Exemption to specified goods imported for Common Wealth Games and Government's Flip Flops
GOING by the media reports in the recent past, it appears that the entire blame for delay in execution of several projects related to Common Wealth Games, 2010 was laid at the doorstep of the Organizing Committee of the Common Wealth Games, 2010 and other executors of the various projects like CPWD, New Delhi Municipal Corporation etc. It is another matter that there were also serious allegations of corruption and nepotism in awarding contracts for execution of these projects.
While some of the blame may rest with these project executing authorities and the OC, CWG, since a majority of goods and equipment required for execution of some of the projects related to CWG are being imported, the exclusion of suppliers/contractors/ vendors/sub-vendors for the purpose of allowing benefits of exemption Notification No. dated 27.02.2010 also proved to be a major stumbling block in shaping up the CWG venues on time.
It may be noted that the Central Government has vide Notification No. dated 19.02.2010 exempted certain specified goods viz., sports goods, sports and fitness equipments, arms and ammunition, doping control equipment, satellite phones/GPS and other communication equipments, video/plasma screens, electronic score board display, timer devices, furniture and fixtures, power generation and distribution systems, air conditioning equipments, food stuff, energy drinks, pharmaceuticals etc imported by the Organizing Committee of the Common Wealth Games, 2010, National Sports Federations or participating athletes, from basic customs duty and additional customs duties subject to the conditions prescribed in the said notification. Unfortunately, this notification did not include suppliers/contractors etc for the purpose of exemption benefits when it was first issued.
As these importers were denied the benefits of the exemption notification by the field formations and doubts were expressed as to whether they were actually eligible for the exemption benefit under the said notification, Board vide Circular No. dated August 9, 2010 clarified that suppliers/contractors/vendors appointed by the OC, CWG would not be eligible for the benefit under the said notification. Board further advised that the provisions of Foreign Trade Policy or any other Acts or exemption, if any, in this regard, will apply as per the instructions/circular issued by DGFT and concerned Departments from time to time. The OC, CWG was advised to take up these matters with DGFT and concerned Departments and sort out the issues well in advance before arrival of consignments, who have since issued requisite clarifications. Board also advised the field formations to speedily clear consignments meant for CWG 2010 by appointing a nodal officer for the purpose.
Further, vide Circular No. , dated August 13, 2010, Board issued further instructions to facilitate speedy clearance of certain specified goods in consultation with Prasar Bharti, Ministry of Sports and Youth Affairs and OC, CWG and specified certain conditions and procedures to be followed by OC, CWG or Prasar Bharti with regard to the import of the said specified goods. It may be noted that the issue involved was again with regard to the eligibility of contractors/vendors/sub-vendors for the benefit of exemption Notification 13/2010-Cus.
Finally, Central Government realized its folly of not allowing the benefit of the said exemption notification to the suppliers/contractors/vendors/sub-vendors of OC, CWG and made an amendment vide Notification No. dated August 27, 2010 to include these categories of importers in the eligible list of importers. Likewise, the suppliers/contractors/vendors/sub vendors of Prasar Bharti or of broadcasting rights holders were also included in the eligible list of importers to claim exemption benefits subject to certain conditions.
The moot point is how the Finance Ministry could assume that the actual imports of some of the specified goods required for the execution of the projects will be solely imported by the OC, CWG or the various National Sports Federations. After all, Suresh Kalmadi & Co are at the helm only to run the show and not execute the projects on the ground. It is common knowledge that it is the contractors/vendors/sub vendors who actually undertake the work allotted to them by the OC, CWG/National Sports Bodies etc and not Suresh Kalmadi & Co.