Justified Support During Lock down For Businesses / MSMEs / Employees

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Subject: - Request for vital support to Industries and commerce Without Effecting Government's Revenue

We highly appreciate the steps taken by the Govt. of India for protecting the people in the country from the pandemic due to Corona virus. We fully support the directives and restrictions to maintain order and prevent panic among the people; especially the people in the unorganized sector and the poor strata of the society.

We understand the duties cast upon the State Govt. under the Disaster Management Act, 2005 to prevent the disaster, mitigate its effect and rehabilitation of the people affected by it. In accordance with the provisions of the said law the financial relief has been provided to all the sectors; though for the organized sector the relief under the PF law has been limited to the workers drawing wages up to Rs.15000/- only.

However, we bring to your kind notice that the units in the MSME Sector may not be able to survive at all as a result of this crisis; because of the fact that we are all working in a supply chain virtually on conversion basis for the higher industries. There is no way for the survival of most of the Exporters.

In the given circumstances we have been asked to pay full wages for the entire lock down period. Section 39 of the Disaster Management Act, 2005 is clear that the State Govt. has to allocate funds and resources for the prevention of disaster, its mitigation and rehabilitation. In concurrence and compliance of the directive of the Govt. most of the industry has paid the wages for the month of March, 2020. However not that the economic disaster has appeared as a reality, the industry is not is position to the wages for the month of April 2020. A “natural calamity” has been recognized and addressed in the Industrial Disputes Act, 1947 in Section 2(kkk) and very well addressed in the various connected provisions. Any amount that is not “earned wages” would be a compensation as in the present case i.e half the wages and the other half paid on the direction of the “orders” of the Govt. would be an advance against wages.

Order no 40-3/2020-DM-I(A), dated 29.03.2020 passed by MHA is sheerly passing financial burdens on Businesses/MSMEs despite they have deposited social security funds like LWF,ESIC,Labour cess in the past decades for its Employers i.e MSMEs be supported by Govt. without giving any financial burdens on the said organizations.  

We are thankful to RBI for keeping provision to help MSME’s during lockdown appreciate all efforts being taken by Hon’ble Prime Minister for controlling the spread of COVID-19.

Challenges MSMEs are facing during lockdown are as under: -

1.    Salaries for Staff, Workers & Contractual Workers:

a) PF Deductions: It is suggested to waive off deposit of PF for 3 months, which is kind of savings.

b) Conveyance Expense: Usually any employee spends almost 10-12% of his salary on his conveyance to come office. This expense is not being done during lock down.

c)Kitchen & Necessity Expense: Usually any staff has 30% of their salary on their kitchen & necessity expenses.

Suggested Solution :Keeping aside the savings for 3 months and taking care of only basics let all MSMEs be allowed to pay 30% of salaries to their Staff, Workers & Contractual Worker without imposing any burden of payments of statutory deductions under Force Majure provisions applicable to all even to Employers rights also which is also need to protected legally/morally by the GOVERNMENT .

2. Electricity &Water& Internet Charges:

During lockdown MSMEs are facing to pay minimum electricity and water bills. These charges are for no usage of electricity/water/internet. It is suggested that during lockdown period minimum charges i.e Fixed Charges for electricity & water being paid by MSMEs requested to be waived off .And it is suggested also that during this lock down period the coal cess also be waived off as there is no usage of the same.

3. Bank Interest on Loan to MSME: During period of lockdown at least 2% rebate on existing bank interest be given to MSMEs.

4. Future OD Limits (after lock down period): Big recession is expected after the lockdown. A provision / plan be made for MSME for its revival with OD limits.

Suggested Solution: Allow additional OD limit equivalent to 50% of GST paid in last 24 months at nominal ROI.

Therefore in view of the facts mentioned above we request your good self with FOLDED HANDS to withdraw or otherwise modified the said order dated 29.03.2020 passed by MHA by giving some interim/relief measures to Employer also , as current order which is being passed  MHA dated 29.03.2020 is violation of Art 14 and 19(1)(g) ,110, 265,300-A wherein said rights are entrusted to all class as fundamental rights and other constitutional rights under Indian Constitution without favoring any particular class even otherwise said order dated 29.03.2020 issue under DM ACT IS LACK OF LEGISLATIVE JURISDICTION and contrary to the provisions of section 39 and 72 of Disaster Management Act itself and moreover said  order dated 29.03.2020 to bear additional burden is not allowed under the category of CSR by concerned Ministry therefore their no legal sanctity to the same and is nothing but moral obligation which we are ready bear to extent to our capacity only. 

Thanks & Regards,

Business / MSME Owners / Employees