Rameshwar Malani, Chairman Srinath Const & President- BAI Nashik
Established in the year 1974, Shrinath Construction have carved a niche in the industry as one of the leading Civil Contractors of the country. The group have had the distinction of building of large Institutional Buildings and Corporate Office Complexes, Industrial Complex Buildings, Hospitals, Medical Colleges and Laboratory Buildings, Educational and Technical Institutes, Schools & Auditoriums, Gymnasiums & Sport Complexes, etc all over Maharashtra.
Gharabari.com finds an opportunity to have a tete-a-tete with Rameshwar Malani, Chairman, Shrinath Constructions, who has also been elected as President of Builder Association of India [BAI], Nashik branch recently. He shared his views about the woes of the Construction sector specific to Nashik [Maharashtra] Market.
Excerpt of the conversation with Sandeep Pattnaik of Gharabari.com…
Q. 1. Sir, you have taken over as the President of Builder Association of India - Nasik Branch. What is the most vital issue according to you, is haunting the construction Industry here?
A. The most prominent issue before the construction sector is the high tax regime in the form of Service Tax [ST] on contractors almost @5% on Government works (earlier not there) which ultimately has increased the cost of construction here. The new budget has made the levy of this ST even on all on-going projects pertaining to the previous fiscal years, I.e. before March’ 31. The Builders association demand is to make it applicable for new projects only, barring the old on-going projects.
Secondly, Builder's procurement of cement bags at Rs 250/- bag whereas, the Government has fixed the same @Rs 120/- bag for certain specific Central Government projects has put the Builders in a tightspot.
Q. 2. You have also raised concerns of the prevalent Ready Reckoner Rates. What would be your initiatives in this regard?
A. There lies lot of ambiguity as to the Ready Reckoner rates in Nashik. It is the rate which is taken as the basis for calculating stamp duty on properties. Every year on Jan’1, the rate has been revised by the state government making it on a higher side and putting burden on the building contractors.
This constant revision in RR rate has increased the property prices in Nashik. At some parts of the city, the RR rates are higher than the market rates,which has led to higher valuation of residential flats, ultimately finding no takers. As a result, these residential properties, flats are lying unsold. We at BAI will take it forward and urge the state government to frame a concrete policy for RR rates in future.
Q. 3. Shrinath Constructions was in the construction business since 1974. What is your appx yearly turnover so far?
A. Rs 50-60 Crs. We have a target to make it to Rs 100 Crs in future years, subject to a favorable tax regime from the state government for the sector. In my view, there should be a single window under which tax should be levied instead of multiple tax levies like VAT, Service Tax etc. The proposed GST is a move in this regard.