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BBIA’s Emergency Meeting Spotlights Jammu & Kashmir’s Industrial Woes: Blocked Funds and Incentive Delays



Jammu. 30-10-2023: An Urgent Meeting of Bari Brahmana Industries Association (BBIA) was held today under the Presidentship of Sh. Lalit Mahajan in the presence of Sh. Tarun Singla Sr. Vice President, Sh. Ajay Langer Vice President, Sh. Viraaj Malhotra General Secretary, Sh. Rajesh Jain Secretary and Sh. Vivek Singhal Treasurer BBIA, and other Members to discuss the issue in respect of blockage of Working Capital of Industrial Units as the J&K Finance Department fails to release funds for reimbursement of CGST/SGST as well as refund of Turnover Incentive.

Members present in the meeting raised serious concern  towards the payment  of  Reimbursement Claims of CGST/SGST duly sanctioned and forwarded  by State Tax Department Jammu amounting to  Rs. Approx. 25 Crores of Jammu Division pending with the Additional Treasury Gandhi Nagar Jammu since last one month resulting blockage of Working Capital Funds of Industrial Units.

It is pertinent to mention here that as per the guidelines of SRO’s the payment of Reimbursement claims of CGST/SGST should be released within 21 days from the date of submission of claims but the payments of sanctioned claims submitted for the period up to 30-06-2023 awaiting allotment of requisite funds to Additional Treasury Gandhi Nagar Jammu by Finance Department which shows the casual attitude of the Finance Department and we termed it as least priority of Govt. towards the working Industrial Units of J & K in spite of all the odds and   providing Employment to lakhs of Local people.

In respect of Turn Over Incentive, It is pertinent to mention here that the Fiscal Incentives announced by Govt. exist only on Papers as Industries Department failed to release the pending Claims amounting to app. Rs.210 Crores for the Financial Year 2021-22 in spite of repeated requests and reminders to enhance the Budgetary allocations from Rs. 50 Crores to Rs. 210 Crores.

It is worthwhile  to mention here that the Fiscal Incentives for the Existing Working Industrial Units have been diluted to 50% only as compared to prior to GST  resulting in Existing Industrial Units were suffering very badly  due to the dilution of Incentives in the post-GST Regime  as per the details given below:-

S. No

Pre- GST Regime

Up to 07-07-2017

Post GST

(Approximately Per Annum)

2 VAT Remission 600 Crores CGST/SGST Reimbursement Approx. 390 Crores for the F.Y. 2022-23
3 CST Exemption 200 Crores Reimbursement of 2% as Interstate Turnover in lieu of CST for the period 2020-21) 4 Crores (Incentive withdrawn w.e.f. 01-04-2021)
4 Toll Tax Exemption to Industrial Sector 200 Crores  Turnover Incentive for the Existing Units as on 31-2021 50 Crores
Total 1000 Crores   444  Crores

Moreover, the Existing Units are not able to compete with the New Units being set up under the Central Package of Incentives under NCSS-2021 with the Reimbursement of 300% Gross GST whereas the Existing Units are getting only SGST paid on the value addition.

Further the position is more serious that nos. of Big Industrial Houses selling their products for Interstate Sale planning to shift their base to other parts of the country as the Interstate Turnover Incentive has been diluted with a maximum ceiling of 50 lacs per annum and  Reimbursement of CGST and IGST to those units will be discontinued in 2024 to 2026 due to which  working of those units will be non viable due to additional cost of Freight component on the Raw materials and Finished Goods.

In respect of New Investment in the Industrial Sector under the New Central Sector Scheme 2021, the proposals worth Rs.70,000 Crores have been received by the Industries Department against which few units have started production as  due to the non-availability of Developed Industrial land in the Notified Industrial Areas resulting the process has been delayed.

We request Hon’ble Lt. Governor Sh. Manoj Sinha and  Sh. Santosh Dattatreya Vaidya (IAS),  Principal Secretary Finance Department for their kind intervention in resolving the issues related to the Existing working Industrial Units working in the Union Territory of Jammu & Kashmir and  it is the need of the hour to provide the following Fiscal Incentives to Existing Units and Units under Substantial Expansion for Employment Generation.

    • Turnover Incentives should be given on the basis of actual Reimbursement claims submitted by the Industrial Units without any Capping.
    • GST Link Incentive to Existing Units who opt for the Substantial Expansion to manufacture additional Items/change in the line of activity.
    • Time-bound for the release of requisite funds to Additional Treasury Gandhi Nagar Jammu for the Reimbursement of SGST/CGST to Industrial Units of Jammu.