Meetings at Chandigarh and Jalandhar

Meetings at Chandigarh and Jalandhar

FADA organised its 234th Council Meeting at Chandigarh on 6th July 2007. The Council Meeting was followed by three interactive sessions with: Additional Transport Commissioners of Haryana and Punjab; and Regional Managers of 2 & 4 wheeler manufacturers, at the same place. The next day, a Regional Meeting was held at Jalandhar.

(i) Admission of new members; (ii) Approval of FADA's Annual Accounts for the year 2006-07 for adoption at the next AGM; (iii) Initiating & strengthening FADA's Training Programme in various parts of the country to tide over the problem of acute trained manpower shortage; (iv) Strengthening FADA's secretariat with a view to organising regular regional meetings for better contact with members; and (v) Organisation of Auto Summit 2008, were the key decisions taken at the Council Meeting.

Interactive Sessions following the Council Meeting witnessed lively discussion. The interaction with M K Mahajan, Additional Transport Commissioner, Government of Haryana, and Dr Karamjit Singh, Additional Transport Commissioner, Government of Punjab kicked off the proceedings. The discussion at this Interactive Session centred around 4-5 major issues, namely, (a) Empowering automobile dealers in Chandigarh, Haryana and Punjab to do registration of non-commercial vehicles on the lines of schemes as in force in Delhi and Rajasthan for simplification and avoiding delays; (b) Dispensing with the requirement of model approval at the State level, especially when the vehicles are tested and certified by the national test agencies like ARAI and VRDE; (c) Authorising automobile workshops with requisite equipment and technical competence to undertake testing and certification of vehicles for safety and roadworthiness; and (d) Bringing in uniformity in taxes on vehicles across States. First two issues hogged the limelight during major part of the discussion.

Mahajan and Dr Karamjit Singh, while tending to agree with the need for empowering dealers for registration of vehicles, revealed that their respective Transport Departments have been mulling over the issue for some time. However, some of the issues and concerns raised within their departments were: (i) Registration of vehicles is a sovereign function and, perhaps, cannot be delegated; (ii) Some of the stolen vehicles might get registered at dealerships and dealers may have to put in, quite frequently, personal appearances before the Courts as witnesses in such cases to verify the genuineness of registration and registration certificates.

Dr Karamjit Singh pointed out that the Punjab Government had, some time back, initiated a move in this regard and invited automobile dealers for the dialogue. However, some of the dealers showed reluctance in undertaking registration. He also revealed that the matters regarding authorisation of automobile workshop and garages for carrying out testing and certification of vehicles for fitness and bringing in uniformity in vehicle registration taxes had also been engaging the attention of the Punjab Government. While initiative to bring about uniformity in taxes on vehicles at least in northern States had made some headway, the issue regarding empowerment of select workshops & garages for testing & certification of vehicles for fitness was stuck with the concern being expressed that it might become perfunctory like indiscriminate issuance of PUCs by private agencies. As regards the rationale for approval of new models by the State Transport Department, Dr Karamjit Singh explained that every State and city had peculiar needs and requirements. The approval of new models was done to see that the new models introduced in the market fitted in the specific needs of the city or State.

Reacting to the observations of the Transport Authorities, members explained that the dealerships would register only new vehicles received by them from their manufacturer principals. As such, the apprehensions of the Government that the stolen vehicles might get registered at the dealerships were taken care of. Regarding the approval of new models, it was explained that new models and their variants were being introduced at a greater frequency in the market. A lot of time and effort was spent by Transport Department and automobile dealerships for such approvals. Such waste of effort and time could be avoided at least in the case of passenger cars and two-wheelers, in which case the basic features and characteristics remained more or less the same.

Mahajan and Dr Karamjit agreed to consider the suggestions and assured that they would find ways and means to implement these suggestions through dialogue with automobile dealers.

The interaction with Transport Authorities of Haryana and Punjab was followed by separate panel discussions with Regional/Area Managers of General Motors India, Tata Motors and Mahindra & Mahindra, HMSI and TVS Motors, represented by Saurabh Vats, Deepankar Tiwari, Sonu Gujral, Sukhpal Singh and Deepak Bajaj, respectively.

The representatives of manufacturers were of the opinion that the current phase of slowdown would be a phase shortly and that the outlook in the medium and long terms was bright. Shortage of trained manpower especially with the advent of retail chains and BPOs; dealer viability in the context of soaring real estate prices and cost of dealership operations; the absence of provision for automobile dealerships with 3-S facility in the land planning & development of cities, were cited as the major challenges to be addressed jointly by the industry and the trade.

Jalandhar was the scene of action the next day, where a Regional Meeting was held.

Local Service Tax officials were invited to interact with the automobile dealers at this meeting.

Binod Agarwal, President, FADA briefly touched upon the activities of FADA. He, in particular, made mention of FADA's initiatives in the recent past, viz., Helpline Service for members, FADA Academy Training Programme and G10 Programme.

Service Tax officials clarified the dealers' queries regarding service tax on (i) repair & service of vehicles carried out by authorised service stations and exclusions from taxabale value; (ii) incentives received by automobile dealers from banks & NBFCs for arranging vehicle finance for their customers; and (iii) target based incentives received from manufacturers. The discussion was quite meaningful and helped in clearing the mist on various issues.