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Deeptha Rajkumar

Wellington (Nilgiris) , Nov. 21

SMALL growers and bought leaf manufacturers in Tamil Nadu have decided to request the Tea Trade Association of Coimbatore (TTAC) and the Coonoor Tea Trade Association (CTTA) to resume auctions. This follows assurances of a positive resolution to the imbroglio over slapping of tax arrears notices on some auctioneers.

A five-member delegation, comprising members of the Nilgiris Small Growers association and the Bought Leaf Manufacturers Association, met the Minister for Commercial Taxes, Mr Velusamy, the Commissioner of Commercial Taxes, Mr Abul Hasan, and the Secretary of Commercial Taxes in Chennai on Friday.

The delegation apprised them of the current crisis in the tea industry following demand notices being slapped on leading tea auctioneers, claiming differential tax arrears to the tune of over Rs 8 crore.

The arrears have been claimed by the Tamil Nadu Sales Tax Department on the ground that the auctioneers did not enjoy benefits under the Central Sales Tax during 1999-2001 and that sales during the period were covered by the Tamil Nadu General Sales Tax rules.

Mr M. Bhojarajan, President, Nilgiris Small Growers Association, told Business Line after a meeting with senior Government officials in Chennai, that outcome was "very positive".

"We have been told that they will look into the matter immediately and that any hindrance to the industry will be removed. In return they have asked us to resume auctions, keeping in mind the welfare of the industry,'' he said.

Mr N.K. Krishnamurthi, President, Bought Leaf Manufacturers Association, said the officials seemed convinced of their arguments based on the strong representations made by the auctioneers, the small growers and the manufacturers.

"We have been told the Government will take a firm decision on the matter,'' he said.

However, even as the delegation was being assured of an early solution by the authorities in Chennai, several brokers in Coonoor received fresh assessment notices for 1999-2000, while a few others were asked to submit details of their balance sheet. Following this development and as a safety measure, the auctioneers have approached the Sales Tax Tribunal in Chennai to file their appeal. For there is a growing fear that if they were to wait till the end of the 30th day (from whence the demand notices were issued) to go on appeal, they would be in a deeper crisis.

As per the tax notices, by the end of the 30th day — and if there has been no appeal made — recovery can be done by the authorities under the Recovery and Retrieval Act.

On their part, TTAC has decided to wait for some positive outcome of the delegations visit or positive response from the tribunal and review the situation on Thursday/Friday.

Hence, the trade feels that auctions will remain suspended for the second week running at both CTTA and TTAC. Meanwhile, reliable sources told Business Line that the CTO, Coonoor has written to the brokers to resume auctions as the Tamil Nadu Government was losing revenue and their petition was pending disposal before the Chief Minister.

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