Himachal yet to refund 42% of CGST proceeds to industry

Ambika Sharma

Tribune News Service

Solan, September 18

It’s been over two years now when the Central government introduced the GST regime in July 2017, but eligible industrialists who were supposed to get 42% share of the Central incentives from the state are still awaiting their dues.

When the GST was implemented, the earlier scheme of granting incentives like Central excise exemption to various states such as Himachal, J&K and Uttarakhand had been scrapped. The industrial units which had commenced production by March 2010 were eligible for this exemption till March 2020.

The units which had invested at the fag-end of the package period were the most sufferers as they could merely get refund of the 58% share from the Central government.

As per the procedure, the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, is supposed to provide budgetary support to the eligible units for the residual period by way of GST refund, limited to the share of Central-GST or integrated-GST.

While the Centre was routinely refunding 58% share of the Central incentives, the Himachal government had shown no keenness to address this issue, leaving the investors high and dry. With barely six months remaining for the scheme to lapse, the investors have lost hopes of any such refund.

In order to avail the benefit, the eligible unit is supposed to first utilise input tax credit of the Central tax and integrated tax and pay the balance of liability in cash. 

Director Industries Hansraj Sharma said this exemption was available only to investors who had invested in the category C areas comprising tribal and industrially undeveloped areas under the state industrial policy.

Several industrial associations have taken up this issue with the state government. While the previous Congress government had expressed its inability to grant its share of 42%, the present BJP regime too is not serious to facilitate the industries on this account as no serious concern has been shown to refund this share.

Sanjay Khurana, president, Baddi Barotiwala Nalagarh Industries Association, said the issue had been taken up with the state government on several occasions but it has yielded no result. 

The industry feels cheated as they had invested in Himachal on the promise of getting the Central excise exemption for 10 years.