The Site Association of Industry (SAI) and Site Town of City District Government Karachi (CDGK) are up in arms against each other over the issue of trade licences.. The notices being issued by the Town Municipal Officer (TMO), Site Town to industrialists under the Sindh Local Government Ordinance 2001 for obtaining trade licences are causing harassment to member industries, according to SAI. As such.
The latter has taken up the issue with higher authorities of Sindh and Federal governments to seek relief, or it might kick up another issue of high magnitude. Way back in February 2007, Site Limited had written to the TMO terming these notices as illegal because Site Limited by itself is a "government" as per its Memorandum & Articles of Association.
The infrastructure, water, sewerage, roads, etc, fall under the jurisdiction of Site Limited, owner of the land, and all industries have tenancy rights. According to SAI, Site industrial area does not fall in the jurisdiction of CDGK. SAI has strongly protested against the issuance of bailable warrants of arrest issued against the industrialists for alleged violation of municipal law by not acquiring trade licences.
Site Association of Industry Chairman Engr M A Jabbar told Business Recorder that Site Town has no authority to issue notices, and does not enjoy any legal basis to force the industries to acquire trade licences and charge fees in this regard. The actions of Site Town administration are testing the endurance of the already broken nerves of industrial economy, he said. He said that these tactics were aimed at forcing the industrialists to comply with extra legal and extra-judicial extortion, routed by serving bailable warrants of arrest of industrialists of Sindh Industrial Trading Estate.
The industrial economy is shrinking, empirically supported by the present level of export performance, tax realisation, which respectively from July 2008 to February 2009 on total export and collection basis, does not see the future for meeting the targets of exports and collection of taxes. The image building of Pakistan and the perception is so ill-placed and conceived out of the natural geographical boundaries that the Commercial Counsellor of US Embassy during his recent visit to SAI did not hesitate to respond on possible FDI flow by saying that Pakistan is the last destination for investment.
SAI Chairman said that the institutions, which are developed under devolution plan, instead of facilitating the industrial estates, are considering it a source of extortion through raising patent illegal demands such as asking industry to pay trade licence fee.
Pakistan, he regretted, is a country where increasing employment and capital are both penalised one through stringency of labour laws and surveillance under the Industry Relation Act and the other through increasing burden of taxes charged in the name of professional to and increasing capital. "It appears that the grass-roots level governments at town levels are again up to milk this cow to death."
Jabbar said that, in Pakistan, putting up an industry is like purchasing a host of penalties and humiliation. People who have invested and continue to invest due to the fact that the industry cannot stay static but need continued BMR support for surviving. Industry provides employment, contributes to GDP, creates exportable commodities and substitutes imports to contain the trade deficit and, above all, contributes more than 60 percent of the federal taxes in over-proportion of its share in GDP, which is less than 20 percent.
He said he failed to understand why the Site Town, CDGK, officials are bent upon disturbing the tranquillity by unnecessarily imposing illegal taxes and resorting to recovery in the name of trade licence fee through highly deplorable manner by involving the police of Site area in West zone.
He expressed hope that Sindh Chief Minister and Chief Secretary may intervene and come to the rescue of industrialists, ensuring that industrialists are not served with further warrants of arrest by Site Town involving Site police stations.
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