MUMBAI, February 7: The centre has asked plastic and rubber industries not to avail of Modvat facility this fiscal. It had earlier given the same direction to automobile manufacturers.It is believed that the government has been making this request to ensure minimum fund outflow from its coffers so that it can show better books at the financial year-end. The government, on its part, has not yet clarified why exactly it has made the request to various industries.The All India Plastic Manufacturers Association (AIPMA) has come down heavily against the move of central excise authorities asking various units to pay in personal ledger accounts (PLA) for clearing the goods and not to clear the goods in MODVAT upto March 31, 1998.
The association has convened a meeting of the representatives of the industry next week to chalk out a plan of action. The association is even planning to move the court if the authorities refuse to withdraw the decision. The industrial units have been asked to comply with the decisionimmediately."The decision is a violation of the law and it is an attempt to boost the revenues the department. The action comes at a time when the industry is reeling under severe liquidity crunch.
If this continues, many units will be forced to close down their operations," said Arvind Mehta secretary of AIPMA. The Assocaition has already registered their protest with the powers-that-be by sending letters to finance minister and prime minster requesting them to take immediate action but no response had been received so far, he said.
Since 70 per cent of the players comes under Modvat, they will be forced to dole out additional amounts to make the payment in cash.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
