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Plea before Bombay High Court to Waive Property Tax due to Lockdown

On 25th May 2021 a plea by the Federation of Retail Traders Welfare Association has been filed before the Bombay High Court citing the issues of unemployment, huge loss and financial instability that the retail industry is facing right now due to the COVID 19 pandemic situation and lockdown.

Advocates Dipesh Siroya and Jamshed Mistry, on behalf of the federation, said in their petition that “The majority of retailers within the state have suffered huge losses and they are entitled to certain waivers and concessions, so as to ensure the businesses sustain,” as there are more than 13 lakh retailers with approximately 45 lakh employees. The petition is pleading Bombay High Court to waive the property tax, renewal fees and license fees which are yet to be paid by the retailers dealing with non-essential goods in the State of Maharashtra for the lockdown period starting from March 2020. The petitioner also emphasized the several lockdown measures implemented by the State and Central governments since March 23, 2020, before the vacation bench of justices, Ramesh Dhanuka and Madhav Jamdar. Stating the fact that there was a state government imposed lockdown from April 2021 to May 1, 2021, the petitioners claimed that they understood the gravity of the situation and followed the rules completely but there was no subsidy in reciprocation. The petition also submitted that even though businesses of non-essential goods are shut, the retailers have to pay electricity, rentals, employee salaries, property and other taxes. Advocates Siroya and Mistry also mentioned in their petition that “With the days of lockdown continuing to extend in the State, it is getting increasingly difficult for retailers to retain employees and see their businesses afloat. There is a need to inject capital into the industry.” During this pandemic time and the lockdown, the petition stated, the retailers can’t make any profits because they rely on consumers for various business purposes and it’s the consumers who are the sole source of income. In this petition, the federation mentioned those numerous letters, written to several other authorities for a tax waiver, that were never returned or responded to by the authorities. The petitioners also pointed out that, even after being small businesses, retail shops do not get the required support like other small scale businesses as they do not fall within the definition of MSMEs. The federation further added that property tax, license fee, renewal fee etc are only payable when the members have received specific benefits. The petitioners claimed entitlement to waiver of the taxes as these statutory payments are not applicable to the e-commerce sector.

Advocates Jamshed Mistry and Dipak Siroya, summoned the Brihanmumbai Municipal Corporation, State of Maharashtra and Ministry of Revenue and Forest, Disaster Management, Relief and Rehabilitation as respondents. They further alleged the e-commerce industry for violating the SOP (standard operating procedures) and guidelines mentioned in the Disaster Management Act. The petition claimed that the state is not taking necessary actions against e-commerce traders for selling non-essential commodities, violating the April 13, 2021, Standing Operating Procedures. Advocate Jyoti Chavan on behalf of the state claimed that the state will take necessary steps to protect the retail traders and their interests but he didn’t say a word regarding the allegation made on the e-commerce industry. Justice Dhanuka asked, “You are offering incentives to hawkers but not retail traders. Is there any package for retailers also?” On behalf of BMC, advocate Anil Sakhare asked for some time to file a reply to such allegations.

The next date of this matter is scheduled for hearing on June 21st, 2021 and it will be interesting to watch how the rights of the retailers will be protected by the Bombay High Court.

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