Legal complacency vs impeding crucial sector growth – by ankit bhatia

Bonjour all !

Well  ..  as would be aptly apparent, sans conjectures, you could have inferred – enthusiasm no longer persisting to be that of rising albatross from blues of ceremonies, as in last blog, rather inclined towards its (already attained) culmination into the usual frequency – prior to ceremonial blues 🙂

Today’s blog’s protagonist would assertively strike a cosy chord with multitude ! Specifically with the extravagance enthusiasts 😉

IN midst of my extravagant indulgence in commerce – on an online retailer, was startled & perplexed – when there was an obnoxious pop up – from the website – refusing transaction to certain jurisdictions – which, rather, to me, of course subjective, seemed synonymous of being a characteristic of the oblivion, or rather expression of resentment of the platform – towards the extravagance enthusiasts in our specific ordering jurisdiction.

Consequent despair! Perplexing ! Why discrimination! ..

Curious to seek an explanation backing such inducement – as to why certain jurisdiction is incurring this discrimination or rather a blatant boycott !!

‘No system issue’ confirmation from pals (successfully indulging in usual extravagance in other jurisdictions) deteriorated the curiosity even further !

Formal correspondence, majority being informal conversation with supply-chain staff, about audacious discrimination / boycott, unveiled the reasons – to even further dismay & despair !

Reasons for the blatant oblivion towards certain jurisdictions – unfolded towards – what was rather a crucial broader issue for consideration by our fiscal authorities & systems !!

Informal conversations revealed that certain jurisdictions were boycotted by e-commerce corporations – due to imposition of procedural impediments – for instance: even for nominal transactions in some jurisdictions, buyers are being stipulated to maintain records of vehicles, petty vendors are being coerced, dragged into employing procedural hassles! Consequently, such regressive jurisdictions are being boycotted, & discriminated while placing orders!

Have the developing economies ever acknowledged the extremely crucial role of e-commerce corporations ?

E-tailer giants are serving as one of the most crucial stimulants of fiscal growth – especially towards – dispersal of economic growth, balanced economic growth – in pursuance of applauded mantra of ‘sabka vikas’! Every component of governance, fiscal systems ought treat these stimulants unto extreme priority – alike of – single window clearance systems. All the development of sub-strata population in remote areas – which had been stimulated – is attributable solely to such ecommerce – & will attain a stand-still martyrdom – if such ventures are not extremely encouraged / motivated ! All adverse one sided growth, monopoly scenarios – dominated by massive non resident mall cultures – can be curtailed solely by encouraging such ventures!

IN absence of such growth-conducive ventures, all massive retail potential margins were being concentrated within few massive non resident corporations – who would, subsequently, monopolize the Indian retail potential, along with India incurring the disadvantage of repatriation of all such massive resource base – outside our jurisdiction. Never ought we undermine the impairment to balanced growth objective, attributable to absence of e-commerce, such non resident malls would impose upon us – as repercussions. Even further, this sector is also conducive to fiscal / statutory tapping of perpetually unorganized retail sector – consequently leading to foregone fiscal resource base too.

Inconceivable is the reason for such impediments, since, even in my experience of advisory assignments with global investment bank, & fiscal advisory portfolios, the underlying fiscal legal system, attributable to such e-commerce industry, has been fairly evolved, without any major contradicting court/tribunal judgments alike some constitutional matters (without indulging in legal details in this general blog) – depending upon the e-commerce operation model – under which the transactions /supplychain taking place – whether the digital service being rendered is limited to acting as intermediary or in principal capacity – with the corporate / retail buyers!

Subsequent to the Constitutional Amendment, Central Sales Tax Act, Section 3 was being evoked in case of transactions in the nature of being covered under the definition under Section 2/3 – regarding ‘dealer’ / ‘interstate trade commerce’ ‘occasions movement from one jurisdiction to another’ etc, and Finance Act’1994 was being evoked on the consideration by way of commission – attributing to ‘business auxiliary service’. And for the transactions – not covered by Section 3 aforesaid – the consequent State federal fiscal law was being invoked.

However, despite aforesaid legal / constitutional clarity, & beyond all these minuscule issues, dominant issue – which ought to perturb the governance or fiscal systems is – such a crucial sector, for India’s balanced economic growth, is being impeded with, is incurring fiscal / procedural impediments, and system is apparently oblivious to this blunder – in the form of procedural / fiscal impediments in flourishing of this crucial sector! Indian fiscal governance systems ought be extremely vigil, prompt and lend all legal & fiscal ears & not even remotely be complacent towards such a very crucial sector – which is conducive in & culminating into a balanced growth, & is conducive to retaining our resource base within our jurisdiction!

Lets be optimistic !!