all India body 1. About Confederation of Indian Industry (CII) of Engineering Construction Contractors and Real Estate

Companies founded in 1941, with more than 16,000 business The Confederation of Indian Industry (CII) works to create entities as members through its 158 plus Centres (Branches) and sustain an environment conducive to the development of throughout the country. Regional Associations Affiliated to India, partnering industry, Government, and civil society, BAI form indirect membership of more than 1,00,000. The through advisory and consultative processes. fundamental aim of the Association is to bring about all round

improvements in the construction sector, while striving CII is a non-government, not-for-profit, industry-led and towards resolution of operational as well as policy level industry-managed organization, playing a proactive role in problems faced by the construction industry. This involves India's development process. Founded in 1895, India's premier making efforts to obtain from policy makers and authorities, business association has over 8000 members, from the private the level of attention that the construction industry deserves in as well as public sectors, including SMEs and MNCs, and an view of its tremendous contribution and importance to the indirect membership of over 200,000 enterprises from around economy. 240 national and regional sectoral industry bodies.

Vision: CII charts change by working closely with Government on

policy issues, interfacing with thought leaders, and enhancing • To interact with Government bodies like State Public efficiency, competitiveness and business opportunities for Works Departments and the Central Public Works industry through a range of specialized services and strategic Department to modernize methods and specifications of global linkages. It also provides a platform for consensus building and networking on key issues. works towards ensuring suitable work ethics in the Industry and standardizing tender procedures. Contracts

awarded on the basis of such standardization will ensure With 66 offices, including 9 Centres of Excellence, in India, uniformity in execution of construction jobs. and 9 overseas offices in Australia, Bahrain, China, Egypt,

France, Germany, Singapore, UK, and USA, as well as

• To achieve highest standards of efficiency and quality by would facilitate BAI members’ projects going green adopting methodology which could be derived from both with IGBC and further enhance the benefits. Indian and International Standards with a view to making the construction sector competitive in domestic as well 3. Reach out and Information Sharing: IGBC and as international markets. BAI shall share non-confidential information with regard to green buildings, sustainable construction • To develop linkages with other industry and Trade techniques, green materials etc. to reach out to Associations, Chambers of Commerce, Federations etc. members of BAI and IGBC. to enhance the value of its services to members. It shall network with international bodies and gain global 4. Marketing: IGBC and BAI shall promote where presence for its members. appropriate, each other’s services and events. Each organisation shall help publicise the others’ events in • To regard workers and technicians as the key resource their respective websites, printed publications, etc. for construction industry. It shall support and establish Complimentary stalls shall be provided in each training institutions to train workers and technicians. others’ events.

The major objectives of BAI are as: 5. IGBC local chapers: IGBC would seek the support of BAI members in all its local chapters and work a) To promote and foster feelings of unity, co-operation and closely with the stakeholders in the Region/State in mutual help and to eliminate unhealthy competition and taking forward the green building movement. Senior unfair trade practices among the contractors. office bearers of BAI would also be invited to the b) To encourage the trade, industry and profession of Executive Board meetings of IGBC. construction works and all other ancillary and allied trades and industries. 6. IGBC Technical Committees: Senior members of c) To advise and assist the members in technical, non- BAI would be invited to become members of various technical and legal matters. technical committees and steering committees of d) To encourage and conduct research for progress in IGBC green building rating system. building and construction trade and industry and any other profession connected therewith and for that purpose to 5. Terms and Conditions. establish, construct, promote, form and maintain testing institutions, laboratories, buildings, test houses, libraries, There shall be no financial commitment of any kind between collection of models, designs, drawings, articles of both parties. interest and such other information. e) To improve and elevate the technical and general 6. Agreement Tenure. knowledge of persons engaged in or about to be engaged in the building trade or in any employment in connection This memorandum of understanding (MoU) is valid for a therewith by arranging lectures, conducting classes, period of three (3) consecutive years from the date of signing exhibitions, meetings, seminars, etc. and to award of this MoU by both parties and thereafter, shall be renewed certificates of distinction and medals, trophies and prizes for a further period of 3 years on mutually agreed terms and and also institute and establish or to help in establishing conditions. funds for scholarships, rewards and other benefactions.

4. Areas of Cooperation. AVINASH M. PATIL Dr. PREM C JAIN The Indian Green Building Council (IGBC) and the Builders’ President Chairman Association of India (BAI), the two institutions (also referred Builders’ Association of Indian Green Building to as the Parties) agree as follows:- India Council

th 1. Networking in events: Based on the theme of the Date: 4 March 2017 meeting or event, IGBC and BAI shall participate to Place: Kolkata advance green buildings, especially residential, in Indian construction industry. IGBC and BAI shall Excise Duty Matter offer complimentary participation of respective key officials in their annual events, seminars and Excise Duty on 'Site Manufacturing' conferences for mutual benefits. Many infrastructure players executing metro-mono rail projects or flyovers require manufacturing for their respective 2. Capacity Building: IGBC and BAI shall jointly projects, specific beams, girders, etc. at their respective organize training and awareness programmes to project site, which were exempt from Excise Duty. However, facilitate capacity building to the stakeholders of some of Excise Department’s, field officers were denying IGBC and BAI chapters across the country. This exemption on the basis that the manufacturing site / yard is away from the project site. BAI represented the matter to

Central Board of Excise & Custom, (CBEC) stating that in iii. Such goods manufactured at the said premises are crowded cities, client/owners offer to the contractors, exclusively used for the construction work, as per manufacturing yards at a distance from actual project site, as the relevant contract or agreement. such exemption should be granted even in such cases CBEC accordingly issued circular expanding scope of word 'site', 3. It appears that in some field formations, the distance at which is reproduced below. which goods manufactured at site is used in the project, Circular No.1036124/2016-CX has been considered as criteria for examining the F. No. 68/1/2016- CXI eligibility of goods for exemption. This is an extraneous Government of India criteria not flowing from the language used in the Ministry of Finance notification, particularly when the expression “site” Department of Revenue stands explained in the notification. As explained in para Central Board of Excise and Customs 2.2 above, the eligibility criteria must flow from the New Delhi, dated the 6th July, 2016 plain reading of the explanation of the expression “site” To, in the notification. Principal Chief Commissioners of Central Excise/Service Tax (All), 4. In view of the above, it is hereby directed that each case Chief Commissioners of Central Excise/ Service Tax (All), may be decided taking into consideration the facts of the Principal Commissioners of Central Excisel Service Tax individual case, examined in light of the clarification (All). given above. Circular No. 456/22/99-CX, dated Madam/Sir, 18.05.1999 is hereby rescinded.

Subject:- Scope of word 'site' appearing in Notification No. 5. Field formations and trade may be suitably informed. 1212012- Difficulty experienced, if any, in implementing the cirular should be brought to the notice of the Board. Central Excise, dated 17.03.2012-reg Hindi version would follow.

Representations have been received from the trade (Santosh Kumar Mishra) regarding difficulties being faced in availing of benefit of Under Secretary to the Government of India exemption applicable to goods manufactured at the site of construction for use in construction work at such site vide S.No. 186 of Notification No. IU20I2-Central Excise, dated NITI Aayog’s initiatives on revival of the construction 17.03.2012, as amended. The issue is, how should the Sector. expmsion "site" used and defined in the aforesaid notifcation be interpreted, particularly for projects which run long Infrastructure companies successfully completed certain diitances, such as construction of road, laying of pipelines or highway projects. In the course of execution differences and laying of railway tracks etc. dispute arose with National Highway Authority, which ultimately led to arbitration. Out of Rs. 70,000 crores, awards 2.1 The issue has been examined in the Board. The worth Rs. 20,000 crores given in favour of contractors were expression site has been defined in the notification (ibid) challenged by NHAI in High Courts, pending disposal. These as "any premises made available for the manufacture of companies had availed bank loans, which they could not repay goods by way of a specific mention in the contract or in time due to claims being locked up. As a result, agreement for such construction work, provided that the construction companies’ interest burden went on increasing goods manufactured at such premises are solely used in affecting their performance in current fiscal year. Banks have the said construction work only". either restructured their loan or in some cases declared it a non-performing asset. Construction companies’ balance sheets 2.2 It is clear from the definition that the expression "site" were stressed. cannot be given a restrictive meaning while interpreting the same so long as the premises under consideration for In the given circumstances, President of Construction availing benefit of exemption under S. No. 186 of Federation of India, Mr. Ajit Gulabchand met Union Finance Notification No. 12/2012-Central Excise, dated Minister Shri Arun Jaitely on 9 th June 2016 and gave 17.03.2012 fulfils following conditions:- representation urging him to take steps for easing financial stress on banking and construction industry. Ultimately it i. The said premises are made available to the resulted in a meeting held in Prime Minister’s Office in the manufacturer of goods by way of a specific first week of August 2016, attended by Secretaries of mention in the contract/agreement for such Expenditure, Surface Transport, Law, Corporate Affairs, construction work. Chairman-National Highways Authority of India (NHAI) and representative from Niti Ayog. This meeting sorted out the ii. The goods under Chapter 68 (except 6804, 6805, issue, under which 75% amount of arbitration award given in 6811, 6812 and 6813), for which exemption is favour of contactors shall be released in favour of Banks claimed are manufactured at the said premises; and against Bank Guarantee. If NHAI is successful in the Court, then Bank Guarantee shall be cashed by NHAI. Alternatively if Court order is in favour of contractor, Bank Guarantee companies to bid for new contracts and the resulting would be released. competition will be beneficial in containing the costs of public works. This measure will provide a stimulus to the In addition, Niti Ayog also examined issues leading to construction industry and to employment. arbitration award and delay in finalization of awards. Niti Ayog recommended that, arbitration cases initiated under the Government Departments and PSUs have also been instructed pre-amended Arbitration Act be transferred to the amended to transfer cases under arbitration to the amended Arbitration Arbitration with consent of contractors wherever it is possible Act which has an expedited procedure, with the consent of the and item rate contract may be substituted by model EPC contractors. In the long run, other measures are also under (Turnkey) contract. consideration, including changes to bid documents and model contracts, and increased use of conciliation. NITI will also All the recommendations of Niti Ayog were forwarded to examine the idea of creating "claim take out funds" financed Cabinet Committee on Economic Affair (CCEA) for its by private sector investors, while the Department of Financial recommendation. CCEA under Chairmanship of Prime Services will examine a suitable scheme for addressing Minister examined the recommendation of Niti Ayog and stressed bank loans in the construction sector. granted approval in its meeting held on 31 st August 2016. Background This decision would help many infrastructure developers to The move comes in the backdrop of the need to have a slew of save on interest expenses and reduces their bank debt. This is short-term and long-term initiatives to address the issues ailing expected to help in improving the liquidity in short run and the construction sector. The construction sector is a major reform the construction sector in long run. All new contracts contributor to economic activity accounting for about 8% of shall have a provision of conciliation board of independent GDP. It is the largest creator of direct and indirect subject experts. employment, employing about 40 million people. It is a highly employment intensive sector with a strong multiplier effect, Government Departments and PSUs have also been instructed creating an estimated 2.7 new jobs indirectly for every Rs. 1 to transfer cases under arbitration to the amended Arbitration lakh invested. It has major forward linkages to sectors like real Act which has an expedited procedure, with the consent of the estate, infrastructure and manufacturing and backward contractors. In the long run, other measures are also under linkages to steel, cement, etc. Thus, this sector is critical for consideration, including changes to bid documents and model stimulating employment and economic activity. contracts, and increased use of conciliation. NITI Ayog will also examine the idea of creating "claim take out funds" In recent years, the construction sector has been affected by financed by private sector investors, while the Department of the large number of projects which got stalled during the Financial Services will examine a suitable scheme for period of stagnation between 2011 and 2014. The banking addressing stressed bank loans in the construction sector. sector also has a large exposure to construction, estimated at over Rs. 3 lakh crores. 45% of the bank loans in the sector are under stress. Press Information Bureau Government of India Studies have shown that a key factor behind the difficulties Cabinet Committee on Economic Affairs (CCEA) facing the construction sector is the pendency of claims from Government bodies. An estimated Rs. 70,000 crores is tied up 31-August-2016 14:11 IST in arbitration. Over 85% of the claims raised against Government bodies are still pending of which 11% is pending Cabinet approves Initiatives to revive the Construction with the Government agencies, 64% with arbitrators and 8.5% Sector with courts. The average settlement time for claims is estimated at more than seven years. A majority of arbitration The Cabinet Committee on Economic Affairs, chaired by the awards have gone against the Government agencies. In the Prime Minister Shri Narendra Modi today approved various case of the National Highways Authority, out of a total of 347 measures to revive the construction sector which has been arbitral awards, 38 went in favour of the authority and 309 undergoing stress. went in favour of the contractor/concessionaire. Out of the arbitral awards in NHAI cases, more than 90% were Under the proposal put forward by NITI Aayog and approved unanimous awards in which all arbitrators including the one by the CCEA. Government agencies would pay 75% of the appointed by NHAI had concurred in the decision. In many arbitral award amount to an escrow account against margin cases, arbitration awards are contested in the courts, even free bank guarantee, in those cases where the award is though a large majority of arbitration decisions are upheld by challenged. the courts.

The escrow account can be used to repay bank loans or to However, of late, the construction sector has been several meet commitments in ongoing projects. This is a major step challenges leading to decline in the overall investments and which will allow recovery of loans by banks and allow growth. The issues ailing the sector was discussed with the construction companies to speed up execution of ongoing representatives of construction companies, banks, NHAI, projects. It will also increase the ability of construction concerned Departments/ Ministries. Based on detailed discussions, larger economic importance and multi-sectoral indirectly for every Rs. 1.00 lakh invested. The sector has nature of the issues, NITI Aayog put forward the proposal to major forward (infrastructure, real estate, manufacturing) and suggest various initiatives required for addressing the issues backward (steel, cement, etc.) linkages, implying a high ailing the construction industry. multiplier effect on economic growth, almost two times. Major construction activity originates in the infrastructure, ***** industrial and real estate sectors, where infrastructure sector Press Information Bureau accounts for almost half of the demand. Government of India Cabinet Committee on Economic Affairs (CCEA) The demand for construction services is expected to rise due to several factors, like massive expansion of the infrastructure 31-August-2016 14:17 IST sector, industrialization, urbanization, rise in disposable incomes, various Government initiatives to improve India's Backgrounder: Initiatives to revive the Construction residential and transport infrastructure (Smart Cities project, Sector 'Housing for All by 2022', Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and easing of FDI norms in The Cabinet Committee on Economic Affairs under the 15 sectors including real estate and construction). Timetric's Chairmanship of Prime Minister Shri Narendra Modi has Construction Intelligence Centre (CIC) projects major growth approved today a series of initiatives to revive the for the construction industry in India, with average annual Construction Sector. growth in real terms expected to improve from of 2.95% in 2011-2015 to 5.65% during 2016-2020. These initiatives include: However, of late, the construction sector has been showing (i) PSUs/Departments may seek the consent of the signs of stress. Revenue growth and profit before tax (PBT) contractors/ concessionaires to transfer the arbitration margins have declined significantly. Most companies are cases initiated under the pre-amended Arbitration Act to barely able to cover interest costs from earnings. Increasing the amended Arbitration Act, wherever possible; debt levels remain a critical issue affecting financial stability and borrowings. Several factors have contributed to this stress

(ii) In case of claims where the PSU/ Department has e.g. in stalled assets in infrastructure sector and high levels of challenged the Arbitral Award, 75% of the award amount receivables especially from the government entities, slowdown may be paid by the PSU to the contractor/ concessionaire in real estate sector leading to stretched liquidity and limited against margin free Bank Guarantee; resources.

(iii) All PSUs/ Departments issuing public contracts may A report commissioned by the Cll indicates that: (i) Pending consider setting up Conciliation Committees/ Councils claims from government bodies are key factor behind comprising of independent subject experts in order to burgeoning debt of construction companies, accounting for - ensure speedy disposal of pending or new cases; 150% of the debt; (ii) Over 85% claims raised are still pending

(iv) Item-rate contracts, may be substituted by EPC (turnkey) of which 11% are at the level of employers, 64% at arbitrators contracts, and PSUs/ Departments may adopt the Model and 8,5% in Courts; (iii) Average settlement time is 7.5 years; EPC contracts for construction works; and (iv) "Awarded claims" do not get settled after the Arbitrator's decision; (v) Almost all court orders uphold the arbitrators' (v) Department of Financial Services, in consultation with decisions and referring claims to courts leads to delayed pay- Reserve Bank of India, may evolve a suitable one-time out by about 2.5 years; and (v) Only about 8% of total claimed scheme for addressing stressed bank loans in the amount (among settled claims) was agreed for and paid out by construction sector. NHAI in FY15.

Major Impact Subsequent to the discussions with various stakeholders These initiatives are expected to help in improving the including the representatives of construction companies, liquidity in the short run and reform the contracting regime in banks, NHAI, concerned Departments/Ministries and PSUs, the long run. Given the significant multiplier effect the following issues emerged: construction sector has on the economy, these measures are expected to give a major boost to economic growth. As the a) Substantial claims raised by contractors/ sector provides the largest segment of direct and indirect concessionaires against PSUs are pending either in employment, the revival of the sector would also help in the arbitration proceedings or in courts; significant employment generation. b) Most of the pending claims are legacy issues relating

Overview: to old item-rate contracts. With phase out of item- Construction sector has an important place in the Indian rate contracts and adoption of EPC (turnkey) economy. It is the second largest contributor to economic contracts in NHAI, the number and quantum of activity accounting for about 8% of GDP; accounts for the claims is likely to come down; second highest inflow of FDI after the services sector; c) Settlement of claims through conciliation generates the highest level of direct and indirect jobs proceedings by committees of experts has proved to employing about 40 million people and creating 2.7 new jobs be much more effective than arbitration and the

settlement is reached at a much lower value than the decades in the developed world and Federation claimed amount in conciliation proceedings; International Des Ingenieurs-Conseils (FIDIC –

an International Federation of Consulting d) Delays in final settlement of disputed claims implies Engineers, Known by its French acronym) has significant interest payments by the PSUs by way of also published such contractual frameworks; delayed payment charges;

e) The amended Arbitration Act addresses some of the 2.2 Model bidding documents and Model EPC lacuna of the original Act; and contracts, suitably revisited or modified wherever required to suit the requirements of f) Mounting claims in public contracts indicate particular sectors, may be adopted by PSUs / deficiencies in the contracting regime thus Government Departments for construction warranting reform. works;

Based on detailed discussions, it was decided that NITI Aayog 2.3 Ministry of Finance has issued model bidding would move a proposal to the CCEA suggesting various documents for RFQ, RFP etc. which may be initiatives required for addressing the issues ailing the adopted (with appropriate changes wherever construction industry in view of the larger economic required) in all sectors. Model EPC contracts importance and multi-sectoral nature of the issues. have been developed for Highways and Accordingly, after detailed stakeholder consultations, a series Railways and published by the erstwhile of initiatives is being put in place to address the issues Planning Commission also. NHAI has already impacting the construction sector. adopted this document and all construction *** contracts are currently being structured on this

No. N-14070/14/2016-PPPAU model. NITI Aayog shall assist the concerned Government of India departments, wherever required, in this regard.

National Institution for Transforming India (NITI Aayog) 2.4 The method of conciliation has proved more NITI Bhawan, New Delhi effective in settling disputes as per experience September 05, 2016 of some of the PSUs. All PSUs / Departments Office Memorandum issuing public contracts ma consider setting up Conciliation Committees / Councils comprising Subject: Initiatives on the Measures for revival of the of independent subject experts in order to ensure Construction Sector – regarding. speedy disposal of pending or new cases.

1. The construction sector has been facing a number of Recourse to such conciliation may be open problems, mainly arising from the liquidity before, during or after the Arbitration constraints caused on account of their payments not proceedings. A provision to this effect would being released by the Government Departments / also need to be made in the Contract Public Sector Undertakings (PSUs) pursuant to the Agreements in future as a mechanism for arbitral awards. To discuss the problems of the resolution of disputes.

construction sector, detailed deliberations / 3. All the concerned Ministries / Departments shall also consultations were held with the representatives of communicate the above to their respective PSUs for the construction industry, banks, major government taking necessary action on the aforesaid measures. PSUs and concerned Ministries / Departments. Based on the above deliberations / consultations, the NITI Sd/- Aayog placed a proposal before the cabinet (A. Muthuvezhappan) Committee on Economic Affairs (CCEA) for its Director (PPPAU) consideration suggesting various immediate and To: long-term measurers required for addressing the 1. Secretaries of all the Ministries / Departments of issues ailing the construction sector. The CCEA, Government of India. chaired by the Hon’ble Prime Minister, has 2. Chairpersons / CMDs / MDs of all the Central considered the proposals of NITI Aayog in its Government PSUs. meeting held on 31 st August 2016 and approved the 3. Chairpersons / CMDs / MDs / CEOs of all the same for the revival of construction sector. Scheduled Commercial Banks. 4. Chief Executive, Indian Banks Association, Mumbai.

2. The NITI Aayog has separately issued instructions on 5. Shri Alok Tandon, Additional Secretary, Cabinet the subject with regard to the immediate measures to Secretariat, Rashtrapati Bhavan, New Delhi – 110 be taken by all concerned. In addition to the said 001. instructions, the CCEA has also directed that the 6. Dr. T.V. Somanathan, Joint Secretary, PMO, South following measures may be expeditiously examined Block, New Delhi – 110 001. by all the concerned Departments / Ministries / PSUs: Copy for information to:

2.1 Item-rate contracts, may be substituted by EPC 1. PS to Vice Chairman / PS to MoS / PS to all (turnkey) contracts, wherever appropriate. Such Members contracts have been in vogue for over two

2. Sr. PPS to CEO / PPS to Special Secretary 22.11.2016. To Ref: 277/S/2016-17 dated September 7, 2016 The Director General Shri Narendra Modiji CPWD, Nirman Bhawan Hon’ble Prime Minister of India New Delhi-110011. Government of India Prime Minister’s Office, Sub: Measures to revive the Construction Sector - reg. South Block, NEW DELHI – 110 001

Respected Sir, Ref: Your D.O. No. 02/SE (TAS) /Arb Cases/2016- Sub: Initiative to revive the Construction Sector. 17/280 E dated 18.11.2016. (Available on website)

Builders’ Association of India (BAI) is an apex all India body Dear Sir, of Engineering Construction Contractors and Real Estate Companies founded in 1941, with more than 16,000 business We have perused the contents of your letter under reference entities as members through its 158 plus Centres (Branches) (available at website) about the Cabinet Committee on throughout the country. Regional Associations Affiliated to Economic Affairs’ approval for revival of construction sector. BAI form indirect membership of more than 1,00,000. The We offer our views/comments on various decisions/directions, fundamental aim of the Association is to bring about all round as follows: improvements in the construction sector, while striving towards resolution of operational as well as policy level 1. Decision. To seek consent of contractors to transfer problems faced by the construction industry. This involves the pending arbitration cases under the Amended making efforts to obtain from policy makers and authorities, Arbitration Act. the level of attention that the construction industry deserves in view of its tremendous contribution and importance to the Our View: We agree with this decision. economy. 2. Decision. Where the department has challenged the Construction Sector has an important place in the Indian arbitral award, under Section 34 of Arbitration Act economy. It is the second largest contributor to economic 1996, 75% of award may be paid by the department activity accounting for about 8% of GDP; accounts for the against Bank Guarantee without prejudice to the final second highest inflow of FDI after the services sector; order of the Court. generates the highest level of direct and indirect jobs employing about 40 million people and creating 2.7 new jobs Our View: We agree with this decision. indirectly for every Rs.1.00 lakh invested. The sector has major forward (infrastructure, real estate, manufacturing) and 3. Decision. The payment may be made into designated backward (steel, cement, etc.) linkages, implying a high ESCROW account with the stipulation that the multiplier effect on economic growth, almost two times. amount so released will be used first for payment of Major construction activity originates in the infrastructure, lenders’ dues, second, for completion of the project industrial and real estate sectors, where infrastructure sector and then for completion of other projects of the accounts for almost half of the demand. department as mutually agreed and decided. Any

Sir, in such circumstances BAI gratefully acknowledge your balance remaining in the ESCROW account initiative in reviving the Construction Sector by releasing 75% subsequent to settlement of lenders’ dues and amount of arbitration award in favour of contractors against completion of the projects of the department may be Bank Guarantee to the contractors. Sir, this initiative of yours allowed to use by the contractor with the prior will not only reduced bank loans to Construction Sector turned approval of the department. into non-performing asset (N.P.A.), but construction Our View: We find that the provisions of this contractor’s balance sheet henceforth looks more healthy and para defeats the very purpose of reduction in interest outgo. ‘Measures to revive the construction sector’ as follows: Since release of fund will now improve liquidity of It may create further disputes between construction contractors, they would positively respond to PPP contractors and department, as projects of road-sea-air connectivity projects. follows:

We once again thank you for your kind support to the First: We consider that this condition is not Construction Industry and expected to avail similar measures relevant to the works in CPWD. This in future too. condition may be application to other Yours faithfully, departments/PSUs which have lent their money to contractors and are suffering from non performing assets AVINASH M. PATIL (NPA). In CPWD, it is not possible President for the department to identity/decide Builders’ Association of India the lenders of contractors.

Affairs in the Central Government, that of releasing 75% Second: Operating/control over ESCROW amount of Arbitration Award given in favour of account whether by department or contractors’, contractor or by both. In this regard, please find attached two Office Third: Control and monitoring of expenditure Memorandum issued by CPWD, New Delhi, dated if being incurred on this project or 04.11.2016 and 07.11.2016 issued by the Secretary - UD, other projects of the department. Ministry of Urban Development, New Delhi after the revival of the matter of Arbitration amount to be paid to the Fourth: The contractor is the best judge to Contractors against bank guarantee. financially plan and decide to use the available funds for various projects in This memorandum will help many infrastructure his hand keeping in view their developers to save on interest expenses and reduces their bank priorities. The department’s debt. This is expected to help in improving the liquidity in interference in this matter will disturb short run and reform the construction sector in long run. All the financial planning of the new contracts shall have a provision of conciliation board of contractors. independent subject experts.

Fifth: It will delay availability of funds in the This is for kind information and record. hands of the contractor, free from others’ control without which the Please send us email on [email protected] very purpose of revival of for any further information/clarification you may be required construction sector, cannot be in this regard. achieved. Thanking you, Sixth: We understand that applying any Yours faithfully, precondition for payment of the amount of the award by Arbitrator, may not be legally allowed. RAJU JOHN Executive Secretary 4. In view of the above facts, it is considered necessary Builders’ Association of India that 75% of the award amount is released to the contractor immediately on his application with Bank Guarantee without any preconditions for which necessary approval of the competent authority may be obtained, if desired. Yours faithfully,

R. N. Gupta Vice President

Achievement

Ref: 375/N/2016-17 dated November 10, 2016 To: All Managing Committee / General Council Members of BAI Chairmen of all BAI Centres.

Respected Sirs,

Sub: Office Memorandum issued by the Secretary - UD, Ministry of Urban Development, New Delhi dated 4.11.2016 and 07.11.2016.

Please recall the discussion held during the Managing Committee meeting held at Chennai on Sunday, 6 th November

2016 on ‘ Ways and means of requesting State Government to replicate decision(s) of Cabinet Committee of Economic

Table A Sr. Denomination Number of Sr. Denomination Number of No. of currency notes in No. of currency notes in circulation circulation in million in million pieces pieces 1. Rs. 5/- 7000 5. Rs. 100/- 15000 2. Rs. 10/- 32500 6. Rs. 500/- 15000 3. Rs. 20/- 4000 7. Rs. 1000/- 5000 4. Rs. 50/- 3000

This screwed pattern of high denomination notes has put people to inconviencance, due to inadequate logistics system of supplying new currency notes of Rs. 500/- and new denomination note of Rs. 2000/- to banks, ATM’s and post offices. However as per Business Standard of 21 st November 2016, between 2007 to 2012, transactions in cash has come down from 90.60% in 2007 to 86.60% in 2012 and appears to have gone down further as shown in table B below.

Table B

Sr. Particulars Financial Financial Financial Financial Financial Financial No. year year year year year 2011 year 2007 2008 2009 2010 2012 1. Payment by 2.80 3.10 2.90 2.80 3.50 4.10 card 2. Electronic 2.60 3.00 3.80 4.50 5.60 6.80 direct 3. Cash 90.60 90.00 89.70 89.50 87.90 86.60 transaction 4. Cheque / 4.00 3.90 3.60 3.20 2.90 2.50 Demand Draft Total 100 100 100 100 99.90 100

Construction and Real estate sectors gives employment to almost four crore people, mostly unskilled and surplus farm labour. Despite the fact that it is the second biggest employer after agriculture, almost 87% of industry being in unorganised sector depends heavily on cash transaction. Figure given in Table ‘C’ below proves predominant nature of construction Industry:- Table ‘C’ (figures are in Rs. Cr. At 2011-12 period) Sr. 2011-12 2012-13 2013-14 2014-15 No. 1. Total Output (read 2141012 2163885 2254046 2379885 turnover) of construction Industry as per National Account Statistic 2016. Demonetisation – Impact on Construction / Real Estate & 2. Turnover of listed 160413 165615 150195 147653 companies at BAI’s response current prices.

th 3. Estimated 160000 166000 150000 147000 Prime Minister on 8 November 2016, announced the turnover of private demonetisation of Rs. 500/- and Rs. 1000/- currency note, limited companies effective from midnight, to unearth black money, eliminate and non-listed limited companies terror funding and fake currency. India is a case based society. taken as similar to Seventy percent of transactions are in cash. Fourty Eight that of listed percent of G.D.P. comes from informal sector, which accounts companies. Stated for eighty percent of our population. Country has the highest at Serial No. 2 above. currency in circulation at Rs. 17.50 lakh crores, which is 13% of GDP against 4% in advanced economies. Out of total 4. Total turnover in 320413 331615 300195 294653 organised sector. currencies in circulation, 86% is in denomination of Rs. 500/- (2+3) and Rs. 1000/- notes, amounting to Rs. 15.35 lakh crores. 5. Wholesale Price 8.94% 7.36% 5.98% 2.00% Details of notes in circulation is given in Table A :- Inflation. Stated in India Economy Review October

2016 issue, Page 57.06 crores per day. Mumbai Metropolitan Region coupled No. 116. with Pune is the biggest real estate market in the country. In 6. Turnover of 291769 307209 279242 288760 this region banking facilities and ATM are more extensive. organised sector Despite this, fall in the stamp duty collection is almost 30% in converted at 2011- 12 prices by the first 12 days, whereas document registration number came deduction on down to more than 30%. Scenario in other market such as W.P.I. rate. NCR, Chennai, Bengluru, Kolkata, Hyderabad and 7. Turnover of 13.62 14.19 12.38 12.13 Ahmedabad and tier II towns is likely to be more distressing. organised sector in Indian construction feels that Prices will not go down but percentage term of total turnover. document value will go up, since cash component is expected to come down. However in long run demonetisation coupled 8. Turnover of 86.38 85.81 87.62 87.87 unorganised sector with Real Estate Regulation Act, Benami Act and GST, will in percentage term transform real estate sector in longer term. of total turnover. In contrast to real estate sector, construction activity in most of Each activity in construction business be it excavation, EPC and infra sector shall have little impact due to concreting, Centering, plastering etc is outsourced either by demonetisation, because most of projects are government engaging sub-contractors or labour contractors. Contraction funded and having banking transactions. However, small workers are by and large being migratory are daily wage contractors due to cash crunch will have some disruption in earners. Demonisation is a heavy blow to them for their daily medium term. So is the case with toll collection of BOT ration, bread and butter. So is the case with labour / sub Projects. contractors not able to give wages in new currencies due to inadequate supply. Net result is stoppage or slowdown of Building material industry such as cement, tiles and paint shall work till such time owner contractor / sub-contractor / labour have negative impact due to slowdown in building contractor are pays to them in new currency of Rs. 500/- or so. construction and real estate sector, having 60 to 65% of consumption. Real estate sector even otherwise was affected by reduced number of new launches, diminishing sale and high number of unsold flats as published in Indian Express dated 13.11.2016 as per details given in Table ‘D’ below:- Ref: 400/N/2016-17 dated November 28, 2016

Table ‘D’ Dr. Urjit R. Patel Shri Narendra Modiji Shri Arun Jaitley (Numbers in 1000’s) Hon’ble Governor, Hon’ble Prime Minister Hon’bl e Union Reserve Bank of India of India Minister of Finance Sr. Particulars 2011 2012 2013 2014 2015 Government of India Government of India Government of No. 16 th Floor, Central Prime Minister’s Office, India 1. Number of 450000 450000 400000 300000 250000 Office Building, South Block, Room No. 134, units launched Shahid Bhagat Singh NEW DELHI – 110 001 North Block, Marg, NEW DELHI – 2. Number of 350000 350000 325000 280000 290000 MUMBAI – 400 001 110 001 units sold

3. Number of 100000 100000 175000 20000 -40000 unsold units Respected Sir, 4. Aggregate 100000 200000 375000 395000 355000 number of unsold unit. Sub: Enhancing the cash withdrawal facility for Construction Industry. National Capital Region and Mumbai Metropolitan Regions are worst affect compare to Pune, Bengluru, Hyderabad, and Builders’ Association of India (BAI) is an apex all Chennai. An associated chamber of commerce & Industry’s India body of Engineering Construction Contractors and Real report realesed in 2015 states that about 75% of 3540 real Estate Companies founded in 1941, with more than 16,000 estate projects with investment over Rs. 14/- lakh crores were business entities as members through its 158 plus Centres non-starter with demonetisation by government, high end flats (Branches) throughout the country. Regional Associations sale shall come down in next 12/24 months. Coupled with Affiliated to BAI form indirect membership of more than implementation of Real Estate Regulatory Act from April 1,00,000. The fundamental aim of the Association is to bring 2017, expert feds that cash component in real estate would about all round improvements in the construction sector, while come down drastically. striving towards resolution of operational as well as policy level problems faced by the construction industry. This Real estate sector shall receive big blow due to of involves making efforts to obtain from policy makers and demonetisation. Times of India in it’s 22.11.2016 reported that authorities, the level of attention that the construction industry stamp duty collection on registration of property document deserves in view of its tremendous contribution and came down to 4721 numbers in Maharashtra with collection of importance to the economy. Rs. 41.07 crores per day between 9.11.2016 to 21.11.2016 against normal of 7221 numbers of document collecting Rs.

Builders Association of India (BAI) is an Hence, it is most respectfully submitted that the organization formed for ensuring transparency, competitive present limit of Rs.50,000/- in withdrawal from Current rates efficiency and technical perfection in the field of Account may be modified to avoid the hardships faced by awarding and execution public works of the Government and Construction Workers. its various departments. It also stands for the welfare of the construction contractors. Thanking you, Yours faithfully, BAI, at the outset, wholeheartedly welcome the demonetisation of Rs. 500/- and Rs.1,000/- notes and extend our support for the measures for eliminating black money and fake currency from our economic system. We will AVINASH M. PATIL wholeheartedly co-operate with procedures adopted by President Reserve Bank of India (RBI) and the Government for the Builders’ Association of India implementation of the demonetisation programme. In this juncture it may bring into your kind attention about some of the difficulties in executing the allotted public works and the resultant plight faced by the builders in the country. Ref: 401/N/2016-17 dated November 28, 2016

Shortage of currency in making cash payments leads Shri Narendra Modiji to the stagnation of works. The withdrawal limit of Hon’ble Prime Minister of India Rs.50,000/- weekly, from the Current Account is creating Government of India troubles in the execution of the on-going public works and the Prime Minister’s Office, beginning of the allotted works. South Block,

NEW DELHI – 110 001

A medium size Real Estate Developer or Contractor Respected Sir, normally requires around Rs. 3,00,000/- (Rupees Three Lakh) to meet the daily expenses for carry out the works. In which Sub: Enhancing the cash withdrawal facility for almost all the payments are to be made in currencies. It Construction Industry. includes payments to sand, metal, filling fuels, transportation of materials, cost for food of labours, rentals of machines and Builders’ Association of India (BAI) is an apex all wages of labours. The prevailing practice in the field is that India body of Engineering Construction Contractors and Real all these payments are to be settled on a daily basis. The Estate Companies founded in 1941, with more than 16,000 suppliers, service providers and the labours are only amenable business entities as members through its 158 plus Centres for cash payments. Hence, the present limit in withdrawal (Branches) throughout the country. Regional Associations from the current account is creating much problems in Affiliated to BAI form indirect membership of more than executing public works. 1,00,000. The fundamental aim of the Association is to bring

about all round improvements in the construction sector, while BAI would like to submit that the above said curb in striving towards resolution of operational as well as policy withdrawal from the Current Account leads to the delay in level problems faced by the construction industry. This completion of the public works. It will cause huge loss to the involves making efforts to obtain from policy makers and exchequer. authorities, the level of attention that the construction industry

deserves in view of its tremendous contribution and The works allotted to the members of the Builders importance to the economy. Association of India by the Government is mainly in the nature of public utilities. Therefore, non implementation or Builders Association of India (BAI) is an delay in completion of these works may lead to public unrest. organization formed for ensuring transparency, competitive

rates efficiency and technical perfection in the field of We are facing huge loss due the cessation works. We awarding and execution public works of the Government and are in a difficult situation to meet the commitments to the its various departments. It also stands for the welfare of the financial institutions who are the lenders of large amounts for construction contractors. the works. If the present crisis continues it will certainly ends up in the total perish of the builder community. BAI, at the outset, wholeheartedly welcome the

demonetisation of Rs. 500/- and Rs.1,000/- notes and extend Moreover, our men and machinery are idling. It our support for the measures for eliminating black money and affects our efficiency and productivity. The labours started fake currency from our economic system. We will deserting us due to the non-payment of wages, the idling wholeheartedly co-operate with procedures adopted by construction materials facing corrosion and the suppliers of Reserve Bank of India (RBI) and the Government for the machines started recalling it due to non-payment of rent. If the implementation of the demonetisation programme. In this crisis prolonged it will be a herculean task to recoup the men juncture it may bring into your kind attention about some of and machinery for the prompt execution of works. the difficulties in executing the allotted public works and the BAI’s Appeal to centres/members for not to deposit cash in resultant plight faced by the builders in the country. BAI’s Bank A/c due to demonitasation which is reproduced below. Shortage of currency in making cash payments leads to the stagnation of works. The withdrawal limit of Ref.: 394/N/2016-17 dated 23 rd November, 2016 Rs.50,000/- weekly, from the Current Account is creating troubles in the execution of the on-going public works and the Chairmen and Office-Bearers of all BAI Centres beginning of the allotted works. Members of the Managing Committee and General Council of BAI A medium size Real Estate Developer or Contractor normally requires around Rs. 3,00,000/- (Rupees Three Lakh) Dear Sirs, to meet the daily expenses for carry out the works. In which almost all the payments are to be made in currencies. It Reg.: Request to not to deposit cash in Current/SB A/c of includes payments to sand, metal, filling fuels, transportation BAI. of materials, cost for food of labours, rentals of machines and wages of labours. The prevailing practice in the field is that This is to request all BAI Centres as to not to deposit CASH in all these payments are to be settled on a daily basis. The the BAI Centres Bank Account to which the BAI PAN Card suppliers, service providers and the labours are only amenable bearing number AAATB0212F is linked. for cash payments. Hence, the present limit in withdrawal from the current account is creating much problems in By ‘CASH’ we mean amount for which, the Centre will not executing public works. be able to give explanation or show as the deposited cash was ‘Cash in hand’ as on 8 th November, 2016. BAI would like to submit that the above said curb in withdrawal from the Current Account leads to the delay in The above request is arising out of demonetisation of Rs. completion of the public works. It will cause huge loss to the 1,000 and Rs. 500 currency notes by Government of India and exchequer. subsequent caution issued by taxation authorities to Trusts, as mentioned in all newspapers across India. (Copy of circulars The works allotted to the members of the Builders and News item attached). Association of India by the Government is mainly in the nature of public utilities. Therefore, non implementation or Please contact the undersigned for any further clarification. delay in completion of these works may lead to public unrest. Thanking you, We are facing huge loss due the cessation works. We are in a difficult situation to meet the commitments to the Yours Faithfully, financial institutions who are the lenders of large amounts for the works. If the present crisis continues it will certainly ends up in the total perish of the builder community. RAJU JOHN Moreover, our men and machinery are idling. It EXECUTIVE SECRETARY affects our efficiency and productivity. The labours started BUILDERS ’ ASSOCIATION OF INDIA deserting us due to the non-payment of wages, the idling construction materials facing corrosion and the suppliers of machines started recalling it due to non-payment of rent. If the [TO BE PUBLISHED IN THE GAZETTE OF INDIA, crisis prolonged it will be a herculean task to recoup the men EXTRAORDINARY, PART II, SECTION 3, SUB- and machinery for the prompt execution of works. SECTION (i)] Hence, it is most respectfully submitted that the GOVERNMENT OF INDIA present limit of Rs.50,000/- in withdrawal from Current MINISTRY OF FINANCE Account may be modified to avoid the hardships faced by DEPARTMENT OF REVENUE Construction Workers. CENTRAL BOARD OF DIRECT TAXES

Thanking you, NOTIFICATION Yours faithfully,

New Delhi, the 15th November, 2016

G.S.R 1068(E) .- In exercise of the powers conferred by AVINASH M. PATIL section 285BA, read with section 295 of the Income-tax Act, President 1961 (43 of 1961), the Central Board of Direct Taxes hereby Builders’ Association of India makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. (1) These rules may be called the Income–tax ( 30th ii) in sub-rule (5), the following proviso shall be inserted, Amendment ) Rules, 2016. namely:- (2) They shall come into force from the date of their publication in the Official Gazette. “Provided the statement of financial transaction in respect of the transactions listed at serial number (12) in the Table under 2. In the Income-tax Rules, 1962 (hereinafter referred to as the sub-rule (2), shall be furnished on or before the 31st day of said rules), in rule 114B, in the Table, for serial number 10 January, 2017.”. and entries relating thereto the following serial number and entries shall be substituted, namely:- [Notification No. 104/2016][F.No.370142/32/2016-TPL] (Dr. T.S. Mapwal) Under Secretary to the Government of India Sl. Nature of transaction Value of transaction No. Note:- The principal rules were published vide notification (1) (2) (3) S.O. 969 (E), dated the 26th March, 1962 and last amended “10. Deposit with,- Cash deposits,- vide notification S.O.3399(E), dated 07th November, 2016. (i) a banking company (i) exceeding fifty or a co-operative bank thousand rupees during to which the Banking any one day; or Income Tax department sends warning Regulation Act, 1949 (ii) aggregating to more (10 of 1949), applies than two lakh fifty note to trusts, societies (including any bank or thousand rupees during Sources said more such notices will be sent in the coming days banking institution the period 09th referred to in section 51 November, 2016 to 30th The Income-Tax Department has started sending notices to of that Act); December, 2016 societies and trusts, including religious and charitable trusts, (ii) Post Office. asking them to inform it about cash balances as on November 8, the day the government announced the decision to 3. In the said rules, in rule 114E, demonetise Rs 500 and Rs 1,000 notes.

(i) in sub-rule (2), in the Table, after serial number Sources said more such notices will be sent in the coming 11 and entries relating thereto the following days. While the move is being dubbed as a “preventive serial number and entries shall be inserted, measure”, sources in the I-T department said the government namely:- has decided to take “strictest possible action” against those who are found to have violated the law. Sl. Nature and value of Class of person No. transaction (reporting person) The notices are being sent under Section 133(6) of the Income (1) (2) (3) Tax Act, 1961, which empowers the I-T authorities to compel “12 Cash deposits during the (i) A banking company or banks and other authorities to furnish information which could . period 09th November, a co-operative bank to be useful in connection with any pending proceeding or 2016 to 30th December, which the Banking enquiry. 2016 aggregating to Regulation Act, 1949 (10 (i) twelve lakh fifty of 1949) applies “Submit cash balances as per your books of accounts of all thousand rupees or more, (including any bank or institutions being run by you as on 31-03-2016 and as on close in one or more current banking institution of 08-11-2016 to this office,” says a notice accessed by The account of a person; or referred to in section 51 Indian Express. of that Act); (ii) Post Master General The reason for seeking the information is mentioned in the as referred to in notice itself. “In the backdrop of this demonetisation of old currency notes, the department is also aware of the pressure or temptation that may be there on trusts and societies to Sl. Nature and value Class of person accommodate others,” says the notice. No. of transaction (reporting person) (1) (2) (3) Stating that all deposits made in banks after November 8 ii) two lakh fifty clause (j) of section 2 of “shall be part of scrutiny by the department after 30th thousand rupees or the Indian Post Office December, 2016”, the notice also advises the management of more, in one or Act, 1898 (6 of 1898).”; such institutions not to deal with Rs 1,000 and Rs 500 notes, more accounts “by either accepting cash or paying in cash for any of your (other than a current activities after November 8, 2016”. account) of a person. “There are indications that some persons and/ or organisations have prevailed upon managements of some trusts and societies to accept their currency notes of high denomination and show the same as cash in hand. This is a much abused way to turn • One Seminar on the role of the Construction Industry in black money into white. development, involve all the departments that we are connected with. Let them realise the importance and glory We have some specific instances also that we are following up of this industry and organisation. on. However, these notices are only to ensure that such illegal • One grand programme involving the local MP, MLA, acts are stopped. Failure of the persons to whom we have sent Mayor, Commissioner, etc. notices to furnish the information sought by us by November 18 will result in penal proceedings under the Act,” said a senior I-T officer. 'Concluding Function' of BAI's Platinum Jubilee Celebrations

PLATINUM JUBILEE CELEBRATION OF BAI On Saturday 5th November, 2016 the 'Concluding Function' of BAI's Platinum Jubilee Celebrations commenced in the BAI is at threshold of history having been formed in 1941. It morning the in sprawling and prestigious Chennai Grade has in year 2016 completed seventy five years journey. Centre. Chief Guest, Mr. M. Venkaiah Naidu, Hon'ble Union Construction is a hard line with long working hours. It needs Minister for Urban Development, Housing & Urban Poverty of initial fixed investment is low, whereas it’s working capital Alleviation and Information & Broadcasting, hoisted the BAI requirement is high. All its activities are outsourced to Platinum Jubilee Flag to commence the celebrations in front of different people/agencies. In view of this peculiarities, the Convention Hall at Chennai Trade Centre in the presence individual initially start with construction business but during of Mr. Avinash M. Patil, President, BAI; Bhishma R. course of next 20/30 years, changes business. As a result Radhakrishnan, Chairman, Platinum Jubilee Celebrations mortality rate in industry is quite high. In a given scenario not Committee; Mr. A. S. Chinnaswamy Raju, Mr. B. Seenaiah - only to survive but to grow is a stupendous achievement, for a Past Presidents, BAI; Mr. K. Venkatesan, Chairman, BAI trade association like BAI. It initially started with 13 members Southern (Chennai) Centre and other office-bearers and senior and as of now spread over 150 plus centres with direct functionaries of BAI and BAI Southern (Chennai) Centre. The membership 15,000 business houses and indirect membership Convention Hall was filled to its brim by BAI members across of 1,00,000 through its affiliated associations. the length and breadth of India to witness the historic event.

th The Managing Committee Meeting held at Ahmedabad on 30 Thereafter Hon'ble Minister was offered breakfast in the VIP May 2015, have entrusted the Chairmanship of ‘Platinum lounge, wherein he showed his simplicity by requesting for an Jubilee’ celebration of BAI to Shri R. Radhakrishnan, Past informal breakfast with other members, so that he can be President & Past Trustee of BAI. The Co-Chairmen of the amongst BAI members. He had earlier informed that he will Committee are Shri B. Seenaiah, Past President; Shri Sushanta be arriving early and would like to interact with BAI's senior Kumar Basu, Imm. Past President; and Shri D.L. Desai on industry issues. Hence, after the breakfast, he went to the (Shankarbhai), Trustee. Past Presidents are Members of the VIP lounge, wherein he was briefed about BAI's views of Committee and all Office Bearers of the Headquarter will be RERA by Mr. K. Sriram, Past State Chairman, BAI Ex-officio Members. The Committee was also empowered to Karnataka; some industry issues by Mr. B. Seenaiah, Past add more members, as we have decided to publish a Memoir President, BAI; about skill development in construction of BAI with all relevant information pertaining to BAI history. industry by Mr. Sushanta Kumar Basu, Past President, BAI and about the recent decision by Cabinet Committee on The Organising Committee Members of Platinum Jubilee Economic Affairs by Mr. Neerav Parmar, Hon. Gen. celebration have unanimously decided to direct BAI Centres Treasurer, BAI. He patiently heard their submissions and to celebrate the Platinum Jubilee. Centres should organise assured that he would try to redress the problems. programmes with the following templates:-

Inauguration • Aim to touch all age groups with the celebration. The inauguration ceremony 'Concluding Function' of BAI's • Competitions for children. Platinum Jubilee Celebrations started at 08.55 a.m. with an • Essay debate competitions for High School and College invocation song. Dignitaries who graced the dais during the Students. inauguration ceremony were : Mr. M. Venkaiah Naidu, • Special programmes for budding Civil Engineers. Hon'ble Union Minister for Urban Development, Housing & • Aim to create one good permanent infrastructure for the Urban Poverty Alleviation and Information & Broadcasting; city like a circle, toilet block, , school, training Mrs. B. Radhika Chakaravarthy, Chief Post Master General, centre etc. Chennai City; Mr. S. N. Subrahmanyan, Whole Time Director, • To felicitate a senior most Builder (Member of BAI). Deputy Managing Director and President, M/s Larsen & • To conduct health care camps for construction workers. Toubro; Mr. Avinash M. Patil, President, BAI; Bhishma R. • To organise ‘Well Built Structure Award’. Radhakrishnan, Past President, Past Trustee BAI & Chairman, • Target one programme for home makers, they can be your Platinum Jubilee Celebrations Committee; Mr. Mu. Moahan, biggest ambassadors. Vice-President, BAI; Dr. R. B. Krishnani, Vice-President, • A Sports Olympics for Construction Workers. BAI; Mr. R. N. Gupta, Vice-President, BAI; Mr. C. G. Deochake, Hon. Gen. Secretary; Mr. Neerav Parmar, Hon. Gen. Treasurer, BAI; Mr. Lal Chand Sharma, Imm. Past

President, BAI; Mr. A. S. Chinnaswamy Raju, Past President, its Platinum Jubilee. In his address he also saluted the BAI; Mr. B. Seenaiah, Past President, BAI; Mr. M. architects of this great institution, who made it possible with Thirusangu, State Chairman, BAI Tamilnadu, Puducherry, their dedicated involvement, to mention a few - Mr. H. J. Andaman & Nicobar Islands; Mr. K. Venkatesan, Chairman, Shah, Mr. R. J. Gandhi, Mr. Amarjit Singh Choudhary, Mr. N. BAI Southern (Chennai) Centre; Mr. K. Ramanujam, Neelakanrtan Iyer, Mr. M. N. Rajaraman, Mr.S. A. N. Chairman, Organising committee and Mr. S. Ramaprabhu, Raganatha Achar, Mr.Ajit Gulabchand, Dr. T. N. Subbarao, Hon. Secretary, BAI Southern (Chennai) Centre. Mr. A. S. ChinnaswamyRaju, Mr. C. L. Varma, Dr.Brahm Dutt, etc. He had a special word of praise for the Panelists Hon'ble Minister thereafter lighted the traditional lamp who had helped him in bringing out the book. The Panelists (KuthuVilakku) in the presence of other dignitaries. are Chanakya D. L. Desai (Shankarbhai), Mr. J. R. Sethuramalingam, Mr. L. Venkatesan and Dr. D. Thukkaram. Mr. K. Venkatesan delivered the welcome address. He elaborated about the history of the BAI Southern (Chennai) In his address he profusely thanked Hon'ble Minister Mr. M. Centre and thanked BAI, in particular the President and Venkaiah Naidu who had accepted to be the Chief Guest and Managing Committee, for giving Southern (Chennai) Centre release the book. He appreciated the simplicity of the Minister the opportunity of organising the Platinum Jubilee for his gracious request to have breakfast along with the Celebrations. It was also brought to the notice of the Hon'ble members . Minister that BAI Southern (Chennai) Centre is the largest BAI Centre in India having 2200 members with a history of 65 Before concluding Mr. R. Radhkrishnan thanked Mr. Lal years. Chand Sharma, Immediate Past President and the Managing Committee for the unique opportunity bestowed to him to be Mr. Avanish M. Patil delivered the presidential address. In his the Chairman of this great event. address he dwelt at length about the role played by the construction Industry in the development of the country by After this the Hon'ble Minister released the book '75 Years of providing the infrastructure facilities like roads, bridges, metro Glorious existence - the never ending journey of excellence'. railways, irrigation projects, airports, sea ports, etc. He also The first copy of the book was received by Mr. B.Seeniah. mentioned about the construction industry's contribution towards providing housing for the society at large. He pointed Honouring the Stalwarts out that the construction industry is the second largest industry On the occasion, Mr. K. V. Rangaswamy, Former Board in providing maximum employment for skilled and unskilled Member and former President, M/s Larsen & Toubro was workers - next to agriculture. He further added that conferred with 'Nirman Ratna' Award. Bhishma R. construction industry is playing a major role in the economic Radhakrishnan was conferred with 'Seva Ratna' Award. growth of the country by contributing a sizable share to its GDP growth. Both of them were honoured with shawl, garland and adorned with Mysore Pheta by Hon'ble Minister. Mr. A. S. Release of Special Postal Cover & Stamp Chinnaswamy Raju and Mr. K. Venkatesan. A citation was Mrs. B. Radhika Chakaravarthy, Chief Post Master General, read and presented to both the Awardees. A plaque engraved Chennai City Region released a Special Cover and Stamp to with the words 'Nirman Ratna' and 'Seva Ratna' were commemorate the Platinum Jubilee Celebrations of BAI. presented to Mr. K. V. Rangaswamy and Bhishma R. Hon'ble Minister received the Special Postal Cover and Stamp Radhakrishnan respectively with their photographs in the and formally handed it over to Mr. A. S. Chinnaswamy Raju. plaque, was also presented. A Gold Haaram with a medallion This historic event of releasing the Special Postal Cover and engraved with the word 'Seva Ratna' was presented to Stamp to commemorate the celebration is the first of its kind Bhishma R. Radhakrishnan by Mr. M. Karthikeyan, Past in the history of BAI. It was a proud moment for the President, BAI on behalf of the Platinum Jubilee Celebration contractors and builders fraternity. Committee.

Release of book - '75 Years of Glorious existence - the never Mr. S. N. Subrahmanyan in his special address mentioned that ending journey of excellence' he was happy to have associated himself in this historic celebration. He thanked the organisers for recognising the role Bhishma R. Radhakrishnan, dwelt in detail about the journey played by his Guru in L&T Mr. K. V. Rangaswamy in the of BAI and its glorious achievements during 75 years of its development of the construction industry for the past four existence with excellence in every initiative and endeavour as decades and for honouring him with the prestigious award of its thrust. In this context he credited Brig. Jackson, a British 'Nirman Ratna'. Engineer in the Military Engineering Department as the founding father of BAI in 1941 at Pune. He said he was also happy to witness the awarding of 'Seva Ratna' being conferred on another stalwart Bhishma R. He went on the add that BAI was started with just thirteen Radhakrishnan which he richly deserves. members and today BAI is proud to have more than one lakh direct and indirect members, having 160 centres through the He also mentioned that BAI is doing yeomen service for length and breadth of the country. This is the only trade body construction sector of this country and L&T is always proud to which has the distinction of growing upto the Celebration of be associated with them in such events. He assured that in the coming years also L&T will continue to extend its goodwill Felicitation and co-operation to such events as in the past. Mr. A. S. Chinnaswamy, Mr. B. Seenaiah, Mr. A.K. Yussouf and Mr. M. Karthikeyan - Past Presidents of BAI garlanded Hon'ble Minister Mr. M. Venkaiah Naidu in his address and felicitated Bhishma R. Radhakrishnan and expressed their regaled the audience with his inimitable way of speech loaded wholehearted happiness for the honour bestowed on him as with pun and humour about the serious business of nation 'Seva Ratna'. They expressed that he richly deserved this building. honour for his untiring contribution, sacrificing his family and business for over four decades in the cause of the development In spite of his very busy schedule he made it a point to of the construction industry. participate in this important milestone event not only because of the significance of the Platinum Jubilee but also since the Bhishma R. Radhakrishnan, during his felicitations to Mr. K. organisation is honouring two stalwarts Mr. K. V. V. Rangaswamy for being the receipient of the prestigious Rangaswamy and Bhishma R. Radhakrishnan who have done 'Nirman Ratna Award' mentioned that BAI was highly yeomen services to the construction industry. He praised their privileged to honour Mr. K. V. Rangaswamy with this greatest contribution to nation building through their services. He award of 'Nirman Ratna' on this historic occasion of Platinum stressed the importance of infrastructure development in the Jubilee Concluding Celebrations. He added that Mr. K. V. contribution to the GDP growth of the country and appreciated Rangaswamy was the pride of India in the construction sector. the role played by L&T in this endeavour. In this context he He has created several monuments nationally and at extolled the virtues of our Hon'ble Prime Minister Mr. international levels. Some of his specialised structural designs Narendra Modi, in his single minded focus of nation building, have won several awards in the International level and his by involving industrialists and trade bodies in the process. He contribution to the construction industry is unparalleled at any mentioned that the next five year plan invokes the public point of time. He particularly emphasised Mr. Rangaswamy's private partnership as the fulcrum of activity to ensure 7% to love and affection towards BAI and his encouragement to the 8% GDP growth. He stressed the need for a multi directional, BAI for all its activities. sustainable growth, which means the various arms of the society, be it banks and financial institutions, trade & industry He was not only a great engineer but had also created a lot of bodies, etc. have to contribute their mite to ensure the fruits of eminent engineers with his advice and guidance. One among their labour reach an inclusive society. He explained the thrust them is Mr. S. N. Subrahmanyan, which was acknowledged by areas of the Prime Minister's development agenda as reform, Mr. S. N. Subrahmanyan during his speech. Bhishma R. perform, transform with public private partnership. Radhakrishnan highlighted that BAI on this historic occasion highly feels proud to honour the great technocrat. He dwelt at length about the recent Bill passed in the Parliament regarding the Real Estate Regulation Act (RERA) In his acceptance speech Bhishma R. Radhakrishnan and said that it is only 'regulation' and not 'strangulation' of the expressed his gratitude to one and all for honouring him with sector. He was pained to see that due to a few bad apples in 'Seva Ratna' award during this historic celebration of Platinum the sector, the whole real estate sector was getting a bad name Jubilee Concluding Celebrations. Though he wondered and stressed that BAI weed out such entities and follow the whether he was worthy of receiving this award, he accepted regulations, which will go a long way in making the people the same in view of the love and affection of the institution. recognise the value of this sector which is also extending its He empathically mentioned that he was dedicating this award hand in providing housing for millions of people. He assured to the Southern (Chennai) Centre, to his well wishers, to his that during the implementation of RERA, if the sector faces mentor like Mr. Neelakantan Iyer, Mr. M. N. Rajaraman, Mr. any bottlenecks in their operations, he will arrange a meeting S. A. N. Ranganatha Achar, Dr. T. N. Subba Rao, Mr. A. S. with the Prime Minister himself, to iron out the issues. He also Chinnaswamy Raju, his close associates and to his parents. touched upon the 'Make in India' campaign, the 'Swach Bharat' campaign, the 'Beti Padao / Beti Bachao' campaign, 'Skill He was humble enough to say that these awards make him feel Development Program', etc to emphasise the need for more responsible for his future involvement and gave him contribution from all the stakeholders of the society to ensure more courage and strength of mind to serve for this fraternity that India becomes a real super power in the years to come. He till his last beat of his heart. Before his conclusion, he was very appreciative of the role played by BAI and the office emotionally he assured he will serve this fraternity not as bearers in this endeavour and wished them all the best for their leader but as a soldier, as a humble worker taking command future. from the people at the helm of affairs.

Mr. K. Ramanujam in his address appreciated the various Technical Session committee members for their untiring contribution for the In the post lunch session, the members were treated to success of the greatest event in the history of BAI. He thanked technical information of the highest cadre interspersed with the Southern (Chennai) Centre Chairman Mr. K. Venkatesan PowerPoint Presentation. Mr. V. Somasudharam, Former for giving him the opportunity to be the Chairman of the advisor, Rail spoke about tunnelling of Metro Organising committee for this wonderful event. He expressed Rail Project. Mr. Sudhakar of M/s Schwing Stetter India Pvt. his gratitude to Bhishma R. Radhakrishnan for his untiring Ltd. spoke about Modern Construction Equipment and efforts in the fund raising activities which is an essential Technology. requirement for the success of any event of this magnitude.

Oratorical Competition Karthikeyan and Bhishma R. Radhakrishnan. Mr. Avinash M. In commemoration of the Platinum Jubilee Concluding Patil the incumbent President was also honoured. Celebrations, Oratorical Competition was organised for the civil engineering students from various engineering colleges On behalf of the Past Presidents, Mr. V. Ramachandran, on 7th October, 2016 in Chennai on the subjects, "Get thanked the Organising Committee of Platinum Jubilee equipped with modern trends in construction techniques" and Concluding Celebrations for felicitating them. "Today's Civil Engineers - Nation Builders of Tomorrow”. Thereafter Mr. Avinash M. Patil released the 'Special The finals of the Oratorical Competition was held on 27th Souvenir' brought out by the Platinum Jubilee Concluding October, 2016 on the topic "Vision 2020 - Skill India to Build Celebrations Organising Committee to mark the historic India" and out of eight students three were selected as the occasion and the first copy was received by Mr. Mu. Moahan, winners, viz. . Vice President, BAI.

1. Ms. Akshya of Mr. Venkateswara Engineering College The Platinum Jubilee Concluding Celebrations Organising 2. Ms. D. J. Hema Malani of GKM College of Engineering Committee also honoured the BAI head quarters Office 3. Ms. U. Priyadharshini of Velammal Engineering College Bearers and Trustees with Yelachi Garland, Shawl, Turban and were presented with a memento, viz. Mr. R. N. Gupta, Mr. They were presented with a trophy and certificate each. Mu. Moahan, Dr. Rajiv B. Krishnani - Vice-Presidents; Mr. C. G. Deochake, Hon. Gen. Secretary; Mr. Neerav Parmar, Hon. Vote of thanks Gen. Treasurer; Mr. N. Sachitanand Reddy, Mr. M. Mr. S. Ramaprabhu proposed a formal vote of thanks. He Karthikeyan, Mr. Vijay Jagannath Devi, Mr. R. Suburaman, profusely thanked the Hon'ble Minister Mr. M. Venkaiah Mr. Lalchand Sharma - Trustees, Mr. K. John Paul, State Naidu for his participation as Chief Guest and for being Chairman - Kerala; Mr. K. S. Someshwara Reddy, State present for more than two and half hours inspite of his busy Chairman - Karnataka; Mr. B. Sugunakar Rao, State Chairman schedule. He profusely thanked the BAI President and - Telangana; Mr. Ch. Ramakotaiah, State Chairman - Andhra Headquarters for giving Southern (Chennai) Centre the golden Pradesh; Mr. M. Thirusangu, State Chairman - BAI Tamil opportunity for organising Platinum Jubilee Concluding Nadu Puducherry, Andaman and Nicobar Islands; Mr. Suresh Celebrations. He also thanked Bhishma R. Radhkrishnan for B, Patil, State Chairman -Maharashtra; Mr. Nitin M. Shah, his guidance and support for the success of this event. He also State Chairman -Gujarat; Mr. Sudip Kumar Dutta, State thanked all Past Presidents, all the EC/GC/MC and other Chairman -Kolkatta and Mr. S. Ayyanathan, State Secretary, members and special invitees who were present in large BAI Tamil Nadu Puducherry, Andaman and Nicobar Islands. numbers from across India for this historic function. He also thanked the sponsors for their support without whom the Mr. Raju John, Executive Secretary, BAI and Mr. S. function would not have been such a huge success. Madhusudan, Head Communications, BAI were also honoured with Shawl and Memento. Valedictory Function After a high voltage inaugural session and informative BAI Awards 2015-16 technical in the morning and afternoon, the Valedictory 'BAI Awards 2015-16' were announced during the 75th AGM Function was held in the evening. It was also time to enjoy the of BAI held on Saturday 2nd July 2016 at Nashik. The Award Platinum Jubilee Concluding Celebrations with a bang and a Presentation was held during the Platinum Jubilee Concluding cultural programme was organised which lasted an hour. Celebrations.

After the rendering of the 'Tamizh Thai Vaazhthu', Mr. K. 1. Overall Best BAI Centre : 1. Mysore Centre Venkatesan welcomed the gathering to the evening session. (Below 200 Members) There was a special warm welcome for Mr. Avanish M. Patil, a Past Presidents, all head quarters Office Bearers, all Centre 2. Overall Best BAI Centre : 1. Southern (Chennai) Chairman and Members from the length and breadth of the (Above 200 Members) Centre country. 2. Mumbai Centre

3. Image Building Activities : 1. Karnataka (Bangalore) Mr. M. Thirusangu, State Chairman, BAI Tamil Nadu by a Centre Centre Puducherry, Andaman and Nicobar Islands and Mr. Mu. 2. Eastern (Kolkata) Centre Moahan, Vice President, BAI also addressed on the occasion. 3. Tirupur Centre

Honouring of All Past Presidents 4. Organising Best Training : 1. Tirunelveli Centre On the occasion, all Past Presidents present were honoured by Programme or Seminar 2. Pune Centre the Platinum Jubilee Concluding Celebrations Organising Committee, viz. Mr. Lalchand Sharma, Mr. Sushanta Kumar 5. Maximum Annual : 1. Tiruchirappalli Centre Basu, Mr. B. Seeniah, Mr. Bhagawan J. Deokar, Mr. A. K. Membership Growth 2. Muvattupuzha Centre Yusouf, Mr. S. P. Goel, Mr. B. N. Dixit, Mr. V. 3. Guwahati Centre Ramachandran, Mr. A. S. Chinnasamy Raju, Mr. M. 6. Best Efforts by any : Durgapur Centre Centre for Quality

Construction Change of Guard at BAI

7. Best Builders’ Day : 1. Madurai Centre BAI's Organisational Elections for 2017-18 culminated on the Celebrations. 2. Nashik Centre 30th March, 2017. Mr. Raju John, Executive Secretary, BAI 3. Tiruchirappalli Centre officiated as the 'Returning Officer' for conducting the 4. Kanyakumari Centre elections.

8. Maximum Membership : 1. Kottayam Centre Retention 2. Ulhasnagar Centre Mr. H. N. Vijaya Raghava Reddy was unanimously elected as the President of BAI for 2017-18. 9. Best publication by a : 1. Southern (Chennai) Centre BAI Centre 2. Mumbai Centre Mr. Avinash M. Patil, President, BAI (2016-17) formally announced the results of "BAI's Organisational Elections for 10. Best performing : 1. Shri Neerav Parmar, 2017-18" in the evening of 30th March, 2017. Chairman of BAI’s Chairman, Legal & functional Committees. Arbitration Committee. Result of the election of a Trustee necessitated due to the demise of Mr. M. Karthikeyan was also announced Mr. K.

2. Shri K. Viswanathan, Ramanujam was unanimously elected as Trustee for the term Chairman, Taxation, 2016-19. Royalty, Entry Tax, Direct Tax and Indirect Tax Committee. On 31st March, 2017, Mr. R. Radhakrishnan, the senior most 11. Best performing State : Shri Sunil B. Mundada, State Past President of BAI, formally installed Mr. H. N. Vijaya Chairman. Chairman, Maharashtra. Raghava Reddy as President of BAI for 2017-18 by adorning him with the "BAI's President's Medallion". He also installed 12. Special Award for : Hyderabad Centre the other officer-bearers of 2017-18. conducting XXVII All India Builders’ Subsequently, Mr. Avinash M. Patil handed over the 'BAI Convention Key' to Mr. H. N. Vijaya Raghava Reddy, symbolising handing over of charge. In his special address, Mr. Avinash M. Patil, appreciated Southern (Chennai) Centre; Chairman, Platinum Jubilee A large number of senior functionaries of BAI from many Committee; Chairman, Co-Chairmen - Organising Committee Centres were present, which included BAI's office-bearers for and the various Committees for their untiring efforts to make 2016-17 and 2017-18 also. this event a grand success In the morning of 31st March, 2017 a joint meeting of Office- Vote of thanks Bearers 2016-17 and Office-Bearers 2017-18 was held in the BAI office. Mr. S. Ramaprabhu thanked President, Vice Presidents, Head Quarters - Office Bearers, State Chairmen, Trustees, All Renovated BAI Secretariat inaugurated Centre Chairmen, All Members, Sponsors for their participation. He finally thanked all the Committee members Considering the overall growth of BAI and its increased from Southern (Chennai) Centre for their untiring efforts to activities, it was being long felt that the BAI Secretariat in make this event a grand success. Mumbai should be spruced up suitably. Accordingly the Managing Committee of BAI at its meeting held in Patna on Major Constitutional Amendment. 20 th December, 2013 sanctioned an amount of Rs. 50 lacs for renovating the BAI secretariat in Mumbai. Senior Two Regions created out of Southern Region. functionaries of BAI and many BAI Centres announced their contribution towards the ‘Renovation Fund’. M/s Design Southern Region has splitted into two regions, that is , Variable – offered their honorary services in designing and Southern Region – I & II and same has been approved in the th supervising the executing of the renovation of the office. A Special General Meeting of BAI held on 6 November 2016 at ‘Renovation Committee’ consisting of Mr. Ram M. Bhatia, ITC Grand Chola, Guindy, Chennai. Past Vice-President, BAI and Mr. Neerav Parmar, Chairman, BAI Mumbai Centre (presently Hon. Gen. Treasurer, BAI) Southern Region – I consists of Andhra Pradesh, was formed in the Managing Committee and General Council Telangana and Karnataka States. Meeting held at Jaipur on 20 th September 2014 to oversee the work. Subsequently, due to changes in layout and increased Southern Region – II consists of Kerala, Tamil Nadu, cost the sanctioned amount was increased to Rs. 60 lacs by the Puducherry and Andaman & Nicobar. Managing Committee of BAI at its meeting held in Ahmedabad on 30 th May, 2015. Each Region will elect Vice President from the respective Region. Finally on 31 st March, 2016, a state-of-the-art secretariat was inaugurated by Mr. Lal Chand Sharma, President, BAI in the

presence of a galaxy of past and present office-bearers of BAI and many senior functionaries of BAI from across India. Builders’ Association of India (BAI) is an apex all India body of Engineering Construction Contractors and Real Estate The newly renovated state-of-the-art secretariat of BAI in Companies founded in 1941, with more than 16,000 business Mumbai boasts of the latest in office gadgets. Hi-tech office entities as members through its 153 plus Centres (Branches) cabins for the senior staff members, a more spacious main throughout the country. Regional Associations Affiliated to conference room, a small conference room, video BAI form indirect membership of more than 1,00,000. The conferencing facilities in some of the office cabins and fundamental aim of the Association is to bring about all round conference rooms, hi-tech work area for the office staff, improvements in the construction sector, while striving pleasant and welcoming reception area, fully operational towards resolution of operational as well as policy level pantry, wash rooms with latest facilities, etc. problems faced by the construction industry. This involves making efforts to obtain from policy makers and authorities, While the Managing Committee had sanctioned Rs. 60 lacs the level of attention that the construction industry deserves in but as the work progressed, there were changes in the layout view of its tremendous contribution and importance to the due to site conditions and specification of the materials were economy. upgraded due to which the cost is likely to go upto nearly Rs. 1 Core. It will take the cost to nearly Rs.1 Crore, out of which Construction contractors execute various departmental Rs.80,00,000/- towards Renovation has been expenditure and projects of the Governments and the procedure followed in further earmark Rs.10,00,000/- towards upgradation. The more or less on the principle of pre audit by Government following have contributed to the ‘Renovation Fund’. BAI is Engineers / Third party appointed by the Government calling upon its members to send in their contribution also. Engineers. The basic two fundamental issues for this pre audit system are as follows:- Shri Lal Chand Sharma, President, BAI Rs.1,00,000 Shri V.M. Fazal Ali, Vice president, BAI Rs. 1,00,000 a) To avoid faulty construction that requires to be Shri Mahesh M. Mudda, Rs.1,00,000 demolished and thus causing national wastage. Hon.Gen.Secretary,BAI b) One man or one agency may commit a mistake but Shri A. Puhazhendi, Past Vice President, BAI Rs.25,000 the second man / agency is very unlikely to make the BAI Muvattupuzha Centre Rs.25,000 same mistake. BAI Madurai Centre Rs.25,000 BAI Rajasthan State on behalf of BAI centres Rs.5,00,000 This is a time tested procedure and is being followed in Rajasthan BAI Gujrat(Ahmedabad) Centre Rs.50,000 successfully through centuries. Thus at every stage of design BAI Ranga Reddy Centre Rs.75,000 & construction, a process of pre audit and pre approval by Shri K.Vishwanathan, BAI Rs.50,000 Government Engineers / third party appointed by Govt. Dr. Anand J.Gupta, BAI Rs.1,00,000 Engineers of work, is followed. BAI Eastern (Kolkata) Centre Rs. 25,000 BAI Bharuch and Baroda Centre Rs.30,000 Sir, out of thousands of such projects, one or two failures is BAI Ulhasnagar Centre Rs. 25,000 not uncommon in the history of constriction in the developed Shri S. K. Samantha Rs. 1,00,000 countries and in our country also this does happen. BAI Nashik Centre Rs. 51,000 BAI Kottayam Centre Rs. 25,000 In the latest of such incidents a part of the under construction BAI Durgapur Centre Rs. 25,000 Vivekananda flyover at Kolkata collapsed under dead load BAI Hyderabad Centre Rs. 25,000 only and around twenty seven precious lives were lost . The BAI Durg-Bhilai Centre Rs. 25,000 failure could be caused by inadequacy of design provision, BAI State Chairman Office, Tamilnadu State Rs. 50,000 material failure, bad workmanship & supervision, etc. The BAI Guwahati Centre Rs. 15,000 right cause must be ascertained to avoid such occurrence in future and punish the guilty. As of now, BAI HQ had taken an adhoc advance of Rs.35 Lakhs from the general fund expecting BAI members or Like every other past similar incident , here also ten officials centres will contribute the same. of the construction Agency were put behind the bars and very unfortunately and, again like every other past similar incident, BAI’s Representations to various Ministries. st the Engineer who designed the bridge , the professor of Ref: 98/M/2016-17 dated 21 May 2016 Jadavpur University who proof checked the design, the Shri Narendra Modiji KMDA Engineers who approved the drawings & released the Hon’ble Prime Minister of India same for construction and above all the KMDA Engineers Government of India who approved the work at every stage of construction are Prime Minister’s Office, South Block, untouched and moving freely in the society. If the officials of NEW DELHI – 110 001 the construction agency are at fault, so are the Engineers who checked and passed the design & construction – probably Respected Sir, more so!

Sub: Unequal treatment of Construction Agencies in the administration of justice .

Both the groups , contractor’s and the departmental Engineers, the country. Regional Associations Affiliated to BAI were mandated to ensure a proper construction, which they form indirect membership of more than 1,00,000. definitely failed, and are therefore equals in the eyes of law The fundamental aim of the Association is to bring and as per Article 14 of constitution, shall not be discriminated about all round improvements in the construction upon by the state. sector, while striving towards resolution of operational as well as policy level problems faced by Sir, it is not our suggestion not to punish the guilty- in fact the the construction industry. This involves making officials of contractors as well as department must be punished efforts to obtain from policy makers and authorities, if it is so found that they failed to act with required skill & the level of attention that the construction industry knowledge which they professed to have possessed or they did deserves in view of its tremendous contribution and not exercise, with reasonable competence the skill and importance to the economy. knowledge which they did possess. 2. Since last two years, the Indian economy is in expansion phase which need to be sustained in Sir, unfortunately, the people who assist in the administration forthcoming years. Sustaining this rate of growth will of Justice like police force and the bureaucracy in general, need huge investments in physical infrastructure such close their eyes on the performance of fellow government as roads, railways and ports. An efficient officials and prefer to go for easy preys like contractor’s transportation system is critical for sustaining engineers. economic growth and the burgeoning demand for passenger and freight movement. India has the We appeal to you, Sir, to kindly look into the matter and second largest road network across the world at 4.7 advise / instruct the state governments to act impartially and million km. This road network more than without any show of indulgence to their servants so that trials 60 per cent of all goods in the country and 85 per & punishments do not lead to a travesty of justice. cent of India’s total passenger traffic. The plan outlay for 2015-16 stepped up budgetary support for Road Thanking you, Transport and Highways to Rs 42,912 crore (US$ Yours faithfully, 6.43 billion).

3. Hon’ble Minister of Road Transport and Highways, Mr Nitin Gadkari has announced that the target for laying out new roads in India will be increased to

150,000 kilometers per year from 2016 compared to AVINASH PATIL existing 96,000 kilometers. Amidst the growing PRESIDENT demand for roads, it is imperative for the BUILDERS ’ ASSOCIATION OF INDIA Government to encourage infrastructure development Copy to: Chief Ministers of all States initiatives which includes facilitating availability of

road construction machinery and equipment.

Ref: 114/M/2016-17 dated 31 st May 2016 Exemption from customs duty to road

construction machinery i.e. slipform pavers and To, cone crushers prior to union budget 2016-17 The Hon’ble Finance Minsiter,

Ministry of Finance, 4. Prior to amendment made in Union budget 2016-17, North Block, various road construction machineries were exempted New Delhi from basic customs duty i.e. BCD, CVD and SAD.

The Sr. No. 368 of Customs Notification No. Dear Sir, 12/2012-Cus granted exemption from Basic Custom

Duty (BCD) and Countervailing Duty (CVD). As far Sub : Request for restoration of exemption from as Special Additional Duty (SAD) was concerned, countervailing duty on Pavers used for Notification 21/2012-Cus dated 17.03.2012 (Sr. construction of road levied vide Notification No.1) provided for exemption from SAD to specified No. 12/2016 dated 1.3.2016. goods on which no BCD and CVD is payable. The

notification implies that SAD would not be payable With reference to the above subject we seek to submit as on such goods. Thus road construction machinery under: were exempted from payment of BCD, CVD and

SAD by reading together both customs Notifications. 1. Builders’ Association of India (BAI) is an apex all Exemption prior to Amendment made in Union India body of Engineering Construction Contractors Budget was as under: and Real Estate Companies founded in 1941, with

more than 16,000 business entities as members

through its 153 plus Centres (Branches) throughout

9. Construction of public infrastructure like roads, water Sr. Chapter Description Standard Additional Condition distribution canals etc. are exempted from payment No. Rate Duty Rate of service tax. When the activity is exempted from 368. 84 or any Goods Nil Nil 9 other specified in payment of service tax the machinery like road Chapter List 16 paving machine etc. directly used for such activity is required for not eligible for cenvat credit. This will have an construction impact of cascading effect as credit of taxes paid is of roads not available. Therefore, it is requested that the

exemption be restored on road construction Exemption from CVD and SAD withdrawn in Union machinery. Budget 2016-17.

10. In the light of the escalating need of the economy, the 5. The Union Budget, 2016 vide Notification No. aforementioned withdrawal of exemption from CVD 12/2016 dated 01.03.2016 has withdrawn the and SAD on the road construction machinery is out exemption with respect to CVD. The exemption with of place. regard to Basic Customs Duty and Cess, however,

remains. Thus the current entry is as under: 11. The import of machinery and equipment used in

development of infrastructure, especially roads Sr. Chapter Description Standard Additional Condition No. Rate Duty Rate requires to be relaxed. 368. 84 or Goods Nil [-] 9 any other specified in 12. Hence, it is prayed that the exemption in respect of Chapter List 16 CVD and SAD be restored to its earlier position. required for construction of roads Thanking you, Note:- Additional duty = Countervailing duty which is 12.5%. Yours faithfully,

6. The effect of the amendment is that BCD would not be payable on the goods in question, viz. slipform pavers and cone crushers. However, exemption from CVD is removed from the customs notification. Since AVINASH PATIL there is no exemption from CVD, the exemption from PRESIDENT SAD would also not be available to road construction BUILDERS ’ ASSOCIATION OF INDIA machineries.

Withdrawal of exemption to road construction machinery will ruin the dream of Hon’ble Prime Conference on Implications of GST on Construction, Real Minister for better infrastructure in the country. Estate and Infrastructure Sector

7. Hon’ble Prime Minister is encouraging the foreign A ‘One day Conference on Goods & Service Tax’ was investors to invest in India and concept of make in organized by BAI Mumbai Centre along with M/s Consult th India is being promoted. Our country is at the stage Construction, Ahmedabad 24 September, 2016 in Hotel that we need foreign investment to become VITS, Andheri East, Mumbai. manufacturing hub of the world. By removing the exemptions available to developers of infrastructure Mr. Shyam Raj Prasad, Commissioner of Service Tax, was the will increase government spending after Chief Guest. CA Tarun Ghia, Elected Central Council infrastructure. Certainly this is not the objective of Member of the Institute of Chartered Accountants of India the government. (ICAI) & Chairman, Committee for Members in Industry (CMII) of the ICAI, delivered the keynote address. Also 8. The withdrawal of exemption from CVD and SAD present on the occasion were : Mr. Pradeep Nagawekar, would lead to increase the landing cost of the road Chairman, BAI Mumbai Centre; Mr. C. G. Deochake, Hon. construction machinery and equipment. The said Gen. Secretary, BAI: Mr. Neerav Parmar, Hon. Gen. increase in cost of machinery would have cascading Treasurer, BAI & Chairman, BAI’s Legal and Arbitration impact on increase in road construction projects in Committee; Mr. K. Vishwanathan, BAI’s Taxation, Royalty, the country. Thus the withdrawal of exemption from Entry Tax, Direct Tax and Indirect Tax Committee and Mr. CVD and SAD will have huge impact on the cost of Raju John, Executive Secretary, BAI. the all road construction projects in the country. Mr. Pradeep Nagawekar welcomed all the delegates which Removal of exemption will have cascading effect was followed by Key note speech of CA Tarun Ghia giving an as Cenvat Credit is not available. overview and the complications in the construction sector as far as GST is concerned.

Mr. Shyam Raj Prasad then addressed the concerns of the b) Those construction contractors who initiated members by highlighting the simple aspects of GST and mechanisation of construction activities on roads, be giving a complete overview of what is being planned under it hard surface (i.e. concrete) or flexible pavement GST. (i.e. bitumen surface) or in other infrastructural facilities such as pipeline, ports, etc Various expert speakers spoke during the technical sessions viz. CA Sanjay Agarwal from Reliance Industries; Adv L. c) Work carried out in remote and difficult areas such as Badrinarayanan from Lakshmikumaran & Sridharan and Sikkim, North Eastern States, J & K, H.P. or work CA Sandesh Mundra, Chairman, BAI’s Goods & Service Tax executed in country under hostile environment such Committee. as Afghanistan.

The topics covered during the conference discussion were as d) Pioneers in infrastructure development like first below :- public private partnership work in roads, buildings, seaports, state transport, bus depots or bus stations.  Why our country needs GST?  Current Complications in Construction, Real Estate and e) Those construction contractors continuing business Infra Sector. since 1947 or even earlier till date and have  Concept of Supply and Valuation under GST. established name for quality workmanship.

 Flow of Credits. f) Promoting use of green buildings or technologies in  Expected Implications on Inter-state Works Contract. building works.  Impact Analysis on various Projects and critical precautions to be planned in advance g) Socio Economic status and contribution of the  Transitional Issues with ongoing Projects. contractor towards manpower and to the growth of  Panel Discussion on proposed representation by BAI and construction industry. other sister bodies to Ministry of Finance.  Followed by Question and Answer session. h) Other honours, Awards received by the Contractor.

On the occasion a book on GST was released. The book has been authored by CA Sandesh Mundra and Naimish Padhiar BAUMA CONEXPO INDIA 2016 along with several other co-authors. ‘BAUMA CONEXPO INDIA 2016’ – the fourth International The conference concluded with a panel discussion featuring Trade Fair for Construction Machinery, Building Material Machines, Mining Machines & Construction Vehicles’ was CA Rajkamal Shah, CA Bharat Shemlani, CA Rajkumar th th Adukia, Mr. Neerav Parmar and Mr, K. Vishwanath, held between 12 and 15 December, 2016 in HUDA Ground, Chairman, BAI’s Taxation, Royalty, Entry Tax, Direct Tax Gurgaon. ‘BAUMA CONEXPO INDIA 2016’ is organised by and Indirect Tax Committee, wherein the panelists discussed Messe München (organisers of ‘bauma’ brand of exhibitions) on various issues that are expected to be faced under GST and and Association of Equipment Manufacturers (organisers of the points where the representations may have to be given to ‘CONEXPO-CON/AGG’ brand of exhibitions). the Finance Ministry. BAI is a joint organiser of ‘BAUMA CONEXPO INDIA 2016’. Lot of participation came from the audience by way of queries throughout the day which was very encouraging for the ‘BAUMA CONEXPO INDIA 2016’ was inaugurated on 12 th organisers. December, 2016. Present during the inauguration were, Ms.

Santosh Yadav, Deputy Speaker, Haryana Legislative A representation to Government of India has been made, Assembly; Mr. Girish Shankar, Secretary, Department of based out of the discussion in the Conference. Heavy Industry, Government of India; Dr. Silva-Garbade,

Deputy Minister, Economic Sections, German Embassy in

India; Mr. Patrick Santillo, Minister Counselor, US Embassy PADMA Awards Vis-à-vis BAI in India; Mr. Avinash M. Patil, President, BAI; Mr. Anand Sundaresan, President, Indian Construction Equipment BAI for a long time started lobbying for bestowing Padma Manufacturers’ Association and Mr. Igor Palka, CEO, M/s bC Awards for deserving contractors and it is thus decided to fix Expo India. eligibility criteria for nominating contractors for Padma Awards. The following are the broad norms decided by the “With infrastructure investment set to go up, demand for Office Bearers:- construction equipment will rise further and the Indian construction equipment revenues are expected to breach the a) He should be a Patron Member of BAI. US$ 23 billion mark. BAUMA CONEXPO INDIA is an international trade fair for construction machinery, building material machines, mining machines and construction vehicle industry, which brings the industry together on one platform in Sri K. Appi Reddy, Past Vice President, BAI, Sri A. India,” said Mr. Avinash M. Patil, in his address during the Chamaraja Reddy, Past State Chairman, BAI, Sri V. Srinivasa inauguration. Murthy, Past State Chairman, BAI and K. Sriram, Past State

Chairman, BAI were nominated as Advisers. After the inauguration the BAI President and other senior functionaries visited the trade fair. BAI President also formally inaugurated the BAI stand in the trade fair. Further Sub committees were formed for various activities.

BAI President also had a meeting with Mr. Qi Jun, Chairman It was discussed and decided to charge Rs.10,000 + of China Construction Machinery Manufacturers Association applicabale Tax as Delegation fee for members and for (CCMA), who are organising BICES 2017 – Beijing Spouses it was decided to charge Rs.7,000 + applicabale Tax. International Construction Machinery Exhibition and Seminar, The same was unanimously approved. which is to be held from September 20 to 23, 2017 at New Beijing International Exhibition Center. BAI & HR Matters

‘BAUMA CONEXPO INDIA 2016’ had 647 exhibitors—of HIDA Employers’ Organizations Cooperation Programme, which 57% were international companies from 30 countries, Tokyo, Japan, Raju John represents India occupying a total of 150,000 square meters of space. Nearly 31,000 participants visited the trade fair. The Overseas Human Resources and Industry Development Association (HIDA) is an organization for human resources development in developing countries to promote technical XXVIII All India Builders’ Convention cooperation through training, experts dispatch and other programs. Through those programs, HIDA aims at The Managing Committee Meeting held at Nashik, on 2nd July contributing to the mutual economic growth of developing 2016, have unanimously accepted the proposal of BAI countries and Japan as well as enhancing friendly relations Karnataka (Bangalore) Centre for hosting “XXVIII All India between those countries. Builders’ Convention” at Bangalore in the month January 2018. HIDA had organised ‘The Refresher Seminar for Former Participants [ERLX]’ in Tokyo, Japan between 8 th and 17 th The Fourth Managing Committee & Second General Council November, 2017. meeting held on 6 th November 2016 at Chennai have unanimously nominated Bhishma R Radhakrishnan, Past Mr. Raju John, Executive Secretary, BAI who had attended the ‘Workshop for Officials of Employers’ Organizations’ President & Trustee, BAI as XXVIII All India Builders’ th rd held in Kuala Lumpur, Malaysia between 19 and 23 Convention Chairman. The committee also nominated Shri A. January 2010* and organised by NIPPON-KEIDANREN S. Chinnaswamy Raju, Past President & Trustee, BAI as International Cooperation Center (NICC) was invited by Convention Chief Patron, Shri B. Seenaiah, Past President, HIDA for ‘The Refresher Seminar for Former Participants BAI and Shri H. N. Vijaya Raghava Reddy, Past Vice [ERLX]’. President as Convention Patrons. A total number of 12 participants were present from

Bangladesh, Indonesia, Malaysia, Philippines, Thailand and The Organising committee of the Convention will be headed Vietnam. by the Sri K. Subramani as Chairman, Past Vice President, BAI and Sri Basavaraj S Totad as Hon Secretary . The programme objectives were :

Subsequent to the MC&GC Meeting a State Level Meeting 1) To provide the former participants of NICC short-term was conveyed and XXVIII All India Builders’ Convention invitation programs or the former participants of HIDA/AOTS Employers’ Organization Cooperation Committee Office Bearers and Sub Committee Chairmen were Program with an opportunity of up-dating their nominated unanimously. knowledge on and deepening understanding of the latest practices of industrial relations and human resource Vice Chairmen are Sri D. Kempanna - Past State Chairman management in Japan through lectures, visit to a company and Mr. N.S. Muralidhar, Past State Chairman. and discussions, thus helping nurturing harmonious industrial relations in their companies/organizations.

Joint Secretaries Sri B. M. Nataraju, Past Secretary, Karnataka 2) To follow up the former participants regarding how they have made use of their experience gained in Japan for (Bengaluru) Center and Sri K. N. Babu Reddy, Secretary, improving industrial relations and human resource Karnataka (Bengaluru) Centre and Hon. Treasurer as management in their companies/organizations. Sri G. M. Ravindra, Past Secretary, Karnataka Centre. 3) To disseminate the latest labor and economic information in respective countries of the former participants among

Japanese business persons in the HIDA Interactive BAI members / visitors can download : Meeting. 4) To learn human resources management for productivity  BAI Constitution (BAI Rules & Regulations) improvement  Membership Application Form 5) To learn from one another about different perspectives,  Membership Data Updation Form cultures and industries. BAI members can get their membership number through www.baionline.in. IFAWPCA Mid Term Board Meeting. Services to be introduced over a period, include : IFAWPCA Midterm Executive Board Meeting held at Kathmandu, Nepal. During 31 st August 2016 to 2 nd September,  Website based email service to BAI members. 2016, wherein Mr. Avinash M. Patil, President, BAI Executive  ‘News & Discussion Board’ – news concerning the Board Member of IFAWPCA represented BAI. construction industry will be hosted and members/visitors can air their opinion on the same. For your information at present IFAWPCA has 18 members,  ‘Meeting Room’ – akin to the concept of ‘chatting’, apart from BAI, viz. senior functionaries can hold meetings via video conferencing. 1. Bangladesh Association of Construction Industry  Archives of ‘Indian Construction’ and other 2. Construction Association of Korea publications by BAI Centres. 3. Cambodia Constructors Association  Total detailed membership database of BAI. 4. Federation of Contractors Associations of Nepal 5. Singapore Contractors Association, Ltd. ‘Wheeling & Dealing’ – is a platform for BAI members and 6. The Hong Kong Construction Association, Ltd. others for offering machinery to be given on hire or request 7. Indonesia Contractors Association machinery on hire / offer specialised service or request for 8. Maldives Association of Construction Industry specialised service, etc. 9. Master Builders Australia 10. Master Builders Association Malaysia FINANCE OF THE ASSOCIATION 11. Thai Contractors Association 12. Mongolian National Construction Association The Headquarter, due to its better financial discipline, was 13. National Construction Association of Sri Lanka generating surplus for the last 15 years, and the current year 14. Registered Master Builders Association, New also we have a surplus of Rs.94,08,860/-. This is a major Zealand achievement, though there was a marked decline in interest 15. Overseas Construction Association of Japan, Inc. income. It is also a fact that, the Trustees are prompt and alert 16. Philippine Constructors Association, Inc. in keeping the Fixed Deposits with Banks which offers the 17. Taiwan General Contractors Association highest return.

FUNCTIONS OF BAI HEADQUARTER OFFICE BAI WEBSITE ‘www.baionline.in’

BAI launched its website ‘www.baionline.in’ at the Managing BAI Headquarter and BAI Delhi Office with a staff of 14 th members functioning exceptionally well under the control of Committee Meeting at Nashik on 9 August 2008. With the Executive Secretary, Shri Raju John. launch of www.baionline.in, BAI too aims at giving its members top-of-the-line service. MEETINGS As of now www.baionline.in offers the following services : During the financial year under report, (Six) Managing

Committee and 4 (four) General Council Meetings were held  All circulars meant for BAI Centres and senior at: functionaries will be hosted.

 Important Judgements, Circulars and Notifications by Government(s) and /or Departments will be hosted.  1. Delhi on 30 th April 2016.  Tender information. th  Latest Price Index Numbers.  2. Nashik on 2 July 2016.  Construction industry related exhibition/trade fair  3. Kottyam on 18 th September 2016. information. th  Information on all publication of BAI and its Centres.  4. Chennai on 6 November 2016.  Details of office-bearers of BAI.  5. Gurgaon on 12 th December 2016.  Links to important websites i.e. like minded national th & international organisations, Government  6. Kolkata on 4 March 2017. organisations concerning having dealings with construction industry, service providers, construction companies, etc.

COMMITTEES : • Founder Member of Construction Industry Development The Managing Committee authorised the President, Shri Council (CIDC), New Delhi. Lal Chand Sharma to re-constitute the Committees for the year 2016-2017. • Member of Indian Merchants’ Chamber, Mumbai.

Accordingly, the following Committees were constituted • Member of Indian Council of Arbitration, New Delhi. with its Chairpersons as under: - • Member of Employers’ Federation of India, Mumbai. Name of Committee Chairpersons

• Member of Indian Roads Congress. Central Govt. Dept. and PSU. : Shri Ved Khurana

Cement & Bulk Material Purchase : Shri A. Puhazhendi • Member of Federation of Indian Chambers of Commerce & Industry, New Delhi. CIDC Co-ordination : Shri Sanjay Tyagi • Member and Promoter of Construction Skill Constitutional Amendment : Shri K. Sriram Development Council of India (CSDCI), New Delhi.

Contract Conditions : Shri H. S. Pasricha BAI’ S REPRESENTATIVES ON VARIOUS COMMITTEES Corporate Membership Development : Shri Vilas K. Birari & Communications • Shri Avinash M. Patil as Member, Board of Governors of National Institute of Construction Management & Goods & Service Tax : Shri Sandesh Mundra Research.

Grievances : Dr. Tarro T. Manghnani • Shri Avinash M. Patil as Member, Board of Governors of Construction Industry Development Council (CIDC). Housing & Real Estate & : Shri K. Ramanujam Infrastructure Development, ISO, • Green Building & Recreation. Shri Avinash M. Patil, Member, Board of Governors of National Academy of Construction (NAC). Indian Construction Bulletin : Shri D.L. Desai (Shankarbhai) • Shri B. Seenaiah, Member, Review Committee for Contract Management System formed by Ministry of Labour Welfare, Provident Fund, : Shri CH. Ramakotaiah Statistics & Programme Implementation (MOSPI). ESIC & Labour Cess. • Legal & Arbitration : Shri Neerav Parmar Shri Avinash M. Patil, Member, National Council of Construction Federation of India (CFI). Mechanisation : Shri V.G.Sakthikumar • Shri Avinash M. Patil in the focus group formed for Membership Development & New : Shri Pratap B. Salunkhe WTO. ` Centres. • Shri Sushanta Kumar Basu represent BAI on the MES : Shri Varinder Kumar Garg Working Group of Construction constituted by Planning th MSME : Shri Saumil A. Patel Commission for the 12 Five year Plan (2012-17).

National Highways : Shri B. Seenaiah • Shri Mahesh M. Mudda as Board Member on the Executive Board of IFAWPCA. Public Relations : Shri R. K. Jain • Shri Mahesh M. Mudda on the Expert Committee and Railways : Shri K. Venkatesan Shri Neerav Parmar on the State Level Advisory

Skill Development : Shri Neelakanth S. Joshi Committee of Building & Other Construction Workers (Regulation of Employment and Conditions of Service) Taxation, Royalty, Entry Tax, Direct : Shri K. Viswanathan Act 1996 for Government of Maharashtra. Tax & Indirect Tax. • Dr. Anand J. Gupta on Central Advisory Committee BAI Spokesperson : Shri Ram M. Bhatia constituted by the Ministry of Labour, Government of India, under the Building and Other Construction BAI MEMBERSHIP /A FFILIATIONS Workers (Regulation of Employment and Conditions of Service) Act 1996. • Affiliated to International Federation of Asian & Western Pacific Contractors’ Associations (IFAWPCA).

• Shri H.S. Pasricha, Member, Central Advisory Contract Affiliated Association Membership Labour Board, Ministry of Labour, Government of India. Annual Subscription Rs. 4,840 Entrance Fee Rs. 500 ‘INDIAN CONSTRUCTION ’ Rs. 200 OFFICES OF BAI CENTRES Service Tax Rs. 801 Total Rs. 6,3411 There has been a growing trend amongst BAI Centres to go in for their own office premises, with facilities for conducting meetings, training, etc. The premises owned by these Centres are registered under the name of “Trustees Builders’ Association of India”. Affiliated Association – Patron Membership

As on date, the Centres who have their own office premises Membership (One time subscription) are Andhra Pradesh (Hyderabad), Delhi, Eastern (Kolkata), Rs.30,000 Karnataka (Bangalore), Nanded, Nashik, Pune, Rajasthan ‘INDIAN CONSTRUCTION ’ Rs. 200 (Jaipur), Sangli and Southern (Chennai). Service Tax Rs. 4,500

Total ‘INDIAN CONSTRUCTION ’ Journal Rs.34,550

Shri D.L. Desai (Shankarbhai) was the Chairman, Indian Corporate Membership Construction Journal Committee for 2016-2017. The printing Memberships of the magazine has been continued with a marked change and (One time subscription) Rs.3,00,000 your journal is becoming more and more popular. Annual Subscription Rs. 10,000 The journal has admittedly established a numero-uno position Service Tax in construction related trade magazines as is evident from non- Rs. 46,500 member subscribers, which includes, Engineering Institutes, Tota l Government Departments and Undertakings including many Rs.3,56,500 Works Authorities. NEW CENTRES . The Association is also sending around 1000 complimentary copies to like-minded organisations in the country and abroad, For the year 2016-17, BAI opened Centres in Gurgaon and Government Authorities, Engineering Colleges, Department Karnal in Haryana State, Delhi East (Shahdara) , Delhi Heads, Works Authorities etc. The rising paper, printing and North, Delhi South and Delhi West in Delhi State, postal costs coupled with low advertisement revenue forces Kallakurichi, Perambalur, Ponneri, Thiruthuraipoondi in BAI General Fund to cross subsidise the publication as it is Tamilnadu State, Hassan in Karnataka State, Vizag Steel City not self sufficient. in Andhra Pradesh. 2016-17 was an eventful year for BAI as far as growth of the BAI movement is concerned. BAI MEMBERSHIP SUBSCRIPTION . BAI now planning to open new BAI Centres at Punjab and The subscription for various categories of membership with Orissa. the Association were as follows :- MEMBERSHIP STRENGTH Annual Membership Annual Subscription As on 31 st March 2017, the membership was16,950, which Rs.2,640 included 12,780 Patron Members and 4,170Annual Members Entrance Fee Rs. 100 ‘INDIAN CONSTRUCTION ’ Rs. 200 BUILDERS ’ DAY 2016. Service Tax Rs. 411 Total Rs.3,351 The theme for the ‘Builders’ Day 2016” was “VISION 2020 – SKILL INDIA TO BUILD INDIA”. Builders’ Day was Patron Membership celebrated by almost all Centres in a befitting manner. One time subscription – Membership for 20 (Twenty) years. Rs.25,000 ‘INDIAN CONSTRUCTION ’ Rs. 200 Service Tax Rs. 3,750 Total Rs.28,950

OBITUARIES : He attended IFAWPCA Convention at Bangkok in 1984 and at Bombay in 1991. He has attended all the All India Builders’ Mr. M. Karthikeyan – A Leading light of BAI fades away Conventions starting from 1977 in Madras (1979 Bombay, & Mr. A. S. Chinnaswamy Raju – A guding light of BAI 1982 Delhi, 1985 Calcutta, 1987 Bangalore, 1989 Hyderabad, fades away. 1991 Pune) and was Co-Convenor, Convenor and Co- Convenor respectively for the last three Conventions. BAI lost the following Past President and Trsutee From the day Sales Tax on works contract was imposed, he 1. MR. M. KARTHIKEYAN , TRUSTEE AND PAST PRESIDENT took the lead to fight out the case in High Courts and Supreme OF BAI EXPIRED ON 3RD JANUARY , 2017. Courts as the Chairman of Sales Tax Committee of Tamil Nadu and then as the Sales Tax Committee Chairman of BAI Mr. M. Karthikeyan was President of BAI during 1992-93. all over India and it was during his term that the Supreme Born on 27 th March, 1939 in a village in Coimbatore District, Court gave a historical judgement that the Sales Tax on works he Graduated in Civil Engineering in the year 1961 through contract cannot be levied on total value of works and that it Coimbatore Institute of Technology, Coimbatore. He was an can be levied only on goods transferred into the construction outstanding student and was also actively engaged as works. Students’ Secretary in college days. He has also served on various Committees like, Contract Not satisfied with mere Engineering qualification, he did his Conditions Committee, Bulletin Committee, and helped in Postgraduate in Management Studies ‘MBA’ at Madras compiling the Standard Contract Conditions Documents. He University in the year 1976. He is a fellow member of the has also served as a Member on Provident Fund and Labour Institution of Engineers also. Laws and Publications Committees. He was instrumental in mooting the idea of celebrating Builders’ Day and made it an He worked as Junior Engineer in Highways Department for a annual feature of the association. period of eighteen months and then along with his uncle and godfather of the family, Mr. P. K. Natarajan formed a He was elected as a Trustee of BAI for the term 2016-19. Company in 1962 under the name and style of M/s P. K. Natarajan & Co. Under his direct control, he executed many multistoreyed buildings for Telephone Exchanges at Madras 2. Mr. A. S. Chinnaswamy Raju, Past President and Past and at other places, besides Offices, Star hotels, Stadia, Super President of BAI expired on 31 st March, 2017. markets, Bus stands, Colleges, Housing complexes, Factory buildings, etc., at Coimbatore, Ooty, Rameswaram and other Mr. A. S. Chinnaswamy Raju was President of BAI during places. Though the works were concentrated on Telecom, 1996-97. He was born in 1931, and was involved in CPWD departments, he had experience with departments like construction activity since teenage years and over the years MES, State PWD, Highways, ISRO, BHEL, Railways, etc., had done works for various Government bodies like MES, besides doing works with Architects. PWD, Public Sector Undertakings, etc. These works ranged from factories, living quarters, runways, hospitals cricket He had experience of more than four decades in working with stadia etc., mostly in Karnataka and during 1965-1971, in different types of works and also with different departments Hyderabad. and clients. Recently he diversified and specialised water proofers and structural repairers and was engaged in Diversification in late 70s, brought him in building material Rehabilitation Work. He was also a software engineer and had factories such as spun concrete pipes, flooring tiles, etc. developed software for accounts and tender modules for besides hoteliering in which now managed three major hotels builders. in Bengaluru, viz., The Atria, Hotel Chalukya and Hotel Kanishka, of which, he was the Chairman and Managing M. Karthikeyan was a member of BAI since 1964. He took Director. active interest from 1975 onwards and served the Association in various capacities starting from Executive Committee In addition to his own business activities, he was actively Member, Hon. Treasurer, Vice Chairman and Chairman of involved in social life. He was presently the President of the Southern Centre. Thereafter he was State Chairman, Tamil Karnataka State Contractors’ Association for over a decade Nadu and then Vice President of the Association. Since he and the Association had a number of achievements during his used to attend most of the Managing Committee and General tenure. He had been instrumental along with his colleagues in Council Meetings for the past 32 years, he carne in close setting up a Contractors’ Credit Cooperative Society to service association with Past Presidents Mr. R. G. Gandhi, Mr. Y. G. the financial needs of the small contractors. This has now Patel, Mr. H. J. Shah, Mr. H. L. Aurora, Mr. M. Nilakantan, grown into a multi-branch operation all over the State. Mr. M. N. Rajaraman, Mr. Amarjit Singh Choudhury, Dr. T. Similarly in order to address the recreational needs of member N. Subba Rao, Mr. S. A. N. Ranganathachar, Mr. R. Contractors, he had been instrumental in obtaining land and Radhakrishnan, Mr. S. R. Kar Roy, Mr. Ajit Gulabchand and starting a club ‘Karnataka Contractors’ Club’ in the sylvan Mr. Lalit Sangtani and their teams of Office Bearers. surroundings of the Banglore Palace.

Mr. Chinnaswamy Raju was also been the architect behind • Shri K.P. Pradeep, Member of BAI and MD & Editor of starting ‘Centre for Awareness in Construction and ‘Masterbuilder’ Magazine, expired on 11 th June 2016. Engineering – CACE’ at Banaglore to train construction workers, supervisors, small contractors, in the correct use of • Shri K.B. Gurha from Korba (Chattisgarh), a regular products, tools, productivity etc. Recognising the work done contributor of articles to ‘Indian Construction’ journal, by the Centre, an organisation of Netherlands expired on 6 th March 2016. ‘BOUWBERRAD’ came forward to extend financial assistance. • Shri Damodar Narayan Bhobe, Patron Member of BAI Mumbai Centre, expired on 26 th July 2016. With the help of some of his close associates and eminent industrialists, Mr. Chinnaswamy Raju formed a Financial • Shri Kumar Vaswani, Past Chairman, BAI Pune Centre, Institution known as ‘Plus Finance Ltd.’, the main object of expired on 20 th August 2016. which was to acquire a wide range of assets like movable Plant and Machinery, Balancing equipment, Air Conditioning • Shri Simon Mathai, Patron Member of BAI systems, Medical equipments, etc. through Lease Finance/Hire Muvattupuzha Centre, expired on 1 st September 2016. Purchase Finance. • Shri M. Jayakumar, General Council Member from BAI The latest area of diversification for the group under the Mayiladuthurai Centre expired on 20 th September 2016. stewardship of Mr. Chinnaswamy Raju, has been the infrastructure sector. This includes large-scale housing • Shri Subir Kumar Choudhury, Past Hon. Gen. Secretary; townships and power generation. In the area of housing, I Past Chairman, BAI Mumbai Centre and Founder, Atria Holdings’ is in the process of building over 7 million ‘Mumbai Construction’ – News Bulletin of BAI Mumbai sq.ft. of space over the next 5 years. In the area of power th Centre and former Sheriff of Mumbai, expired on 14 generation the group envisages putting up power projects to November 2016. generate 200 MW of power.

• Shri R. Raman, Past Chairman, BAI Southern (Chennai) Mr. Chinnaswamy Raju has been associated with the Builders’ Centre, expired on 2 nd December 2016. Association of India from 1986, as one of its Managing

Committee members and was one of the Vice Presidents for • Shri M.R.N. Murthy, Past Vice President of BAI, expired an 18-month terms in 1991-93. In addition, he was associated on 5 th December 2016. with a number of other socially active organisations and educational institutions. He was elected as the President of • Shri Atul Raval, Past Chairman of BAI Gujarat BAI for 1996-97 and as a Trustee for the period 1999-2004. st (Ahmedabad) Centre, expired on 1 February 2017. The All India Builders’ Convention was held in January 1997, • Shri Harkant Vachharajani, Past Chairman of BAI during his Presidentship, when then Honourable Prime th Minister Mr. Deve Gowda was the Chief Guest. Tamilnadu Gujarat (Ahmedabad) Centre, expired on 8 March 2017. State Chief Minister Hon’ble Dr. M. Karunanithi and many State and Central Ministers participated in the convention. An exhibition was also simultaneously conducted.

Mr. A. S. Chinnaswamy Raju was to be seen at events of BAI

Karnataka (Bangalore) Centre, he attended most of the

Managing Committee and General Council meetings held across India. He was always available to BAI for guidance.

The Association lost the following members who left for their heavenly abode. BAI in their death has lost sincere and hardworking members.

• Shri K. Sudarshan Reddy, Past State Chairman, Andhra th Pradesh, expired on 28 February 2016.

• Shri Shitul Patel, Past Executive Committee Member of th BAI Mumbai Centre, expired on 5 March 2016.

• Shri M. Krishnamurthy, Past Vice President, BAI, th expired on 11 June 2016.

ATTENDANCE SHEET FORMING PART OF ANNUAL REPORT FOR THE YEAR 2016-17 ATTENDANCE (OUT OF SIX MEETINGS)

Name Attendance Name Attendance Shri Avinash M. Patil, President 6 Shri Naresh Kumar Agarwal 4 Shri Mu. Moahan, Vice President 6 Shri Narendra Kumar 3 Dr. Rajiv B. Krishnani, Vice President 6 Shri Neelkanth S. Joshi 2 Shri Ravindra Pradhan, Vice President 3 Shri O.K. Selvaraj 3 Shri R.N. Gupta, Vice Presidents 6 Shri P.P. John 2 Shri C.G. Deochake, Hon. Gen. Secretary 6 Shri P. Parameswaran 6 Shri Neerav Parmar, Hon. Gen. Treasurer 6 Shri Prabir Kumar Mukherjee 4 Shri Lal Chand Sharma, 5 Shri Pratap B. Salunkhe 2 Imm. Past President & Trustee Shri Prince Joseph 3 State Chairmen / State Co-ordinators Shri R. Ethirajan 5 Shri Alok Shivhare (Chhattisgarh) 2 Shri R. Krishnawamy 5 Shri B. Sugunakar Rao (Telangana) 6 Shri S. Ayyanathan 3 Shri CH Ramakotaiah (Andhra Pradesh) 4 Shri Sanjay Laxman Patil 1 Shri Devendra Tiwary (Jharkhand) 1 Shri S. Ganapathi 5 Shri John Paul K. (Kerala) 6 Shri Srinivasa Reddy 3 Shri K.S. Someshwara Reddy(Karnataka) 5 Shri S. Prakash 3 Shri Kulesh Goswami (Assam) 1 Shri S. Ramaprabhu 5 Shri M. Thirusangu (Tamil Nadu) 5 Shri T.V. Chandrasekaran 4 Shri Nitin M. Shah (Gujarat) 3 Dr. Tarro T. Manghnani 6 Shri Ravi Kumar Kheria (Rajasthan) 2 Shri Y. Ishwar Rao 1 Shri Sanjay Tyagi (Uttar Pradesh) 1 Shri Sudip Kumar Dutta (West Bengal) 3 Representatives of Affiliated Association Members Shri Suresh B. Patil (Maharashtra) 6 Shri Atul Vijaykant Moog 0 Shri Suresh Vaswani (Madhya Pradesh) 2 Shri E. Manohar 2 Shri N. Velayutham 2 Members of the Managing Committee Shri R.R. Shridhar 3 Shri Abhay M. Garde 1 Shri A. Chamaraja Reddy 3 Past President Shri Amar Bawa 2 Shri B.N. Dikshit 2 Shri A. Puhazhendi 5 Shri H.S. Dugal 0 Shri Ashok Agarwal 2 Dr. Brahm Datt 1 Shri Baburao L. Shakkarwar 1 Shri Shriprakash Goel 4 Shri Basavaraj S. Totad 3 Shri A.S. Chinnaswami Raju 1 Shri Bhopinder Lal 5 Shri V. Ramachandran 4 Shri D. Kempanna 3 Shri R. Radhakrishnan 6 Dr. Dharmesh C. Awasthi 3 Shri M. Karthikeyan 4 Dr. D. Thukkaram 5 Shri A.K. Yussouf 2 Shri G. Thilagar 2 Shri P.R. Mundle 0 Shri Harshad N. Bhayani 2 Shri Ajit Gulabchand 0 Shri H.N. Vijaya Raghava Reddy 5 Shri S.A. Vichare 0 Shri Jaiprakash Bhatia 5 Shri Lalit Sangtani 0 Shri Jawahar Mutha 1 Shri Bhagwan J. Deokar 4 Shri Jagdish M. Parekh 2 Shri Cherian Varkey 1 Shri K. Annamalai 5 Shri B. Seenaiah 2 Shri K.J. George 1 Shri S.K. Basu 5 Shri K. Mathiyalagan 3 Shri K. Ramanujam 4 Members co -opted to Managing Committee Shri K. Subramani 5 Shri J.R. Sethuramalingam 3 Shri L. Shantakumar 4 Shri N.M. Patel 5 Shri L. Venkatesan 4 Shri V.M. Fazal Ali 4 Shri Mahesh R. Mirani 4 Shri Vinod C. Gamdiwala 5 Shri Mathew Alex Vellapally 4 Shri M. Dhandavakrishnan 2 Special Invitees Shri M.G. Sundar 3 Shri A.K. Srivastava 1 Shri Mohan S. Kataria 3 Shri A.N. Balaji 1 Shri Mohinder Rijhwani 3 Shri Anthony Rathnam 1 Shri Mohan D. Bhate 3 Shri Arvindbhai V. Patel 0 Shri N. Ramalingam 0 Shri B. Adinarayana Reddy 1 Shri Narendra P. Patel 2 Shri B. Babu Rao 1

Special Invitees Trustees Shri C.S. Parhar 2 Shri Ashok K. Choudhary 2 Shri D.P. Balaji 1 Shri D.L. Desai (Shankarbhai) 3 Shri G.M. Ravindra 1 Shri M. Karthikeyan 4 Shri H.V. Nagesh 1 Shri N. Sachitanand Reddy 5 Shri Harkant G. Vachharajani 0 Shri R. Subburaman 3 Shri I. Nepolian 1 Shri Vijay Jagannath Devi 4 Shri J. Dhanasekar 0 Shri Lal Chand Sharma 5 Shri Jacob Mathew Vellapally 1 Shri Jaideep P. Raje 0 Shri Joshy Joseph 3 Shri K. Chinnaswamy 2 Shri K. Rajakumaran Nair 1 Shri K. Rajavel 2 Shri L.D. Kotwani 1 Shri M. Rajendran 1 Shri Mahesh G. Mahajan 2 Shri Manesh K. 1 Shri Milind T. Patil 1 Shri MVG Jawagar 1 Shri N.M. Krishnamurthy 1 Shri N.P. Vishwanath 2 Shri P. Shahin 0 Shri P.K.P. Narayanan 2 Shri Paresh Vachhani 0 Shri Praksh N. Dewalkar 1 Shri Pratap S. Rananaware 0 Shri R. Manohar 1 Shri R. Saravanan 2 Shri R. Sivakumar 4 Shri Rahul B. Vakharia 0 Shri Rajendra K. Mutha 2 Shri Rajendra M. Upadhye 0 Shri Ramdas R. Jagtap 1 Shri Ramesh P. Marda 0 Shri S. Pandiyen 2 Shri S.M. Sait 0 Shri S.R. Swamy 1 Shri Sanjay Shah 1 Shri Sharad D. Kharade (Patil) 1 Shri Stanley Scaria 1 Shri Sunil Kokitkar 1 Shri Suresh Moorjani 3 Shri Tarak R. Mamlatdarna 1 Shri Uday N. Gokhale 1 Shri V. Narasimhan 3 Shri V. Sivarajan 3 Shri V.L. Muniraja 1 Shri Vinit Patel 0

Chairpersons of Committees Shri H.S. Pasricha 0 Shri K. Sriram 4 Shri K. Venkatesan 6 Shri K. Viswanathan 4 Shri R.K. Jain 0 Shri Saumil A. Patel 0 Shri Sandesh Mundra 1 Shri Varinder Kumar Garge 0 Shri Ved Khurana 2 Shri V.G. Sakthikumar 3 Shri Vilas K. Birari 4

Name Attendance Name Attendance BAI Centres Chairmen Shri K.K. Abraham (Changanacherry) 2 Shri N.K. Thakur (Patna) 2 Shri V.S. Jayachandran (Kerala 2 Trivandrum) Shri Ran Vijay Pradhan (Jharkhand Ranchi) 0 Shri Manoj Mathew ( Cochin) 2 Shri Shiv Kumar Burman (Jamshedpur) 0 Shri K.M. Abdul Jabhar (Kodungallur) 0 Shri Surojit Samanta (Eastern Kolkata) 2 Shri Jose Thomas ( Kollam) 2 Shri Awadh Kishore Mishra (Durgapur) 1 Shri Santy V. Mathew (Kottayam) 5 Shri Ranjit Kumar Debnath (Haldia) 1 Shri Sabu Thomas (Muvattupuzha) 3 Shri Sanjib Goyal (Guwahati) 1 Shri Jose Valothil (Thripunithura) 1 Shri Pinak Pani Nath (Silchar) 1 Shri Navas Attinkara (Thiruvalla) 1 Shri Ram Avtar (Delhi) 4 Dr. C.R. Ramdas (Thrissur) 1 Shri Nand Kishor Goyal (Rajasthan Jaipur) 1 Shri S. Balaji (Chengalpattu) 3 Shri Kishor Singh Parihar (Jaisalmer) 0 Shri S.M. Bakiaraj (Chettinadu) 1 Shri Anil Bhawnani (Jodhpur) 0 Shri R. Karana Boopathy (Coimbatore) 4 Shri Rajeev Khattar (Agra) 0 Shri M. Veeramarban (Dindigul) 2 Shri Manoj Sharma (Agra Cant.) 0 Shri R. R. Sathiamurthi (Erode) 1 Shri Ashok Kumaar Sharma (Aligarh) 3 Shri R. Govindan (Kanyakumari) 0 Shri Harish Chandra Agrawal (Allahabad) 0 Shri B. Murali (Kodaikanal ) 1 Shri Arun Kumar Tyagi (Bagpat) 1 Shri R. Venkatesan (Kumbakonam) 3 Shri Praveet Chaudhary (Bareilly) 1 Shri M. Selvakumar ( Madurai) 2 Shri Satish Kasana (Gautam Budh Nagar) 1 Shri P. Satheesh Kumar (Maduranthagam) 0 Shri Dinesh Sharma (Ghaziabad) 2 Shri S. Chandrasekaran (Mayiladuthurai) 2 Shri Ravinder Nagar (Greater Noida) 1 Shri A. Moorthy (Nagapatnam) 0 Shri Rajeev Agarwal (Hapur) 4 Shri K. Mani (Namakkal) 2 Shri Vikas Agarwal ( – South) 0 Shri V. Loganathan (Neyveli) 2 Shri Yoginder Kasana (Loni) 1 Smt. P. Punithavathi (Nilgiri) 0 Shri Harjeet Singh (Lucknow) 1 Shri M. Murugesan (Pudukkottai) 1 Shri Sudhir Tyagi (Meerut) 1 Shri S. Mohan (Salem) 2 Shri Vijay Kumar Bansal (Meerut Cantt.) 1 Shri K. Venkatesan (Southern Chennai) 6 Shri Vipin Kumar Sirohi (Modi Nagar) 0 Shri B. Anandhan (Thanjavur) 3 Shri Vipin Kumar (Moradabad) 0 Shri Sivakumar E.S. (Theni) 0 Shri Manbir Tyagi (Moradabad Northern Rly.) 1 Shri L. Sundaram (Tiruvannamalai) 1 Shri Rajiv Tyagi (Muzaffarnagar) 1 Shri J. Sankaran (Tiruchirappalli) 2 Shri Jai Kumar Agarwal (Sitapur) 1 Shri A. Kumar (Tirupur) 1 Shri M. Sri Hari (Nellore) 1 Shri M. Olaganatha Sankar ( Tirunelveli) 1 Shri N. Srinivasa Reddy (Ravulapalem) 3 Shri K.J. Jayasrinivasan (Thiruvallur) 0 Shri V. Venkateswara Rao (Vijayawada) 1 Shri Haribalakrishnan (Tuticorin) 0 Shri G.V. Ravi Raju (Visakhapatnam) 0 Shri C. Sridhar (Vellore) 0 Shri V. Gangadhar (Adilabad) 1 Shri Surendra K. Prahladka (Andaman & 1 Nicobar) Shri V. Ravinder Reddy (Greater Hyderabad) 4 Shri L. Carttigueane (Puducherry) 3 Shri P. Narasimha Rao (Hyderabad) 5 Shri N. Anbazhagan (Karaikal) 2 Shri U. Surender (Karimnagar) 2 Shri Hemant Khanna (Bilaspur) 1 Shri CH Srinivasa Rao (Khammam) 2 Shri Kanwaljeet Singh Oberoi (Durg- 1 Bhilai) Shri S. Venkateswarlu (Medak) 1 Shri Sharda Prasad Singh (Jagdalpur) 2 Shri CH Pavan Reddy ( Mahaboobnagar) 3 Shri Kanmal Jain (Kanker) 1 Shri Soma Srinivas Reddy (Nalgonda) 4 Shri K. Chandrasekhar Rao (Raipur) 2 Shri V. Bhaskar Reddy (Nizamabad) 4 Shri Vilas Bhangi (Goa) 0 Shri Ghantasala Balaji (Ranga Reddy) 1 Shri Kalpesh A. Joshi (Vadodara) 2 Shri K. Devender Reddy () 3 Shri Rajesh N. Shah (Bharuch) 0 Shri M.K. Anantha Reddy (Chitradurga) 0 Shri Gopal Sing Rathod (Gujarat 1 Ahmedabad) Shri R. Ambika Pathy (Karnataka Benglore) 2 Shri Smit Kaneria (Rajkot) 0 Shri N. Subramanya (Mysore) 3 Shri Bhuwan Giri Goswami (Surat) 2 Shri Inani Purushottam (Raichur) 0 Shri Ramesh Nathani (Bhopal) 2 Shri H.R. Shashidhar Naik (Shimoga) 3 Shri Arun Kumar Jain (Indore) 0 Shri Rajeev Warrier (Alleppey) 1 Shri Sanjeev Garg (Jabalpur) 0 Shri V.S. Mytheen (Aluva) 2 Shri Dilip B. Jagtap (Ahmednagar) 2 Shri K.A. Johnson () 3 Shri Pradeep R. Chadha (Amravati) 1 Shri Girish Manapure (Butibori Nagpur) 0 Shri Rajendra Kharade (Baramati) 3 Shri Rajendra Bhupal Khanderajure 2 Shri Sanjay S. Desale (Dhule) 3 (Ichalkaranji)

Shri Pratap Krishant Kondekar (Kolhapur) 2 Shri Anil Bhaidas Patil (Jalgaon ) 2 Shri Mahendra P. Patil (Malegaon) 1 Shri Suresh Ramrao Pensalwar (Latur) 0 Shri Raja Dronkar (Nagpur) 1 Shri Pradeep Nagawekar (Mumbai) 5 Shri Rameshwar Malani (Nashik) 6 Shri Manoj More (Nanded) 1 Shri Nimbalkar Pramod Subhashrao (Phaltan) 1 Shri Ashok R. Jethwani (Parbhani) 0 Shri Jayant P. Patankar (Sangli ) 1 Shri Siddharth Shah (Pune) 3 Shri Mangesh Arun Jadhav (Satara) 1 Shri Kisan Keshavrao Thorat (Sangamner) 0 Shri Prakash Hotchand Menda (Ulhasnagar) 6 Shri Rajesh B. Deshmukh (Solapur) 1 Shri M.K. Ashik (Calicut ) 1

Note: Discrepancy, if any, may kindly be informed to the Head Quarter Secretariat on or before 30 th June 2017.

Team 2017-18

President Mr. H. N. Vijaya Raghava Reddy Vice Presidents Mr. L. D. Kotwani Mr. R. N. Gupta Mr. S. Narasimha Reddy Mr. Sachin Chandra Mr. V. N. Varadharajan

Hon. Gen. Secretary Hon. Gen. Treasurer Mr. C. G. Deochake Mr. Neerav Parmar Imm. Past President Avinash M. Patil

State Chairman – Andhra Pradesh Mr. P. Raja Babu

State Chairman – Chattisgarh Mr. Alok Shivhare

State Chairman - Gujarat State Chairman - Jharkhand Mr. Pankaj N. Saraiya Mr. Chandrakant K. Raipat State Chairman - Karnataka State Chairman - Kerala Mr. S. R. Swamy Mr. V. Santosh Babu State Chairman - Maharashtra State Chairman - Tamil Nadu Mr. Rajendra S. Athawale Mr. G. Ved Anand State Chairman - Telangana State Chairman - Uttar Pradesh Mr. B. Sugunakar Rao Mr. Ravindra Tyagi State Co-ordinator - Assam State Chairman – Delhi

Mr. Sanjib Goel Mr. Ram Avtar State Co-ordinator - Haryana State Co-ordinator - Madhya Pradesh Mr. Rajiv Goel Dr. Santosh Katiyar State Co-ordinator - Puducherry State Co-ordinator - Rajasthan Mr. L. Carttigueane Mr. Pradeep Kumar Jain

State Co-ordinator - West Bengal Mr. Ashok Kumar Chandak

Members of the Managing Committee representing Centres

Mr. Anilbhai R. Zinzuwadia Mr. Ashok Agarwal Mr. Baburao L. Shakkarwar Mr. Bhopinder Lal Mr. D. R. Sekar Mr. D. V. N. Reddy Mr. G. Diwakar Mr. G. Thilagar Mr. Jaiprakash Bhatia Mr. K. Annamalai Mr. K. Subramani Mr. M. Dhandavakrishnan Mr. M. Thirusangu Mr. Mathew Alex Vellapally Mr. Mohan S. Kataria Mr. N. Ramalingam Mr. N. Shanmugam Mr. N. S. Muralidhara Mr. Prabir Kumar Mukherjee Mr. Prakash H. Menda Mr. Prince Joseph Mr. S. Ramaprabhu Mr. S. I. Chunkhare Mr. S. S. Natarajan Mr. Suresh B. Patil Mr. T. V. Chandrasekaran Mr. V. Satya Murthy Mr. V. Srinivasa Murthy

Members of the Managing Committee representing Patron Members

Mr. A. Chamaraja Reddy Mr. Alex P. Cyriac Mr. Basavaraj S. Totad Mr. Bhojraj Vithalrao Naik Nimbalkar Dr. Dharmesh C. Awasthi Mr. John Paul K. Mr. K. Viswanathan Mr. K. J. George Mr. L. Shanthakumar

Mr. L. Venkatesan Mr. Mahesh M. Mudda Mr. Mu. Moahan Mr. N. M. Patel Mr. Narendra Kumar Mr. P. Narasimha Rao Mr. P. P. John Mr. P. Subramani Mr. Paul T. Mathew Dr. Rajiv B. Krishnani Mr. Ravindra Pradhan Mr. S. Ayyanathan Mr. S. Ganapathi Mr. S. D. Kannan Dr. Tarro T. Manghnani Mr. V. Ravinder Reddy

Members of the Managing Committee representing Affiliated Associations

Mr. Arvind V. Patel Mr. G.M. Ravindra Mr. R. Manoharan Mr. S. Pandiyen

Co-Opted Members

Mr. V.M. Fazal Ali Dr. D. Thukkaram Mr. M. Munireddy

Specail Invitees

Mr A.S. Gandhi Mr A.V. Sridhar Mr Abhay Garde Mr Anthony Rathnam Mr B. Anandhan Mr B. Ramesh Mr C.K.S. Panicker Mr C.N. Raja Mr Dinesh K. Patel Mr E. Keerthinathan Mr Girish Manapure Mr Girish Shah Mr Jagdish M. Parekh Mr Joshy Joseph Mr K. Selva Durai Mr K. Selvaraj Mr K.K. Raghavan Mr M. Aravinth Mr M. Baldwin Bruce Mr M. Rajendran Mr M.S. Ramprasad Mr Mahesh R. Mirani Mr Mahesh Verma Mr Mohan D. Bhate Mr Najeeb Mannel Mr P. Palani Mr P. Senthil Nathan Mr P.K. Ramachandran Mr P.M. Harshe Mr Prakash N. Dewalkar Mr R. Dharmalingam Mr R. Joseph Arputha Alex Mr R. Krishnaswamy Mr R. Mouraly Mr R. Srinivasan Mr Rajendra M. Upadhye Mr Rajendra Mulchand Gothi Mr Ramesh Marda Mr S. Balaji Mr S. Wilfred Mr Sukumar F. Chougule Mr Surendra K. Prahladka Mr Suresh Moorjani Mr T.V. Ramakrishnan Mr Tarak R. Mamlatdarna Mr U.M. Gurushanthappa Mr Uday N. Gokhale Mr Upendra J. Barot Mr V. Govthaman Mr V. Sivarajan Mr V.S.K. Moorthy Mr Vinod C. Gamdiwala

Builders’ Association of India

(All India Association of Engineering Construction Contractors & Builders)

FUNCTIONING CENTRES

ANDHRA PRADESH STATE Jharkhand (Ranchi) Pune TELAGANA STATE Nellore Sangli Adilabad Rajahmundry KARNATAKA STATE Satara Greater Hyderabad Ravulapalem Karnataka (Bangalore) Solapur Hyderabad Tanuku Chitradurga Ulhasnagar Kamareddy Vijaywada Hasan * Wai Karimnagar Visakhapatnam Mysore Khammam Vizag Steel City* Raichur RAJASTHAN STATE Mahaboobnagar Shimoga Jaisalmer Medak ASSAM STATE Jodhpur Nalgonda Guwahati KERALA STATE Rajasthan (Jaipur) Nizamabad Silchar Alleppey Udaipur Ranga Reddy Tezpur Aluva Warangal Angamalli TAMIL NADU STATE BIHAR STATE Calicut Chengalpet UTTAR PRADESH STATE Patna Changanacherry Chettinadu Agra Kerala (Thiruvananthapuram) Coimbatore Agra Cantt. CHATTISGARH STATE Kochi Dindigul Aligarh Bilaspur Kodungugallur Erode Allahabad Durg-Bhillai Kollam Kallakurichi * Baghpat Jagdalpur Kottayam Kanyakumari Bareilly Kanker Muvattupuzha Kodaikanal Gautam Budha Nagar Raipur North Malabar (Kannur) Kumbakonam Ghaziabad Thripunithura Madurai Greater Noida DELHI STATE Thrissur Madhuranthakam Hapur Delhi Thiruvalla Mayiladuthurai Loni Delhi East Shahadara* Nagapattnam Lucknow Delhi North* MADHYA PRADESH STATE Namakkal Meerut Delhi South* Bhopal Nilgiri Meerut Cannt. Delhi West* Indore Neyveli Modinagar Jabalpur Perambalur * Moradabad GOA STATE Ponneri * Moradabad Northern Railway Goa MAHARASHTRA STATE Pudukkottai Muzaffarnagr Ahmednagar Salem Sitapur GUJARAT STATE Amravati Southern (Chennai) Kanpur Baroda Baramati Thanjavur Kanpur -South Bharuch Butibori Thenni Gujarat (Ahmedabad) Dhule Thiruthuraipoondi * UNION TERRITORIES Rajkot Ichalkaranji Thiruvannamalai Andaman & Nicobar Surat Jalgaon Tiruchirapalli Karaikal Kolhapur Tirunelveli Pondicherry HARYANA STATE Malegaon Tirupur Gurgaon Mumbai Tiruvallur WEST BENGAL STATE Karnal Nagpur Tuticorin Durgapur Nanded Vellore Eastern Centre (Kolkata) JHARKHAND STATE Nashik Haldia Hazaribagh Nandurbar *Opened during the Jamshedpur Phalatan year 2016 -17.

AFFILIATED ASSOCIATIONS

• All Kerla Government Contractors Association • Kerala CPWD Conatractors Association • Amravati District Contractors’ Association, Amravati • Latur District Builders’ Association, Latur • Association of Builders for Chennai Development • Mumbai Housing & Area Development Contractors’ Association, • Chennai Flat Promoters’ Association - North Mumbai • Chennai Suburban Builders Association • Nagpur Contactors Association • Confedeartion of Real Estate Developers Association of India • Pavers Finished Road Builders’ Association, Chennai (CREDAI), Karnataka • Singara Chennai Builders Association • Contractors and Builders Association of Vidarbha • Southern Region Petrolum Corporation Contractors Welfare • CPWD Civil Contractor Association Association • Earthmoving Contractors & Machinery Owners Association • The Association of Engineering Constractors CMWSS Board • Flat Promoters Association (Ambattur & Avadi) • Tamilnadu Fly Ash Bricks & Blocks Manufacturers Association, • Flat Promoters Association- Chennai South Chennai • Gujarat Contractors’ Association, Ahmedabad • Tamil Nadu Solid, Hollow & Paver Blocks Manufactures • Jharkhand Local Thekedar Sangh, Ranchi Association • Kancheepuram Civil Engineers Association (KANCEA) • The Southern Railway Engineering Contractors Association • Karnataka State Contractors’ Association, Bangalore

Builders’ Association of India (All India Association of Engineering Construction Contractors & Builders)

ESTD . 1941

Report s from BAI Centres

2016–2017

www.baionline.in

BAI Centre’s Report 2016 – 17

Alleppey Centre Changanassery Centre

Members of the Centre, under the leadership of Mr. Installation function of the office bearers of the Jacob John (Chairman – 2014-15) and Mr Money Centre was held on 19th June 2016. Varghese (Hon Secy 2014-15) had undertaken a project ‘Home for the Homeless’, wherein they The Centre installed a water cooler at constructed houses for the poor. The project was Thrikodithanam Police Station for public use, which completed in 2016-17 and keys were handed over to was inaugurated by Mr. Ajith Kumar, Dy. S.P. deserving poor families. Changanachery and also distributed text books, note books and bags to the students and to the needy pupil Angamaly Centre of Changanachery Government School.

Installation of new office Bearers were conducted at The Centre celebrated ONAM on 18th September Diana Heights Hotel on 26.06.2016. State Chairman 2016. The Centre arranged family meet on 11th Shri John Paul installed Shri Johnson K. A. as October 2016 and 11th January 2017. Chairman and office bearers. Roji M John MLA was the Chief Guest. Builders Day was conducted on On 11th January 2017, a technical meet was arranged 27.11.2016 with a motivation talk by an International by the Centre on ‘How to make good cement corporate trainer Shri Adv. Kunji Palu. Centre also concrete and mortar’. initiated for giving a home for homeless and work started for a home for Sarojini, a widow having one Builders’ Day was celebrated by the Centre in child. Centre actively interacts with the members and association with Thiruvalla, Alapuzha and Kottayam conducted three general body meetings and seven Centre. executive meetings. The centre is planning for increasing its strength by another 33% increase that is The Centre took the steps to settle the labour issues 60 members. related with loading and unloading and gave representation to DLO, Kottayam for fixation of rates Baramati Centre for loading and unloading in certain items the reconciliation is in progress. Centre celebrated “Engineers Day” on 19th & 20th Sept 2016 alongwith Vidya Pratishthan’s Bajaj Chengalpattu Centre Institute of Engineering & Technology (VPKBIET), Baramati. Various competitions were organized for The Centre held’s 12 Executive Meeting for the year the engineering students and prices were distriputed 2016-17. to the winning students in the presence of Mr Vijay Devi, Trustee-BAI and many other senior members On 29.04.2016 Friday Installation Function of CPT & functionaries of Centre/State and prominent Centre Er. S. Balaji, Chairman and his Team of personalities. Office Bearers out founder Chairman C. Sathishkumar was installed the New Office Bearers Bharuch Centre and Chief Guest Chettinad Cement, Vice President, Guest of Honour Principal Dr. T. Sivanesan, The Centre organised a meeting of fellowship meet Professor, University are Participate the Function. for all members of BAI Bharuch Centre conducted to Installation Function Chairman Er. R. Prakash review previous year projects and brainstorming for arranged this function grand manner. the next year 2016-17. On 29.07.2016 Fourth EC Meeting held at MM Hotel The Centre organised a P.F. Meeting on 04.06.2016 Kanchipuram Meeting regarding Health Camp evening talk on PF all members gathered at SMP Program organized by Apollo Hospital and House Bharuch and had a talk from PF office Educational Donation, New Member Introduction Bharuch discussed about compliance and and Issuing Certificate speech in Legal Advisor and commitment for PF of labours and staff members. Health Insurance Clamp for Workers and Members.

The Centre organised Engineers Day Celebration on On 15.08.2016 Independence Day Celebration Flag 15.09.2016, Celebrated Engineers day along with the Hosting Ceremony at out Office and tree plantation students of SVNIT Bharuch College. Presentation on program special speech and arrange the breakfast to today’s and Future of Civil Engineering, students our members. narrated about their subjects and implementation in future technology.

The centre Organised, an event with the State Health  A Seminar on GST was held on 28 th September Minister Program on 21.09.2016, with our members 2016. regarding dengu program in this function honour our  A Seminar on ESI / EPF was conducted at BAI Chairman. Chambers on 27 th January 2017.

The Centre also organised, “Skill India to Build  The Lecture on the topic ‘Vision on Urban India” Builders day Celebration Celebrating on Development’ was organised jointly with Kerala 23.10.2016, in Grand Manner with 500 workers and Management Association, CREDAI and IIA on 300 members arrange free medical camp with Suriya 4th October 2016. Clinic Kancheepuram Chief Gust motivation speech  A Certificate course in Construction cine actor Ajay Rathnam given eminent speech and Kancheepuram MLA C.V.M.A. Ezhilarasan, Chief Management for Engineering graduates in Guest and also attend the function and the give award association with KITCO was given for 15 students. BAI members were also some of the to Er. P. Ravichandran, Er. S.K. Kuppulingam, Best faculties. contribution to the industry. The hole function was arranged grand manner by builders day committee chairman Er. E. Venkatesan and Co. Chairman M.G. The Centre organised a seminar on ESI / PF was Sundar, all the members and workers issuing grand conducted at BAI Chambers on 27 th January 2017. gift. The Centre added 12 more new Patron Members for Cochin (Kochi) Centre the year 2016-17 and the total membership as on 31 st March 2017 is 220. The Centre organised a lecture on safety at construction sites by Mr. Josey John, w L&T ECC, During the year, the Centre conducted 12 Executive Mumbai were conducted jointly with CREDAI on Committee Meetings. 11 th June 2016 at Hotel Downtown. Coimbatore Centre The Centre organised a seminar on GST was held on 28 th September 2016 at BAI Chambers by Adv. Jose The Centre Office Bearers were installed on 2.4.2016 Jacob, Head, Indirect Taxes and Legal, JB Arsen. by Shri Avinash Patil, BAI, President, A children’s park was opened at Kalveerampalayam by the efforts The Centre organised lecture on the topic “Vision on of our Chairman Mr. R. Karanaboopathy with State Urban Development” by Ar. Iqbal Hibib from Dhaka Chairman Mr. Thirusangu opening the park. was organised jointly with Kerala Management Association, CREDAI and IIA on 04 th October 2016. Swami Sugbodhanandha from Bangalore rendered a brilliant and funny speech. This was attended by A certificate course in construction management for around 1300 builders and their family members. engineering graduates in association with KITCO was given for 15 students. BAI members were also The Centre organised platinum Jubilee’s valedictory some of the faculties. function on 24.11.2016 in a grand manner at hotel Raddison Blue. All the committees under out our Past Builders’ Day was held jointly with Muvattupuzha, Chairman Mr. K. Vishwanathan worked brilliantly Thripunithura and Thrissur Centres on 22 nd October towards the making the valedictory a grand success. 2016 at Hotel Taj Gateway. President, Shri Avinash All India Past Chairman Mr. Beeshma R. Patil was the Guest of Honour. Around 350 members Radhakrishnan, all India Vice Chairman (South) Mr. attended the function. M. Mohan, State Chairman Mr. Thirisangu and South Centre Chairman Mr. Venkatesan participated in the State Committee and State Convention was hosted by valedictory function. The event was sponsored by the Centre on 22 nd October 2016 and were well Renocon, P.R. Redymix, C.M. Doors. There was a attended. Seminars were also held during the State detailed coverage about the event in The Hindu Convention. On “Leadership in Safety” by Mr. Josey Newspaper. John, L&T, ECC, Mumbai and a ‘Discussion in latest labour laws’ by Adv. Jose Jacob, Head, Indirect The Centre Organised Builders Day and Monthly Taxes and Legal, JB Arsen, which were well Meeting on 23.10.2016 was held CODISSIA. Food appreciated by the members of all Centres. for the event was sponsored by membership committee Chairman Mr. K. Chinnasamy. Mementos Technical Seminars / Training: were also provided by past Chairman Mr. K. Chinnasamy. Sweets were provided by executive  A Lecture on Safety at construction site were committee member Mr. Lakshmanan. th conducted jointly with CREDAI on 11 June

2016.

Delhi Centre Centres, Delhi Centre created mile stone by by sponsoring Delhi East Centre in Delhi which was Centre hosted the First Meeting of the Managing formally inaugurated by Mr. Lal Chand Sharma,Imm. Committee of BAI for the year 2016-17 on Saturday, th Past President and Shri R N Gupta, Vice President on the 30 April 2016 at India Habitat Centre, New 18th July 2016 in a grand function organized at New Delhi. Mr. R N Gupta, Vice President and Mr. Ram Friends Club, Mathura Road, New Delhi. Also Avtar, Chairman welcomed the delegates to the present on the occasion were Mr. Ram Avtar, meeting and thanked BAI-HQ for hosting the Chairaman, Delhi Centre, Shri Rajiv Goel, Chairman- meeting. Centre also arranged for a Welcome Dinner th Gurgaon Centre and other senior members from and of delegates on Friday, the 29 April 2016. Mr host of other members from Delhi Centre. Mr. J P Avinash M Patil, President appreciated the efforts of Aggarwa; was formally installed as the first the centre in arranging the meeting at such a short Chairman of BAI - Delhi East Centre. Mr Lal Chand notice and also for the nice arrangements at the venue Sharma spoke on the occasion about BAI, of the meeting, dinner and transport arrangements. appreciated the good efforts put in by Shri R N On Saturday 8th August, 2016, Delhi Centre in Gupta, Vice President, Mr Ram Avtar – Chairman association with Delhi East-Shahdara, Gurgaon and and other in opening of the second centre in Delhi Karnal Centres organised a 'Farewell-cum-Welcome' Mr. Sharma also distributed Patron Membership function for Mr. Diwakar Garg, outgoing DG-CPWD, Certificate who were present on the inauguration who retired on 30th July 2016 and for Mr. Abhay ceremony. Sinha, incoming DG-CPWD, who joined on 1st August 2016. Mr. Mukand Joshi, who also retired as Delhi North Centre SDG-CPWD on 30th July, 2016 was also given a fond farewell. All the three officers were present along Mr R N Gupta, Vice President and Mr Ram Avtar - with their better halves. Nearly 33 senior serving Chairman Delhi Centre achieved another mile stone officers (Chief Engineer and above) and 14 retired of sponsoring and opening of Fifth Centre, in one officers, along with their spouses, from CPWD, were year, by announcing the opening of Delhi North invited. BAI was represented by Mr. R. N. Gupta, Centre in Delhi on 11th December 2016. Other Vice-President; Mr. Ram Avtar, Chairman, Delhi centres opened during the year are Gurgaon Centre Centre, Mr. J. P. Aggarwal, Chairman, Delhi East - and Karnal Centre in Haryana, Delhi East Centre and Shandara Centre, Mr. Rajiv Goel, Chairman, Delhi West Cenatre in Delhi. Though the Centre will Gurgaon Centre and Mr. Vijay Kumar Gupta, become functional from 1st April 2017, all the Chairman, Karnal Centre and other senior formalities related to the centre were completed by functionaries from these Centres. In his brief address enrolling the requisite number of patron members and Mr. Diwakar Garg thanked all BAI members for announcing the name of Mr. Sanjeev Bansal as its their support and co-operation during his service first Chairman. with CPWD, particularly as DG in particular. Mr. Abhay Sinha in his address assured his support Delhi West Centre and co-operation to the BAI members. All the other officers appreciated BAI members and Delhi West Centre was formally inaugurated by Mr. thanked for organsing the event, which gave them Avinash Patil, President on 8th September, 2016 in an opportunity to meet old stalwarts from their the Conference Room of BAI's Delhi office. Also department and also interact with the contractors present on the occasion were Mr. R. N. Gupta, Vice- working for their department. President, BAI and Mr. Ram Avtar, Chairaman, Delhi Centre and host of other members from Delhi Delhi, Delhi East, Delhi West, Delhi North Centres Centre and Delhi West Centre. Mr. Manoj Kumar from Delhi and Gurgaon and Karnal Centre from Singla was formally installed as the first Chairman of neighbouring Haryana jointly celebrated "Builders' BAI, Delhi West Centre. Delhi West is the fourth Day 2016-17' in Delhi on 10th November, 2016. Mr. Centre which has been sponsored and opened in R. N. Gupta, Vice-President was the Chief Guest for 2016-17 by Delhi Centre. Other centres which have the celebrations. Mr. Ram Avtar, Chairman, Delhi been sponsored and inaugurated by Delhi Centre Centre; Shri Rajiv Goel, Chairman, Gurgaon Centre; from April 2016 onwards are Delhi East Centre in Shri Jagdish Prasad Agarwal, Chairman, Delhi East Delhi and Gurgaon Centre & Karnal Centre in Shandara Centre; Mr. Manoj Kumar Singla, Haryana. Chairman, Delhi West Centre and host of senior functionaries from these Centres were present on the Dhule Centre occasion. Instalation function of the office bearers of the rd Delhi East Centre Centre was held on 3 April 2016. Shri Suresh B. Patil, State Chairman, was the Chief Guest. A large Joining the growing trend across India, that of number of members were attended the function. existing BAI Centres sponsoring opening of new

‘Swachhata Abhiyan’ was carried out for 2 Km road his team installed by Mr. S.K. Basu past president of length by the Centre, in the presence of Municipal BAI chief guest and Mr. Sudip Dutta state chairman Commissioner, Shri Namdeorao Bhosale, on 20 th was present. Senior member felicitated by centre. May 2016. The Centre organised Builders Day and Platinum The Centre organised an Awareness Lecture on Jubilee on 20.11.2016 of BAI was celebrated. Chief RERA and MOFA by expert speaker Advocate Guest was Mr. S.K. Basu present on that ceremony. Dinesh Gaikwad, on 29 th July 2016. A large number of members were participated the lecture. The Centre organised AGM and family picnic held on 29.01.17 at Anand Amusement Park, city centre. On 10 th August 2016, Mahamorcha was arranged by On that day new committee members were elected the Centre for implementation of New DCR for ‘D’ for 2017-18. Chairman Mr. Ajit Singh Alag and Class Corporation and various demand regarding others. regularities in sanctioning process. A Press Conference was also organised. Print and media 7 members of Durgapur were present at GC & MC given good coverage in all leading Newspapers. meeting at Chennai, Mysore & Kolkata.

The Centre organised an Expert Lecture on Durgapur centre arranged many seminar and meeting Demonetisation of Currency and its effect on Real for Service Tax and others issues for awareness. 93 Estate Sector by CA Shri Shriram Deshpande, on 27 th members are now in BAI Durgapur centre. November 2016. Durgapur Centre member, Mr. A.K. Chandak was The Centre organised Lecture on New DCR by elected new state Coordinator. Deputy Director, Town Planning, Shri Anant Dhamane, on 22 nd December 2016. A large number Kolkata (Eastern Centre) of members were participated the lecture. A delegation of senior members and their facility, led The Centre participated in the Trade Fair ‘Rover by Mr.S K Basu, Past President, visited Sri Lanka Buildcon 2017’, a popular exhibition of Dhule City, between 23 rd – 30 th March 2016 on business-cum- on 29 th December 2016. pleasure trip, on an invitation from National Construction Association of Sri Lanka (NCASL). A lecture was organised by the Centre on Investment The delegation met the Senior Members of NCASL Opportunities in Real Estate Sector ‘SPARSH 2017’ at their Seminar Hall. Mr. Basu introduced the on 29 th January 2017. Shri Rohit Mishra, Shri Sanjay members of the delegation and explained the general Desale, Chairman, Dhule Centre, and CA Shriram construction scenario in India and necessity of this Deshpande were the Keynote Speakers. type of meeting in between the two Associations to build a bridge between the two countries for the The Centre opened two new BAI Centres namely, cause of construction fraternity and mutual benefit. Shahada and Nandurbar in Maharashtra on 25 th He also discussed about the various opportunities in March 2017 by the hands of BAI President, Shri India for overseas contractors. NCASL informed the Avinash M. Patil. Shri Suresh B. Patil, State delegation about many big projects coming in Sri Chairman, Maharashtra and Shri Pratap Salunkhe, Lanka and the acute shortage of skilled workers. Mr. Chairman, Membership Development & New Basu explained about the initiative taken by BAI Centres Committee were present on the occasion. through NSDCI and offered assistance for forming The Centre celebrated Builders’ Day on the same such institutions there. Delegation also enquired day. The Centre also organised Awareness about the possibilities and procedure for working in Programme for Labours at various site locations. Sri Lanka. The overall interactive meeting was fruitful and Mr Basu invited all members of NCASL During the year, the Centre arranged interactive to India to exchange views for the good of meeting with various Political and Government construction industries of both the countries. officials. A meeting of the Executive Committee of Eastern Durgapur Centre (Kolkata) Centre was held in the Guest House of

st construction site of M/s S. K. Samanta & Co. Pvt. The Centre organised 1 meeting held on 27.04.16 at Ltd. (SKSCPL) in Bilaspur on 9th April, 2016. City Residency. The installation Ceremony date was th Before the meeting, the members visited Dipka decided on 8 May 2016. The new Chairman is Mr. Coal Handling Plant & Workshop, Gevra Silo Site, R. S. Khamboh. project sites at Kusmunda and Surshakti TMT Bars

The Centre organised Installation Ceremony was held Rolling Mill Division. The members also visited on 8.05.16 at city residency Durgapur. New the Construction Workers Training Institute in committee of 2016/17 chairman Mr. A.K. Mishra and Dipka, established by SKSCPL.

A function to felicitate Mr Sudip Kumar Dutta on his The Centre organised a Felicitation to State Co- being elected as State Co-ordinator of BAI West ordinator, BAI-WB, A felicitation function was Bengal was held in Kolkata on 6 th May 2016. Mr S K organized on 6 th May, 2016 at Bengal Club, Kolkata Basu, Past President was the Chief Guest. Mr Ashok to felicitate Sri Sudip Kumar Dutta, State Co- Kumar Chandak, Chairman-Durgapur Centre and Mr ordinator, BAI, West Bengal along with the R K Debnath, Chairman – Durgapur Centre were the Chairman of BAI, Durgapur and Haldia Centre. Sri Guest of Honour. Mr Dutta in his speech expressed S.K. Basu, Past President, BAI was the Chief Guest. his desire to open more Centres in West Bengal and The programme was attended by the members of sought the co-operation of everybody. Mr S K Basu Durgapur and Haldia Centre also. After felicitation, a briefed the gathering of various activities of BAI. cultural programme was organized which was Other senior member from the adjoining areas also performed by family members of our Eastern, graced the occasion with their family members. Kolkata Centre followed by Fellowship Dinner.

Members of the Centre visited Durgapur Centre for The Centre organised a Visit Durgapur Centre, the installation function of office bearers on 8 th Members of our Eastern (Kolkata) Centre headed by May 2016. Sri Sushanta Kumar Basu, Past President attend the Installation Ceremony of New Chairman of BAI, A Seminar on GST, “Decoding and Gearing up for Durgapur Centre on 8 th May 2016 at Hotel Citi Draft GST Law’ was organised by the Centre in Resideny, Durgapur. In this programme Durgapur association with ASSOCHAM on 24 th September Centre also felicitated our State Co-ordinatory, Sri 2016 at Hotel Taj Gateway, Kolkata. The key note Sudip Kumar Dutta. address was given by Shri Sumit Dutt Majumder, Ex-Chairman, Central Board of Excise and The Centre organised The 66 th Annual General Customs; Shri J.K. Mittal, Sr. Advocate in Indirect Meeting of the Centre was held on 22 nd June, 2016 at Taxes; Shri Vijay Kumar, Principal Commissioner the Centre where the members confirmed the Minutes of Service Tax-I, Government of India and Shri of the last Annual General Meeting and also Ajit Kumar, Dy. Commissioner of Central Excise, confirmed the Annual Report and Audited Balance Government of India. About 97 members of BAI Sheet for the year 2015-16 including members from Kolkata, Durgapur and Haldia Centres attended the Seminar. The Centre organised a seminar on GST, “Decoding and Gearing up for Draft GST Law”, was organized The Centre hosted the Sixth of the Managing by Builders’ Association of India, Eastern (Kolkata) Committee and Fourth Meeting of General Council Centre in association with ASSOCHAM on Saturday, of BAI for the year 2016-17 in Hotel ITC Sonar, 24th September, 2016 at Hotel Taj Gateway, Kolkata Kolkata on Saturday, the 4 th March 2017. Mr from 10.00 AM onwards. The seminar started with Surojit Samanta, Chairman welcomed the members welcome speech of Sri Surojit Samanta, Chairman of attending the meeting and thanked BAI-HQ for the Centre and the key note address was given by Sri giving the opportunity to host the meeting. The Sumit Dutt Majumder, Ex-Chairman, Central Board Centre also hosted the welcome dinner on Friday, of Excise and Customs and also an eminent Author, the 3 rd March 2017. In the evening of Saturday, 4 th Columnist and Customs and GST expert. Sri J. K. March 2017, after the meetings, instead of usual Mittal, Sr. Advocate on Indirect Taxes and an entertainment programme, which is arranged for eminent writer on the subject addressed the gathering the members to unwind, centre kept an ‘Open on some technical aspects of GST. Sri Vijay Kumar, House’ during the fellowship dinner wherein Principal Commissioner of Service Tax-I, Govt. of members were invited to give vent to their India and Sri Ajit Kumar, Dy. Commissioner of thoughts with regard to talking construction Central Excise, Govt. of India addressed the industry, BAI organizational issues / suggestions gathering thereafter and briefed about the current for the future and lot of deliberations took place status of enactment of GST Law. Sri Sanjay which was appreciated by everyone. Jhunjhunwala, Chairman, ASSOCHAM - Eastern Region, cited the role of GST to get rid of the The Centre organised a Visit Construction Site On 9th cascading effect of indirect taxes on business. April, 2016 all Office Bearers and Executive Thereafter, two very detailed, exhaustive and Committee Members were visited construction site of informative technical sessions were conducted by Sri S.K. Samanta & Co Pvt Ltd., at Gebra, Bilaspur, Sumit Dutt Majumder and Sri Pulak Saha of Price Madhya Pradesh and happy to note the ongoing Waterhouse Coopers (P) Ltd. Both of them took construction work. In the evening Chairman, Sri S.K. questions from the audience for almost half an hour Samanta hosted the first monthly meeting of the each. 97 members of BAI including members from Executive Committee for the year 2016-17 at their Kolkata, Durgapur and Haldia Centre attended the Guest House at Bilaspur. The entire programme was seminar. The event was followed by Lunch. well organized by his company.

The Centre received BAI Award 2015-16 towards – International Trade Fair for Construction Image Building Activities by a Centre. Machinery, Building Material Machines, Mining Machines & Construction Vehicles, in HUDA The last MC/GC meeting of the year 2016-17 was Grounds in Gurgaon, in a specially erected hosted by our Centre at ITC Sonar on 4 th March, conference hall at the venue of the Exhibition. Mr. 2017. On 3 rd March, welcome dinner was also Rajiv Goel, Chairman welcomed all in the meeting arranged at the same venue. Hon’ble Governor of and thanked the President and others for hosing Tripura, Sri Tothagata Roy was the Chief Guest and the meeting in the very first year of its formation. Inaugurate the MC/GC Meeting. Maximum number The Centre had arranged for a welcome dinner on of members throughout the country were attended Sunday 11 th December 2016. The Centre, in During the meeting, various agenda items was association with senior members from BAI Delhi discussed and resolved unanimously. In the evening Centre arranged for a courtesy visit of Mr Abhai there was a Farewell Dinner at ITC Sonar, Kolkata. Sinha, Director General, CPWD who interacted As per the opinion of the members, the entire with senior functionaries of BAI. He was in programmed was well managed particularly the particular briefed by the issues of contractors by special Hospitality of Bengal. Mr Avinash M Patil, Mr R N Gupta and Mr Neerav Parmar. Gujrat (Ahemdabad) Centre Gujrat Contractors Association (GCVA) organized Hyderabad Centre Gujrat Vibrant Summit & Awards 2016 in Ahemdabad on 29 th April 2016. Mr Nitinbhai Patel, The installation of New Office Bearers for the year Hon’ble Minister of Road & buildings, Govt of 2016-17 was held on 1.4.2016. With Shri P. Gujrat was the Chief Guest. Mr. B Seenaiah, Past Narasimha Rao Chairman, Shri Anirudh Gupta, Vice President was the Guest of Honour. Various awards Chairman, Shri K. Chandra Shekar Reddy, Secretary, were presented to the contractors / builders / Shri Y. S. Rama Raju, Joint Secretary, Sri. S. infrastructure companies on the occasion. Prominent Srinivas Rao, Treasurer. luminaries from the building and construction industry graced the occasion. During this year the centre has concentrated on the problems being faced by the construction industry in Gurgaon Centre Roads, Bridges, Housing, Irrigation etc.

The first BAI Centre in Haryana State i.e. Gurgaon The Hyderabad Centre was awarded Special Award was inaugurated by Mr. Avinash M. Patil, President for conducting XXVII All India Builders Convention on 17th June, 2016 in Gurgaon. Mr. Rajiv Goel was at Ramoji Film City, Hyderabad for the year 2015- installed as the first Chairman of Gurgaon Centre by 16. Mr. Avinash Patil. Mr. R. Gupta, Vice-President, BAI presided over the inauguration function. Patron During this year the centre has enrolled 379 more Membership Certificates were distributed to the members into BAI as on 31.3.2017. The Centre will newly enrolled Patron Members of the Centre. Mr. be adding some members to strengthen the BAI. Lal Chand Sharma, Imm. Past President & Trustee, BAI spoke about BAI and the various issues Ichalkaranji Centre confronting the building and construction industry being tackled by BAL Other senior members from Mr. Rajendra B. Khanderajure was installed as the Delhi Centre, Executive Secretary & Executive Chairman of Ichalkaranji Centre for 2016-17 on 21st Officer-Delhi Office were also present on the May, 2016 by Mr. Avinash M Patil, President. Mr. occasion. Suresh B. Patil alongwith other office bearers of the Centre, State Chairman-Maharashtra and Mr. Vijay Mr. Igor Palka, Chief Executive Officer, M/s bC Devi, Trustee were the Guests of Honour. Mr. Pratap Expo India Pvt. Ltd. - organisers of 'BAUMA B. Salunkhe, Past State Chairman was also present on CONEXPO 2016' was also present on the the occasion. occasion and briefed the gathering about 'BAUMA CONEXPO 2016' - International Trade Ichalkaranji Centre has instituted 'Jeevan Gourav Fair for Construction Machinery, Building Material Purskar' and 'Yuva Gourav Purskar'. On 21st May, Machines, Mining Machines and Construction 2016, Mr. Uday Gokhale was bestowed the 'Jeevan Vehicles in India, to be held in Gurgaon between Gourav Purskar', while Mr. Jahir Soudagar and Mr. 12th and 15th December, 2016. Firoj Shikalgar were bestowed the 'Yuva Gourav’.

Gurgaon Centre hosted the Fifth Managing Centre organized ‘Tree Plantation’ drive to plant Committee and Third Council Meeting 2016-17 of 1000 trees in and around Ichalkaranji which was BAI on Monday, the 12 th December, 2016, organized by Mr Prashant Rasai, CEO-Ichalkaranji alongside the ‘BAUMA CONEXPO INDIA 2016’ Muncipal Council in the presence of the other senior officials of the Council as well as the Centre. The donated their blood. Cataract checkup was done and event was covered by Media. spectacles were provided at discount rate.

Indore Centre During the year, the Centre conducted Twenty (20) Executive Committee Meetings. The Centre organise a meeting of all the members of BAI – Indore Centre called on June 30 th , 2016 at the Karnal Centre Office of Highway Infrastructure Pvt. Ltd. 57 FA Sch. No 94, Pipliyahana Junction, Ring Road Indore Joining the growing trend across India, that of to discuss various issues about the taxes and to sort existing BAI Centres sponsoring opening of new out the same by sharing views & suggestion. Centres, Delhi Centre created mile stone by sponsoring and opening of third Centre in a row by The Centre organise a meeting of all the members of opening Karnal Centre which is the second centre in BAI – Indore Centre called on Sep 9 th , 2016 at the Haryana. Delhi Centre has already opened Gurgaon Office of Highway Infrastructure Pvt. Ltd. 57 FA Centre in Haryana on 17th June 2016 which was Sch. No. 94, Pipliyahana Junction, Ring Road Indore. inaugurated by Mr Avinash M Patil, President. An agenda for a meeting was to discuss ESIC Karnal Centre was formally inaugurated by Mr. Lal Applicability to Construction workers, Provident Chand Sharma,Imm. Past President and Shri R N Fund Matters and Service Tax Matter. Gupta, Vice President on 18th July 2016, alongside the opening of Delhi East Centre in a grand function The Centre organise a meeting of all the members of organized at New Friends Club, Mathura Road, New BAI – Indore Centre called on October 07 th , 16 at the Delhi. Also present on the occasion were Mr. Ram office of Highway Infrastructure Pvt. Ltd. 57- FA Avtar, Chairaman, Delhi Centre, Shri Rajiv Goel, Sch. No. 94, Pipliyahana Junction, Ring Road Indore, Chairman-Gurgaon Centre and other senior members with retired PWD Engineers regarding the from and host of other members from Delhi Centre. Amendment in tender’s condition of Model tender Mr Vijay Kumar Gupta was formally installed as the documents. first Chairman of BAI - Karnal Centre. Mr Lal Chand Sharma spoke on the occasion about BAI, The Centre organise an Interactive session with appreciated the good efforts put in by Shri R N Hon’ble Mr. Ajay Kumar Mehta (Regional P.F. Gupta, Vice President, Mr Ram Avtar – Chairman Commissioner) held on January 13 th , 2017 4 PM at and other in opening of the second centre in Haryan a Hotel Shreemaya Residency A.B. Road Indore. and opening of third centre in a row in the year 2016- 17. Mr. Sharma also distributed Patron Membership The Centre organise a meeting of all the members of Certificate who were present on the inauguration BAI Indore Centre called on March 03 rd , 2017 at the ceremony. office of Highway Infrastructure Pvt. Ltd. 57 – FA Sch. No. 94, Pipliyahana Junction, Ring Road Indore. Karnataka (Bangaluru) Centre An agenda for a meeting was GST law & representation to the different departments for the The Centre organised a meeting to discuss about the same. XXVIII All India Builders’ Convention to be held on January 2018 at Bengaluru. Shri K.S. Someshwara Kanyakumari Centre Reddy informed that during the Special Meeting called on 15 th August 2016 at Builders’ NGV Club, Mr. R. Radhakrishnan, Past President & Past Trustee Shri R. Radhakrishnan – Past President & Trustee, installed Mr. R. Govindan as Chairman of BAI requested members to propose the tentative Kanyakumari Centre for 2016-17 on 6th April, 2016 dated for the Convention. Shri Basavraj Totad alongwith other office bearers. Mr. M. Thirusangu, suggested 5 th , 6 th & 7 th January 2018 or 19 th , 20 th & State Chairman, Tamil Nadu, Pondicherry and 21 st January 2018, the dates are on Friday, Saturday Andaman Nicobar also graced the function. and Sunday. It was unanimously decided as 5 th , 6 th & 7th January 2018. The Centre contributed Rs.1,00,000/- from Association Amount for State level meeting and The centre organised an event for Honouring of National Level Meeting. Artisans on the EVE Builders’ Day held on 23 rd October 2016 on the occasion of Builders’ Day – The Centre organised Build Expo held on July 1, 2, 3, 2016, 100 Artisans were honoured at Builders’ NGV 2016 at Perumal Mandapam., Club. The Chief Guest for the function was Shri R.R. Jannu, IAS, Commissioner of Labour, Government of The Centre organised Blood Donation and Eye Camp Karnataka, Shri K.S. Someshwara Reddy, State on 06.08.2016 at Dhevi Kalaiyarangam, Thattan Chairman, Karnataka, BAI was the Guest of Honour, Vilai, was held from 9 am. to 2 pm. many members Shri A.S. Chinnaswamy Raju – Past President & Trustee, BAI and Shri H.N. Vijaya Raghava Reddy –

Past Vice President, BAI & President – Builders’ bearers. Mr Mu Mohan, Vice President, Mr M NGV Club graced the occasion. Hon. Secretary Shri Thirusangu, State Chairman, Tamil Nadu, K.N. Babu Reddy proposed the vote of thanks. Pondicherry and Andaman Nicobar were also present Kodaikanal Centre on the occasion. Dr Sembiyuran, eminent orator delivered a special talk on the occasion. Er. R. As a part of image building activity, members of Soundarajan, outgoing Chairman formally handed Centre took up a social service project of cleaning over charge to Er . R. Venkatesan. Kodaikanal lake culverts and storm water drains. The local print and electronic media gave wide coverage Madurai Centre to the efforts of the Centre. st The Centre organised Builders’ Day 2016-17 on 21 Kodungallur Centre February 2017. Dr. Mangesh G. Korgaonker, Director General, National Institute of Construction The Kodungallur Centre conducted 12 Executive Management & Research (NICMAR), Pune, was the Committee and General Body Meeting. Chief Guest. Mr. Avinash M. Patil, President, BAI presided over the function. The keynote address was The Centre organised newly brought up GST bill on delivered by Mr. V. Ramachandran, Past President 07.11.2016 for the members by Chartered and Past Trustee, BAI. Mr. R. Subburaman, Trustee, Accountant Mr. Thomas P. Chaly. BAI; Prof. Dr. K. Arunachalam Dean (Academic Process), Thiagarajar College of Engineering, The Centre organised an awareness programme on Madurai; Mr. A. Puhazhendi, Past Vice President, 07.01.2017 for labourers about banking transactions BAI; Dr. B. Sivagurunathan, Associate Professor & and online payments on the event of demonetization Head of Civil Engineering Department, Thiagarajar and cashless economy, which helped out a log of College of Engineering, Madurai, were the Guests of people in bringing about ease of operation in the bank Honour. The Rolling Shield, awards and certificates transactions. of the Election Competition, Problem Solving Competition and Quiz Competition, conducted earlier The Centre organised a seminar on “Fire & Safety on by Madurai Centre were presented to the winning 4.2.2017 by Mr. Sanoop – Senior Fire Safety officer students from the 16 Engineering Colleges. – JNP LLC Riyad, KSA. Mumbai Centre Kottayam Centre Mr. Pradeep Nagawekar was installed as the Mr. John Paul K. was installed as State Chairman, Chairman of Mumbai Centre for 2016-17 by Mr. BAI Kerala on 21st April, 2016 by Mr. Avinash M Avinash M. Patil, President on 24th May 2016 Patil, President in Kottayam. Mr. Mu. Moahan, Vice- alongwith other office bearers of the Centre. Dr. President, was the Guest of Honour. Mr. V. M. Fazal Rajiv B. Krishnani, Vice-President, Mr. Suresh B. Ali, Imm. Past Vice-President, and Mr. Raju John, Patil, State Chairman Maharashtra; Mr. C. G. Executive Secretary were also present. Mr. Avinash Deochake, Hon. Gen. Secretary and Mr. Neerav Patil released the 'BAI Kerala Directory' and Mr. Parmar, Hon. Gen. Treasurer (outgoing Chairman of Gibu Mathew, Convenor 'BAI Kerala Directory' BAI Mumbai Centre), also graced the installation presented copies of the directory to all the dignitaries. function. Senior functionaries from BAI Centres in Chattisgarh, Goa, Gujarat, Madhya Pradesh & Kotayam Centre also hosted 'First BAI Kerala State Maharashtra States and many members from the Meeting for 2016-17' on 21st April, 2016. Mr. John Centre attended the installation function Paul K., State Chairman, Kerala, chaired the meeting. Issues concerning the building and construction The first Western Zone Meeting of Builders' industry, particularly in Kerala and on the national Association of India (BAI) for 2016-17 was held on front too were discussed. BAI organisational matters Tuesday, 24th May 2016 in Mumbai. The meeting were discussed. Office-bearers and senior was hosted by BAI Mumbai Centre. Dr. Rajiv B. functionaries of BAI Centres in Kerala attended the Krishnani, Vice President chaired the meeting. Mr. meeting. Avinash M. Patil, President also graced the occassion. BAI HQ Office bearers and West Zone The Centre hosted the Third Meeting of the office bearers also graced the dais during the Managing Committee of BAI for the year 2016-17 on meeting. Host of issues confronting the building and Sunday, the 18th September 2016 at Backwater construction industry in Chattisgarh, Goa, Gujarat, Ripples, Kumarakom, Kottayam. Madhya Pradesh & Maharashtra States in particular and on the national level in general were discussed. Kumbakonam Centre Non-availability of natural sand in Maharashtra,

Er . R. Venkatesan was installed as Chairman for Madhya Pradesh and Chhattisgarh; Price Variation/ 2016-17 on 24 th April 2016 alongwith other office Escalation of Construction Materials; Pre- qualification and Registration in Government

Departments, withdrawal EMD system by body meetings were held in various places. One of our Maharashtra Government; 'Single Window' general body meetings conducted at Club mud Resort Registration in some States; EPF applicability to in Maldives with good strength of members. All casual and temporary construction workers; training GCMC meetings we are providing a remarkable and certifying construction workers; Real Estate presence from the centre. (Regulation and Development) Bill 2013 (RERA) Act etc. were some of the issues which were The centre sent representation to several PWD Matters discussed in depth. like amendments of PWD Manual, Standard bidding Documents etc. On this matter authorities consider Mr. Pradeep Nagawekar, Chairman, Mumbai Centre majority of our demands. One of the main benefits was was the Chief Guest at the Lecture Meeting on 'Real adding the price escalation in PWD contracts beyond Estate (Regulation and Development) Act, 2016 and 18 months period contracts and another highlight was its implications for builders, developers, in Standard Bidding Document i.e. fixing the stakeholders, implications on redevelopment projects responsibility to the employer, engineer and contractor. and enhanced role of Chartered Accountants' held on 8th June, 2016 in Mumbai. The Lecture Meeting was The centre write to Works Authority whenever organised by 'Committee for Co-operatives and NPO arbitrary tenders issued by departments in Public Sectors' of The Institute of Chartered Accountants- of Works Department, Kuttanad Packages, Irrigation India (ICAI). CA Tarun Ghia, Chairman, 'Committee Departments, Forest Industries Travancore and Kochi for Co-operatives and NPO Sectors' of ICAI, Metro Rail Corporation Ltd etc. presided over the lecture meeting. In the case of using branded – Cement and Steel in The Centre arranged a meeting of the stakeholders PWD works. We approached the Chief Secretary; he coming under Real Estate (Regulation and quickly responded and gave direction to the Chief Development) Act, 2016 (RERA) on 9th July 2016. Technical Examiner to conduct a meeting with us. He From BAI, Mr. Pradeep Nagawekar, Chairman, BAI had released an order mentioning that the quality and Mumbai Centre; Mr. D.L. Desai (Shankarbhai), specification of the material is necessary rather than its Trustee, BAI; Mr. Ram M. Bhatia, Past Vice brand. We are able to stop the unfair tender practices President, BAI; Mr. L.D. Kotwani, Past Hon. Gen. followed in the Kerala Construction Corporation by Secretary, BAI and Mr. Bhushan Mehta, Past representing properly before the competition Chairman, BAI Mumbai Centre were present. From commission of India. By this step we were able to Practicing Engineers, Architects and Town Planners reinitiate transparency in tender procedure. Association (India) (PEATA), Mr. Manojkumar A. Dubal, President; Mr. Tarun Motta, Vice President, BAI – Muvattupuzha Centre and 46 A Class Mr. Manoj Daisaria, Past President and Mr. Contractors under it are the Petitioners before the Shashikant Jadhav, Executive Committee Member, Hon’ble High Court of Kerala in WP© were present. Mr. Tarun Ghia represented Institute of No.39162/2016. They approached the High Court Chartered Accountants of India (ICAI). Suggestions seeking to quash certain orders (Exts. P11 and P33) to be made to the Government of Maharashtra, whill issued by the Government of Kerala dated 20.2.2016 will be framing the rules for implementing RERA and 21.20.2016, whereby certain contract works are were discussed. The suggestions were discussed and entrusted by the State Government with the 11 th finalized and the same has been forwarded by BAI to respondent Uralunkal Labour Contract Co-operative The Principal Secretary (Housing), Government of Society (ULCCS) without any tender. Maharashtra. The Court opined that the award of works under The ‘6th Construction Week Awards’ was held in challenge is tainted with malafide, favouritism, Mumbai on 21st September 2016. Many senior unfairness and illegality. functionaries of BAI Mumbai Centre attended the same. Mr. Pradeep Nagawekar, Chairman, Mumbai Hence the Court decided to interfere with the award of Centre; Mr. C.G. Deochake, Hon. Gen. Secretary, works to the ULCCS by the Government of Kerala. BAI and Mr. Neerav Parmar, Hon. Gen. Treasurer, Accordingly, the award of work in respect of BAI were given the honour of presenting some of the Amabalpuzha-Thiruvalla Town Road was set aside. As Awards. M/s. New India Construction – firm of regards the other works under the challenge, the Court Mumbai Centre Hon. Treasurer, Mr. Harshad Shah quashed the same to the extent to which agreements was awarded the Runner Up award as ‘Road were not executed as on the date of filing the writ Contractor of the Year’ for their ‘BRTS Project’ petition i.e. 07.12.2016. Pune.

Muvattupuzha Centre The Government was directed by the High Court to invite expression or tender or offers either from the The Centre every month conduct the General Body contractors general or from accredited agencies at the Meetings on third Thursday. Few out bond general earliest. The High Court also reminded the State

Government, that it is always better to invite tenders Nearly 60 students actively participated in this event. by issuing notifications so as to ensure transparency Prizes were distributed to the winners. and to avoid any arbitrariness or unfairness in the matter of award of contracts by the State Government. The Centre organised a workshop the 9 th General Meeting – “Builders’ Day Celebration” on 27 th In every year we are conducting three family meetings November 2016 was held at 6.00 PM in Hotel including one Builders Day Celebration in a various Golden Land Mark Resort, KRS Road, Mysuru with venues. Most of our family members were present. the theme – vision 2020 – Skill India to Build India”. Now our strength becomes 63 patron members. The program was commenced by the invocation by Mysore Centre Master Pranav. Our Center Chairman Shri N Subramanya welcomed the gathering. The Chief The Centre Office Bearer were installed on 3.4.2016. Guest was Shri Avinash M. Patil, National President, Shri B. Seenaiah, Past President BAI, presided as the BAI, Guest of Honour were Shri Mu. Moahan, Vice Chief Guest with Shri C. K. Kumaravel Founder and President BAI, Shri K.S. Someshwara Reddy, State CEO – Naturals, Shri Mu. Moahan, Vice president, Chairman, BAI Karnataka. BAI Southern Region & Shri K.S. Someshwara Reddy State Chairman of BAI Karnataka were the Shri G. Ashok was awarded the ‘Builder Par Guests of Honour for the occasion. Excellence of the year’ – 2016, Shri N.S. Muralidhara was awarded with the ‘Member The Centre organised a workshop on Personality Extraordinaire Award’, Shri Parvez E Rudina was Development / Leadership Skills for the new team of awarded with ‘Life Time Achievement Award’. office bearers for the year 2016-17 Sunday, 24th April in our Past Chairman Shri K. Sriram's Farm During the year, the Centre conducted Eleven (11) 'Carisbrooke', Koodanahalli, Mysuru. All the Executive Committee Meetings. executive committee members, event heads, coordinators participated in a day long orientation Namakkal Centre program to improve their leadership qualities. Er. K. Mani was installed as the Chairman of The Centre organised a workshop Builders' Namakkal Centre for 2016-17 by Mr. Mu. Moahan, Association of India, Mysuru Centre bridges the gap Vice-President on 22nd May, 2016 alongwith other between academia & the industries by conducting office bearers. Mr. M. Thirusangu, State Chairman, various need based activities for the civil students. Tamil Nadu, Pudhuchery and Andama Nicobar was The civil branch of Vidya Vikas Institute of the Guest of Honour. Mr. Pa. Raman, Secretary, Engineering & Technology Department of Civil Salem Kamban Kalam was the Guest Speaker and Engineering students were held an departmental fest enthralled the gathering with humorous anecdotes on “Vruddhi 2K16” on 25 April 2016. Builders' everyday life. Office-bearers from various Centres in Association of India, Mysuru Centre was one of the Tamil Nadu were present on the occasion. sponsors for the event. A lecture meeting on ‘Town Planning’ was oganised A press meet was held on 29th April 2016 towards by Centre on 28th September 2016. Er B Palanivel, May Day Celebrations at patrakartara bhavan. The Chairman, Deptt of Town & Couontry Planning, chairman N. Subramanya and members of Govt of TN was the Keynote speaker. Dr. R Asokan, construction workers welfare committee (CWWC) Principal, Kongunadu College of Engg & Tech was briefed the print and visual media on various the Chief Guest. Mr Ulagantha Sankar and Ms activities and programmes to be conducted on the Vasanthi, HOD were also present. occasion of May Day. A multi-purpose hall ‘Namakkal Builders Mahal’, The two days Skill Development Workshop was conceived and constructed by Namakkal Builders organized in association with M/s. Asian Paints at Association Trust - a NGO under the aegis of the MBCT ® Training Centre, Mysore. Nearly 60 Centre was inaugurated on 4th Sept 2016. Mr P painters and wood polishers actively participated and Thangamani, Min of Electricity &Prohibition Excise learnt the new techniques in wood polishing. Duty, Dr V Saroja, Min of Social Welfare, Govt of Certificates were issued to all the participants during TN, MLA and other senior officers and functionaries the valedictory function on 21st May 2016. of BAI were present on the occasion.

The Centre organised a workshop on 25 th June 2016 Centre conducted a ‘Special Personality Debate competition for high school student on “USE Development Programme’ of plastic is a boon or bane” & for Under Graduate ‘URAVENNUMPALAAM’ on 25th Oct 2016. JCI Students on “Development Works at Chamundi Sen, R S Prabhu, Past Zone President, National Hill… is it necessary?” was held at MBCT Premises. Director Training-Erode was the trainer of the programme. It was very useful for the members. arrangements made for the meeting and hospitality Various awards were given during the programme. extended. Chairman and other members / office bearers co- ordinated organizing of the event. Phaltan Centre

The centre organised new Office Bearers installation Mr. Pramod Nimbalkar was installed as the Chairman function and Annual General Body Meeting on of Phaltan Centre for 2016-17 by Hon'ble Srimant 22.05.2016 at Golden Palace Hotel, Namakkal. All Ramraje Naik Nimbalkar, Speaker, Legislative India Vice President Shri M. Moahan as Chief Guest, Council, Maharashtra on 16th April, 2016. Mr. State Chairman Shri. M. Thirusangu as a Special Avinash M. Patil, President, Dr. Rajiv B. Krishnani, Guest. Vice-President, Mr. Suresh D. Patil, State Chairman, BAI Maharashtra and Mr. Vijay Devi, Trustee, and Inaugural Function of Namakkal Builders Mahaal on other office-bearers of Phaltan Centre and their 04.09.2016, organised by Namakkal Builder families were present during the function. Association Trust. Our Past National President Bhisma R. Radhakrishnan, All India Vice President Ponneri Centre Mr. Moahan, State President Mr. M. Thirusangu, State Ministers Hon’ble P. Thangamani & V. Saroja, A new BAI Centre Ponneri near Chennai was MLA K.P.P. Baskar, Local Municipal Chairman Mr. formally inaugurated by Mr. Avinash M Patil, Karikalan and other dignitaries participated. President in Chennai on 7th September, 2016. Southern (Chennai) Centre took lead in forming Our Centre organise a Speaker meeting on Ponneri Centre. Mr. A. Vijay Kumar was installed as 28.09.2016 for Civil Student Members at Kongunadu the first Chairman of Ponneri Centre by Mr. Avinash Engineering College, Thottiyam, Trichy District. M Patil. Senior Members and functionaries of the Topic : Town and Country Planning Rules, Speaker : Southern Centre and nearby Centres graced the Er. B. Palanivel, State DTCB Committee Chairman. occasion. Members and senior functionaries of the General Body meeting on 25.10.2016, Self Southern Centre co-ordinated the formation of Development course, Topic : Uravennum Paalam, Ponneri Centre. Conducted by : Jc. R.S. Prabhu. We honour our charter Chairman Er. R. Ganesan, our Vice-Chairman Pune Centre Mr. K. Venkatachalam as best contractor award receivers. Dr Rajiv B. Krishnani was installed as the Vice President of BAI for 2016-17 by Mr Avinash M Patil, Our Centre organised a Platinum Jubilee Celebration President - BAI on 6 th April 2016. Mr Siddharth Shah and Builders Day Celebration on 11.12.2016 at was also installed as the Chairman of Pune Centre for Namakkal Builders Mahaal. 2016-17 by Mr. Patil alongwith other office bearers. Mr. D L Desai (Shankarbhai), Trustee - BAI and Mr During the year, the Centre conducted Nine (9) A Puhazhendi, Past Vice President - BAI were the Executive Committee Meetings. Guests of Honour. Mr. Suresh D. Patil, State Chairman-Maharashtra also graced the occasion. Nashik Centre One day site visit to crushed sand plant installed by Centre hosted the 2 nd Meeting of the Managing M/s. B.G. Shirke Construction Technology Pvt. Ltd. Committee and 1 st Meeting of General Council of At Alandi on 20 th June 2016. BAI for the year 2016-17 in Hotel Express Inn, Shri Datta Ghule – Convenor of Site Visits. Nashik on Saturday, the 2 nd July 2016. The Centre simultaneously hosted the Seventy Fifth ( 75 th – the The Centre Conducted Half Day Seminar on Total Platinum Jubilee ) Annual General Meeting of the Quality Management specially with reference to the Builders’ Association of India on 2 nd July 2016 at the Construction Industry was held at Sumant same venue. Mr. Rameshwar Malani, Chairman of Moolgaonkar Hall, MCCIA, Pune. Mr. Prakash B. the Centre formally welcomed the members to the Yardi will be our Faculty Member, who is associated meeting and thanked BAI-HQ for giving the Centre with the Quality Circle activities in Cummins India the opportunity of holding the MC & GC Meeting for more than 20 years, was faculty for the said and the 75 th Annual General Meeting of the BAI. The subject. More than 100 delegates attended the meeting was formally inaugurated by Mr Kalraj seminar. Mr. Jagannath S. Jadhav was the Convener Mishra, Hon’ble Union Minister for Micro, Small & of this Seminar. Medium Enterprise by lighting of the traditional lamp. Centre also hosted the welcome dinner on 1 st The Centre Conducted 8 th Edition of Students’ July 2016 and farewell dinner on 2 nd July 2016. All Internship Programme conducted between 30 th May members who attended the meetings appreciated the 2016 to 14 th June 2016 about 243 nos students participated. Students were given certificates of Construction of Toilet Blocks / Fresh Rooms for internship. Girls : Pune Centre under its social obligation every year Likewise 9 th Edition of Students’ Internship constructs a set of Toilet blocks / Fresh Rooms for Programme was held between 50 th December 2016 to rural schools which imparts education to mostly Girls 20 th December 2016 about 55 nos students students. Under this programme BAI Pune Centre participated. Due to over whelming response of constructs a Toilet Block / Fresh Room for Girls students number of participants were increase students at Village Walhe under the Guidance of Shri substantially. Shri Jaideep Raje and Shri Sanjay D.S. Shirole Convenor of this activity was main force Vaichal were the coordinators of both the students’ behind this programme, which he undertakes every Internship Programmes. year with utmost sincerity. Western Region Conference on 25.02.2017 at The To encourage and appreciate efforts of Children of Hotel Aurora Towers, Pune. out members a Children’s Felicitation Programme BAI Vice President Dr. R.B. Krishnani held the was held on 30 th July 2015 at The Ladies Club, Pune. Western Region Conference on 25.02.2017 at the More than 100 Children were felicitated and given Hotel Aurora Towers, Pune. The conference was well gifts and certificates at the hands of Chief Guest Ms. attended by more than 100 delegates. Critical issues Shashwati Pimplikar, a famous Marathi actress. like River Sand crises, PWD Contractor registration, Skill Development were discussed at length. Builders’ Day Celebration 21 st October 2016 at The Residency Club, Pune; Seminar on GST on 25.03.2017 :

Builders’ Day is celebrated every year to pay tributes Builders’ Association of India, Pune Centre to the builders, engineers & contractors and conducted a Seminar on GST – Goods & Service Tax acknowledge their contribution in the nation building. on Saturday 25 th March 2017 at Residency Club, The theme for 2016-17 was “Vision 2020 Skill India Pune. Eminent Speaker’s Dr. Waman Parkhi – to build India.” Partner KPMG Mr. Chirag Shah – Partner – Deal Advisory KPMG Mr. Kirti Oswal – Partner – BSR – Mr. M.J. Halbe, Mr. Vishwas Lokare, Mr. Sanjay Associates LLP. Lot of queries were raised by many Vaichal & Mr. Shafique Khan all very Senior delegates regarding the application of GST. It would Members & Past Chairmen of Pune Centre were be beneficial to our Members and all from the felicitated for their exemplary work in the field of Construction Fraternity to attend. Representatives construction and felicitated at the hands Chief Guest and Members from Construction Industry, Er. S.D. Limaye, OSD, Project & Contractors, Promoters, Builders, Labour Consultant, Railway & Tunnel Projects. In a Contractors, Project Managers, Site Engineers and traditional manner by offering them a shreefal, shawl Property owners attended the Seminar. BAI Pune and a Memento. Centre Office Bearers; Chairman; Shri Siddharth Shah, Vice Chairman; Shri Jagannath Jadhav, Hon. All the felicitated members shared their experiences Secretary; Shri Manoj Deshmukh, Treasurers; Shri and enlightening thoughts to encourage others for Sunil G. Mate. performing and achieving better. 70 Plus members attended the function. Raichur Centre

Well Built Structure Competition 2016. Centre organised Installation of New team of office bearers on 25 th May 2016. All India vide president of Well Built Structure Competition (WBSC) in its 20 th Freedom fighter Samiti (New Delhi) Shri Kashi Rao series had 40 Plus participants The competition is Patel Graced the occasion as Chief Guest and our held primarily to encourage Quality, Speed and centre honored him with shawl garland and memento. Economy, Labour walface and safety aspects are also The function was very impressive and praised by all considered as important aspects, BAI – B.G. Shirke invitees who attended. Awards for 2016 competition were awarded in the presence of 300 plus building professionals. June-2016 :- In the Committee of District schedule of rates of Bellary Circle, our centre was invited and our Shri Abhai Sinha, Director General, Central Public centre represented with four members at the office of Works Department (CPWD), & Shri L. Moorthi, Past the Chief Engineer PWD North Dharwad. Detailed Vice President South presided the Award Ceremony. item war discussion was held and representation was Mr. Jana of M/s. B.G. Shirke Construction & also given in writing to revise the rates as per actual Technology Pvt. Ltd. Sponsor of the WBSC awards prevailing rates of labour, materials, wood etc. did the honors of giving away awards to the winner Accordingly the officers present in the meeting participants. Shri Mahesh Mirani was Chairman – realized the things and we were assured to revise the WBSC Committee. rates with detailed analysis of newly prevailing rates.

Rajasthan (Jaipur) Centre President was the Chief Guest. Mr. R. Radhakrishnan, Past President & Past Trustee also The Centre alongwith ‘Spoorthi’ (Ladies wing) graced the occasion. Mr. M. Karthikeyan, Past felicitated Mr Ashok Lahoti, a BAI member, on him President, Dr. D. Thukkaram, Past Trustee, Mr. K. being elected Mayor of Jaipur. 115 BAI members and Ramanujam, Past Chairman-Tamilnadu, Mr. S. 30 members of ‘Spoorthi’ were present on the Ganapathy, Past Vice Chairman and J. R./ occasion. Mr Ashok Lahoti addressed the gathering Sethuramalingam, Trustee were facilitated for and stressed upon his motto ‘Clean Jaipur Green serving the industry for more than three decades on Jaipur’. Chairman Mr Nand Kishore Goyal, State Co- the occasion. Health camps at various works sites, ordinator Mr Ravi Kumar Kheria, Past Vice President diagnosing and advising treatment to the workers Mr Ashok Agarwal and other senior members / office were done. Entertainment programme, high tea and bearers graced the dais during the function. Mr dinner was arranged for the families of BAI Mahender Kumar Sethi, GC Member presented members, Senior members of the Centre co-ordinated memento and Mr. Kheria presented ‘Gaurav Samaan the arrangements. Patra’ to Mr Lahoti .

Ravulapalem Centre Mr. K. Venkatasen was installed as Chairman of the Centre for 2016-17, alongwith other office berarers,. BAI Ravulapalem Centre in East Godavari District, by Mr. R. Radhakrishnan on 11th April 2017. Andhra Pradesh, has taken a Hall from the existing Outgoing Chairman Mr. K. Selvaraj, formally handed Contractors’ Association Building and renovated it to over the charge. Mr. Mu Mohan and Mr M have a Chairman’s Chamber, a Conference Hall, Thirusangu were facilitated on being elected as Vice which can accommodate upto 100 people and a Bed President and State Chairman, Tamil Nadu and Room to accommodate any BAI Guests. The Centre Pudicherry for 2016-17 respectively. Mr. M also engaged a full time employee to take care of Karthkeyan was also felicitated on being elected as Administrative and Financial activities of the Centre. Trustee of BAI for 2016-19.

Satara Centre “World Water Day” was celebrated by Vels University, Pallavaram, Chennai on 22nd March Mr. Mangesh Arun Jadhav was installed as the 2016. Mr R Radhakrishnan, Past President & Past Chairman of Satara Centre for 2016-17 on 7th May, Trustee delivered the inaugural address at the 2016 by Mr. Avinash M Patil, President alongwith ’Seminar on Preservation of Water’ held on the other office bearers. Mr. Rajiv B. Krishnani, Vice- occasion. He alongwith other senior members of the President, Mr. Suresh B. Patil, State Chairman, Centre planted trees on the occasion. Maharashtra and Mr. Vijay Devi, Trustee were the Guests of Honour. Other senior members from the Mr R Radhakrishnan graced the 3rd ‘MAYAN centre were also present. AWARDS’ function held in in Chennai on 30th March 2016. The event was graced by His On 8th May, 2016, Mr. Avinash M Patil, President Excellency Dr. K Rosaiah, Hon’ble Governer of met Mr. Sharad Pawar, President, Nationalist Tamil Nadu. Congress Party (NCP) in Satara and briefed him about BAI and its various activities. BAI President Mr R Radhakrishnan, Past President & Past Trustee also brought to attention of Mr. Sharad Pawar to installed Mr. J. Mohan as President of 'Flat Promoters some of the vexed issues of the Indian building and Association, Ambattur & Avadi' for 2016-17 on 3rd construction industry and requested him to look into April, 2016. 'Flat Promoters Association, Ambattur & the same. Other senior members from Satara and Avadi' are affiliated to BAI. He also installed Mr. other Centres were also present on the occasion. Sivakumar as President of 'North Chennai Flat Promoters Association' for 2016-17 on 4th April, Solapur Centre 2016. 'North Chennai Flat Promoters Association' are affiliated to BAI. “Builders’ Day 2016-17” was celebrated by Centre on 23rd October 2016. Dr R B Krishnani, Vice In accordance with the announcement made by Mr. President and Mr Suresh Patil, State Chairman were K. Venkatesan, Chairman during his installation that Chief Guests during the celebrations.. Senior the Centre will be organising 'Health Camp' every members / functionaries / office bearers were present month during his tenure, so as to cover 5000 workers, during the celebrations. Chairman Mr Rajesh the Centre has been along with Southern Builders Deshmukh and his team members co-ordinated the Charitable Trust, since May 2016, organising 'Health organization of the programme. The print media gave Camp' across Chennai, for construction workers coverage of the event. every month. Three such camps were organized which were attended by atleast 7 Doctors & 15 nurses Southern (Chennai) Centre from Appolo / Government Hospitals and other

The Centre celebrated the “Builders’ Day 2015-16” supporting staff with vehicles fitted with surgery and on 25th March 2016. Mr. V.M. Fazal Ali, Vice treatment equipments, carried out the diagnosing like, ECG, blood test, blood pressure, weight scale and thorough eye check up, medicines were made retired Indirect Tax Manager, M/s L & T was also available free of cost. The Doctors & Nurses were present on the occasion. Senior Members and felicitated by the prominent and senior members of functionaries of the Centre were present and the Centres who attended the Camps. participated in the training programme.

A training programme on 'Air Conditioning Practices' Centre organized a Seminar on Real Estate was organised by Centre along with The Indian Regulatory Authority (RERA) Bill on 30th August Society of Heating, Refrigerating and Air 2016. Mr Suresh Krishn, President, CREDAI- Conditioning Engineers (ISHRAE) on 26th May, Chennai Chapter gave key-note address. Mr. K 2016. Mr. Balakrishnan, President; Mr. Ferno Susai, Vaitheeswaran, Advocate & Tax Consultant & Mr R Advocacy Chair; Mr. Raja Sriram, Past President / Ramalingam, CA explained about RERA through a National Co- Chairman; Ms. Suganya Sriram, were Powerpoint presentation and answered queries raised present on behalf of ISHRAE and addressed the by participants. Senior members and functionaries members. Mr. Raja Sriram gave a power point from BAI and affiliated Associations participated in presentation, wherein he shared important the Seminar. information. He also explained about Green Buildings through a power point presentation. Mr. V. Centre organized a Health Camp on 13th Sept 2016 S. B. Sunder, Chairman, Traning Committee; Mr. K. at the work site of M/s Srinivasan Associates, Venkatesan, Chairman and other office-bearers and Chennai. Members from the Centre participated in senior functionaries co-ordinated the organising of the camp. Mr O K Selvaraj, Imm Past Chairman the training programme. explained about the Camp to the workers in Hindi for better understanding. A team of Doctors from Appolo Centre organised a meeting along with office-bearers Hospital and Govt Eye Hospital diagnosed more 300 of BAI's Affiliated Association's to discuss regarding workers. Other Senior members and functionaries of Real Estate (Regulation and Development) Act, 2016 the Centre were present in the Camp. (RERA) on 31st May, 2016. Mr. Mu. Mohan, Vice- Centre celebrated ‘Construction Workers Day’ on 5th President, Mr. K. Venkatesan, Chairman and other Oct 2016 by organizing Health Camp, cultural office-bearers and senior functionaries of Centre entertainment, presenting them gifts, serving special were present during the meeting along with members dinner etc. The Health Camp was inaugurated by Mr. of the Affiliated Associations. R Radhakrishnan and team of Doctors from Apollo Centre organized a training programme on 'Plumbing Hospital and Govt Eye Hospital and diagnosed more / Sanitary Works' along with CERA on 27th June, 300 workers, gave them free medicines / advise for 2016. Mr. K. Ramanujam, Managing Committee further treatment. In the evening, entertainment Member inaugurated the training programme. More programme was arranged in which Mr. P Bose- than 100 persons participated in the training Director, Directorate of Industrial Safety & Health, programme which was organized and co-ordinated by Govt of TN was the Chief Guest who explained the Chairman & other senior functioneries / members of safety measures at construction site, elaborated on a the Centre. number of schemes available for the benefit of construction workers and wanted them to become The 66th Annual General Body meeting of Southern member of Construction Workers Welfare Board to (Chennai) Centre was held on 2nd June 2016. Mr. K. avail and enjoy benefits of the scheme. He stressed Venkatesan, Chairman chaired the meeting. The that it is the responsibility of the builders, engineers, report of Hon. Secretary and the Audited Financial supervisors as well as the workers to avoid accidents. Statement for the year 2015-16 were submitted and Senior members and functionaries from participated got approved at the AGM. The office-bearers team in the event as well co-ordinated its arrangements. for 2015-16 headed by Mr. O. K. Selvaraj as Chairman was appreciated for their outstanding 'Concluding Function' of BAI's Platinum Jubilee performance. Mr. Mu. Mohan, Vice-President Celebrations addressed the members. Others senior members of ‘Concluding Function’ of BAI’s Platinum Jubilee the Centre also graced the dais during the AGM. Celebrations were held in the Centre on Saturday 5th November, 2016 at Chennai Grade Centre. Mr. Centre in association with M/s Pidilite Industries Ltd. Avinash M. Patil, President, BAI; Bhishma R. organised a training program in the BAI Southern Radhakrishnan, Chairman, Platinum Jubilee (Chennai) Centre Office in Chennai on ' New Celebrations Committee, many Past Presidents / Construction and Repairing Segment' on 25th Trustees / Senior functionaries and members, in large August, 2016. Mr. V. K. Jina Chandra Babu, number, participated in the celebrations. Mr. M. Regional Manager, M/s Pidilite Industries Ltd. Venkaiah Naidu, Hon'ble Union Minister for Urban conducted the training programme along with a Development, Housing & Urban Poverty Alleviation PowerPoint presentation mainly on water proofing and Information & Broadcasting was the Chief Guest and repairing the structures and clarified the queries and lighted the traditional lamp at the inaugural raised by the participants. Mr. P. Purushotham, ceremony.

Mr. K. Venkatesan delivered the welcome address L&T in this endeavor. He also dwelt at length about and elaborated about the history of the BAI and Mr. the recent Bill passed in the Parliament regarding the Avinash M. Patil delivered the presidential address. Real Estate Regulation Act (RERA) and said that it is In his address he dwelt at length about the role played only 'regulation' and not 'strangulation' of the sector. by the construction Industry, being the second largest in providing employment, and is contributing in the In his acceptance speech Bhishma R. Radhakrishnan development of the country by providing the expressed his gratitude to one and all for honouring infrastructure facilities like roads, bridges, metro him with 'Seva Ratna' award during this historic railways, irrigation projects, airports, sea ports. celebration of Platinum Jubilee Concluding Celebrations. Though he wondered whether he was Mrs. B. Radhika Chakaravarthy, Chief Post Master worthy of receiving this award, he accepted the same General, Chennai City Region released a Special in view of the love and affection of the institution. Cover and Stamp to commemorate the Platinum Jubilee Celebrations of BAI. Hon'ble Minister Mr. S. Ramaprabhu proposed a formal vote of thanks. received the Special Postal Cover and Stamp and He profusely thanked the Hon'ble Minister Mr. M. formally handed it over to Mr. A. S. Chinnaswamy Venkaiah Naidu for his participation as Chief Guest Raju. This historic event of releasing the Special and for being present for more than two and half Postal Cover and Stamp to commemorate the hours inspite of his busy schedule. He profusely celebration is the first of its kind in the history of thanked the BAI President and Headquarters for BAI. It was a proud moment for the contractors and giving Southern (Chennai) Centre the golden builders fraternity. opportunity for organising Platinum Jubilee Concluding Celebrations. He also thanked Bhishma Bhishma R. Radhakrishnan, dwelt in detail about the R. Radhkrishnan for his guidance and support for the journey of BAI and its glorious achievements during success of this event. 75 years of its existence with excellence in every initiative and endeavour as its thrust. In this context On the occasion, all Past Presidents present were he credited Brig. Jackson, a British Engineer in the honoured by the Platinum Jubilee Concluding Military Engineering Department as the founding Celebrations Organising Committee. On behalf of the father of BAI in 1941 at Pune. He proudly informed Past Presidents, Mr. V. Ramachandran, thanked the all that BAI which was started with just thirteen Organising Committee of Platinum Jubilee members now have more than one lakh direct and Concluding Celebrations for felicitating them. indirect members, having 160 centres through the length and breadth of the country and remembered all Thereafter, Mr. Avinash M. Patil released the 'Special who made it possible with their dedicated Souvenir' brought out by the Platinum Jubilee involvement. After this the Hon'ble Minister released Concluding Celebrations Organising Committee to the book '75 Years of Glorious existence - the never mark the historic occasion and the first copy was ending journey of excellence'. The first copy of the received by Mr. Mu. Moahan, Vice President, BAI. book was received by Mr. B. Seenaiah. The Platinum Jubilee Concluding Celebrations

On the occasion, Mr. K. V. Rangaswamy, Former Organising Committee also honoured the BAI Board Member and former President, M/s Larsen & Headquarters Office Bearers and Trustees with Toubro was conferred with 'Nirman Ratna' Award. Yelachi Garland, Shawl, Turban and were presented Bhishma R. Radhakrishnan was conferred with 'Seva with a memento. Mr. Raju John, Executive Secretary, Ratna' Award. BAI and Mr. S. Madhusudan, Head Communications, BAI were also honoured with Shawl and Memento. Hon'ble Minister for Urban Development, Housing & Urban Poverty Alleviation and Information & The Centre hosted the Fourth Managing Committee Broadcasting, Government of India, Mr. M. Meeting and Second General Council Meeting for Venkaiah Naidu in his address regaled the audience 2016-17 on Sunday, 6th November 2016 at ITC with his inimitable way of speech loaded with pun Grand Chola, Guindy, Chennai. and humour about the serious business of nation The Centre hosted the ‘Sixth BAI Tamil Nadu State building, In spite of his very busy schedule, he made Meeting 2016-17’ on 15 th February 2017 at Chennai it a point to participate in this important milestone Trade Centre, Chennai. Mr. M. Thirusangu, State event not only because of the significance of the Chairman, BAI Tamil Nadu, Puducherry and Platinum Jubilee but also since the organisation is Andaman Nicobar, chaired the meeting, Mr. S. honouring two stalwarts Mr. K. V. Rangaswamy and Ayyanathan, State Secretary, BAI Tamil Nadu, Bhishma R. Radhakrishnan who have done yeomen Puducherry and Andaman Nicobar conducted the services to the construction industry. He praised their proeedings of the meeting. Mr. Mu. Moahan, Vice contribution to nation building through their services. President, BAI also graced the meeting. Issues He stressed the importance of infrastructure concerning the infrastructure construction and real development in the contribution to the GDP growth estate industry in Tamil Nadu were taken up during of the country and appreciated the role played by the meeting.

‘BAI Tamil Nadu State Convention 2017’ was Mr L Narsing Rao for Kamareddy Centre. Mr B organised by Southern (Chennai) Centre on 15 th and Sugunakar Rao administered the “Oath of Office” by 16 th February 2017 in Chennai Trade Centre. During Mr. Mu Mohan and the newly inducted Chairmen of the inauguration of ‘BAI Tamil Nadu State Centres were administered by Mr B. Seenaiah, Past Convention 2017’, Hon’ble Justice Mr. S. President. Mr. M Nagesh Reddy- Past State Rajeswaran was the Chief Guest. Mr. Ravi Wig, Chairman, Telangana formally handed over charge to Member, Central Board of Trustees, EPF and Mr. Mr B Sugunakar Rao. Mr N Sachitanand Reddy was Raju John, Executive Secretary, BAI, were the felicitated on being elected as Trustee of BAI for the Guests of Honour. Mr. M. Thirusangu, State term 2016-19. Chairman, BAI Tamil Nadu, Puducherry and Andaman Nicobar gave the Presidential addrees. Mr. Thanjavur Centre

Mu. Moahan, Vice President, BAI and Mr. R. Er. B. Anandhan was installed as the Chairman of Radhakrishnan, Past President & Past Trustee, BAI Thanjavur Centre for 2016-17 by Er. A. K. Yussouf, participated as Special Guests and addressed on the Past President on 20th April, 2016 alongwith other issued faced by the construction fraternity. More than office bearers. Mr. M. Thirusangu, State Chairman, 700 members from all over Tamil Nadu, Puducherry Tamil Nadu, Pondicherry and Andaman Nicobar also and Andaman Nicobar have participated in the graced the occasion and inducted new BAI members. Convention. Members of Thanjavur Centre and their families were

On 16 th February 2017, the Technical Sessions of the present during the function.

‘BAI Tamil Nadu State Convention 2017’ were held. Mr Avinash Patil, President visited Thanjavur on The first Session was on ‘Provident Fund’. Mr. 8th Oct 2016. A special meeting of the members of Narayanappa, Central Additional Chief Provident Centre was convened on the occasion. Mr Patil Fund Commissioner addressed about Provident Fund. briefed the members about the various steps being Mr. Kulkarni, Additional Central Provident Fund taken by BAI to solve problems of real estate and Commissioner, Tamil Nadu and Kerala also infrastructure construction industry. He and his addressed on Provident Fund. wife was taken around to the famous temples and

The Second Session was on ‘Goods and Service Tax’ historical places. Er B Anandhan, Chairman and his (GST). Mr. C.A. Gopalakrishnaraju, Regional team members and senior functionaries arranged Council Member – ICAI delivered the key note meeting and other things for the President. address. Builders’s Day 2016 was celebrated in a fitting manner on 27 th November 2016 Er. R. Concurrently with ‘BAI Tamil Nadu State Radhakrishnan, Former National President & Convention 2017’, second edition of BATIMAT Trustee was the Chief Guest and complemented the 2017 – Construction Materials & Technology growth and development of BAI Thanjavur Centre. Exhibition was organised at Chennai Trade Centre. th th The Exhibition was held between 16 and 19 He said the Centre was started in 1983 with 21 February 2017. Around 50 organisations showcased members and now grown to 310 members in which their products in the Exhibition. On the concluding 192 are Patron members is the wonderful and th day, 19 February 2017 of the Exhibition, memento commendable achievement. He appreciated the was presented to the Exhibitors on behalf of Southern unity among members and prayed that the same (Chennai) Centre. should continue for ever. Mr. M. Thanasangu, BAI, State Chairman offered felicitation. Telangana State Senior Engineer and expert in cost effective

Mr B Sugunakar Rao was installed as the State construction technology, Er. S. Rajendran was Chbairman of Telengana State for 2016-17 on 4 th honoured and presented with Achievement of April 2016. Mr Etala Rajender, Hon’ble Minister for Excellence Award.

Finance, Govt of Telangana was the Chief Guest. Mr Past Chairmen of the centre were honoured with Koppula Eshwar, Chief Whip of Govt of Telangana shawal. Er. T. Kalyanasundaram, Chairman and Mr. Mu. Mohan, Vice President were the Guests Builder’s Day Celebration Committee made of Honour. On the same occasion Chairmen of BAI excellent arrangements. Er. B. Anandan, Centre Centres in Telangana for 2016-17 were also installed Chairman presided over the function and Er. R.K. namely Mr P Narsimha Rao for Hyderabad Centre, Kumar proposed the vote of thanks in the end. Mr K Devender Reddy for Warrangal Centre; Mr U Builder’s day was well attended by members and Surender for Karimnagar Centre, Mr. Soma Srinivas their family and it will fresh in memory for years to Reddy for Nalgonda Centre, Mr G Balaji for Ranga come. Reddy Centre; Mr V Bhaskar Reddy for Nizamabad Centre, Mr V Gangadhar for Adilabad Centre, Mr Thiruthuraipoondi Centre Ch. Srinivasa Rao for Khammam Centre; Mr V Ravinder Reddy for Greater Hyderabad Centre and BAI Thiruthuraipoondi Centre was inaugurated on 26th March, 2016. Mr. E. Selvakumar was installed as the first Chairman of the new Centre for 2016-17 programme. High profile and experienced faculty by Mr. R. Radhakrishnan, Past President and Past took classes for Civil Masons, Bar Benders and Trustee, Mr. N. Raghunathan, State Chairman, Tamil Domestic Electricians. Nadu, Pondicherry & Andaman Nicobar (2015-16) was also present on the occasion. Thiruvalla Centre

Theni Centre Centre felicitated Mr John Paul K . on him being elecdted as State Chairman-Kerala for 2016-17 in a The Centre organised Installation function held on function in Thiruvalla. Mr Navas Attinkara, 28.05.2016 at Vasantha Mahal, Theni. Chairman did the honour of felicitating Mr John Paul.

The Centre organised tour to BAI members to Thrissur Centre Srilanka from 21.05.2016. Dr Ramdas C R was installed as the Chairman for The Centre organised Income Tax Awareness 2016-17 on 23 rd April 2016 by Mr John Paul K, State Meeting held on 03.08.2016 at Hotel Western Gatz. Chairman - Kerala alongwith other office bearers of Theni. A goods number of members attended Third the Centre. Dr. E Sreedharan was the Chief Guest and State Level MC & GC Meeting held on 12 & was felicitated by Centre. Dr Sreedharan also 13.08.2016 at Coimbatore. addressed the gathering.

Large number of Members attended Second State Tirunelveli Centre Level MC & GC Meeting held on 23 & 24.06.2016 at Pondicherry. Er. M. Olaganatha Sankar was installed as the Chairman of Centre by Mr. Mu. Mohan, Vice- The Centre organised Diwali Celebration – Family President alongwith other office bearers of the meet held on 23.10.2016 at Vasantha Mahal, Theni. Centre. Mr. M. Thirusangu, State Chairman, Tamilnadu, Puduchery and Andaman Nicobar and During the year, the Centre conducted Three (3) other senior members of the Centre were also present Executive Committee Meetings. on the occasion.

Tiruchirappalli Centre Vellore Centre

Builders’ Association of India, Tiruchirappalli Mr C Sridhar was installed as Chairman of the Centre Centre’s Installation Function for the year 2016-17 for 2016-017 by Chief Guest Mr Mu Mohan, Vice was held at Kalaingar Arivalayam on 17.04.2016. President alongwith the other office bearers. Mr Arul The Chief Guest Shri Krishna Jaganathan, State Co- Jothi Arasan, General Manager, Aavin and Dr S K ordinator. Shri Dharma Rakshana Samithi, Sarkar, Dean – School of Civil Engineering, Vellore highlighted the Importance of life, connected to Institute of Technology were the Guest of Honour. Building, in an excellent manner. Mr. Mu. Mohan, Other senior members were also present and the BAI, Vice President installed the New Team. Mr. M. outgoing Chairman formlly handed over the charge to Thirusangu, State President, addressed the gathering. Mr. Sridhar. Mr. A.K. Yousuf, BAI, All India Past President, Released the Monthly Bulletin of our centre Visakhapatnam Centre “Builders’ Fort” with Mr. D. Damodaran as the Editor. Mr. CH. Ramakotaiah was formally installed as State Chairman of BAI Andhra Pradesh for 2016-17 Mr. A Puhazhendi, All India Past Vice President by M. Venkata Rao, Past State Chairman, inducted the New Members. This year we inducted Andhra Pradesh on 12th April, in 157 new members and 19 patron members. Visakhapatnam. Present on the occasion were, Mr. G. V. Ravi Raju, Chairman; Mr. R. The Centre organised a work shop was conducted for Satyanarayana, Imm. Past Chairman; other office- the students of Indira Ganesan Engineering College bearers and senior functionaries of the Centre on 03.08.2016. Around 250 students participated. Our Past President A. Puhazhendi gave a lecture, on Mr G V Ravi Raju was installed as the Chairman of the construction of multi-storey buildings. We the Centre by Mr. Ch. Ramakotaiah, State Chairman - sponsored an industrial study visit to Coimbatore, for AP on 12 th April 2016 alongwith other office bearers these students. of the Centre. Out-going Chairman Mr R BAI Trichy Centre arranged a one day Skill Satyanarayana formally handed over the charge to the Development Training Programme at Skill Kraft- incoming Chairman in the presence other senior Skill Training Institute, Mathur, Trichy on members and office bearers of the Centre. 25.09.2016. There were about 65 workers from different categories participating in this programme. High profile and experienced faculty took classes for

BUILDERS’ ASSOCIATION OF INDIA

Builders’ Association of India (All-India Association of Engineering Construction Contractors & Builders) G-1/G-20, 7 th Floor, Commerce Centre, J. Dadajee Road, Tardeo, Mumbai - 400034  23514134 , 23520507, 23514802 L  91-22-23521328 Web Site : www.baionline.in E-mail : [email protected]

PROXY

Name of the Member

I/We, the undersigned of being a member of Builders’ Association of India hereby appoint of or failing him/her of or failing him/her of as my/our proxy to vote for me/us and on my/our behalf at the 76th Annual General Meeting of the Association being held on on Saturday 22 nd July, 2017 at 4.00 P.M. at Hotel Novotel, Hyderabad Airport, Hyderabad.

Signed this day of 2017.

Affix Re.1/- Revenue Stamp

(Signature of Member with Rubber Stamp)

Note: Proxies, in order to be effective, must be received by the Association not less than 48 hours before the time of the Meeting.