Builders’ Association of India

(All India Association of Engineering Construction Contractors)

Registered & Head Office: G-1/G-20, Commerce Centre, J. Dadajee Road,

Tardeo, Mumbai – 400 034 Tel : (022) 23514134, 23514802, 23520507

Fax : 022-23521328 E-mail : baihq.mumbai@gmail.com

Delhi Office: D1/203, Aashirwad Complex

Green Park Main, New Delhi – 110 016 Tel : (011) 32573257

Telefax: (011) 26568763| E-mail: baidelhi16@gmail.com

ESTD. 1941

72nd

Annual Report and Accounts

2012–2013

www.baionline.in

Estd. 1941

BUILDERS’ ASSOCIATION OF INDIA MANAGING COMMITTEE 2012-2013

President

Shri B. Seenaiah

Vice Presidents

Shri D.C. Awasthi Shri K. Viswanathan Shri Ranjeet More Shri Ravindra Pradhan

Hon. Gen. Secretary

Shri Anand J. Gupta

Hon. Gen. Treasurer

Shri Mahesh M. Mudda

Imm. Past President Shri Cherian Varkey

Trustees

Shri D.L. Desai Dr. D. Thukkaram Shri Lal Chand Ralhan Shri Mohan D. Bhate

Shri Narendra Kumar Shri P. Jayapal Shri P. Kandaswamy

State Chairmen / Co-ordinator

ANDHRA PRADESH CHATTISGARH DELHI GUJARAT Shri P. Mohan Reddy Shri Lalit Kumar Oswal Shri Arun Sahai Shri Bhupesh P. Shah

JHARKHAND KARNATAKA KERALA MADHYA PRADESH

Shri T.C. Mohanty Shri V. Srinivasa Murthy Shri Alex P. Cyriac Shri Suresh Vaswani

MAHARASHTRA RAJASTHAN TAMIL NADU UTTAR PRADESH Shri Manoj L. Potekar Shri Ashok Agarwal Shri Mu Moahan Shri R.P. Gupta

WEST BENGAL Shri G.C. Gupta

Members

Shri A. Chamaraja Reddy Shri Abhay Garde Shri Avinash M. Patil Shri Baburao L. Shakkarwar Shri Bhopinder R. Lal Shri C. Devarajan Shri D. Kempanna Shri D.R. Sekar Dr. D. Thukkaram Dr. Narendra D. Patel Shri G.M. Ravindra Shri H.N.Vijaya Raghava Reddy Shri Harkant G. Vachharajani Shri Harshad N. Bhayani Shri J.R. Sethuramalingam Shri Jagdish Parekh Shri K. Annamalai Shri K. Basavaraja Gowda Shri K. John Paul Shri K. Lava Shri K. Rajavel Shri K. Sriram Shri K. Subramani Shri K.J. George Shri K.P. Baney Shri L. Moorthi Shri Lal Chand Sharma Shri M. Dhandavakrishnan Shri M.A. Jesurajarajan Shri M.M. Mohandas Shri M.R. Navaneethakumar Shri M.S. Nandakumar Shri Mohan Katariya Shri N. Raghunathan Shri N. Sachitananda Reddy Shri N.R. Prasher Shri Nimesh D. Patel Shri O.K. Selvaraj Shri Prabir Kumar Mukherjee Shri Pratap Salunkhe Shri R. Ethirajan Shri R. Murugan Shri R. Parthiban Shri R. Sivakumar Shri R.P. Selvasundaram Shri Ram Janam Sinth Shri Ram M. Bhatia Shri Ravindra Tyagi Shri S. Ganapathy Shri S.D. Kannan Shri S.I. Chunkhare Shri S.K. Pradhan Shri V.S. Selvaraaj Shri V.S.K. Moorthy Shri Vinod C. Gamdiwala Shri Y. Ishwar Rao

Co-opted Members

Shri K. Appi Reddy Shri P.K. Ramachandran Shri P. Narasimhulu

Special Invitees Shri B.D. Narang Capt. George Thomas Shri Girish I Patel Shri H.V. Nagesh Shri K. Sudarshan Reddy Shri Kapil Gupta Shri Manikram J. Halbe Shri Mohamed Iqbal Qureshi Shri Nandkumar Jethani Shri Rajeev Agarwal Shri S. Saravana Kumar Shri S.P. Shamanna Reddy Shri Santosh Lodha Shri Santosh R. Navle Shri Shiv Kumar Sharma Shri V. Shivarajan

BUILDERS' ASSOCIATION OF INDIA Managing Committee Meeting – Delhi, 27th July 2013

Agenda Item No.8 – Draft Annual Report for 2012-13

Report of the President and Managing Committee of Builders' Association of India for the year 2012-13

Friends, The President and the Managing Committee have great pleasure in presenting the 72nd Annual Report of the Association along with the Statement of Accounts and the Auditors’ Report for the year 2012-13. CONSTRUCTION INDUSTRY – A PERSPECTIVE Construction Sector emerged as very important part of economy especially when providing better physical infrastructural facilities for faster economic growth is leitmotif. Construction Sector accounts for nearly 45% of total planned investment and is second largest employer after agriculture. During XIth Five Year Plan period (2007-2012) it contributed 7.03% to GDP as per Table A below:

Table A Macro

variable 2008-

09 2009-

10 2010-

11 2011-

12 2012-

13 GDP from construction (at constant price) in Rs. Cr.

332329 355717 384199 404617 325320 (upto

31-12-.2013

Share of construction in GDP in percentage term.

8.5 8.2 8.2 8.2 8.2

Growth rate of construction sector.

5.3 6.7 10.2 5.6 (RE)

5.9 (AE)

Gross capital formation in Rs. cr.

88523 86290 98426 N.A. N.A.

Note: RE - Revised Estimate. AE - Advance Estimate. Source : Economic Survey 2012-13, and National Account Statistics 2012.

Construction Industry being an important indicator of growth and development as it creates investment opportunity and increases production capacity across various related sectors. The Sector is labour intensive and including indirect jobs provides employment to around 33 million people. It is estimated that about 70% of these are employed in infrastructure and remaining 30% in real estate segment. Industry is expected to generate additional

employment of 47 million people with total number employed in the sector reaching to 83 millions by 2022. After sector was given Industry status in 2000, there have been more initiative by government to undertake project on PPP basis. FDI upto 100% under automatic route is allowed in townships, housing and built-up infrastructure. Construction sector is fragmented and in unorganised sector. However with more emphasis on infra sector, many industrial houses have entered this sector. At last count there are about 67 listed construction companies on Mumbai stock exchange. Planning Commission has taken initiative in creating model engineering – procurement construction (EPC) contract document. Estimate shows that for every rupee invested in construction sector 78 paise gets added to GDP. INDIA ’S ECONOMIC SCENARIO IN XII FIVE YEAR PLAN. The Central Statics Office’s advance estimate of record ten year low GDP growth of 5% for 2012-13. It sees GDP growth at 6.1% to 6.7% for 2013-14. Fiscal Deficit revised target at 5.3% of GDP is met. Inflation rate has come down to 6.2%. If XII Five Year Plan GDP growth target of 8% is to met than economy need to grow at average 9.50% growth rate between 2014-15 to 2016-17. Saving rate has fallen from high of 36.8% of GDP achieved in 2007-2008 to likely 28% to 29% of GDP in 2012-2013. As a result investment rate has fallen from 38.1% of GDP in 2007-08 to likely 30.8% in 2012-13. Due to high investment rate in 2007-08, GDP grew by 9.3%, whereas at 28% to 29% of GDP as investment rate brought, down GDP growth to 5% in 2012-13. The way out lies in shifting national spending from consumption to investment, removing bottlenecks to investment by taking measure for structural reforms. In a bid to help highway developers undertaking PPP project from severe financial crunch, economic survey proposed a complete exit norms after two years of commercial operation. Prior to November 2009, highway developers had exit norm upto 76% subject to holding 24% of equity and as lead partner. New measure if implemented would free developer’s investment to be deployed in other projects. In a break with the past, survey has devoted an entire chapter on “Seizing the Demographic Dividend.” Economy is unable to generate sufficient number of jobs

despite records GDP growth. Generation of more jobs creates growth. Present labour force of 477 million people is likely to grow to 586 million by 2020. Despite this it will not be able to absorb rising working age people to the extent between 4 million and 16 million. Manufacturing sector is unable to absorb the numbers resulting in creation of lowly paid jobs in construction and other informal sector of economy. India’s current account deficit (difference bet higher import and lesser export) is now at record 5.4% of GDP in January 2013, need to be brought down to more manageable 2.5% of GDP. More worry-some is the fact that deficit is financed by volatile capital flows by FII, which could reverse if investors feels unsecure. Many of our companies have heavily borrowed in international market at cheaper interest rate. BAI @ PLANNING COMMISSION Providing inputs in formulation of XII Five Year Plan. In the context of formulation of XII Five Year Plan, Planning Commission formed a ‘Steering Committee on Construction’ on 4th August 2011. Composition of Steering Committee is as follows:-

1. Dr. Arun Maira – Member (Industry) Planning Commission

- Chairman.

2. Dr. Manoj Singh – Advisor

(Transport) Planning Commission

- Member.

II. Director General C.P.W.D. - Member. 20. President BAI - Member. 19. Director & CEO – L&T

ECC(wing) - Member.

25. President CREDAI - Member. 30. M.D. Simplex Infrastructure

Ltd. - Member.

31. Dr. P.R. Swarup

D.G.C.I.D.C. - Convenor.

The initial draft of the approach paper to the XII Five Year Plan had set target 9 to 9.5% GDP growth in October 2011, compared to 7.9% achieved in XI Five Year Plan. It was later brought down to 8.2% in September 2012, which was further brought down to 8% in National Development Council Meeting in December 2012. Given below growth in various Five Year Plans. Plan No.

Plan Period

Target Growth

Realised Growth

I 1951 – 1955

2.1% 3.5% It was from III Five Year

II 1955 – 1960

4.5% 4.2% Plan onwards upto 1990-91 which achieved about 3% growth called by economist Raj Krishna as ‘Hindu Rate of Growth’.

III 1960 – 1965

5.6% 2.8%

Annual 1966 – 1968

- 3.9%

IV 1969 – 1973

5.7% 3.2%

V 1974 – 1978

4.4% 4.7%

Annual 1979 – 1980

- -5.2%

VI 1980 – 1984

5.2% 5.5%

VII 1985 – 1989

5% 5.6%

Annual 1990-1991

- 3.4%

VIII 1992 – 1996

5.6% 6.5%

IX 1997 – 2001

6.5% 5.5%

X 2002 – 2006

7.9% 7.7%

XI 2007 – 2012

8.1% 7.9%

XII 2012 – 2017

8%

GDP growth in the first year of XII Plan period 2012-2013 is now projected at 5.7 to 5.9%, whereas RBI is projecting 5.5%. During first half of 2012-13. Growth achieved is 5.4%. For the second year of Plan period 2013-2014, growth is being projected at 6.5%. It means that to achieve average growth of 8%, economy will have to grow at 9.2% during 2014 – 2017 period. Since the planning began in 1951, the economy has seen growth of more than 9% in five years. In 1976 – 1977, it grew by 9%, in 1988 – 1989, it grew by 10.2% and in 2005 – 2006, 2006 – 2007 and 2007 – 2008, it grew 9.5%, 9.8% and 9.3% respectively. In view of such scenario, it is very tall order for economy to grow by 9.2% during 2014 – 2017 period. URBAN HOUSING REQUIREMENTS BY 2030 Planning commission has estimated 24.71 million housing shortage at the begining of XIth Five Year Plan (2007-12). Out of this 24.71 million houses, about 8 million is urban housing requirement whereas rest is rural housing. In 2011 census only, 285 million people i.e. 28% of population lives in urban areas. According to demography expert and urban planners, urban population will rise to 40% by 2030. It took nearly fourty years for Indian’s urban population to ise by 230 millions in 2008. It will take only half the time to add the next 250 millions as per Mekinsey’s Report “India’s Urban Awakening”. By that time i.e. 2030 country’s population is expected to be around 1500 million and therefore urban population at rate of 40% will be around 600 million. This means that

country needs to provide shelter/housing to 315 million i.e. 31.50 crores (600 million minus 285 millions existing urban population). On the basis of 4 persons per household would work out to construction of 7,87,50,000 houses to settle this urban migrant population. This demand of about 8 crores houses is in addition to the present 8 million urban housing shortage is mind blowing taking into consideration only about three to five lakh houses at present constructed by Real Estate Industry. It means that against years (i.e. 2010 to 2030). Industry is delivering maximum 5 lakh houses. Admittedly looking to such huge requirement many industrial houses have started real estate activity. It is doubtful whether real estate Industry be able to scale up it’s capacity more so in light of shortage of engineers, supervisors, skilled workers and even unskilled workers during April-June period. Housing Boards by and large have abandoned their role of providing urban housing. India in order to cope with such demand need to create more than 100 cities like Lavasa in next twenty years besides expanding present cities. Government of Gujrat issued notifieation in March 2010, for development of 879 sq.km area for Dholera Special Investment Region to be developed at a cost of Rs. 11-trillion having an employement potential to be 0.25 million. Under this project Greenfield city of 300 Sq.km in area planned to be develop at Dholera near Ahmedabad. This new city will be connected to National Highway No. 8E other Greenfield cities planned are at Manesar-Balwal in Haryana, one between Indore-Mhow in M. P. and one near and around Dighi Seaport in Maharashtra. All these cities are along route of Delhi-Mumbai Industrial corridor. Such huge migration to urban areas would ensures development of small cities about 30 to 60 minutes away from metros on PPP mode. It will also see development of slew of specialised tier III or IV cities such as 15 cities, education cities as happened during II and III five year plan when steel cities such as Bhillai, Durgapur and Rourkela got developed. Despite such scenario no policy change in Urban Planning and Development Control rules is visible. Country’s given land mass being constant there is no option but to have verticle growth to accommodate 590 million people likely to reside in cities. PUBLIC -PRIVATE PARTNERSHIP (PPP) PROJECTS India today has 337 public-private partnership (PPP) projects in infrastructure, accounting for $ 124 billion in investments, which places it among the first five developing countries by the number of projects and magnitude of investment. But do these PPPs provide value for money to the government or they are merely moving liabilities into the future? Value for money to the government is ascertained by comparing the projects’ discounted whole life cost with the counter-factual – the discounted whole life cost of conventional procurement. The two main methods for implementing ‘build, operate and transfer’ road projects in India are BOT (annuity) and BOT (toll). The difference between the two relates to the

allocation of traffic risk, which is assumed by the government in ‘annuity’ projects, while it remains with the concessionaire in ‘toll”. In ‘annuity’ projects, construction, operation and maintenance of roads are done by the concessionaire who gets annuity payments determined by competitive bidding to recover his investment. Annuity payments are borne by the government through deferred budgetary expenditure and the concessionaire receives a fixed sum directly from the contracting agency, National Highway Authority of India (NHAI), biannually. In ‘toll’ projects, investment is recovered through toll revenues, and budgetary support is restricted to an upfront grant to the concessionaire, upto a maximum of 40% of the project cost.This upfront grant compensates the concessionaire for undertaking projects that are economically viable but fall below financial viability threshold. SKILL DEVELOPMENT IN CONSTRUCTION SECTOR Out of country’s total population of 1.20 billion in 2010, 674 millions were in age group of 18-59 years called working age population which is going to increase to 793 million by 2022, When country’s population is expected to be 1.4 billon. Economic planner states that if sixty percent of population is in earning age which would increase saving rate and country would be able to reap “Demographic” dividend for a long period. Needless to state that this will have to be earned by “skilling” people. It will not come automatically. There are scores of students who have classroom knowledge but are not employable since they lack required industry specific knowledge or training. Industrial Training Institutes and other initiatives of various ministries yield only half a million trained people against demand of 5 million. ITI could not update different vocational training courses required for various industries and continue with age old courses. Industry now require different skill. Skill gap is a major challenge for an economy that wants to grow at more than 9% a year. Skill Development has not received the required focus. Only 5% of total school and college graduates go for vocational training compare to other developed countries where it is 50%. Such approach led to low employability of youth and lack of skilled worker. A study by ICRA Management Consulting Service, projects an incremental demand of 246 million people in 20 critical economic sector by 2022 as per details in Table ‘A’ below :

Table A Sr. No

Name of Industry Incremental demand in million up to 2022

1 Informal employment sector 37.60 2 Auto and Auto Components 35.00 3 Building and Construction 33.00 4 Textile and Clothing 28.20 5 Transportation and logistics 17.70 6 Organized retail 17.30 7 Real Estate 14.00 8 Health care 12.70

9 Food processing 9.30 10 Education & Skill Development 5.80 11 Services 5.30 12 IT and ITES 4.60 13 Gems and Jewellary 4.60 14 Leather Goods 4.20 15 Banking and Financial service 3.60 16 Tourism and Hospitality 3.40 17 Furniture and Furnishing 3.30 18 Electronics and IT hardware 3.00 19 Media and Entertainment 1.90 20 Chemicals, Pharmaceuticals,

Construction materials and building hardware

1.40

Total 245.90

Industry size and Growth of Construction Industry The size of the Construction industry is around Rs. 2.1 trillion in 2008 and likely to be Rs. 17.68 trillion during XIIth Plan period. The Construction sector in India is the second largest economic activity after agriculture and provides employment to about 33 million people. India's Construction industry has grown at a Compounded Annual Growth Rate (CAGR) of about 11.1% over the last eight years on the back of massive infrastructure investment and rapid rise in housing demand. Foreign Direct Investment (FDI) inflow into the sector during 2007-08 is estimated to be around Rs. 240 billion. Spending on infrastructure sectors such as ports, power plants and roads is projected at more than Rs. 2.5 trillion during XIth Five Year Plan and is projected at Rs. 4.5 trillion during XIIth Five Year Plan. It will require 92 million man years of labour. Construction and Real Estate Industry need almost 20% of total skilled personnel to sustain itself. Ratio of skilled workers is hardly 15%. This result in lower productivity per worker. Construction sector is expected to totally employ 83 million people by 2022 as per details given in Table ‘B’ below :

Table B (figure in 1000)

Sector 2012 2018 2022 Incremental Infrastructure 33868 48280 58289 33111 Real estate 14515 20692 24981 14191 Total 48383 68972 83270 47302 Incremental requirement of 44457000 personnel is having a break-up for different category of tradesman is as per detail given in Table ‘C’ below:

Table C Type of people Incremental

Requirement Bar Benders 1419000 Masons 1419000 Plumbers 1183000 Carpenters 1892000 Surveyors 47000 Others including Glazing workers, painters, operators

459000

Minimally Educated 38038000 Total 44457000

NSDC has four basic type of funding equity, convertible debt, loan and grant. As mandated under NSDC’s program Construction Industry need to form a Construction Sector Skill Council (CSSC). CSSC need to put a required training structure for development of different skills. It needs to bring about uniformity in Training Standards based on industry’s requirement. CSSC also has to establish standard in training and certification of trade skills. At present workers in construction sector acquires skill by working under a “master tradesman”. Such skilled worker though has skill but not knowledge. CSSC will have to take steps to impart knowledge to such skilled workers and also issue skill certificate to such workers. In the meantime All India Council for Technical Education is establishing 300 new polytechnics under Public – Private – Partnership mode throughout the country. AICTE has accordingly invited application from individuals, industries or companies set up u/s. 25 of companies Act. Central Govt. shall provide Rs. 3/- crores loan, state government would provide Rs. 2/- crore loan or land whereas rest will have to be brought in by private sector. Current status of Skill development in Construction Sector & the Challenges ahead The construction industry in India has been isolated from the mainstream of vocational training for various reasons and unlike other sectors, work need to be done even for such basics like identification of trades, development of course curriculum, formulation of skill standards etc. The lack of Government efforts in Skills Training in Construction Trades can be seen through the following observations:

- Vocational Education (VE) at school level is under Ministry of HRD. There is no course under VE available on Construction Trades at school level.

- Vocational Training (VT) is under Ministry of Labor & Employment. Though Union and State Government together run several thousand ITIs, Craft Training Centres etc., needs of skill man-power for construction sector has been totally neglected. In other words very little attention has been given to Training for Skills related to trades in Construction.

- Skills Development Initiatives – This also applies to other skill development initiatives undertaken by the Union or State government over last few decades. There have been no systematic efforts for construction specific training- be it training of Masons, Bar benders, Scaffolding etc.

- The institutions/programmes which have been set up with government encouragement and participation for development of construction sector have also not been able to meet the

expectations of the Construction Industry as they have not focused their vision, policy making and operational practices to the industry and this approach has ultimately not produced the desired results.

Thus, as a result, there are no established Competency Standards nor National Occupancy Standards or Training Modules. The few training programmes that exist have adopted practices suiting their particular requirements. There are variations in practices and systems and the training is being provided on totally need basis. There is also no system for mapping of existing skills. Also, the main issue is on the level of Acceptability of the Trainees by the Industry and therefore their sustained employment and retention. This is the biggest Challenge the Industry faces and has to review its Labour Engagement Policies. At the same time the Standard of training must match the needs of the Industry making Engagement of Trained Workers an automatic preferred choice. This is the second biggest Challenge. Sector Skill Council SSC for Construction – Project Objective Government of India having recognized that demographic dividend will not come automatically, established National Skill Development Corporation Ltd. on 31st July, 2008 as not for profit company licensed under section 25 of companies Act. It is more of a public-private partnership. Private sector will have to take initiative and play dominant role in “skilling” of people. NSDC has targeted to train 150 million people over 10 years (i.e. by 2022) out of incremental demand of 240 million stated in Table A. It may be reiterated that the formation of the Sector Skill Council need to be set up for performing the following functions:- - Identification of skill development needs and

preparing a catalogue of skill types. - Develop a sector skill development plan and maintain

skill inventory. - Developing skill competency standards and

qualifications. - Certification as per the Industry Standards &

Acceptance. - Standardisation of affiliation and accreditation process - Participation in affiliation, accreditation,

standardization. - Plan and execute training of trainers. - Promotion of academies of excellence. - Setting up LMIS to assist planning and delivery of

training. In particular context of the construction sector, the SSC will work towards achievement of the above objectives by involving industry as well as other concerned stakeholders. It will encourage deliberations and discussions for working out the overall strategy and the

operational framework. In the process it will also consciously work for making the SSC self sustaining over a period of time. The foremost objective of setting up a SKILLS COUNCIL for CONSTRUCTION is to establish STANDARDS in TRAINING and CERTIFICATION of TRADE SKILLS in CONSTRUCTION compatible with the COMPETENCY STANDARDS set by the CONSTRUCTION INDUSTRY. In the process, it would TRAIN the TRAINERS to attain the desired level of competency in training of trade skills. In order to ensure career progression of employees, it will in due course provide higher level of training for integration of trades, minimum with Supervisors at different levels in consultation with the industry. Its long-term objective is to migrate to competency based learning to continuously open avenues for attaining higher levels of competency to meet the needs of the industry as well as enable career progression of the individual with the lead and active support of the Construction Industry in coordination with other important and relevant stakeholders including trade bodies, institutions, academia and Government (Central & State) bodies. Broad Activity Segments of SSC include:- • Standards & Research • Operations / Delivery Mechanism • Certification & Accreditation/Quality Assurance • Labour market information system (LMIS) • Monitoring, Quality Audit & Extension Promoters of the Proposal. 1. Construction Federation of India (CFI) 2. Builders Association of India (BAI) 3. Confederation of Real Estate Developers’

Association of India (CREDAI) 4. National Real Estate Development Council

(NAREDCO) Overall plan A Three Tier Organisation Structure is envisaged viz: Top Tier being The Governing Council, Second Tier being the Executive Board and third tier would be the Secretariat. Tier I: Governing Council would comprise of the Board of Directors of the SSC for Construction sector (under Sec.25 of the Companies Act) comprising primarily prominent industry members from the promoter organizations apart from special invitees who would be members nominated by supporting construction organizations and representatives of key stakeholders from government/academician and other relevant institutions. Members of Governing Council would have both Direct Stake in the Outcome of the Council as well as Financial Stake. They would be setting directions and providing or advising on the Finances of the Council. Any mobilisation of funds either through Loans or Overdrafts would have their approval. The composition of the

Governing Council will primarily reflect the ownership of the SSC by Construction industry representatives - CFI, BAI, CREDAI, NAREDCO, NHBF etc. The Governing Council shall be headed by an industry luminary. Tier II: Executive Board will work out Strategic Plans and yearly Budgets. This Board would comprise of the CEO and Head of Core Groups who will be full-time employees as well as Non-Executive Members/ Advisors, nominated by the Governing Council, who would be compensated suitably, if required, for their contribution. The Executive Board will be involved in the Operations of the Council and through the Advisors maintain a link with the Industry. The Chairmen of the Core Groups need not necessarily belong to the members of the Governing Council and may be invited from outside if that is considered to be important for successful functioning of the concerned Core Group. Tier III: Secretariat is the permanent staff of the Council starting from the CEO and right down to the secretarial staff etc. The procedure/authority or the delegation of the same shall be decided by the Governing Council in a manner that would help in bringing on board competent Key Personnel without favour or bias. Formation of Construction Sector Skill Council. It was tentatively decided that, newly formed ‘Construction Sector Skill Council’ should have two representatives from each of Promotor Associations namely Construction Federation of India (CFI), Builders’ Association of India (BAI), Confederation of Real Estate Developers Association of India (CREDAI), National Highway Builders’ Federation (NHBF). Accordingly Shri S. Ramadorai, Advisor to the Prime Minister, National Council on Skill Development called a meeting of Presidents of Promoter Associations and others on 23rd August 2012 at Mumbai. It was decided in the said meeting to constitute Construction Sector Governing Council having following members:-

o Mr. AjitGulabchand and Mr. S N

Subrahmanyan (CFI nominees) o Mr. B. Seenaiah and Mr. D L Desai (BAI

nominees) o Mr. Lalit Kumar Jain and Mr. Shekar Reddy

(CREDAI nominees) o Mr V C Verma and Mr. S. Mukundan (NHBF

nominees) o Mr. N Hiranandani, Mr PhillieKarkaria and

Mr. J Ganguly (addl industry nominees) o 1 nominee from NSDC to be communicated

in September o 1 Government nominee from the Planning

Commission to be decided by Advisor to Prime Minister.

o 2 technical advisors in the Council (from the skills side) to be decided upon subsequently

by the remaining members of the Governing Council.

o The CEO to be inducted into the Governing Council as an ex-officio member, with voting rights.

Shri Ajit Gulabchand was requested to become Chairman of Governing Council. The Members agreed to mandating at least 20% labour certified by CSSC in all construction projects, by end of year 3, and agreed to contribute to meet SSC funding requirements for first three years (Industry contribution of Rs.7 Crore needed). It was decided that : − Col N B Saxena (L&T),Mr. Siddharth Singh (CFI)

and Mr. RajpalArora (BAI) to engage with NSDC to ensure that the Proposal is presented to the NSDC Board on 27th Sept.

− Mr. Gulabchand’s Office to set up a Secretariat to fast track setting up of the SSC as a Section 25 Company and create recruitment policies. In addition, the Office would coordinate with industry associations to get some seconded staff working full-time for the SSC for a minimum of one year, and to fix the date for the next Governing Council meeting.

− L&T to help with finalizing the model and implementation plan for the trainer-training and certification components of the SSC.

− The first Governing Council meeting to especially focus on creating a plan for developing (master) trainers in the sector.

− In addition, the Governing Council to come back to the Advisor to the PM, NCSD with specific industry recommendations/asks on use of Building and Other Construction Workers’ Cess for the SSC and/or training activities in construction

− NSDC would be forwarding MoA/AoA format to Mr Gulabchand’s Secretariat for CSSC Co formation.

Aspect of Training & Certification. While certification requires no funding, training of construction workers involves substantial finance. Governing Council Members feel that, Construction Workers Cess fund be utilised for this purpose. However, there is no provision in Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 for imparting vocational training to registered construction worker. Fortunately, the State Government of Delhi have come out with Delhi Gazette No.24, dated 10th February 2012 facilitating the availment of Construction Welfare Cess collected from Contractors for training of construction workers. Similarly, the Ministry of Labour And Employment, Government of India, came out with a Notification No.Z-20011/05/2010-BL dated 21st May 2012 facilitating the

availment of Construction Welfare Cess collected for training of construction workers. REPRESENTATION REQUESTING CONTRIBUTION OF 50%

CONSTRUCTION WORKERS CESS COLLECTED FROM CONTRACTORS FOR TRAINING OF WORKERS. BAI President sent the following representation to all Members of Parliament (both Rajya Sabha and Lok Sabha).

Ref: 244/A/2012-13 dated August 4, 2012 To: The Hon’ble Members of Parliament Respected Sirs, Sub: Representation requesting contribution of 50% Construction Workers Cess collected from Contractors for Training of Workers. Builders’ Association of India (BAI) is an apex all India body of Engineering Construction Contractors, founded in 1941, has more than 13,000 business entities as members through its 130 plus Centres (Branches) throughout the country. The fundamental aim of the Association is to bring about all round 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, the level of attention that the construction industry deserves in view of its tremendous contribution and importance to the economy. Better infrastructure is an enabler of economic growth and enhancer of quality of life. Economic planner allotted One Trillion U.S. Dollar (approximately Rupees Fifty Six Lakh Crore) for infra sector in XIIth Five Year Plan. In order to earn demographic dividend, skilling of construction workers is of utmost importance. Government therefore came out with a mission to skill 83 Million construction workers through National Skill Development Corporation by 2022. To facilitate various welfare measures to the Construction Workers , the Government of India enacted Building & Other Construction Workers Welfare Cess Act, 1996 and as per the Act, Construction Industry have to contribute 1% of the contract value to the State / Central Government. As on 31st November 2011, Construction Industry contributed Rs.5265.57 Croreas “Cess”, and. State Government has only spent Rs.752.11 Crores from collected “Cess”. The productivity of Indian Construction Worker is remarkably low and as per reliable data, it is only 8 when comparing to the productivity of an American Worker as 100. Further, so far, there is no initiative from the Government side for basic skill training and skill upgradation of Construction Workers.

Construction Industry feels that about 50% of Labour Welfare Cess collected by various State Government and Central Government be transferred to National Skill Development Corporation for skill training of construction workers. We, therefore request you to kindly use your good office in recommending to the concerned Ministry for releasing of 50% Construction Welfare Cess collected for the skill development of construction workers.

Thanking You, Yours faithfully, Sd/- B. SEENAIAH President Builders’ Association of India The Government of India, Ministry of Labour & Employment came out with a Circular No.Z-200011/05/2010/BL dated 21st May 2012 stating therein that vocational training and skill upgradation may be a permissible activity. The Delhi State Government also came out with a Notification No.24 dated 10th February 2012 amending Rule 283(A) of Building & Other Construction Workers (Regulation of Employment and Conditions of Services Act, 1996 in exercise of powers conferred by Section 62 of Delhi State, permitting the utilization of Construction Welfare Cess for imparting vocational training to construction workers. CEMENT CARTEL PETITION WITH COMPETITION COMMISSION OF INDIA BAI had filed a complaint on 13th February 2010 with the erstwhile Monopolies and Restrictive Trade Practices Commission (MRTPC) drawing its attention to unusual spurt in cement prices. Director General – Investigation & Research (DG-IR) could not file the preliminary investigation report. Pursuant to repeal of the ARTP Act, 1969, the matter was transferred to the Competition Commission of India (CCI), which on 24th June 2012 directed DG to conduct investigation under Section 26 (1). DG submitted his investigarion report to CCI on 31st May 2011. Matter was simultaneously heard with Case No. 29/2010. On 30th July 2012 CCI delivered order upholding BAI’s contention. Relevant extracts of the order are printed herein below, followed by some related news items.

Before The Competition Commission of India

Case No.RTPE-52/2006

Date of Order 30th July 2012 1) M/s Shree Cement Limited - through Shri Manas K Chaudhry & Shri Sagardeep 2) Cement Manufactures Association - through Shri Ashok Desai & Others

3) J.K. Cements (JK Group) - through Shri P. K. Bhatia 4) Binani Cement Ltd. –through Shri Aditya Narain & Shri R. Sudhinder. 5) Lafarge India Pvt. Ltd. - through Shri A. Haskar & Shri Samir Gandhi 6) Jaiprakash Associates Limited - through Shri Parag Tripathi & Shri G R Bhatia 7) Ultratech Cement Ltd. - through Shri Aspi Chinoy & Shri Pravin Parekh 8) The India Cements Ltd. - through Shri Harishankar 9) Ambuja Cements Limited - through Shri Ramji Srinivas & Ms Anu Tiwari 10) A C C. Limited - through Shri K Venugal and Ms. Pallavi Shroff 11) Century Textiles & Industries Ltd. - through Shri Pramod Agarwala & Others 12) Madras Cement Ltd. - through Shri. T. Srinivas Murthy 13) Builders Association of India - through Shri. O. P. Dua & Shri Rahul Goel Order under Section 27 of the Competition Act, 2002 This case has been received on transfer from the Office of the DG (IR), MRTP Commission under Section 66(6) of the Competition Act, 2002 (‘the Act’). The MRTP Commission had taken suo moto cognizance and initiated investigation on the basis of press reports published in the business daily, the Economic Times on 09.05.2006 and 29.06.2006 regarding increase in cement prices. Subsequently, a letter dated 16.9.2006 of the Builders' Association of India (‘the BAI’) was also received by the MRTP Commission through the then Ministry of Company Affairs on 26.09.2006. Reply of the parties :

The Commission also notes that parties in case No.29 of 2010 and in the present case are same except M/s Shree Cement Ltd., which was not a party in Case No.29 of 2010. As the replies of the parties (except M/s Shree Cement Ltd) have been noted in details in Case No. 29 of 2010, hence, the submissions of the parties in this case which have been dealt with in the order passed in Case N o.29 of 2010 are not repeated in extenso. Accordingly, a brief resume of the additional submissions made by the parties in case has been recorded below. However, since M/s. Shree Cement Limited was not a party in Case No. 29 of 2010, its reply of the following is being recorded in detail :-

1) M/s Shree Cement Limited (Shree Cement) 2) Cement Manufacturers Association (CMA) 3) M/s J K Cement Ltd 4) M/s. Lafarge India Pvt. Ltd (Lafarge) 5) M/s India Cements Ltd.

Decision of the Commission :

The Commission has carefully gone through information / report of the DG and averments of vari2 ii the instant

case. The Commission notes that in addition to substantive issues involved in the matter, the cement companies have also raised certain preliminary objections. Evaluation of Contentions Regarding Jurisdiction It has been contented that the DG, unlike its. predecessor DG (l&R), does not have suo moto power to investigate any breach of the section 41(1) of the Act. Accordingly, it has been argued that any investigation arising out of section 66(6) of the Act does not confer any statutory powers upon the Commission to form prima facie view under section 26(1) of the Act without routing the same through section 19(1) thereof. In the instant case, it has been argued that the Commission formed the prima facie view without establishing the causal link with section 19(1) of the Act and as such the prima facie order is bad in law. It has been argued that the Commission could have considered the inconclusive investigation as piece of information and instituted the inquiry under section 19(1) of the Act under its SUO moto powers and proceeded to form the prima facie view in terms of section 26(1) of the Act. It has also been contended that as the allegations in the present matter pertained to year 2005and 2006 the case ought to have been examined under the MRTP Act and the Competition Act cannot be applied retrospectively. It has also been argued that as the matter was being investigated by the DG (IR), MRTPC before being transferred to the Commission the rights, liabilities and obligations accrued to the parties under repealed MRTP Act are preserved and protected by virtue of Section 66(1A) of the Competition Act, 2002. The Commission is of opinion that the preliminary objections taken by the parties are contr.ary to the scheme of the Act and the legal position on this aspect is quite clear. is regard it is also noted that Hon'ble High Court of Delhi in W.P.(C) 6805 / 2010 Interglobe Aviation Ltd. v. Competition Commission of India decided on 06.10.2010 has held on similar issue that where the investigation by the DGIR, MRTPC remained incomplete and the matter did not crystallize into a 'case' before the MRTPC, it was not incumbent on the DGIR, MRTPC to transfer the case to the Competition Appellate Tribunal and not to Commission. This 'view was reiterated by the Hon'ble High Court of Delhi in W.P. (C) 7766 / 2010, Gujrat Guardian Ltd. v. Competition. Commission of India decided on 23.11.2010. In this case the petitioner advanced the argument that as the matter was pending before DGIR, MRTPC the case ought to have been transferred to Competition Appellate Tribunal and not to the Commission. It was also contended that the Commission had no power to pass order under section 26(1) of the Act in such matter and that the Commission had to proceed under the provisions of the MRTP Act. The Delhi High Court rejected tie arguments raised by the petitioner and held that "This Court finds that since the investigation was incomplete the matter was rightly transferred to the CCI. On further consideration of the material on record the CCI formed a prima fade opinion to proceed under Section 26(1) of the CA. This was not

contrary to Section 66(6) of the CA. It is possible in the course of investigation that the DG, CCI forms a prima facie opinion to proceed under the provisions of the CA, 2002 itself. There is no illegality per se in such action of the DG, CCI." The Commission further observes that though Shree Cement was not a party named in the information filed in Case No. 29 of 2010, the DG while analyzing the data has fully taken into consideration the data and conduct relatable to M/s Shree Cement Limited. The Commission also in its order dated 20.06.2012 in the said case in its analysis has also referred to the same. Moreover, admittedly as the Shree Cement is a member of CMA, and therefore, the conduct of this party was also analyzed therein. Order under Section 27 of the Act:- The Commission finds the parties in the present matter including Shree Cement have contravened provisions of section 3(3) (a) and 3(3)(b) read with section 3(1) of the Act. The Commission observes that since the cement companies which are parties in the present case have been found to be in cartel (except M/s Shree Cement) in Case No. 29 of 2010 also and penalized therein, hence, the Commission does not deem it fit to order remedies including imposition of penalty on such companies again for the same period of contravention. It has been noted in the para 98 of this order that conduct of M/s Shree Cement Limited was not examined during the inquiry in Case No. 29 of 2010. However, in the present matter as the conduct of M/s Shree Cement has also been found in contravention of the provisions of sections 3(3)(a) and 3(3)(b) r section 3(1) of the Act, the Commission decides to imp it in terms of proviso to section 27(b) of the Act. The calculation of penalty limit based on net profit in terms of section 27(b) is as under: Name Gross

turnover for 2009-10 (In Rs. Crore) taking into account period of con-travention post Notification i.e. 20.5.2009 on pro-rata basis (In Rs. Crore)

10% of Turnover as calcu-lated in column 2(in Rs. Crore)

Gross Turn-over for 2010-11 (in Rs. Crore)

10% of Turnover calculated in column 4 (in Rs. Core)

Total (In Rs. Crore)

Shree Cement Ltd.

3475.20 347.52 3937.78 393.77 741.29

The calculation of penalty limit based on net profit in terms of section 27(b) is as under:

Name Net Profit

2009-10 taking into account period of contraven-tion post Notification i.e. 20.5.2009 on pro-rata basis (in Rs. Crore)

3 times of Net Profit as calcula-ted in column 2 (in Rs. Crore)

Net Profit 2010-11 (in Rs. Crore)

3 times of Net Profit as calcula-ted in column 4 (in Rs. Crore)

Total (In Rs. Crore)

Shree Cement Ltd.

585.33 1755.99 209.70 629.10 2385.09

It would be seen from the above that the amount of three times of net profit calculated as above is higher than 10% of the turnover. Since as per the provisions of Proviso to Section 27(b) the penalty has to be determined on the basis of net profit or turnover whichever is higher, in this case the net profit has been taken into account by the Commission. Therefore, considering the totality of the facts and circumstances of the instant case, the Commission decides to impose a penalty of 0.5 time 01 net profit for 2009-10 (from 20.05.2009) and 2010-11 in case of M/s Shree Cement in this case. Accordingly, the penalty amount is determined as under: Name Net Profit

2009-10 taking into account period of contraven-tion post Notification i.e. 20.5.2009 on pro-rata basis (in Rs. Crore)

0.5 times of Net Profit as calcula-ted in column 2 (in Rs. Crore)

Net Profit 2010-11 (in Rs. Crore)

0.5 times of Net Profit as calcula-ted in column 4 (in Rs. Crore)

Total (In Rs. Crore)

Shree Cement Ltd.

585.33 292.66 209.70 104.85 397.51

Since the enforcement provisions of the Act have come into effect from 20.05.2009, for the calculation of penalty in the present case, the period from 1.4.2009 to 19.05.2009 has not been considered and amount of penalty has been calculated accordingly for the balance period of 2009-10. The Commission also directs M/s Shree Cement to 'cease and desist' from indulging in any activity relating to agreement, understanding or arrangement on prices, production and supply of cement in the market. The Commission decides accordingly. M/s Shree Cement should deposit penalty amount within a period of 90 days from the date of receipt of this order and also file an undertaking in compliance of direction given in preceding para within same period.

The Secretary is directed to communicate this order as per regulations to all the parties. Sd/- Sd/- Sd/- Member (G) Member (R) Member (GG) Sd/- Sd/- Sd/- Member (AG) Member (T) Member (D) Sd/- Chairperson

Brief Report of the Proceedings in the Competition Appellant

Tribunal at New Delhi in the matter of

Appeals filed by various Cement Companies, Aggrieved by the Competition Commission of

India Order in Case No 29/2010 dated 20.06.2012 &

RTPE/2006 on 30.07.2012 Under Section 53B of the Competition Act, 2002 in the Competition Appellant Tribunal at New

Delhi V/s. Competition Commission of India - Respondent. Represented by : Shri Balbir Singh, Shri Abhishek Singh Banger and Shri Abhishek Yadav, Advocates for the Respondent (CCI) Builders' Association of India - Respondent. Represented by : Shri O.P.Dua, Sr. Advocate with Shri Rahul Goel, Ms Anu Monga and Shri Aditya Garg, Advocates

The matter was listed for hearing, in the Tribunal, on the following dates :- 13th September 2012 (1 day) 11th & 29th October 2012 (2 days) 1st & 22nd November 2012 (2 days) 6th December 2012 (1 day) 29th & 30th January 2013 (2days) 18th to 22nd & 25th to 28th February 2013 (9 days) 1st. 13th to 15th & 18th March 2013 (5 days) Coram of the Tribunal :- Hon’ble Mr. Justice V.S.Sirpurkar - Chairman Hon’ble Mr. Rahul Sarin - Member Hon’ble Mrs. Pravin Tripathi - Member Competition Commission of India in its order dated 20th June 2012, in Case No.29/2010, imposed a penalty of Rs.6307.32 Crore on Cement Manufacturers Association and ACC, Ambuja Cements, Ultra Tech, Grasim Cements, Lafarge India, J K Cement, India Cements, Madras Cements, Century Cements and Binani Cement,

accusing them of creating a carte for indulging in the unfair trade practices. In another Case No. RTPE 52/2006, in its order dated 30th July 2012 Competition Commission of India imposed a penalty of Rs.397.51 Crores against Shree Cement. These companies were directed by the Competition Commission of India to deposit the amount of penalty within 90 days of the order.

All the cement companies and the Cement Manufacturers Association, aggrieved from the above orders moved Competition Appellate Tribunal, firstly for stay on depositing the amount of penalty and secondly for quashing the impugned order on the various grounds.

On initial four days of listing of the matter for hearing, the Tribunal granted the stay on depositing the penalty amount, imposed by the CCI in its order dated 20.06.2012 & 30.07.2012 till further orders or vacation of the stay.

On 6th December 2012, Chairman, Competition Appellate Tribunal ordered the cement companies to come out with the application on the common grounds which are applicable to all the cement companies. Accordingly, the cement companies moved with the applications for taking up the matter on the following grounds :- 1. When the final hearing of the Competition

Commission of India took place on 21st & 22nd and 23rd February 2012, only 6 members of the commission were present in the meeting and Chairman, Shri Ashok Chawla was not present. Despite this, he has signed order, which is bad in law and be treated null and void.

2. The Competition Commission of India did not allow the witnesses to be cross-examined by cement companies which is against the law of natural justice.

3. There is no direct evidence with regard to the cement manufacturers indulging into cartelization and as such the orders of the commission be remanded and sent back to the commission for reconsideration. If the orders of the CCI are not remanded, then what will be the amount of penalty which the cement may require to deposit with the Tribunal before the case is listed for hearing. Companies will be allowed to argue on all the points against each company leveled by the CCI.

Hearing in the Tribunal from 29th January 2013 started where the advocates from all the cement companies were given the opportunity to argue the case. The matter did not came up for hearing on 29th & 30th January 2013 as the other matters listed for hearing were not completed. A marathon hearing of the case took places in the month of February (9 days) and March (5days) 2013 in the a band of prominent & senior counsels participated in the arguments from the cement companies as well as from

Builders’ Association of India & Competition Commission of India participated. Arguments on the main grounds was very well defended by the counsel appearing of behalf of BAI as well as CCI :- 1. As regards signing of the final order by the

Chairman, CCI, it was argued that on the last date of hearing of the matter in the CCI on 23.02.2012, counsels appearing on behalf of the cement companies were requested by CCI for giving written submission on the basis of what that have been argued earlier on the various dates. 9 companies made the written submission to the CCI and 3 companies did not made any submission in addition to what have been argued orally by their counsel. The final orders were signed by all the six members who were present on 21st, 22nd & 23rd February 2012. It was argued that the Chairman has signed orders for those 9 companies who had made the written submission as the chairman have gone through those submissions and all the six remaining members have signed for all the companies because they were present during the oral submissions and have also gone through the written submissions made by them.

2. As regards allowing the witnesses to be cross examined by the counsels of the cement companies, it was argued that as per the provisions of Competition Act, it is the prerogative of the CCI to allow or not to allow the witnesses to be cross-examined. CCI accordingly utilised it’s power.

3. Regarding the direct evidence with regard to the cement companies indulging in the cartelization, it was argued that there are ample proof of cartelization i.e. price parallelism, deliberate under utilization of installed plant capacity, chocking the supply line, collection of data by CMA and sharing such data with all the cement companies, rising of prices after the meeting of the High Power Committee, constituted by the CMA etc.

The arguments have been since been completed on 18th March 2013 and as per the verbal orders of the Hon’ble

Mr. Justice V.S. Sirpurkar – Chairman, Competition

Appellate Tribunal, on 18th March 2013, the orders

have been reserved. BAI President sent the following representation to all Members of Parliament (both Rajya Sabha and Lok Sabha).

Ref: 194/J/2012-13 dated July 3, 2012 To:

The Hon’ble Members of Parliament

Respected Sirs,

Sub: Appointment of Cement Regulatory Authority.

Builders’ Association of India (BAI) is an apex all India body of Engineering Construction Contractors and Real Estate Companies founded in 1941, with more than 13,000 business entities as members through its 130 plus Centres (Branches) throughout the country. Regional Associations Affiliated to BAI form indirect membership of more than 50,000. The fundamental aim of the Association is to bring about all round 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, the level of attention that the construction industry deserves in view of its tremendous contribution and importance to the economy. Cement is one of the main raw materials used in construction works. In building works, it constitutes about 13% of cost, whereas in roads, sewerage, dams, etc., it varies from minimum 5% to maximum 30%. Housing Industry consumes 60% of cement produced by Cement Industry, infrastructure consumes 20%, whereas industrial, commercial and others consumes balance 20%. Cement Industry indulges in unfair trade practice is evident in Enquiry No.RTPE 99/1990 decreed on 28th November 2006 by Monopolies and Restrictive Trade Practices Commission’s ‘cease and desist order’. The Hon’ble M.R.T.P. Commission again in Enquiry No.RTPE 21/2001 decreed on 29th February 2008 observed that, “Cement companies are guilty of forming cartel and issued to cease and desist order. The M.R.T.P. Commission also directed them to file the Affidavit with effect that, they won’t do cartelisation again”. Concerned about the continuous increase in Cement price since last many years, the Government of India had appointed a Parliamentary Standing Committee to look into Cement Industry sometime in end 2009 under the Chairmanship of Ex-Chief Minister of Himachal Pradesh Shri Shantakumar. This Committee invited all stakeholders including BAI. After consulting all stakeholders, the Parliamentary Standing Committee presented 95th Report on “Performance of Cement Industry” on 24th February 2011 in Rajya Sabha and also placed it on table of Lok Sabha. The Committee concluded the report by observing interalia the following:- 1. Deliberate under-utilisation of installed capacity

by cement manufacturers to create artificial shortage.

2. The Committee strongly recommends the Government should establish a Statutory Regulatory Authority to regulate the price of Cement.

3. One of the reasons for price rise of cement is

profit motive of the cement companies.

On 20th June 2012, The Hon’ble Competition Commission of India in case No.29/2010 filed by 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 10 Cement Manufacturers plus Cement Manufacturers Association (CMA). It is high time the Government of India should seriously consider complying with the recommendation of the Parliamentary Standing Committee for appointment of a ‘Cement Regulatory Authority’ similar to the Regulatory Authorities constituted by the Government of India to regulate various Core Sectors of Economy like :-

a) SEBI as Regulatory Authority for Capital Market / Stock Exchanges.

b) TRAI as Regulatory Authority for Telecom Industry.

c) IRDA as Regulatory Authority for Insurance Sector. Looking to the unfair business practice indulged by cement producers, BAI feels appointment of a Cement Regulatory Authority is necessary, for which your support in the form of recommendation to Ministry of Commerce & Industry is earnestly requested. Thanking you, Yours faithfully, Sd/- B. SEENAIAH President Builders’ Association of India PROVIDENT FUND

Construction Industry was brought within the purview of the Provident Fund Act, 1952 (the “Act”) vide Notification dated 17.9.1964. Subsequent notifications dated 23.9.1980 and 1.11.1990 sought to broaden the boundaries of the said Act, wherein a requirement was placed for every employee employed in or in connection with the work to become a member of the scheme from such employee’s date of joining. This amendment lead to an interesting tussle between the Central Provident Fund Commissioner and the Building and Construction Industry as to the applicability of paragraph 26(2) of the Provident Fund Scheme to daily rated casual, temporary, and peripatetic labours. The issue got further entwined when the said industry challenged the capability of the Provident Fund Department in distribution of the benefits of this social legislation to the actual beneficiary.

UPTODATE REPORT OF EPF MATTER FILLED BY BAI DELHI CENTRE IN HIGH COURT OF DELHI VIDE CWP NO . 3588/2002 Builders Association of India, Delhi Centre & Others filed a Civil Writ Petition No.3588 / 2002 against

Union of India & Others on the applicability of Employees Provident Fund & Misc. Act on the construction workers. The case came for hearing in April 2002.

On 30.05.2002, the BAI Counsel pleaded before the Court that in terms of the proposed scheme framed by the respondent (EPFO) and as was placed in CWP No.792/1991 (Piayre Lal Hari Singh & Another v/s Union of India & Others , the Provident Fund Organisation (EPFO) was required to issue a pass book and assign a ten digit number to each employees. It is submitted that despite this scheme having framed in 1991 and despite the same having been filed in Court in 1995, no pass book has been issued till date nor ten digit number has been assigned. In the matter CM No.6191/2002 (similar / identical matter) before the Hon’ble Court: Mr. Chawla, the respondent’s Councel (for EPFO) submitted that till the next date of hearing, the respondents will not take any coercive steps in respect to the coverage of casual workers of the petitioner, however, the proceedings will continue. Since, the proceedings under the Act are continuing before the Regional Provident Fund Commissioner, the Petitioner will extend co-operation for completion of the proceedings. On 07 July 2004 - Court issued the “Rule ”. To be heard alongwith WP(C) 7253/2002 (similar / identical matter). The interim orders passed on 30th May, 2002 (under C.M.No.6191/2002) is made absolute till the disposal of the Write Petition. Later on the matter was sent to the Lok Adalat for the final settlement but due to non listing of the matter in the Lok Adalat for such a long time, on 2nd February 2009, the Hon’ble Court issued orders for listing the matter for final disposal on 24th August 2009. The matter has been listed for hearing on 24th August, 2009, 6th January 2010 & 30th April, 2010, 5th October 2010, 5th January 2011 and 30th April 2011 but adjournment granted on one grounds or the other. The matter was listed for 16th August 2011. On 16th August, 2011, counsel for Respondents 2 and 3 stated that she has just taken over as the counsel for RPFC and at her request, the matter was deferred for 29th September 2011. Meanwhile, it was felt that the present Counsel Ms. Amrita Sanghi, was not doing enough for the case and it was decided to change the counsel on the record. Accordingly Shri Somesh Arora has been appointed as the Advocate, on record, to plead that case. He appeared in the High Court on 29th September 2011, behalf on behalf of Builders’ Association of India, and sought adjournment which was granted and the matter was deferred for 5th December 2011. On 5th December 2011, when the matter came up for hearing in the Court of Justice P K Bhasin, BAI’s advocate on record Shri Somesh Arora was present in the court alongwith the Senior Advocate Shri Sandeep

Sethi for arguments but counsel for the respondent for No.1 requested for adjournment. The Hon’ble Judge granted the adjournment and deferred the matter for 20th April 2012. Civil Application vide No.1105/2012 was filed in the High Court of Delhi, on 24th January 2012, with the prayer to direct the respondents to comply with the direction given through various orders passed by the Hon’ble Court of compliance of modified Scheme of respondent, call upon the respondents to clarify the contradictory statements / stands taken before different courts in respect of implementation of Scheme, restrain the respondents not to take any coercive steps till the pendency of the matter etc. The Court of Justice P K Bhasin (Court No. 7) directed the listing of application for consideration on 20th April 2012, the date already fixed in the matter. CM 1105/2012 & 3588/2002 came for hearing in Court No.7 of Justice P K Bhasin on 20.4.2012. Orders : Notice. Notice of the application is accepted by learned counsel for respondent no.1- UoI and respondents No. 2 and 3.

List on 9th October, 2012 along with other connected matters. On 9th October, 2012, it was ordered to list the matter on 31st October 2012, as the concerned Judge in the court where the matter was listed for hearing was on leave. On 31st October, 2012, - Learned counsel for Respondent No. 2 & 3 stated that they copy of lthe application filed by the application regarding deletion of name have not been served to them. Hon’ble Court ordered for supply of copy of the applications to respondents No.2 & 3 within one weak. It was further ordered for listing of the case on 19th December 2012. On 19th December 2012, learned proxy counsel for the Respondent No.2 & 3 prayed for an adjournment as the arguning counsel was in personal difficulty. Next date of hearing was fixed for 7th March 2013. On 7th March 2013, the matter came up for hearing in the court of Hon’ble Judge Vipin Sanghi. BAI had brought Shri Parag Tripathi, Senior Counsel for arguing the case but the Judge was not interested to take up the matter on the grounds that once he has been represented the BAI in the Labour Cess matter in the High Court and has requested the Register of the Court to transfer the case to the another court. The case case up for hearing in the court of Justice Valmiki J Mehta on 16th April 2013. As the Hon’ble Judge received the case on transfer a day before, he ordered for listing of matter on 20th September 2013. He further ordered that all the pleadings be positively completed atleast two weeks before the next date of

hearing failing which right to file the pleadings shall stand closed. Now the matter will be listed on 20th September 2013. BAI President, Shri B. Seenaiah addressed a detailed letter to the Hon’ble Minister, Labour & Employment, Government of India, illustrating the difficulties faced by the Construction Industry vis-à-vis Implementation of provisions of Employees’ Provident Fund Act, 1952. The letter is reproduced below:-

Date : 05.09.2012 The Hon’ble Minister Labour and Employment, Govt. of India, New Delhi 1. We submit that we are engaged in the business of execution and construction or roads, dams, buildings, bridges, development of infrastructure etc. The buildings and construction activities carried out by the builders, contractors are distinctly different from other conventionally established industries, such as manufacturing, trading, service etc., In fact, the activities of building and construction, do not constitute an industry, and are not even recognized by the Govt. as being so. The provident fund Act 1952, which is enacted for the purposes of providing security, to the families of employees working in industries in events such as his retirement or untimely death, can not made applicable to our industry on par with any regular manufacturing industry due to following grounds. 2. It is submitted that the Parliament has enacted the Provident Fund Act. In the year 1952 and the same applies to every establishment which is a factory engaged in any industry, specified in Schedule-I, in which 20 or more persons or class of such establishments, which the Central Government may by notification in the official gazette specify in this behalf. The Provident Fund Act is enacted for the purpose of establishing an institution of Provident Fund for employees in such factories and other establishments for the better future of the industrial worker on his retirement and for the benefit of his dependants in case of his death, while in employment. Plain reading of section 1, of the said Act together with its sub sections, make it apparent that the underlying idea is to bring establishments, who have 20 persons in the employment and which persons are working with an element of regularity to bring such establishments which its’ purview. Further, the statement of objects and reasons and the plain reading of the Act makes it clear that is envisages and relates to an industry and not to any activity when cannot be categorized as an industry. The word establishment is to be read in line with the dominant object and thus means an establishment of an industry. Permanency or at least semi-permanency and not casualness are covered section 1 (5) of the Provident Fund Act, supports our submission that there should be continuity of employment in establishment and concept of continuity in service stands to be apparently embedded in sub sections 3 and of section 1 of the Provident Fund Act.

Therefore, engagement of a particular worker or particular person, for a particular work which is of a casual nature and who is employed due to the exigencies of circumstance, for a very brief period, cannot be interpreted to mean an employee for the purposes of the Provident Fund Act. The concept of employment for the purposes of the Provident Fund Act excludes engagement of casual workers for temporary periods and the word “employment” has necessarily to be construed as regular, permanent or semi-permanent employment in the factory or establishment or an industry. It certainly cannot apply to those casual workers who may work for a very brief duration and then come back to work on the same site/project. 3. It is further respectfully submitted that vide notification No. GSR 1308 dated 17th September, 1964 the establishment of engineers and engineering contractors, not being exclusively engaged in building and construction industry were brought under the purview of the Provident Fund Act with effect from 31st October, 1964. By subsequent notification dated 23rd September, 1990 issued in exercise of powers conferred by sub clause (b) of sub section 3 of section 1 of Provident Fund Act, the union of India, specified every establishment engaged in the building and construction activity in which 20 or more persons were engaged as a class of establishment of which the provisions of Provident Fund Act would apply with effect from 31st October, 1990. 4. In view of the above said amendment, the all the builders’ whoever employing 20 or more persons with regularity and which employees figure on the employment rolls, under the specified salary limit are required to be covered under the EPF Act. Accordingly, we are registered our establishments under the provisions of the Provident Fund Act with individual code numbers. 5. In this connection, it is necessary to submit that up to 31st October, 1990 paragraph 26 (2) of the Provident Fund Scheme stood as follows:

26 (2) After this papagraph comes into force, in a factory or other establishment every employee employed, in or in connection with the work of a factory or establishment, other than an excluded employee, required to become a member from the beginning of the month, following that in which he completes (three months continuous service) of has actually worked for not less than ( 60 days within a period of three months or less) in that factory or other establishment or in any factory of establishment (to which the Act applies), under the same employer or partly in other (or has been declared permanent in any such factory or other establishment whichever is earliest)”.

6. That this paragraph 26 (2) was amended and after amendment was enforced w.e.f 1st November, 1990 the same reads as follows:

“26 (2) After the paragraph comes into force, in a factory or other establishment, every employee employed, in or in connection with the work of that factory or establishment, other than excluded employee, who has not become a member already shall also be entitled and required to become a member of the fund from the date of joining the factory or establishment”.

7. After the 1990 amendment to paragraph 26 (2) of the P.F. Scheme although the qualifying period for entitlement to become member of the P.F., which was there prior to the amendment, has been dispensed with, yet the amendment by no stretch of imagination would bring within the fold of paragraph 26 (2), daily rated, casual/temporary workers engaged at work sites mostly by the Thekedars/petty contractors in multi-tier system because the words “every employee employed” and “date of joining the factory of establishment” appearing in paragraph 26 (2) of the P.F. Scheme, clearly emphasize that the joining the factory or establishment for employment, has to be permanent or semi-permanent in nature or in the other works contemplates continuity in service. It necessarily excluded casual workers or daily wagers, with no continuity of service, bring brought, within the purview of the Act. 8. The purpose of the Act can never be to extend benefits to unskilled workers, who are temporary and mobile and who are not regularly employed. These casual workers may work only for a day or for a few hours and may never further do any work on the same site/project. It it commonly known that these contractors simultaneously take a number of jobs and rotate their casual labour form one site to another. There is no employer-employee or master-servant relationship between the builder and the causal rotating worker as there is no control or supervision, which can be exercised by the former upon the letter nor any element of permanency or continuity of service of the latter with former,. The Act is designed to cover only those employees who has some continuity of service. 9. It is therefore our humble submission is that the Act is not applicable to the case of casual workers, who do not satisfy the definition of an employee under the Act, and since the establishments of the Builders are concerned with casual workers, the Act does not apply to them. In this context, it is pertinent to mention that vide orders dated 27.11.1992 and 19.5.1992 the Hon’ble Division Bench of Delhi High Court, in the proceedings, had directed the EPF authorities to submit the modification, to the existing procedure, for implementation of the amendment to para 26 of the employees Provident Fund Scheme as amended. The Hon’ble High Court also directed that the scheme in respect of peripatetic labour be evolved with the following features. 1. The member should be in a position to make the withdrawal at any place.

2. The member should have the same account number which should be valid anywhere in the country. 3. The Scheme should enable the member to withdraw the money conveniently from the nearest Provident Fund Office. 4. The scheme should enable member to know about the balance of his credit at any given point of time. 10. It is submitted that it has been over twenty years, since the amendment to para 26 of the Employees Provident Fund scheme was brought in and in spite of the orders passed by the Hon’ble Division Bench of the Hon’ble High Court of Delhi dated 27.11.1992 and 19.5.1992, asking the P.F Department to take effective steps for implementation and its directions towards the evolvement of the scheme, the Department have not taken any steps to implement the same, despite of the undertaking recorded in order dated 19.9.1996 given by the EPF department. 11. It is evident that the scheme cannot be implemented unilaterally unless The EPF Department provide for proper mechanism there is not purpose in making these demands, upon the Employers, to contribute towards the fund. On the other hand harassing the managements by making arbitrarily and illegal demands, stopping payments due to the employers arbitrarily under the Government contracts executed by them, asking for records and inspection of document and threatening the employers with coercive and harsh actions including seizure of their bank account and civil detention. 12. It is submitted that the interpretation sought to be given by the EPF department in seeking to interpret para 26 of the scheme so mean that the builder and construction agencies is liable towards contribution of the fund under the Act, even if the casual worker works for only one day is completely erroneous and impracticable. The same could never have been the intention of the legislature as held in various judgments of the Supreme Court & various High Courts. The scheme of the Act is to provide for the security, insurance and pension for the worker with some continuity of service. Thus, is other words, to enable the worker to have access to funds in his/her old age, it is thought of applying the scheme, to the working class. This necessarily implies a long standing, regular and continuous working relationship with the employer, which I obviously not the case with casual workers in the building and construction establishments. 13. Because the purpose of the Act is to provide for the institution of Provident Fund pension and insurance Funds simultaneously. It evidently cannot be extended to building and construction activities due to its peculiar features, such a, the transient and migratory nature of the labour, employed by the contractors, in order to provide services to the builders there can be no occasion for the builder to contribute towards the pension and insurance funds, as there is no permanency in the relationship between the builder who sub contracts the work to the

subcontractor/thekedar and the daily labour employed by the sub-contractor. The entire purpose behind the grant of pension and insurance is to provide security to a regular worker, who is to be compensated for the long standing relationship with a particular industry and employer. This is clearly evident from the fact that the pension and the insurance fund is deductible by the employee only after he has served for a period of 9 years. This obviously cannot be extended to the building and construction activity for casual labour wherein the contractor at the outset is not employer, but merely sub contracts the work and in any case has no nexus or relationship with the labour who may change on a daily basis. This is the reason that the said labour is not even on the rolls of the builders as they do not work regularly for the builders and this do not fall under the category of employees of the builder. Hence it is a deaf pointer to the fact that this Act & the scheme made there under is not meant for employees more so casual employees in the construction & building, infrasturcutre establishments. 14. Further, the scheme in any event is ineffective and cannot be implemented in its present form is evident from the fact that even though the Govt. has recovered crores of rupees in this account, admittedly it has not been able to pass on the same for the benefit of the workers. Therefore, the entire purpose for which the scheme has purportedly been formed is lost. In fact in order dated 29.8.1998 passed in writ petition no. 2393/97, the Hon’ble High Court of Bombay (Nagpur Bench) has observed that the funds so collected are still lying with the Govt. and that there is a deficiency in the implementation of the scheme as observed by the High Court of Bombay in Sandeep Dwellers Pvt. Ltd. vs Union Of India (UOI). 15. Further, it is obvious that such a scheme can never benefited all the casual workers as the proceeds of the same have not still been passed to them. The casual workers themselves are not interested in the scheme and refuse deduction of contribution towards the fund from their wages, as a result the liability of contributing employee’s share, towards the funds, is also passed on to the petitioner. Further, due to the mobile and transitory nature of the casual construction work it is virtually impossible for the petitioner to implement the scheme, in terms of maintenance and filling, record, forms containing details such as date of joining and living, residence and other prescribed particulars of the casual workers. 16. We further respectfully submit that the construction industry as a whole has certain peculiar charastarics, which generally absent in any other industries or establishments. APPLICABILITY OF THE ACT; a. It is submitted that the Parliament has enacted the Provident Fund Act and the same applies to every establishment which is a factory engaged in any industry, specified in Schedule-I, in which 20 or more persons or class of such establishments, which the Central Government may be notification in the official gazette

specify in this behalf. The Provident Fund Act is enacted for the purpose of establishing an institution of Provident Fund for employees in such factories and other establishments for the better future of the industrial worker on his retirement and for the benefit of his dependants in case of his death, while in employment. Plain reading of section 1, of the said Act together with its sub sections, make it apparent that the underlying idea is to bring establishments, who have 20 persons in the employment and which persons are working with an element of regularity to bring such establishments which it’s purview. Further, the statement of objects and reasons and the plain reading of the Act makes it clear that is envisages and relates to an industry and not to any activity when cannot be categorized as an industry. The word establishment is to be read in line with the dominant object and thus means an establishment of an industry. Permanency or at least semi-permanency and not casualness are covered section 1 (5) of the Provident Fund Act, supports employer submission that there should be continuity of employment in establishment and concept of continuity in service stands to be apparently embedded in sub sections 3 and of section 1 of the Provident Fund Act. Therefore, engagement of a particular worker or particular person, for a particular work which is of a casual nature and who is employed due to the exigencies of circumstances, for a very brief period, cannot be interpreted to mean an employee for the purposes of the Provident Fund Act. The concept of employment for the purposes of the Provident Fund Act excludes engagement of casual workers for temporary periods and the word “employment” has necessarily to be construed as regular, permanent or semi-permanent employment in the factory or establishment of an industry. It certainly cannot apply to those casual workers who may work for a very brief duration and then never come back to work on the same site/projects. b. ABSENCE OF FIXED PREMISES there are no fixed premises for execution of work by these employer. The work is carried out mostly in the open where the project is situated. In fact, may a times, the construction and road projects are located in uninhabited areas at far of places, in cities and towns, in jungles or in river or on oceans. The work-site go on shifting especially in case of road construction. This peculiar fluctuation in the environment makes it incumbent upon the contractors to engage the local workers who are accustomed to and who can withstand such weather conditions prevalent in the areas of operation. As a result of this the contractor has to engage different sets of people for doing different kinds of work in different climatic conditions and this makes the strength and quality of the work-force highly unstable and liable to frequent change. Where it is a question of construction a building, the labour is again subject to frequent change as the subcontractors, engaged in such activities, more often than not, work simultaneously on more than one site and hence the labour is subject to frequent change, from one site to the other.

c. UNIQUENESS OF EACH CONSTRUCTION JOB: There are several types of works such as excavation work, foundation work, masonry work, carpentry work, slab work so on and so forth. There are workers who are experts in each type of work and they usually work in groups, take a particular job and go away after completion of such jobs. There are hundreds of varieties of work which are required to be done by experts and highly specialized groups. All these different specialized activities make the duration of work of a particular groups at a particular work site very short which could be as frequent as one day on one site & the next day on the other. There is remote possibility of the same group being re-employed by the same contractor for the same job on the same work site. These workers are normally migratory, rural, from agricultural community. During agricultural operations they go back to their fields, for traditional agricultural work. It is not certain whether the same persons might come back to construction work after harvesting and cropping season is over. The work force is, therefore, unstable. Construction activities have no assured continuity of work. The work is quite often discontinued for different reasons which include lack of details or decisions, change in design, shortage of materials, shortage of work force etc. more ofter than not, even the sub contractors engage different labour every day, depending upon quantum of work to avoid fixed cost. d. MULTI-TIER SYSTEM: Normally, Government, Semi-government or public Bodies award the construction work to contractors like the employer, employer in turn, sub contract the work to several sub contractors depending upon the variety of jobs involved, in the main contract and vis-à-vis the sub contractors the employer become the principal employer. The sub contractors, in turn, again engage petty contractors or Thekedars who are awarded execution of different smaller jobs on piece rate basis. These Thekedars or petty contractors then in turn employ their own work force, who is usually, migratory labour and are “called site workers”. It is in this manner that the execution of the contract, is done by sub contractors. It will thus be seen that the Government, Semi-Government or public bodies, who award the main contract are principal employers vis-à-vis the main contractors like employer who in turn become principal employers, vis-à-vis sub contractors, who in turn become principal employers vis-à-vis the petty contractors, who actually employ daily rated migratory, temporary/casual labour/workers. There is not supervision or control by the main contractors, like employer, over the daily rated temporary/casual worker, actually engaged at the work sites by the sub contractors, petty contractors. These daily rated workers do their specialized or unskilled jobs at a particular work site and then move on the another site, never to return to the earlier site. These daily rated temporary/casual workers are not at all interested in and to the contrary are totally opposed to any deduction being made from their daily wages, towards Provident Fund

contributions or any other contribution. Any deduction from their wages is vehemently opposed by them. These petty contractors having the expertise to do a particular job are engaged by the contractors or sub contractors and such Thekedars/petty contractors transfer their groups from one site to another, belonging to different conctractor/sub contractor & at times the said transfer takes place even on the same day. This makes it impossible for the main contractors like the employer to keep track of these site workers, who have no permanent address. They are constantly moving from place to place and are untraceable in future. e. IDENTIFICATION OF BENEFICIARIES It is further respectfully submitted that the purpose of the Act does not seem to be to impose some levy upon employer or employees. It is not in the nature of tax but as has been held in case of the Provident Fund Inspector vs. T.S. Hariharan reported in 1971 (2) SCC 68, and various other judgments including that of Appellate Tribunal, the purpose is to develop habit of saving in such employees. Identification of employee is therefore held to be must before effecting such recovery. It is the part of wages earned by such employees which is being deducted by the P.F. department and ultimately it is to be returned back to him. If his identity is not known, the amount cannot definitely be returned to him and as such there is no point in effecting deduction from employer on account of such unknown worker. Habit of saving cannot be developed unless and unitl the wages are earned continuously and consistently. The following observations of Hon Apex Court in case between The Provident Fund Inspector vs. T.S. Hariharan reported 1971 (2) SCC 68 assume importance here:

The Act was brought on the statute book for providing for the institution of provident fund for the employees in factories and other establishments. The basic purpose of providing funds appears to be to make provision for the future of the industrial worker after his retirement or for his dependents in case of his early death. To achieve this ultimate object the Act is designed to cultivate among the workers a spirit of saving something regularly, and also to encourage stabilization of a steady labour force in the industrial centres. This Act has since its initial enactment been amended several times to extend its scope for the benefit of industrial workers.

f. This view was upheld by the Hon’ble High Court of Bombay in the case of Sandeep Dwellers Pvt. Ltd. vs Union of India, reported in reported in 2007 (1) LLJ page 518 have held that the casual and temporary workers employed through the contractors are not required to be covered unless they are identified. Therefore, with a direction to conduct a fresh enquiry, the mater was remitted back to the Department with the following directions;

Employer have attempted to demonstrate that as beneficiaries are unknown and the department itself had doubts, recovery from any earlier date for which no deduction has been made should not be allowed. The law in the point is already discussed above. The beneficiaries must be know and the amount of deductions cannot be permitted to lie idle with the department. Hence while finding out whether employees are covered under the Scheme/Act or not, this issue can be conveniently gone into by authority under Section 7-A of P.F. Act and it can choose to give effect to its order from any appropriate date as per evidence on record. g. The issue was again considered by the Supreme Court in the case of in the case of Himachal State Forest Corporation. Vs. RPF Commissioner 2008 Labour Law Reporter page 980 and further held that the demand of the department is ole and stale, the contributions can only be claimed for the beneficiaries who can be identified. The Supreme court has also further held that the old record which is not available with the management should not be insisted to be produced. h. It is submitted that the amount cannot be demanded by department if beneficiaries are not identifiable. The order dated 5/2/1991 passed by Hon’ble Apex Court in writ petition ( Civil) No. 1212 of 1989 between A.I. Construction workers union v. Union of India State that the Hon’ble Apex Court also wanted P.F. department to propose appropriated scheme to protect the deductions made for such migratory site-workers but no such scheme as ever placed by department before either the Hon’ble Apex Court or any High Court. In fact the proceedings of 134th meeting of Central Board of Trustees {CBT} of Provident Fund department in which the issue of various cases pending in various High Court about the amendment to paragraph 26 was considered vide item No. 7. In the meeting the Trustees themselves found that though amendment is found to be valid, the delivery system of services is found to be inadequate, the Trustees therefore felt that scheme as per amended para 26 should be applied to Employees other than peripatetic Employees until new work procedure is evolved. Further, the Trustees also expressed that casual or temporary Employees who were not employed for 30 days in 45 days would not be eligible to become member of provident fund. In this background the determination of said question about casual employees as decided by Employees Provident Fund Appellate Tribunal in case number ATA – 9 (6) 98 between Forest Development Corporation of Maharasthra v. Regional Provident Fund Commissioner. also in the order dated 23/3/2005 passed by Appellate Tribunal in appeal ATA number 966(12) 2004 between BSNL v. Assistant Regional Provident Fund Commissioner, Udipur which holds that purpose of Act is not to collect money and declares that amount cannot be assessed or recovered before the workers/beneficiaries are identified. Similar view was also taken by Hon’ble Apex Court in judgment between Food Corporation of India v. Provident Fund Commissioner reported at in this respect.

17. We further respectfully submit that the News paper establishments to whom the provisions of EPF Act made applicable were given an exemption by addition one more provision in the PF scheme which reads as follows : PARA; 80 of the EPF SCHEME ;- Para-26: Class of employees entitled and required to join the fund: 1 (a) Every news paper employee employed to do any work in, or in relation to, any new paper establishment to which the scheme applies, other than an excluded employee shall be entitled and required to become a member of the fund from the beginning of the month following that in which this paragraph comes into force in such establishment, if on the date of such coming into force he has completed (three months continuous service) or has actually worked for not less than 60 days during a period of three months or less and in that news paper establishment to which Act applies under the same employer are partly in one or partly in the other or has been declared permanent in any such factory or other news paper establishment whichever is earliest. This provision was incorporated under the EPF scheme vide GSR No. 130 dated 16.1.1982. In view of the above said provision under the Scheme, the news paper employees are not entitled to become the members immediately after joining in the employment and they have to necessarily work minimum period of three months continuously or 60 days during a period of three months whichever is less, failing which they are not entitled to become members of the act. PARA 81 of the EPF SCHEME:- 18. Similarly, with special provisions in the case of Cine workers and a special paragraph was incorporated in the EPF scheme which reads as follows: Class of employees entitled and required to join the fund: 1(a) Every cine worker to whom this scheme applies other than an excluded employee, shall be entitled and required to become a member of the fund from the beginning of the month following that in which this paragraph comes into force, if on the date of such come into force he had worked in not less than three feature films with one or more producers. After this paragraph comes into force in film production unit every cine worker thereof, other than an excluded employee who has not become a member already shall also be entitled and required to become a member from the beginning of the month following that in which he completes work in three feature films in that production unit and another such unit to which the Act applies under the same producer or partly in one and partly in the other.

19. It is submitted that the worker in the construction activity are also migrant and they are not working with the same employer and the identification of such workers are very difficult and therefore, the same provision of law which made applicable to the employees of news paper establishments and the cine workers may also be made applicable for the employees working in the construction industry also particularly in view of the above mentioned facts and circumstances 20. For all the reasons mentioned above, it is humbly prayed that the Hon’ble Minister be pleased to issue necessary directions to exempt the employees of construction and infrastructure industry from para 26 of the EPF act by exercising the powers under section 16 (2) of the Employees provident fund and miscellaneous Provisions Act, 1952 and or consequently insert a similar provision on par with the News paper establishments and Cinema Industry in the EPF scheme, otherwise we will suffer great hardship and irreparable loss. 21. We further respectfully submit that in case of any further clarification with regard to the above said issues, we may be given an opportunity of personal hearing to put forth our suggestions and to produce relevant documents. Thanking you, Yours faithfully -Sd/- B.Seenaiah President Builders Association of India The Employees’ Provident Fund Department positively took the letter of our President and came out with the following Circulars:-

Employees' Provident Fund Organisation (Ministry of Labour, Govt. Of India)

Bhavishya Nidhi Bhawan, 14- Bhikaji Cama Place, New Delhi -110066

www.epfindia.gov.in ; www.epfindia.nic.in Web Circulation No. 7(l)2012!RCs Review Meeting/345 dated 30th November 2012 All Additional CPFCs All Regional PF Commissioners All Assistant PF Commissioners Subject:- Guidelines for Quasi-judicial proceedings under Section 7A of the Employees' Provident Funds & Miscellaneous Provisions Act 1952 – regarding. Sir/Madam,

The quantum and quality of assessments under the Act have been an area of concern. After conclusion of Zonal Reviews in the month of August 2012, a Working

Group of senior officers was constituted for suggesting the necessary correctives. Accordingly, instructions as detailed below are being issued for streamlining and standardizing the area of assessments under the Act. These guidelines are meant for the Compliance functionaries, before and upto the initiation of the quasi-judicial enquiry. Certain other procedural advisories are also being issued. 2. INITIATION OF INQUIRY - Inquiries should be initiated only after actionable and verifiable information is placed for consideration of the compliance officers. Following could be the source information for initiation of enquiries: -

a) A system generated report of probable and/or actual defaults based on receipts/remittances position of the establishments.

b) Mapping of individual establishments regarding the amount remitted as well as the number of employees for whom the establishment is remitting the dues. Any variation, positive or negative, greater than 10% over the average receipts/members of the establishment may prompt an investigation.

c) Verifiable complaints or information received

from general public at large may be another source for initiation of investigations and/or enquiry.

d) Reports submitted by the Enforcement Officers.

3. For facilitating the Compliance Officers, complete compliance history of the establishment shall be made available on-line. It shall inter-alia contain following:-

a) Amount remitted and the number of employees for whom the establishment is complying.

b) On clicking the number of members, a randomly sorted list of names of members for whom compliance has been reported by the establishment during the month should be available. This list shall not contain either the PFaccount number or the PFbalances of the members.

c) Compliance history of the establishments, wherein, details such as pending quasi-judicial enquiries, pending recovery certificates, pending legal cases in respect of a particular establishment etc. be made available.

(ACC(C) & ACC(lS) to ensure that the same is made available on epfindia portal on priority} 4. The Compliance Branch in each of the field offices shall have two broad divisions, viz Compliance (Administration) - to investigate and report on complaints, defaults, remittance status etc. Compliance (Judicial) - exclusively for conducting enquiries under the Act.

(ACC(Zones) to ensure that the same is done on priority, ACC(C) to monitor the same.} 5. PROCEDURE FOR INITIATION OF ASSESSMENT INQUIRY-

a) Information received about default will be entered in a Central Register to be maintained on a central server.

b) On receipt of the information notice shall be issued to the establishment enclosing the information on the basis of which the instant notice has been issued. If the establishment accepts the contents of the notice, then the matter may be verified for further necessary action.

c) If no response is received then the EO shall be

advised to investigate and file a report in the matter. The investigation report of the EO shall be according to the "Form of Inspection Report to be submitted by the Enforcement Officer for each Un-exempted Factory/Establishment Visited" as issued vide EPF headquarters circular number Vig.XXV(02)2000/3017 dated 4th August 2010 (at serial number 170, Office Orders/Circulars - 2010-11).

d) The Compliance (Administration) shall

examine the investigation report submitted by the EO and decide whether any case is made out for initiation of quasi-judicial enquiries.

e) If, on the basis of the report of the EO, it is

decided that it is a fit case for initiation of enquiry under section 7A of the Act, then the report of the EO and observations there on of the Compliance (Administration) shall be forwarded to the Compliance (Judicial) branch for initiation of an enquiry under section 7A of the Act by the Assessing Officer.

f) Before recommending any case, the

Compliance (Administration) shall specifically verify, whether .any report/record is available on the file indicating the status of the establishment, i.e. whether it is a closed establishment etc.

g) Complete investigation report should be

available on record before initiation of inquiry is recommended by the Compliance (Administration). In cases where the complete report is not received the Compliance (Administration) shall record reasons in writing for initiating the proposal for the said enquiry.

h) Except under abnormal circumstances, no inquiry shall be initiated unless a prima-facie case exists on the basis of the said report.

i) The Assessing Officers shall, on receipt of the

report from Compliance (Administration) open a separate file for conducting the quasi-judicial enquiry. This file shall start with the issue of summons for conducting enquiry under section 7A. The enquiry shall be deemed to have initiated only if proof of service of notice is available on record.

j) The 7A notice shall be accompanied by the

documents on the basis of which an enquiry is proposed to be conducted.

k) The 7A summons shall be for a specific

period i.e. the notice shall not be an open ended notice and a specific period of default should be compulsorily mentioned in the notice.

I) It should be compulsorily ensured that the

notice has been served on the establishment against whom an enquiry is proposed to be initiated before any further action is initiated for conducting a formal enquiry.

m) If during pendency of 7A enquiry further

default is noticed, either another summon be issued to the establishment for extending the period of current 7A enquiry or a fresh 7A enquiry be initiated ..

n) During the enquiry a departmental

representative should lead the case of the Department. This is a legal requirement and is to be compulsorily insured.

6. ORDER OF ASSESSMENT - The Act mandates that the orders issued by any assessing officer shall be a "speaking order". Accordingly, to ensure that the orders so issued, do not suffer from any procedural infirmity. 7. ACTION TO BE TAKEN AFTER COMPLETION OF INQUIRY - After completion of enquiry the 7A file shall not be merged with the enforcement file. Every order issued under section 7A by the Assessing Officer shall be examined by the Compliance (Administration) to ascertain whether a case exists for filing an appeal against the said order 8. LUMP-SUM ASSESSMENTS - The problem of lump-sum assessments happens mostly in contractor establishments and in establishments employing workers of migratory nature having short term project-based employment in various establishments. The lump-sum assessments happen because the default detection and the subsequent compliance action take place much after the occurrence of default. Further, the employer is either unwilling or unable to provide details of its employees,

when so required during the course of 7A enquiry. Accordingly, following instructions are being issued to regulate such assessments:-

a) The establishment shall file returns and remittances of its employees (whether regular or contractual) through ECR.

b) If the establishment has, on its rolls, employees who are deputed to other establishments on contractual basis, then the EPF code number of the establishment to which the said employee(s) have been so deputed shall be mentioned in the ECR. For this purpose an additional column shall be made available in the ECR.

c) There shall be no assessment without identifying individual members in whose account the fund is to be credited.

d) If the employer or unable or unwilling to submit requisite details, action under Section 14, 14A, 14AA, 14ABand 14 AC of the Act shall be initiated.

9. MULTI LOCATION ESTABLISHMENTS

a) In cases where such. establishments are filing

returns and remittances at a single location, this information shall be made available to all the Regional Commissioners for the purpose of ensuring compliance under the Act.

b) The Regional Commissioner under whose

jurisdiction one or more than one unit of such multi – location establishments is physically situated shall cause periodic inspection of such establishments and make available the inspection report through a function of upload to be provided on epfindia portal.

c) The compliance position as available from the

return and remittances submitted by the establishment and as emerging out of actual inspection of the branch/branches of the establishment shall be available in a consolidated manner at one central location to the Regional Commissioner under whose jurisdiction such establishments are reporting compliance and who shall, if required, cause an assessment enquiry under relevant provisions of the Act.

d) The inspection report of such establishments

shall be according to the "Form of Inspection Report to be submitted by the Enforcement Officer for each Un-exempted Factory/Establishment Visited" as issued vide EPF headquarters circular number Vig.XXV(02)2000/3017 dated 4th August 2010 (at serial number 170, Office Orders/Circulars - 2010-11).

10. LIMITATION FOR INVESTIGATION/ INQUIRY- It has been observed that open ended assessment inquiries and investigations serve no real purpose. Moreover such inquiries often do not result in identification of beneficiaries and only tend to harass the employers and establishments. It is accordingly directed that no inquiry or investigation shall ordinarily go beyond seven years, i.e., it shall cover the period of default not exceeding preceding seven financial years. It is to be ensured that compliance actions are initiated in time and there is normally no reason for extending the scope of investigation and assessment enquiry beyond previous seven financial years.

Your Faithfully Sd/-

(R.C. Mishra) CENTRAL PF COMMISSIONER

Copy for information and necessary action to : 1. FA & CAO 2. CVO 3. Director (NATRSS)

Sd/- (P.K. UDAGTA)

ADDITIONAL CENTRAL PF COMMISSIONER (C)

Employees' Provident Fund Organisation (Ministry of Labour, Govt. Of India)

Bhavishya Nidhi Bhawan, 14- Bhikaji Cama Place, New Delhi -110066

www.epfindia.gov.in ; www.epfindia.nic.in Web Circulation No. 7(1)2012/RCs Review Meeting/21224 dated 18th December 2012 All Additional CPFCs All Regional PF Commissioners All Assistant PF Commissioners Subject : Circular No. 7(1)2012/RCs Review Meeting/345 dated 30" November, 2012 on Guidelines for Quasi-judicial proceedings under Section 7A of the Employees' Provident Funds & Miscellaneous Provisions Act, 1952. Sir, Please refer to the above mentioned circular on the captioned subject posted in the official website of EPFO at 51. No. 455. It has been decided to keep the said circular in abeyance with immediate effect and till further orders.

Yours Faithfully Sd/-

(Ravi Mathur) Central PF Commissioner

Copy for information and further necessary action to : ~ 1. FA & CAO 2. CVO 3. Director (NATRSS)

Sd/- (P.K. UUDAGTA)

ADDITIONAL CENTRAL PF COMMISSIONER (Compliance)

WRITS / REPRESENTATIONS MADE BY BAI ON

INDIRECT TAXES 1. Andhra Pradesh High Court in case of Seven Hill

Construction held that “Additional Composition Scheme” under which “purchase price” of construction material was treated as “Sale price” for the purpose of works contract tax now VAT in respect of contracts having more than 12 months period under APVAT Act is not in conformity with Supreme Court order in Gannon Dunkerly case. Almost all major contractors working in Andhra Pradesh have taken advantage of this scheme under rule 6 (3) (i) will now have to pay higher tax amount. High Court has not directed authorities to deal with all pending matters accordingly stated as such past assessment can be re-opened. BAI has filed Special Leave Petition against this order of Andhra Pradesh High Court which is pending admission.

2. Andhra Pradesh Commissioner of Commercial Taxes issued circular No. AIII(2)/143/2919 dated 19th July 2010 clarifying that the contractee in Andhra Pradesh can not issue “C” form for interstate purchase of goods by contractors. As a result benefit of “C” form available to contractors is now being denied.

3. Customs, Excise and Service Tax Appellate

Tribunal (CESTAT) in case of Ramky – Satya Murthy J.V. and Maytas-Nagarjuna J.V. in Appeal Nos. ST/476/2009, ST/1589/2010, ST/432/2010 and ST/260/2010 dated 14-5-2012 held that the EPC contracts for A.P. Irrigation project under works contract services effective from 1-6-2007 is service taxable. Reasons are (a) “Irrigation” is not included u/s 65 (105) (zzzza) of Finance Act 1994. (b) Exemption notification No.41/2009 do not contain anything purported to act “retrospectively”. (c) Circular dated 15-9-2009 refers to “canal system” in context of definition of “Commercial and industrial construction” and not that of “works contract”.

4. R.M.C. plant put upon site for self consumption at

present is subject to 1% Excise duty. Necessary representation made by B.A.I. to Finance Minister and circular is expected to be issued by Finance Ministry.

5. B.A.I. filed Writ Petition No.3533/2010 in

Guwahati High Court against levy of VAT, for lack

of mechanism to claim deduction of sub-contractors turnover.

6. Arising out of order of Supreme Court in case of

Raheja Developers V/s. State of Karnataka, it was held that agreement for sale of flat on ownership basis is a Works Contract, as such Works Contract Tax (now VAT) is applicable to such transaction. Pursuant thereto, Maharashtra Government amended it’s MVAT Act, 2002 and brought under construction sale of flat under the purview of VAT effective from 20.6.2006.

Promoters & Builders’ Association, Sawantwadi and Maharashtra Chamber of Housing Industry filed Writ Petitions No. 1152/2011, and No. 2022/2007 in Mumbai High Court challenging amendment in MVAT Act 2002. Hon’ble Mumbai High Court by it’s order on 10th April 2012 dismissed both the Writ Petitions.

BAI, Mumbai Centre directly filed a Writ Petition at Supreme Court with No.16433/2012 on Applicability of VAT on Sale of Flat. The arguments on the matter were completed and the Judges have reserved the order. PRE-BUDGET PROPOSAL OF CONSTRUCTION SECTOR 2013-14.

Direct Taxes – Income Tax

Sr. No.

Issues Suggestions

1. Introduction of Transfer Pricing provisions to domestic transaction.

a) The provision needs to be withdrawn b) Alternatively, clarification to be issued whether such provisions would apply : i) to transaction on Revenue account or Capital Account also ii) Only Direct subsidiaries or step down subsidiaries.

2. Applicability of alternate minimum tax on persons other than corporate assessees.

This provision may be dropped or atleast project specific AOP / Joint Ventures should be excluded from AMT.

3. Unavailability of initial depreciation to construction sector.

Benefit should be extended.

4. Mandatory requirements of obtaining PAN u/s 206 AA by foreign parties. Increases cost on Indian entities due to grossing up.

Should be dispended and compliance may be called through quarterly return and related information.

5. TDS deduction @ source u/s 194C and blockage of funds.

Corporate entities above particular threshold limit of capital

contribution may be excluded

6. Lack of clarity on availability of loss AOP in the hands of members.

Due to divergent views, clarity for allowability of losses in the hands of members to be provided.

7. Double taxation of AOP / Integrated Joint Venture profits under MAT u/s 115 JB.

Insertion of a new clause to exclude profit / loss of AOP from book profit - Duplication.

8. Unavailability of carrying back the losses.

Losses should be allowed to be carried back upto 3 assessment years.

9. Unavailability of carry forward and set off of business loss to the construction industry for merger/amalgamation.

Sec. 72A should be amended and be made applicable to all businesses and not restricted for only industrial undertaking.

10. Lack of clarity for availability of depreciation or amortization for PPP/BOT projects.

Asset constructed for PPP/BOT project may be treated as intangible asset entitling depreciation @ 25%.

11. Ambiguity for adjusting Toll revenue against construction of additional bridge / lanes.

Toll Revenue for existing bridge / road should be allowed to be adjusted from construction of new bridge or additional lanes.

12. Disallowance u/s 14A r.w.r. 8D of the Act.

a) Investment Company or SPVs should be excluded from computation of "investment" for rule 8D. b) Disallowance may be restricted towards only those investment which have actually earned exempt income during the year.

13. Treatment of Computer Software and other payment as royalty.

Application of such amendment should be prospective.

14. Higher rate of MAT to Corporates.

Should be brought down to 7.5%.

15. Unavailability of DTAA benefit.

The overriding impact of Sec. 115 JB should be excluding Sec. 90 (2 of the Income Tax Act).

16. Unavailability of deduction u/s 80IA to construction / developer.

a) Benefit may be reinstated

17. 80 IA benefit to be extended to Road Widening projects.

Since Road widening projects are in essence "New facility" - Clarification may be issued for Inclusion of "Road widening projects" as New infrastructure facility for availing exemption under 80 IA.

18. 80 IA benefit to be extended to Limited Liability Partnership (LLP).

80 IA benefit is presently available only to a Company. Benefit may be extended to LLP

19. Limit for payment of Income Tax by civil contractors under Section 44AD to be enhanced to Rs 2,00,00,000.

The present limit of Rs 60,00,000 may be enhanced.

Indirect Taxes - Central Excise

Sr. No.

Issues Suggestions

1. Proposal for duty exemption Notification: Unavailability of Excise Duty benefit for supply of goods to Nuclear Power Projects.

Presently deemed export benefit is available only for supply of Capital Goods. All goods supplied to Nuclear Power Projects should be entitled to Excise Duty exemption.

2. Amendment to Sr.No.206 of Not.No.21/ 2012-C.E. dated 17.3.12: Goods sent for job work which are to be used for Captive consumption do not have Excise Duty exemption.

All goods fabricated at site and used in construction work are exempt from Excise. Any such goods sent out for testing, galvanizing should also be clarified to enjoy such exemption.

3. Amendment to Sr.No.233 of Not.No.12/2012 dated 17.3.2012: Unavailability of Excise exemption for water supply Project:.

The Excise exemption which is presently available only for water treatment plant may be extended to all Units of water supply Project.

4. Clarification to Sr.No.144 of Not.No.12/ 2012 - C.E. dated 17.3.2012: Ambiguity for Excise exemption on concrete mix manufactured at site.

Site should be given liberal meaning for manufacture of concrete mix to be used in construction project as given for prefabricated structures.

Indirect Taxes - Service Tax

Sr. No.

Issues Suggestions

1. Amendment to following Sr. No.s of

Presently the exemption is allowed only to

Not. No.125/2012-S.T. dated 20.6.2012:. Sr. No. 12 ('c) Exemption for construction of civil structure predominantly used by Educational/ Clinical or an Art & Cultural establishment.

Government, Local authority. Or Governmental authority. It should be extended to all entities who are carrying out these activities not for the purpose of profit.

2. Sr. No.12 (d) Restriction of exemption for construction of canal, dam or other irrigation work to only Government or local authority or a governmental authority.

Exemption benefit should be extended to all entities engaged in such work or atleast to State/ Central Government Enterprises / Undertakings. Alternatively benefit should be atleast continued for ongoing contracts.

3. Sr. No.12 (e) Unavailability of exemption for Pipeline, Conduit or Plant for Drinking water, Water Treatment Plant, Sewage Plant.

Exemption benefit should be extended to all entities engaged in such work or atleast to State/Central Government Enterprises / Undertakings. Alternatively benefit should be continued for ongoing contracts.

4. Sr.No.13 (a) Restriction of exemption for construction of road, bridge, tunnel, terminal if it is used for general public.

a) Construction of road, bridge, tunnel are part of infrastructure projects. Hence: b) The benefit should be extended based on nature of activity as all such infrastructure projects are effectively for general public use. c) Alternatively benefit should be continued for ongoing contract post 01/07/2012

5. Sr. No.14 (a) Mega exemption in relation to Airport, Port or Railways does not include completion, fitting out, repair, maintenance, renovation or alteration as is available under other mega exemption.

Similar to Mega exemption provided under Sr. No. 12 & 13 for canal, dam, irrigation work, road, bridge etc. other service like completion, fitting out, repair, maintenance, renovation or alteration etc should also be included for exemption.

6. Sr.No.14 (b) Exemption is available for single residential unit only in a residential complex.

Exemption may be restored upto 12 dwelling units in the complex as allowed earlier..

7. Proposal for exemption Notification:

Site formation, clearance, excavation, earthmoving and demolition should

Site formation, excavation etc finds no specific mention for exemption.

continue to get exemption without which exemption granted for road, bridge etc. would be not viable.

8. Sr. No.12 (f) Unavailability of exemption for construction of residential quarters for staff other than employees of Government authorities.

Exemption may be restored as there cannot be service to self.

9. Amendment to Not.No.30/2012-S.T. dated 20.6.2012: Difficulty in implementing the partial Reverse Charge Mechanism from discharge of tax and accounting.

The responsibility of payment of Service Tax liability should be kept either with the service provider or service receiver fully for supply of manpower, works contract services, security service etc.

10. Rule 6 (A) of Not.No.36/2012-S.T. dated 20.6.2012: Disqualification from export of service for non receipt of consideration in foreign convertible currency for project executed in neighboring countries.

The requirement of receipt in foreign exchange may be dispended for export of service to neighboring countries like Nepal, Bhutan, Sri Lanka etc.

11. Clarification to service provided within SEZ: Late receipt of A-1 Form and doubt in availability of Service Tax exemption for services provided in SEZ by sub-contractors.

To overcome administrative difficulties for late receipt of A1 Form, same should have effect retrospectively though issued late. Also benefit of exemption should be clarified to be available to Sub-Contractors working in SEZ and undertaking similar jobs.

12. Amendment to Cenvat Credit Rules, 2004: Applicability of Reverse Charge Mechanism to AOP / Un-integrated JV's and lapse of Cenvat Credit.

JV's should be excluded from applicability of Reverse Charge Mechanism as projects specific JV's will be left with huge Cenvat Credit to be used as 50% of the Service Tax liability will be deposited be service receiver whereas service tax charged by subcontractor will be available as credit in the hands of JV.

13. Amendment to Sec.72A of Finance Act, 1994:

Provision be deleted since trade is already overburdened with other

Increase burden of special audit over and above other audits.

audits, monthly returns and compliances etc.

14. Amendment to Not. No.24/2012-S.T. dated 6.6.2012: Lack of clarity on option to follow Service Tax discharging method for payment of Service Tax for Works Contract.

A clarification may be issued for availability of such option i.e., either assessment option or composition option as was existing prior to 01/07/2012.

15. Clarification to Sr. No.(h) of Negative List: Ambiguity on payment of Service Tax on receipt of annuity / grant or user fee under BOT projects.

For construction of BOT projects consideration is paid by way of toll fee or annuity. Clarification may be issued that apart from toll/access fee, annuity/grant or user fee is also not liable to Service Tax.

16. Amendment to Sr. No.13 of Not. No25/2012-S.T. dated 20.6.2012: Exclusion of management of road from the Mega Exemption.

The erstwhile exemption for management of road is missing though erection, construction maintenance, repair of road continues to get such exemption.

17. Amendment to Sr. No.(x) of Service Tax (Determination of Value) Rules, 2006. Possible applicability of Service Tax in payment of demurrage penalty, liquidated damages.

Since these payment are not towards rendering any service but for not rendering service in time, same should be clarified to be outside purview of Service Tax.

18. Amendment to Not.No.28/2012-S.T. dated 20.6.2012: Ambiguity in POPS Rules.

a) Rule 8 of POPS Rules may be suitably amended to clarify that projects executed in non-taxable territory i.e. J&K would not become taxable by virtue of obtaining centralised registration by assessee. b) Rule 14 should be amended to suggest that rule which is specific would prevail over applicability of general rule. Similar to provisions of Sec 65A earlier applicable.

19. Clarification to Cenvat Credit Rules, 2004: Denial of Cenvat Credit on Capital Goods used in taxable

Clarification may be issued on Cenvat on Capital Goods to be allowed to be utilized in the year of use of relevant Capital Goods in taxable projects instead

and non taxable project.

of judging in the year of purchase alone.

20. Clarification to Sr. No.(h) of Negative List: Ambiguity on Service Tax exemption for collection of toll charges.

Toll collection is a statutory levy, same should be exempt from levy of Service Tax irrespective of the entity which recovers toll.

21. Clarification to Sl No 29 (sub clause- h) of Mega Exemption. Suitable clarification is required to the effect that when sub-contractor is providing pure services to main contractor, the same would also be exempt from service tax.

Clarification required exempting services provided by sub-contractor with regard to following services listed in Mega exemption :- a) Sl No 12 - Services provided to Government/ Governmental authority b) Sl No 13 - Services provided in relation to construction of road, bridge etc. c) Sl No 14 - Services provided in relation to construction of Railway, Airport, Port etc

22. Amendment to Rule 2 (h)(a) & 2 (i) (a) – Place of Provision of Services Rules (POPS) 2012 - For services carried out in Non Taxable territory (J & K) Ambiguity in the definitions of location of Service Provider / Receiver as well as other rules of Place of Provision (POPS) rules with regard to services provided to a Non- Taxable Territory (say J & K).

Relevant Rules may adequately be amended so as to exclude Non-Taxable territory from the ambit of service tax, because Service Tax is consumption based tax and the principal cannot be different for the holder of centralized registration… The POPS cannot take away the Situs of Service provided by merely on the basis of Centralized registration / Business establishments.

Indirect Taxes - Customs

Sr. No.

Issues Suggestions

1. Amendment to Sr. No.512 of Not.No.12/2012- Cus. dated 17.03.2012: Unavailability of exemption to drinking water supply projects as available for Water supply project for agriculture and industrial use. Amendment to Customs Not. No.152/84-Cus. dated 15.5.1984:

The exemption should be available for all stages of water supply projects consisting of water pumping stations, water treatment plant, water storage facility and pipeline for delivery of water instead of one of the stages i.e. Water treatment plant.

2. Restriction for import of goods from Bhutan used for project imported in Bhutan otherwise than India.

Goods should be allowed to be imported from Bhutan used in projects, without requiring prior approval from CBSE.

3. Amendment to Sr. No.368 List 16 of Not. No.12/2012-Cus. Dated 17.03.2012: Unavailability of exemption on import of tunnel form work, loaders and excavators in some cases.

Item No.22 may be reworded to read as: Item No.22, Loaders, 23 - Excavators, 24- 3 Stage crusher, 25- Drilling Jumbo, 26 – Shortcrete machine and 27 - Tunnel Formwork.

4. Unavailability of exemption for equipment for tunneling work in Hydro, underground storage of water supply project & underground metro railway projects.

As allowed for road project, considering importance of these projects, exemption be granted to various tunneling and excavation and lining equipment.

5. Amendment to Condition No.9 of Sr. No.368 of Notification No.12/2102-Cus. dated 17.03.2012: Difficulties for availing exemption to the sub contractor without name being included in the Concession Agreement Not. No. 21/20122 CUS.

Since sub contractors are finalized post award of contracts, the condition that sub contractors name should be included in concession agreement should be dispended with.

6. Excessive Custom Duty on Cement and Steel for construction of Highways.

Import duty on steel bars & rods and cement be allowed at NIL customs duty without levy of SAD and CVD for the Construction industry.

Central Sales Tax Sr. No.

Issues Suggestions

1. Compulsion for obtaining Form 'F' for Branch Transfer of equipments, plant etc.

a) For goods such as Plant & Machinery, Tools etc. which are not intended for sale, requirement of Form 'F' may be dispended with. b) Apart from Form 'F' alternate mechanism / documentation substantiating movement of stock transfer should be permitted as was available earlier.

2. Unavailability of 'C' Form benefit for purchase of Plant & Machinery to Construction

Similar to manufacturing sector benefit of 'C' Form be extended to Construction Industry as well.

Industry 3. Difficulties in

obtaining 'C' Form within end of next quarter.

a) Instead of issue of 'C" Form a self declaration alongwith relevant TIN references may be provided in a self declaration for movement of goods. b) Alternatively copy of attested 'CST' Registration Certificate reflecting inclusion of relevant goods may be provided alongwith a invoice / delivery challan. c) Responsibility may be jointly fixed on buyer to issue 'C' Form within stipulated time.

4. Unavailability of Form 'I' benefit to developer to SEZ unit.

The benefit of Form 'I' should be extended to developer and to SEZ unit apart from registered dealers.

5. Contraversy raised by certain States in accepting the statutory nature of inter-state transaction meant for works contract by treating it as intra-state.

Explanation-3 to Section-3(6) of CST Act 1956 Consignment note be drawn directly in favour of ultimate consignee instead of the immediate intermediary, such transaction shall be deemed to be the sales in the course of inter-state sales for the purpose of section 6(2) of the Act.

COMMENT ON UNION BUDGET 2013-14 Economic Survey admitted slowing down of economy to 5% growth rate for 2012-2013. It was expected that Finance Minister would come out with big bang investment led proposal to put economy on higher growth path. Budget is high on growth oriented ideas but short on big ticket reform. Budget in reality turned out to be “non – event”. Finance Minister claimed credit for restricting fiscal deficit to 5.2% of G.D.P. without stating that this is achieved by cutting down planned expenditure by Rs. 91838 crores. Finance Minister announced first tranche of Rs. 9000 crores against total of Rs. 24000 crore as Central Sales Tax compensation to states, which was main stumbling block for states accepting operationlisation of Goods & Service Tax. Finance Minister failed to, announce deadline for introducing required constitutional amendment. He however also did not affect any changes in indirect tax that suggested a progress towards GST. He has promised to introduce Direct Tax Code Bill at the end of budget session. It is strange to believe that spending is increased by 17%, whereas fiscal deficit is reduced from 5.2% achieved in 2012-13 to 4.8% in 2013-14. It is apprehended that 6.1% to 6.7% GDP growth rate projected for 2013-2014 may go wrong because of Government is likely to announce populist measure during the year by keeping in mind 2014 election.

Another reason could be overshooting of budgeted subsidies of Rs. 231000 crores. Additionally difficulty may crop up in realizing disinvestment target of Rs. 40000 crores, inview weak sentiments in stock exchanges. It is also to borne in mind that government received only Rs. 1706 crores in spectrum sale against budgeted Rs. 30000 crores in 2012-13. Despite this for 2013-2014 Rs. 40000 crores budgeted unlikely to be realised. Foreign exchange rate of Rs. 54 to a dollar taken for budgetary figure is likely to go wrong as rupee is likely to depreciate further in view of high current account deficit. Coal India is falling short of coal demand. Budget has rightly announced public-Private Partnership concept in coal mining to help boost coal supply to power producers and other consumers. During 2013-2014 Coal India is likely to award 2-3 large projects each of 4 to 5 million tones capacity, followed by awarding bigger projects of 20 million tonnes in future. Delhi – Mumbai Industrial Corridor : Out of seven new cities planned to be developed along dedicated freight corridor to house 1.5 to 2 million populations, work on 940 sq.km. Dholera township about 110km from Ahmedabad and near Shendra-Bidkin township near Aurangabad in Maharashtra is to commence soon. Another new city at Dighi port near Raigad in Maharashtra will come up late. Chennai – Bengaluru Industrial Corridor : Department of Industrial Policy & Promotion and Japan International Co-operation Agency are Preparing a comprehensive plan for corridor to be developed in collaboration with Government of Tamil Nadu, Andhra Pradesh and Karnataka. Bengaluru – Mumbai Corridor : Prepatory work started by Department of Industrial Policy and Promotion. Impact of budget proposal on Real Estate and Infrastructure/construction sector is as follows:- Real Estate :- a) Budget proposed setting up of Rs. 2000 crore funds for Urban Housing. It will provide Rs. 6000 crores to Rural Housing. An additional deduction of interest upto Rs. 1 lakh over existing Rs.1.50 lakh will be available to persons taking loan from a Bank or Housing Finance Corporations upto Rs. 25 lakh for their first home costing less than Rs. 40 lakh during 2013-2014. This is likely to trigger demand for ownership flats. b) For luxury housing i.e. flat costing upto Rs. 1 crore and above or having a carpet area of 2000 sq.ft. if booked for under construction sale than service tax abatement is reduced from 75% to 70%. Earlier on 25% of total value of under construction flat was attracting 11.3% service tax with abatement upto 75%, which value now would become 30%. OR effective service tax rate would increase by 0.6%.

Immovable property transactions are usually undervalued and underreported and almost 50% of transactions do not carry PAN of the concerned parties. With a view to improve reporting of such transaction, seller of flat costing Rs. 50 lakh and above need to deduct 1% of sale value as T.D.S. presumably on likely capital gain tax of buyer to be adjusted towards actual tax. Infrastructure /Construction :- (a) Budget proposed raising limit of tax – free infrastructure bond issued by India Infra Bond Corporation from present Rs. 25000 crore to Rs. 50000 crores. These bonds will help infra companies to raise their capital. (b) India Infrastructure Finance Corporation Ltd. in partnership with Asian Development Bank directed to offer credit enhancement to infrastructure companies that wish to access bond market for long term funds. (c) Any companies investing Rs. 1000 crore or more in plant and machinery between 1-4-2013 to 31-3-2015, will be entitled to deduct investment allowance of 15% of the investment, in addition to current rate of depreciation. This measure is expected to accelerate investment in economy. (d) Appointment of a Regulator to address concern of road users and private road developers. Regulator will look into poor road maintenance, lack of promised facilities, safety measures, service level bench marks and monitoring compliance of concession agreements against developer and N.H.A.I. (e) 3000 km. of National Highways would be awarded purely as construction contract in U.P. Rajasthan, M.P. Maharashtra & Gujarat by September 2013. Broad budgetary allocation is as under:- (Amount in Rs. cr.) 1. Plan expenditure increased by

29% over 2012-13. Rs. 555322

2. Non plan expenditure increased by 10% over 2012-13.

Rs. 1109975

Total Rs. 1665297 Receipts Revenue receipt Net. (Amount in Rs. cr.) 1. Indirect Taxes 565003 2. Direct Taxes 419520 3. Other receipts 71808 4. Capital Receipt 608966 Rs. 1665297 5. Revenue deficit Rs. 379838 6. Fiscal deficit Rs. 542499 7. Primary deficit Rs. 171814

Expenditure Sr. No.

Non-Plan Amount in Rs. cr.

1. Interest payment 371000 2. Subsidies 231000 3. Defense Services 117000 4. Grants to state governments 77000 5. Pension to employees 71000 6. Central Reserve Police 41000 7. Others 38000 8. Economic Services 24000 9. Social service 23000 Revenue Expenditure 993000 Capital Expenditure-Non

Plan

10. Defense forces 87000 11. Other non-plan Capital

Expenditure 30297

Total Non Plan Capital Expenditure

1110297

Plan Expenditure 12. Education, art and culture 62000 13. Water supply, Sanitation,

housing and urban development

36000

14. North Eastern State 30000 15. Health & Family Welfare 29000 16. Social Welfare & Nutrition 20000 17. General Service and Social

Service. 14000

191000 Economic Services 18. Irrigation and Flood Control 1000 19. Communication 6000 20. Energy 13000 21. Transport 73000 22. Rural Development 43000 23. Agriculture and allied activity 19000 24. Others 64000 219000 25. Central assistance to states

and union territories 136000

26. General Service 9000 364000 27. Total of Plan – Expenditure 555000 28. Total of Non-Plan

Expenditure 1110297

Grand Total 1665297 Outlays on Ministries of Rural Development, Human Resources Development, Road & Surface Transport, Ministry of Health & Family Welfare, were increased substantially despite their poor performance in 2012-13. Needless to state that, outlays did not necessarily mean

outcome. Finance Minister has achieved saving on fuel subsidy bill of around Rs.20,000 crores by deregulating price of diesel, which has been virtually nullified by increase of Rs.10,000 crores on food subsidy. Borrowings are almost 35% of total receipt, which will crowd out private sector. BUDGET OUTLAYS FOR INFRASTRUCTURE UNDER PLAN ALLOCATION (Rs. crore) 2012-13

RE 2013-14

BE Central Plan outlay (Budget support) on infrastructure (A)

81,004 1,07,871

Ministry of road transport and highway

15,933 23,500

Ministry of railways 24,265 26,000 Department of drinking water supply (ministry of drinking water and sanitation)

13,000 15,260

Ministry of power 4,708 9,642 Ministry of urban development 5,772 7,456 Department of atomic energy 3,175 5,880 Ministry of new and renewable energy

1,152 1,521

Ministry of shipping 507 852 Ministry of civil aviation 6,200 5,200 Ministry of communication and information technology

4,693 9,600

Ministry of housing and urban poverty alleviation

950 1,460

Ministry of water resource 650 1,500 Central assistance for state and UTs (on infrastructure) (B)

32,966 45,945

MPs local area development scheme 3,950 3,955 Accelerated irrigation benefit programme and other water source programmes

7,342 12,962

Roads and bridges 2,267 2,267 Accelerated power development programme

- -

Backward region grant fund (Budget outlays for infrastructure under Plan allocation (Rs. crore)

10,524 11,500

JNNURM 6,822 14,000 Other miscellaneous projects 2,061 1,261 Total spending on infrastructure (A+B)

1,13,970 1,53,816

Plan outlay 4,29,187 5,55,322 Infra spending as % of Plan outlay 27 28 Compilation: CII Economic Research. [RE - Revised Estimates; BE - Budget Estimates]. Source: Business Standard, 18-3-2013. WORKSHOP ON UNIFIED STANDARD CONTRACT

DOCUMENT . Senior Members of Builders’ Association of India were insisting the President, BAI for holding of a workshop on Unified Standard Contract Document, for the Departments associated with the construction and for the construction companies and also to persuade the Hon’ble Union Minister for Urban Development Shri Kamal Nath to be present in the Workshop and address the delegates.

Shri B Seenaiah, President-BAI have been requesting the Hon’ble Minister to participate in the Workshop at New Delhi and ultimately in January 2013, the Hon’ble Minister gave his consent to hold the Workshop at New Delhi on 5th March 2013. Accordingly, the Workshop on Standard Contract Document for difference categories of construction activities was held on Tuesday, the 5th March, 2013 in Hall No.4, Vigyan Bhawan (1st Floor), Maulana Azad Road, New Delhi on 1.00 P.M. to 5.00 P.M. which was attended by members of the BAI in large number as well from the CPWD / PWD. The following were on the dais :-

1. Shri Kamal Nath, Hon’ble Minister for Parliament Affairs & Urban Development. 2. Dr. Sudhir Krishna, Secretary, Ministry of Urban Development. 3. Shri V K Gupta, Director General (Woros) – C P W D 4. Shri B Seenaiah, President – B A I. 5. Shri M Karthikeyan, Past President & Trustee, B A I 6. Shri D C Awasthi, Vice President (North) – B A I. 7. Shri Anand J Gupta, Hon. Gen. Secretary – B A I. In the Technical Session all except the Hon’ble Minister & Secretary, MoUD, were present. The inaugural address was delivered by Shri Arun Sahai, State Co-ordinator-Delhi & Immediate Past Chairman-Delhi Centre. After the inaugural address, the floor was declared open for the discussion on the various issues which are causing the member companies in executing the construction contracts were discussed in which almost all participated. The purpose of this session was to enlist the points / areas where the intervention of Ministry of Urban Development & Central Public Department / PWDs was required. Hon’ble Minister reached alongwith the Secretary, MoUD. Shri Awasthi welcomed all in the Workshop & invited the President to address the Workshop. Shri Seenaiah, while conveying his heartfelt gratitude to the Hon’ble Minister Shri Kamal Nath, Secretary, Min of Urban Development Dr. Sudhir Krishna and Director General (Works) CPWD Shri V K Gupta for sparing their valuable time from the busy schedule and making it possible to attend the Workshop. In his address, President briefly spoke about the Association and pointed out the areas where the anomalies like escalation clause, Performance Guarantee, price variation, Bank Guarantee, earnest money, Arbitration, EPC etc. He requested the Hon’ble to intervene in the matter other the department will not able to attract the good contract to execute the infrastructure and other prestigious projects for country. Shri Seenaiah formerly felicitated the Hon’ble Minister with a bouquet and Shawl. Shri Karthikeyan felicitated Dr Sudhir Krishna and Shri Anand J Gupta felicitated Shri V K Gupta with a bouquet & shawl. The Hon’ble Minister in his address assure the BAI to remove the working difficulties and bottlenecks being

faced the contractors & construction fraternity. He further stated that huge work of infrastructure has to be completed in the country, it is very much necessary to leave the procedures and practices which are achieved and mind-set change. He directed the officers of the Government to adopt the relevant clauses / practices from the best contract documents being followed by other Government Agencies / World Bank / Metro and try to address the issues raised and put-up the same to the Ministry within 3 months time so that the remedial action by the Government / Ministry of Urban Development. He assured all the support in implementation of Standard Contract Document in the time bound manner. Dr Sudhir Krishna talked about the completion of the Arbitration in the fixed time, adaptation of good construction practices and welfare schemes for the workers. He assured that by sitting together, solutions to all the vexed issues can be found out and congratulated the Association for holding the workshop. Shri V K Gupta in his address stated that his department has been a leader in adopting the best contract document. Their department have been getting executed different types of work and they have different contract documents for that. If it is felt that those contract documents needs changes, his department is open to that and assured all the assistance & co-operation in this regard. He also requested the contractors to adopt good construction practices and be generous in extending the welfare scheme and facilities for the construction workers. The Workshop was concluded with a vote of thanks delivered by Shri Anand J Gupta to all the participants and the organizers who made it possible to hold such a successful Workshop. The positive result of the Workshop can be felt when the Ministry of Urban Development, vide its Letter No.859/UD/2013 dated 8th March 2013 have constituted a Drafting Committee to prepare Standard Contract Document applicable to various types of construction activities and invited the nominations from the Association in the Drafting Committee. Subsequent to the above meeting, a Committee Meeting also held on 10th April 2013 at 3.00 P.M. Details are follows:- Dear Mr.President, As scheduled the Drafting Committee meeting took place at ADG(TD)'s office New Delhi at 3.00 pm at his office at New Delhi. From BAI side 1. Mr. M.Karthikeyan, 2. Mr D.C.Awasthi, 3. Mr Lal Chand Sharma and 4. Mr Praveen Gupta BAI member from Delhi centre in place of Mr Arun Sahai

and From the Department side 1. Mr. S.Jethani ADG(TD) , 2. Mr.V.K.Rokade, CE(CSQ), Civil, 3. Mr. S.arvagya Shrivatsva CE from PWD. 4. Mr Abhai Sinha Member Engg.DDA, 5. Mr. A.K.Mittal, Director Projects, NBCC, 6. Mr.D.K.Saini, Director Projects, DMRC, took part in the meeting and deliberated on most of the points and had initial round of discussions on the amendments sought by us. The minutes of the meeting are not recorded by them though we asked for it, but they said that we can record it and send it to them. We are in the process of minuting the same and will be sending to you and then to them in another two days Govt. of India Ministry of Urban Development (Works Division – III)

Nirman Bhawan, New Delhi

No..859/UDM/2013 Dated the, 8th March, 2013 OFFICE MEMORANDUM Subject: Uniform Standard Contract Document for Construction Companies and Departments associated with construction activities. A workshop on the issue of “Uniform Standard Document” was organized by the Builders Association of India on 5th March, 2013, 2013 at Vigyan Bhawan, which was addressed by Hon’ble Union Development Minister, Secretary (UD) and Director General (CPWD). A need has been felt for Standard Contract Document for different categories of construction activities. A Drafting Committee comprising of following members has been constituted to prepare Standard Contract Document applicable to various type of construction activities : -

1) Shri Sunder Jethwani, ADG (TD) 2) Shri A.K. Mittal, Director (Projects), NBCC 3) Shri Representative from Builders’ Association

of India 4) Shri D.K. Saini, Director (Projects), DMRC 5) Shri Abhai Sinha, Member-Engineering, DDA 6) Shri Dinesh Kumar, Engineering-in-Chief,

GNCTD 7) SE (C&Q), O/o DG, CPWD

The Drafting Committee may select any of its members to chair the meeting and submit the report on Uniform Standard Contract Document for various types of construction activities by 30th April, 2013. Administrative support to the Committee will be provided by the CPWD.

This issues with the approval of Secretary (UD). (Ambuj Bajpai) Under Secretary to the Govt. of India To:

1) Shri Sunder Jethwani, ADG (TD) 2) Shri A.K. Mittal, Director (Projects), NBCC 3) Shri Representative from Builders’ Association

of India 4) Shri D.K. Saini, Director (Projects), DMRC 5) Shri Abhai Sinha, Member-Engineering, DDA 6) Shri Dinesh Kumar, Engineering-in-Chief,

GNCTD 7) SE (C&Q), O/o DG, CPWD

Copy to:

1. Secretary, Ministry of Urban Development, Nirman Bhawan, New Delhi

2. JS (L&W), Ministry of Urban Development, Nirman Bhawan, New Delhi

3. Director (Works), Ministry of Urban Development, Nirman Bhawan, New Delhi

In response to this memorandum we have nominated Shri. M Karthikeyan, Past President, BAI, Shri Lal Chand Sharma, Vice-President, BAI, Shri D.C. Awasthi, Trustee, BAI and Shri Arun Sahai, State Co-ordinator, Delhi in the committee formed the Drafting ‘Unified Standard Contract Document’. BAI’S MEETING WITH HON’BLE PRIME MINISTER OF INDIA The dictum that ‘infrastructure development is an engine for economic growth’ is an accepted fact around the world. Even in India, when ‘infrastructure development’ was at its peak, the GDP was high. Now with ‘infrastructure development’ lagging behind, GDP has also slowed down. Lot of issues are confronting the players of ‘infrastructure development’. Members of BAI are willing to undertake challenging ‘infrastructure development’ works – in many cases on PPP basis. But, a plethora of Government regulations, taxes, levies, etc. are hampering proper functioning of these players. BAI has been in touch with the various Union Ministries and State Government for finding solutions to the problems. In a bid to draw the attention of the head of the Government of India to the problems faced by the Indian construction industry, Mr. B. Seenaiah, President, BAI

sought an appointment of Dr. Manmohan Singh, Hon’ble Prime Minister of India. On 22nd March 2013, Mr. B. Seenaiah along with Mr. R. Radhakrishnan, Past President & Past Trustee, BAI and representatives from 13 Corporate companies met the Hon’ble Prime Minister Dr. Manmohan Singh in his office in Parliament House and represented the construction industry’s concerns in detail. Dr. Sambasiva Rao Kavuru, Member of Parliament, Loksabha also joined the delegation in highlighting BAI’s concerns to the Hon’ble Prime Minister. Mr. B. Seenaiah impressed upon the Hon’ble Prime Minsiter that most of the major contractors are facing issues while executing major infrastructure projects viz. land acquisition, clearance from Union Environmental & Forest Ministry, clearance relating to Coastal Regulation Zone, Green movement groups, etc. A memorandum was submitted to the Hon’ble Prime Minister, which is reproduced below : Other members of the delegation were : Mrs. Srivani Mullapudi, Managing Director, M/s Progressive Constructions Ltd.; Mr. V. C. Verma, National Highway Builders’ Federation; Mr. Rajiv Mundhra, Whole-time Director, M/s Simplex Infrastructures Ltd.; Mr. Arjun Dhavan, President, M/s HCC Infrastructure; Mr. A. G. K. Raju, Executive Director, M/s Nagarjuna Construction Co.; Mr. Ankineedu Maganti, Director, M/s Soma Enterprise Ltd.; Mr. Mr. Alla Ayodhya Rami Reddy, Chairman, M/s Ramky Group; Mr. Krishna Reddy, Managing Director, M/s Megha Engineering and Infrastructure Ltd.; Mr. Mr. Amrit Pal Singh Chadha, Director, M/s C & C Constructions Ltd.; Mr. Saurabh Gupta, CFO, M/s Gammon India; Mr. G. Bhaskara Rao, Executive Vice Chairman, M/s Lanco Infratech Ltd.; Mr. S. Ramachandran, MD - IVRCL A&H (BOOT Projects) and BD - Group Head, M/s IVRCL Ltd.; Mr. K. V. Sathish, M/s Progressive Constructions Ltd. and Mr. S. Ravindranath Tagore, M/s Progressive Constructions Ltd. Date: 22.03.2013 To Mr. Manmohan Singh Ji Hon’ble Prime Minister, Govt. of India Representation by Members of Builders’ Association of India Respected Sir, BAI an apex all Indian body of Civil Engineering Construction Contractors, founded in 1941 spread over length and breadth of the country through 140 Centres is the spokesman for the Indian Construction Industry. BAI is well recognized by Government of India and gives due importance in getting suggestions and advicesin connection with Construction industry.BAIalso participates in union pre-budget meeting.

We put forth the following for the kind consideration of the Hon.Prime Minister.

� Our ultimate prayer to our Prime Minister is to allow the construction industry to prosper in our county which constitutes more than 40% of plan outlay in various projects of various Departments. On top of it, construction sector is next only to the agriculture and the second largest in providing employment apart from contributing more than 11% to GDP.

� Under XII plan (2012-17) an amount of 1 trillion

U.S. Dollar i.e. Rs.52lakh crore (1 Dollar@ Rs.52/-) is proposed to be spent on Infrastructure sector. This includes electricity, Roads & Bridges, Railways, Irrigation, Water Supply, Ports, Airports and real estate.

Our prime requirements are

� Appointing of regulatory authority to stabilize the prices of construction materials like cement, steel and bitumen.

� To form a separate ministry for Construction

Industry like in many other countries to study the difficulties faced by the civil contractors and builders and for streamlining the construction industry.

� Though the arbitration clause is available in

tender, in most of the cases no constructive result is produced and also, time taken for settling the issues running in to years.In many cases even the awarded arbitration amounthas not been settled for many years.On account of this many contractors have wound up their construction business.Early settlement will certainly help the contractors to invest further inthe development works.

� Construction contractors are subject to

innumerable taxes to add and additional burden of 12.60 %as service tax will undoubtedly add to capital cost ultimately resulting in higher inflation.Lot of anomaliesare prevailing in service tax sector.

� Construction industry is second to none in

providing employment opportunity.To provide social justice to the unorganized construction workers a comprehensive labour law should be introduced.The present system of multiple laws causeharassment to genuine builders and contractors without servingthe purpose for which it is created.The law should help the worker to get the benefit in time without any hardship.

� BAI is emphasizing for a very long timeon

Uniform Contract Document based on the World

Bank norms in order to over come innumerable issues.The present contract document isone sided and it is still aBritish legacy. A revision of contract document will certainly help the contractors to execute the projects with quality and in time so that the public will get the benefit.This will also restrict the cost over run of the project.

� With regard to infrastructure projects, all

clearances from various agencies like, land acquisition, environmental clearance, etc shall be obtained before calling for tenders to avoid delay and cost overrun.Still over Rs. 7 lac crore infrastructure projects are pending on account of such problems.

� Apart from the above we also request you to

consider a holiday period for buying heavy constructionequipment to execute the projects within thestipulated period.

Once again, we plead the Hon. Prime Minister to consider our above requests and encourage the construction industry to create a better place than what it is. We humbly request Hon’ble Prime Minister to appoint a Committee for going through the Anomalies and problems faced by the construction industry which is hampering the progress and timely completion of the projects. With regards Yours Truly B.Seenaiah President Builders’ Association of India In pursuance of the meeting, BAI has been given to know that the Hon’ble Prime Minister has formed a ‘Group of Ministers’ to look into the problems of construction industry. XXVI ALL INDIA BUILDERS ’ CONVENTION BAI Mumbai Centre through their letter dated 30th August 2012, have expressed their interest in hosting “XXVI All India Builders’ Convention” sometime during February 2014. The Managing Committee at its meeting held at Jodhpur on 29th September 2012, have unanimously granted permission to Mumbai Centre for hosting “XXVI All India Builders’ Convention”. In the Managing Committee Meeting held at Mumbai on 7th February 2013, BAI Mumbai Centre submitted its preliminary report on the progress of the action taken on “XXVI All India Builders’ Convention”. “Mumbai Centre have appointed Shri Mahesh M. Mudda as Chairman of Organising Committee of ‘XXVI All

India Builders’ Convention’. It is also reported that, Mumbai Centre, while selecting the venue for organising the “XXVI All India Builders’ Convention” considered many neutral venue like Goa or Dubai, and finally decided to hold it in Dubai as many Senior Members expressed desire to have the Convention in Dubai.. The Committee unanimously granted permission for holding “XXVI All India Builders’ Convention” at Dubai. BC-INDIA 2013 EXHIBITION bC India 2013 – A BAUMA CONEXPO SHOW, the 2nd International Trade Fair for Construction Machinery, Building Material Machines, Mining Machines and Construction Vehicles was inaugurated on 5th February 2013 in Bandra Kurla Complex, Bandra (East), Mumbai. Shri Michael Siebert, Consul General of the Germany was the Chief Guest and inaugurated bC India 2013 along with Shri B. Seenaiah, President, BAI; Shri Eugen Egetenmeir, Managing Director, M/s. Messe Munchen GmbH; Ms. Magen Tanel, Vice President, Association of Equipment Manufacturers (AEM) and Shri Thomas Loffler, CEO, M/s. bC Expo India. bC India 2013 was on from 5th to 8th February 2013. BAI is the joint organiser of bC India 2013 Exhibition. On 7th February 2013, the Sixth Meeting of the Managing Committee and Fifth Meeting of General Council of BAI For the year 2012-13 was held in Hotel Trident, Bandra-Kurla Complex, Bandra (East), Mumbai. The meetings were hosted by BAI Mumbai Centre, which had also arranged facilities for all participants to visit bC India 2013 Exhibition. 40TH IFAWPCA C ONVENTION 6th to 9th January, 2013 was red-letter days for Builders’Association of India, as BAI, Kochi (Cochin) Centre hosted the 40th IFAWPCA Convention at Kochi, Kerala. Construction industry professionals from 16 countries from the Asian and Western Pacific region converged in Kochi, Kerala – ‘God’s Own Country’ for the 40th Convention of the International Federation of Asian and Western Pacific Contractors’ Associations (IFAWPCA). The 40th IFAWPCA Convention was held in the state-of-the-art Gokulam Park Hotel & Convention Centre. Members from Australia, Bangladesh, Hong Kong, India, Indonesia, Japan, Malaysia, Maldives, Nepal, New Zealand, Philippines, Singapore, South Korea, Sri Lanka, Taiwan & Thailand, participated in this IFAWPCA Convention. Theme of the 40th IFAWPCA Convention was 'Responsible Infrastructure'. Asian economies will see a new spurt of growth resulting in unprecedented levels of construction, both in infrastructure development and in the area of housing. A fine balance must be struck between developmental activities and the need to remain socially and ecologically responsible. Development has paved the way for far reaching environmental changes that are already

irreversible. Imagine what further development could do to the environment. As responsible co-creators of a new world order, the construction fraternity should together, strive to create a culture of inclusive, green and socially responsible infrastructure development. Hence, the theme of the 40th IFAWPCA Convention was primarily focussed on harnessing emerging technologies to ensure 'Responsible Infrastructure' in an inclusive, socially responsible and eco-friendly manner, be it public infrastructure, transport systems or Building complexes. On Sunday, the 6th January, 2013 delegates from the 16 countries of the Asian and Western Pacific region including India, started arriving in Kochi and the registration process began. Simultaneously, the Finance Committee Meeting, the 1st Executive Board Meeting, a B2B Session, the Past Presidents’ meeting and the Chief Delegates’ briefing were conducted at different venues within the sprawling Gokulam Park Hotel & Convention Centre. The day ended with the ‘Presidential Dinner’ at Ramada Resort, hosted by Mr. Ajit Gulabchand, President, IFAWPCA and CMD, M/s Hindustan Construction Co. Ltd. The 40th IFAWPCA Convention was inaugurated in the morning of Monday the 7th January 2013. The Ceremony commenced with the flag presentation by the Chief Delegates of the respective Associations of the member countries. Shri Cherian Varkey, Chairman, IFAWPCA Co-ordination Committee welcomed the gathering. In his Presidential Address Shri Ajit Gulabchand said that the convention theme was indeed apt for the Indian Construction Scenario, since India is on a fast forward growth mode, especially since the urbanisation of India is definitely happening at a very fast pace. The development and the need to inculcate green, efficient and sustainable growth along with this development should be top priority. Hence the theme “Responsible Infrastructure” has been chosen with great foresight. Shri David Holly, Australian Consul-General in India also addressed the gathering. He thanked the organisers for awarding Australia the partner country status and mentioned that there is ample scope for both India and Australia to collaborate, especially in the fields of architecture, construction and training. Shri. B. Seenaiah, President, BAI while addressing the gathering impressed upon the fact that the Indian Construction Industry, though aware of this development, needs to realise that this knowledge of responsible development has to be deep rooted. But knowing this alone is not enough. A great many things need to be done to take this message to every one concerned. If one looks at the pace at which we are progressing, India is sure to overtake most of the developing countries on Green and Responsible development in the near future.

Shri Subir Vithal Gokarn, former Deputy Governor, Reserve Bank of India, delivered the Key-Note address on ‘Macro Economic Scenario in India in the context of Asia Pacific and rest of the world’. He pointed out the various potential for the growth of Asian Countries in the next few decades. Shri M. V. Antony, Secretary General, IFAWPCA, proposed the Vote of Thanks. For the spouses accompanying the delegates a ‘Sight-Seeing Tour’ was also conducted. The spouses were guided by the members of the Ladies committee who oversaw that the participants were satisfied and this was expressed to the committee after the tour was over. In the afternoon, the Business sessions commenced with the session on ‘India of my Dreams’. Shri Shashi Tharoor, Union Minister of State for Human Resource Development and Dr. D. Babu Paul IAS, Former Chief Secretary - Government of Kerala, spoke. Shri Dato A.K. Nathan, Executive Chairman & Group MD, Eversendai Group, Malaysia gave a very informative talk on Composite Structure – The way forward, highlighting various case studies. The business session of the day started with a ‘Special Address’ by Shri Montek Singh Ahluwalia, Deputy Chairman, Planning Commission, Government of India on ‘Taking India Forward – Role of the Construction Industry’. In the session titled ‘Mechanisation in Construction’, Shri Anand Sundaresan, MD, M/s Schwing Stetter Ltd. was the Chair person. In the session, Shri Hubert Merkl from Germany spoke on ‘Mechanisation in Concreting’; Shri Richard Brindle from UK spoke on ‘Gaps in Mechanisation in Construction’ and Shri K. Senthil Nathan, GM & Head, EDRC, M/s Larsen & Toubro Ltd. spoke on ‘Mechanisation in Construction – Indian Scenario’. In a first of its kind, a Panel Discussion on ‘Women in Construction’ was organised, which was chaired by Dr. Daggubati Purandeswari, Hon’ble Union Minister of State for Commerce & Industry, Government of India. The other panelists were Ms. Yun Yi Ruby Chen, Executive Director, M/s Chien Hao Yuan Construction Co. Ltd., Taiwan; Ms. Liza, NGAMTRAKULPANIT, Director, M/s. Wenco Ltd, Thailand and Mrs. Srivani Mullapudi, MD Progressive Construction, Hyderabad. Shri Shibu Baby John, Hon’ble Minister of Labour, Government of Kerala, chaired the session - ‘Skill Development’. Shri Brian Welch & Mr. Radley De Silva, Executive Director, Master Builders’ Association, Australia, spoke on ‘Skill Development – An Australian Success Story’ and Shri Rupesh Banthia, Member Steering Committee, Kushal Group talked on ‘Pune Model – KUSHAL’. This session was followed by a technical session on ‘Responsible Infrastructure – a Futuristic Approach’,

which was chaired by Shri Ajit Gulabchand. Shri Enric Ruiz Geli of Cloud 9 Studio, Spain spoke on ‘Architecture in Global Warming Scenario’; Shri Ho Hon Sang, MD, M/s Sunway Group, Malaysia spoke on ‘Sustainable Development with minimum environmental impact’; Shri Grayson Perry, Australian Trade Commissioner, Austrade South Asia spoke on ‘Responsible Development’ and Shri Omirous Emmanouilides, Chairman, Master Planning & Architecture Firm, Australia, spoke on ‘Responsible Architectural Planning’. In a session exclusively designed away from the construction industry, but very much important for its players titled ‘Leading Yourself Towards a Fuller Life’, Dr. Sujith Vasudevan was in the Chair, while Shri A. P. M. Mohammed Hanish, IAS, MD, M/s RBDCK spoke on ‘Managing Egos’ and Dr. Mathew Abraham, Neurologist spoke on ‘Ageing Gracefully’. Shri Kamalnath, Hon’ble Union Minister for Urban Development was the Chief Guest during the ‘Valedictory Session’. Others who graced the dais and spoke on the occasion were Shri. Ajit Gulabchand, Shri M. V. Antony, Shri B. Seenaiah, Shri Cherian Varkey and Shri K. Lava. On Wednesday, 9th January 2013, Shri Sam Pitroda, Advisor to Prime Minister, Government of India delivered a Special Address on ‘India of Tomorrow’. The 2nd General Assembly of IFAWPCA was held after this. The swearing in ceremony and the oath by the New Board members was also held during the 2nd General Assembly and was subsequently followed by the meeting of the New Executive Board. The new team of office bearers is headed by Dr. Sudarto as President and Shri Victor Sitorus as Secretary General. The Awards Committee comprising of Dr. Babu T. Jose, Dr. Anil Joseph, Dr. Benny Mathews Abraham, Dr. Yacub Mohan George and Shri S Suresh have done an extensive shortlisting process and analysis of the receipient of each award. Full credit must be given to these gentlemen who painstakingly went through the whole process tirelessly. The following awards were presented:

1. IFAWPCA Atsumi Award : Sri Ajit Gulabchand, HCC Ltd

2. IFAWPCA Yeoh Tiong Lay Award : Sri

A.M. Naik, Larsen & Toubro Ltd

3. IFAWPCA Choi Construction Fieldman Award : a) Technical Category – Shri SRC

Nair, Kunnel Engineers & Contractors (P) Ltd.

The day wound up with a “farewell dinner” at the CIAL Convention centre, where the delegates came informally dressed, some very colourful and looking their best. There were plenty of goodbyes from the delegates after promising to meet for the next convention in Indonesia and renew their friendship. A good number of delegates used this opportunity to visit various tourist destinations and recorded a wonderful feedback of their visit to India and the 40th IFAWPCA Convention. The Award Committee of 40th IFAWPCA Convention have also decided to give the following Awards :

(1) IFAWPCA – India Arjuna Award 2013 to Shri B. Krishnaiah.

(2) IFAWPCA – India Chankya Award 2013 to Shri D.L. Desai (Shankarbhai).

(3) IFAWPCA – India Bhishma Award 2013 to Shri R. Radhakrishnan.

These Awards were given to the receipients at the hands of Shri A.S. Chinnaswamy Raju, Past President & Past Trustee, BAI, in the Managing Committee Meeting held at Mumbai on 7th February 2013. BAI WEBSITE ‘www.baionline.in’ BAI launched its website ‘www.baionline.in’ at the Managing Committee Meeting at Nashik on 9th August 2008. With the launch of www.baionline.in, BAI too aims at giving its members top-of-the-line service. As of now www.baionline.in offers the following services : � All circulars meant for BAI Centres and senior

functionaries will be hosted. � Important Judgements, Circulars and Notifications by

Government(s) and /or Departments will be hosted. � Tender information. � Latest Price Index Numbers. � Construction industry related exhibition/trade fair

information. � Information on all publication of BAI and its Centres. � Details of office-bearers of BAI. � Links to important websites i.e. like minded national

& international organisations, Government organisations concerning having dealings with construction industry, service providers, construction companies, etc.

BAI members / visitors can download : � BAI Constitution (BAI Rules & Regulations) � Membership Application Form � Membership Data Updation Form BAI members can get their membership number through www.baionline.in.

Services to be introduced over a period, include : � Website based email service to BAI members. � ‘News & Discussion Board’ – news concerning the

construction industry will be hosted and members/visitors can air their opinion on the same.

� ‘Meeting Room’ – akin to the concept of ‘chatting’, senior functionaries can hold meetings via video conferencing.

� Archives of ‘Indian Construction’ and other publications by BAI Centres.

� Total detailed membership database of BAI. ‘Wheeling & Dealing’ – is a platform for BAI members and others for offering machinery to be given on hire or request machinery on hire / offer specialised service or request for specialised service, etc. FINANCE OF THE ASSOCIATION Though Headquarter was generating surplus for the last 10 years, payment of Service Tax and Income Tax from the General Fund of the Headquarter coupled with no interest receipt on Corpus Fund FD being kept for obtaining Overdraft created a cash crunch situation at BAI. However, due to the timely involvement of the Trustees, Office Bearers of the Headquarter and major Centres, the financial situation is brought under control. FUNCTIONS OF BAI HEADQUARTER OFFICE BAI Headquarter and BAI Delhi Office with a staff of 14 members functioning exceptionally well under the guidance of Executive Secretary, Shri Raju John. M EETINGS During the financial year under report, 6 (six) Managing Committee and 5 (five) General Council Meetings were held at:

� Hyderabad on 12th May 2012 � Chennai on 30th June 2012 � Hyderabad on 22nd August 2012 � Jodhpur on 29th September 2012 � Bangalore on 17th November 2012 � Mumbai on 7th February 2013

COMMITTEES The Managing Committee authorised the President, Shri B. Seenaiah to re-constitute the Committees for the year 2012-2013. Accordingly, the following Committees were constituted with its Chairpersons as under: - Name of Committee Chairpersons Banking & Finance : Shri N. Raghunathan

Central Govt. Works, PSU, MES & Miscellaneous

: Shri Ved Khurana Shri Alex P. Cyriac

Cement & Bulk Material Purchase

: Shri K. Viswanathan

CIDC Co-ordination : Shri H.S. Pasricha

Contract Conditions : Shri M. Karthikeyan

Corporate Communications

: Shri J.R.Sethuramalingam

Housing & Real Estate & Infrastructure Development, ISO & Green Building.

: Shri K. Sriram

IFAWPCA Co-ordination

: Shri Cherian Varkey

Indian Construction Bulletin

: Shri D.L. Desai (Shankarbhai)

Labour Welfare, Provident Fund, ESIC & Labour Cess.

: Shri K.J. George

Legal, Arbitration, Grievances and Public Relations.

: Smt. Kalyani Kar Roy

Mechanisation : Shri K.K. Taparia

Membership Development & New Centres.

: Shri Sushanta Kumar Basu

Skill Development : Shri Raj Pal Arora

Taxation, Royalty, Entry Tax, Direct Tax & Indirect Tax.

: Shri D.C. Awasthi

BAI M EMBERSHIP/AFFILIATIONS � Affiliated to International Federation of Asian &

Western Pacific Contractors’ Associations (IFAWPCA).

� Founder Member of Construction Industry Development Council (CIDC), New Delhi.

� Member of Indian Merchants’ Chamber, Mumbai.

� Member of Indian Council of Arbitration, New Delhi.

� Member of Employers’ Federation of India, Mumbai.

� Member of Indian Roads Congress.

� Member of Federation of Indian Chambers of Commerce & Industry, New Delhi.

BAI’ S REPRESENTATIVES ON VARIOUS COMMITTEES • Shri B. Seenaiah as Member, Board of Governors of

National Institute of Construction Management & Research.

• Shri B. Seenaiah as Member, Board of Governors of Construction Industry Development Council (CIDC).

• Shri B. Seenaiah, Member, Board of Governors of National Academy of Construction (NAC).

• Shri B. Seenaiah, Member, Review Committee for Contract Management System formed by Ministry of Statistics & Programme Implementation (MOSPI).

• Shri B. Seenaiah, Member, National Council of Construction Federation of India (CFI).

• Shri B. Seenaiah in the focus group formed for WTO. `

• Dr. Brahm Datt, Past President & Past Trustee represent BAI on the Working Group of Construction constituted by Planning Commission for the 12th Five year Plan (2012-17).

• Shri K.V. Rangaswany as Board Member on the Executive Board of IFAWPCA.

• Shri Mahesh M. Mudda on the Expert Committee and Shri L.D. Kotwani on the State Level Advisory Committee of Building & Other Construction Workers (Regulation of Employment and Conditions of Service) Act 1996 for Government of Maharashtra.

• Shri Anand J. Gupta on Central Advisory Committee constituted by the Ministry of Labour, Government of India, under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act 1996.

• Shri H.S. Pasricha, Member, Central Advisory Contract Labour Board, Ministry of Labour, Government of India.

OFFICES OF BAI CENTRES 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”. As on date, the Centres who have their own office premises are Andhra Pradesh (Hyderabad), Delhi, Eastern (Kolkata), Karnataka (Bangalore), Nanded, Nashik, Rajasthan (Jaipur), Sangli and Southern (Chennai). Pune Centre purchased a new office premises and BAI has given an amount of Rs.10,00,000/- for purchasing the new office premises to Pune Centre. ‘I NDIAN CONSTRUCTION ’ Journal Shri D.L. Desai (Shankarbhai) was the Chairman, Indian Construction Journal Committee for 2012-2013. The printing of the magazine has been continued with a marked change and your journal is becoming more and more popular.

The journal has admittedly established a numero-uno position in construction related trade magazines as is evident from non-member subscribers, which includes, Engineering Institutes, Government Departments and Undertakings including many Works Authorities. The Association is also sending around 1000 complimentary copies to like-minded organisations in the country and abroad. The rising paper, printing and postal costs may make it difficult to repeat the financial performance for the ensuing year. ORGANISATIONAL ELECTION 2012-13 The Managing Committee, in its Meeting held at Mysore on 27th January 2012, approved the Election Programme for the year 2012-13 and appointed Shri Raju John, Executive Secretary as the Returning Officer. The Election was conducted as per the Constitution and the result of the same was declared on 30th March 2012 at 5.00 P.M. Following are the Office Bearers of BAI for the year 2012-13:- President : Shri B. Seenaiah Vice Presidents : Shri K. Viswanathan Shri D.C. Awasthi Shri Ranjeet More Shri Ravindra Pradhan Hon. General Secretary : Shri Anand J. Gupta Hon. General Treasurer : Shri Mahesh M. Mudda Imm. Past President : Shri Cherian Varkey State Chairmen / State Co-ordinators: Shri P. Mohan Reddy (Andhra Pradesh) Shri Lalit Kumar Oswal (Chattisgarh) Shri Arun Sahai (Delhi) Shri Bhupesh P. Shah (Gujarat) Shri T.C. Mohanty (Jharkhand) Shri V. Srinivasa Murthy (Karnataka) Shri Alex P. Cyriac (Kerala) Shri Suresh Vaswani (Madhya Pradesh) Shri Manoj L. Potekar (Maharashtra) Shri Ashok Agarwal (Rajasthan) Shri Mu Moahan (Tamil Nadu) Shri R.P. Gupta (Uttar Pradesh) Shri G.C. Gupta (West Bengal) BAI M EMBERSHIP SUBSCRIPTION . The subscription for various categories of membership with the Association were as follows :-

Annual Membership Annual Subscription Rs.2,400 Entrance Fee Rs. 100 ‘I NDIAN CONSTRUCTION’ Rs. 100 Service Tax Rs. 309

Total Rs.2,909 Patron Membership One time subscription – Membership for 20 (Twenty) years.

Rs.25,000

Service Tax Rs. 3,090 Total Rs.28,090

Affiliated Association Membership Annual Subscription Rs. 4,400 Entrance Fee Rs. 500 ‘I NDIAN CONSTRUCTION’ Rs. 100 Service Tax Rs. 606

Total Rs. 5,606 Affiliated Association – Patron Membership Membership (One time subscription) Rs.30,000 Service Tax Rs. 3,708

Total Rs.33,708 Corporate Membership Memberships (One time subscription)

Rs.3,00,000

Annual Subscription Rs. 10,000 Service Tax Rs. 38,316

Total Rs.3,48,316 NEW CENTRES. During the year, the Managing Committee sanctioned opening of new Centres at Jaisalmer, Rudrapur, Srinagar Mahaboobnagar, Aluva, Angamalli and Thiruvalla. M EMBERSHIP STRENGTH . As on 31st March 2013, the membership was 13458, which included 9373 Patron Members and 4085 Annual Members. BAI AWARDS. BAI Awards for 2011-12, for different categories were announced at the Managing Committee Meeting held at Bangalore, on 17th November 2012. Trophies and Certificates of Award were issued to the following winner Centres at the Managing Committee Meeting held at Mumbai 17th February 2013. 1. Overall Best BAI Centre (Below 200 Members)

Mysore Centre.

2. Overall Best BAI Centre (Above 200 Members) – Southern (Chennai) Centre.

3. Image Building Activities by a Centre – Jodhpur Centre.

4. Organising Best Training Programme or Seminar – Pune Centre

5. Maximum Annual Membership Growth – Coimbatore Centre.

6. Best Efforts by any Centre for Quality Construction – Erode Centre.

7. Best Builders’ Day Celebrations – Karnataka (Bangalore) Centre.

8. Maximum Membership Retention – Eastern (Kolkata) Centre.

9. Best Publication by a BAI Centre – Mumbai Centre.

BUILDERS ’ DAY 2012. The theme for the ‘Builders’ Day 2012” was ‘Responsible Infrastructure’. Builders’ Day was celebrated by almost all Centres in a befitting manner. OBITUARIES : The Association lost the following members who left for their heavenly abode. BAI in their death has lost sincere and hardworking members.

• Shri J. Gopi, Past Hon. Treasurer of BAI, Theni Centre, expired on 14th June 2012.

• Shri B.E. Billimoria, Past Chairman of BAI Mumbai Centre, and Past Secretary General, IFAWPCA, expired on 18th June 2012.

• Shri I.D. Grover, Past State Chairman, Madhya Pradesh, expired on 8th August 2012.

• Shri V.S. Selvaraaj, Past Chairman of BAI Erode Centre, expired on 13th September 2012.

• Shri Nimma Narayana Reddy, Past Chairman, BAI A.P. (Hyderabad) Centre, expired on 8th December 2012.

• Shri T. Muniyellappa, Executive Committee Member from BAI, Karnataka (Bangalore) Centre, expired on 4th January 2013.

• Dr. Narendra Patel, Past Vice President of BAI, expired on 23rd March 2013.

• Shri T.R. Rajan, Past Chairman, of BAI, Karnataka (Bangalore) Centre, expired on 1st April 2013.

[Centres’ Reports received from Ahmedabad (Gujarat), Allahabad, A.P. (Hyderabad), Belgaum, Chengalpattu, Dhule, Eastern (Kolkata), Karnataka (Bangalore), Kanpur, Kochi (Cochin), Kanyakumari, Mumbai, Mysore, Pune, Shimoga, Southern (Chennai), Tirunelveli, Tirupur and Ulhasnaagr will be incorporated in the final Annual Report].

NOTES

ATTENDANCE SHEET FORMING PART OF ANNUAL REPORT FOR THE YEAR 2012-2013 ATTENDANCE (out of six meetings)

Name Attendance Name Attendance Shri B. Seenaiah, President 6 Members co-opted to Managing Committee Shri Ravindfra Pradhan, Vice President 2 Shri P.K. Ramachandran 1 Shri D.C. Awasthi, Vice President 6 Shri P. Narasimhulu 3 Shri Ranjeet More, Vice President 5 Shri K. Appi Redy 1 Shri K. Viswanathan, Vice President 6 Shri Anand J. Gupta, Hon. Gen. Secretary 6 Special Invitees to the Managing

Committee

Shri Mahesh M. Mudda, Hon. Gen. Treasurer 5 Shri H.V. Nageh 3 Shri Cherian Varkey, Imm.Past President 4 Shri S.P. Shamanna Reddy 2 State Chairmen / State Co-ordinators Shri K. Sudarshan Reddy 0 Shri P. Mohan Reddy (Andhra Pradesh) 6 Shri V. Shivarajan 2 Shri Suresh Vaswani (Madhya Pradesh) 2 Shri S. Saravana Kumar 3 Shri Arun Sahai (Delhi) 2 Capt. George Thomas 1 Shri Lalit Kumar Oswal (Chattisgarh) 3 Shri Santosh R. Navle 2 Shri Bhupesh P. Shah (Gujrat) 0 Shri Santosh Lodha 1 Shri T.C. Mohanty (Jharkhand) 0 Shri Manikram J. Halbe 0 Shri V. Srinivasa Murthy (Karnataka) 6 Shri Girish I. Patel 1 Shri Alex P. Cyriac.(Kerala) 6 Shri Kapil Gupta 2 Shri Manoj L. Potekar (Maharashtra) 3 Shri Rajeev Agarwal 1 Shri Mu Moahan (Tamil Nadu) 5 Shri B.D. Narang 0 Shri R.P. Gupta (Uttar Pradesh) 1 Shri Mohamed Iqbal Qureshi 1 Shri G.C. Gupta (West Bengal) 1 Shri Shiv Kumar Sharma 1 Shri Ashok Agarwal (Rajasthan) 2 Shri Nandkumar Jethani 2 Members of the Managing Committee Shri M.R. Navaneethakumar 3 Past Presidents Shri G.M. Ravindra 5 Shri B.N. Dikshit 4 Shri D. Kempanna 4 Shri H.S. Dugal 0 Shri Avinash M. Patil 2 Dr. Brahm Datt 0 Shri Bhopinder R. Lal 3 Shri Shriprakash Goel 6 Shri K. Annamalai 4 Shri C. Raghava Reddy 0 Shri Abhay Garde 3 Shri A.S. Chinnaswamy Raju 4 Shri R. Murugan 0 Shri V. Ramachandran 2 Shri S.D. Kannan 4 Shri R. Radhakrishnan 6 Shri K. Lava 2 Shri M.N. Rajaraman 0 Shri M.A. Jesurajarajan 1 Shri M. Karthijeyan 3 Shri K. Subramani 4 Shri A.K. Yussouf 5 Shri A. Chamaraja Reddy 4 Shri P.R. Mundle 3 Shri M.S. Nandakumar 2 Shri H.J. Shah 0 Shri R. Ethirajan 5 Shri Ajit Gulabchand 0 Shri M. Dhandavakrishnan 1 Shri N.D. Golani 0 Shri Nimesh D. Patel 3 Shri S.A. Vichare 1 Shri Y. Ishwar Rao 1 Shri Lalit Sangtani 0 Shri N.R. Prasher 1 Shri Bhagwan J. Deokar 5 Shri Ravindra Tyagi 1 Shri D.R. Sekar 2 Shri K. Sriram 2 Chairpersons of Committees Shri Jagdish Parekh 2 Shri Ved Khurana 1 Shri K. Rajavel 4 Shri H.S. Pasricha 0 Shri Baburao L. Shakkarwar 1 Smt. Kalyani Kar Roy 1 Shri K.P. Baney 2 Shri Kamal K. Taparia 1 Shri Ram Janam Singh 2 Shri Sushanta Kumar Basu 4 Shri Harkant G. Vachharajani 1 Shri Raj Pal Arora 1 Shri S.K. Pradhan 0 Shri Prabir Kumar Mukherjee 2 Shri Lal Chand Sharma 4 Representing Affiliated Associations Shri K. Basavaraja Gowda 2 Shri R. Parthiban 0 Shri C. Devarajan 0 Shri Vinod C. Gamdiwala 0 Shri V.S. Selvaraaj 0 Shri R.P. Selvasundaram 1

Shri L. Moorthi 5 Trustees Shri N. Raghunathan 4 Dr. D. Thukkaram 5 Shri R. Sivakumar 4 Shri P. Jayapal 2 Shri J.R. Sethuramalingam 4 Shri P. Kandaswamy 4 Shri O.K. Selvaraj 4 Shri D.L. Desai (Shankarbhai) 5 Shri S. Ganapathy 3 Shri Mohan D. Bhate 3 Shri K. John Paul 0 Shri Lal Chand Ralhan 0 Shri H.N. Vijaya Raghava Reddy 4 Shri Narendra Kumar 4 Shri N. Sachitananda Reddy 5 Shri V.S.K. Moorthy 5 Shri M.M. Mohandas 3 Shri Pratap Salunkhe 1 Shri K.J. George 5 Shri S.I. Chunkhare 4 Shri Mohan Katariya 2 Shri Harshad N. Bhayani 5 Dr. Narendra D. Patel 2 Shri Ram M. Bhatia 3

Estd. 1941

BUILDERS’ ASSOCIATION OF INDIA MANAGING COMMITTEE 2013-2014

President

Shri B. Seenaiah

Vice Presidents

Shri K. Subramani Shri Lal Chand Sharma Shri Manikant Dr. Taro T. Manghnani

Hon. Gen. Secretary

Shri Anand J. Gupta

Hon. Gen. Treasurer

Shri Mahesh M. Mudda

Imm. Past President Shri Cherian Varkey

Trustees

Shri D.C. Awasthi Shri D.L. Desai Shri J.R. Sethuramalingam Shri P.K. Ramachandran

Shri R. Ramaraj Shri S.K. Pradhan Shri Sajandas Mulchandani

State Chairmen / Co-ordinator

ANDHRA PRADESH BIHAR CHATTISGARH DELHI Shri V. Satyamurthy Shri Sachin Chandra Shri Santosh Lodha Shri Arun Sahai

GUJARAT JHARKHAND KARNATAKA KERALA

Shri Bhupesh P. Shah Shri Kaushal K. Singh Shri N.S. Muralidhara Shri Alex P. Cyriac

MADHYA PRADESH MAHARASHTRA RAJASTHAN TAMIL NADU Dr. Santosh Katiyar Shri Sudhir D. Gharge Shri G.K. Gupta Shri V. Rajagopal

UTTAR PRADESH WEST BENGAL Shri Ravindra Tyagi Shri Chandan Dey

Members

Dr. C. Ashokan Dr. D. Thukkaram Dr. S.K. Manjarekarl Shri A. Chamaraja Reddy Shri A. Puhazhendi Shri Abhay Garde Shri Ashok Agarwal Shri Baburao L. Shakkarwar Shri Basavaraj S. Totad Shri Bhopinder R. Lal Shri C. Devarajan Shri D. Kempanna Shri D.P. Singh Shri G. Ramamoorthi Shri H.N. Vijaya Raghava Reddy Shri Harkant G. Vachharajani Shri Jaiprakash Bhatia Shri K. Annamalai Shri K. Rajakumaran Nair Shri K. Sriram Shri K.G. Janakiraman Shri K.J. George Shri L. Moorthi Shri Lalit Kumar Oswal Shri M. Dhandavakrishnan Shri M. Ramesh Shri M.S. Nandakumar Shri Mathew Alex Vellapalli Shri Mohan D. Bhate Shri Mohanlal S. Kataria Shri Mohinder Rijhwani Shri Mu Moahan Shri N. Raghunathan Shri Narendra Kumar Shri O.K. Selvaraj Shri P. Subramani Shri P.K.P. Narayanan Shri Prabir Kumar Mukherjee Shri Pradeep G. Nagwekar Shri Pratap B. Salunkhe Shri R. Ethirajan Shri R. Sivakumar Shri R.B. Krishnani Shri R.J. Srinivas Shri R.P. Selvasundaram Shri Rajendra Athawale Shri Ram Janam Singh Shri S. Ganapathi Shri S. Shiva Prakash Shri S.D. Kannan Shri Santosh R. Navle Shri T.V. Chandrasekaran Shri V.M. Fazal Ali Shri Vinod C. Gamdiwala Shri Y. Ishwar Rao

Co-opted Members

Shri K. Appi Reddy Shri K. Viswanathan Shri P. Narasimhulu

Special Invitees

Shri B. Babu Rao Shri Jagdish M. Parekh Shri K. Basavaraja Gowda Shri K. Padmanabhan Shri K. Sudarshan Reddy Shri Manesh K. Shri Manikram J. Halbe Shri Manoj L. Potekar Shri Mukesh Verma Shri N.M. Patel Shri Nainesh Shah Shri Nimesh D. Patel Shri P.M. Harshe Shri Rajendra M. Upadhye Shri S. Prabhu Shri S.P. Shamanna Reddy Shri S.R. Swamy Shri Sandip A. Tare Shri Suresh Moorjani Shri T. Kamalnath Naidu Shri U.M. Gurushanthappa Shri Uday N. Gokhale Shri V. Ganesan Shri V. Narasimhan Shri Varinder Kumar Garg