Cotton bodies threaten stir over reverse charge

Published On: 01, Dec 2017 | Source:

Upcountry associations of all cotton growing states have threatened to hold a token protest on December 15 and go an indefinite strike from December 22 unless the issue of Reverse Charge Mechanism (RCM) is resolved in the coming GST Council meet. The GST Council meet is slated to be held on December 21. Cotton Association of India (CAI) convened a joint meeting of the presidents and secretaries of upcountry associations in Mumbai on the issue of RCM under GST and to chalk out a strategy and find a solution to this problem in close coordination. CAI has about 70 ginners enrolled as its members and therefore, this meeting was convened to understand the problem of RCM also from the ginners’ perspective.

The meeting was chaired by Atul S Ganatra, president, CAI and others present at the meeting including B Ravinder Reddy, president and Kakkirala Ramesh, secretary, Telangana Cotton Millers & Traders Welfare Association, Manjeet Singh Chawla, president and Raju Jain, secretary, Madhyanchal Cotton Ginners & Traders Association, BS Rajpal, president, Maharashtra Cotton Ginners’ Association, Anil Somani, Khandesh Gin Press Kharkhandar & Traders Development Association, Shri Omprakash Jain, president and Shantilal M. Ostawal, secretary, Karnataka Cotton Association and Vinod Jain, joint secretary, Madhya Pradesh Cotton Merchants’ Association.

ICA, All Gujarat Cotton Ginners’ Association, Saurashtra Ginners’ Association, Andhra Pradesh Cotton Association and the Cotton Association of Orissa conveyed their support for the meeting and that the decisions taken at the meeting will be acceptable to them. According to Ravinder Reddy, the plight of the entire cotton sector across the country and the issue of pending refunds to exporters since July 2017 on account of

GST were deliberated at the meeting. Reddy, highlighted the damage caused to the crop and heavy losses suffered by the farmers due to pink bollworm and uncertain rains in Telangana. Manjeet Singh Chawla, pointed out that due to RCM, huge funds of ginners were blocked and since cotton seed buyers and the buyers of cotton bales were not paying GST to the ginners this has led to the blockage of huge funds of the ginners. S Chawla requested CAI to take up the matter relating to removal of RCM on kapas. He also stated that the RCM on cotton has also led to tarnishing relationship between the spinners and ginners.

Omprakash Jain said unless RCM on cotton is removed immediately there will be no way left to the ginners but to close down their operations. He appreciated the efforts of CAI in calling this meeting and pointed out that this was perhaps for the first time in the history of the CAI that ginners were provided a platform to discuss their issues. BS Rajpal said RCM has been imposed only on cotton and not on other agri-commodities which is totally unjust. He added that if this RCM continues on kapas it will entail huge losses to the sector. He also requested CAI to take up the matter relating to removal of RCM with the government which will also indirectly benefit the farmers in realising better price for their kapas.