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The Building and Other Construction Workers’ Welfare Cess Act, 1996

An Act no. 28 of 1996 was enacted by the Parliament of India with the name and short title as ‘the Building and Other Construction Workers’ Welfare Cess Act, 1996’. The purpose of the Act is provided as for providing for the imposition and collection of a Cess on the Construction costs incurred by the Employers in order to augment the resources of the Welfare Board of the Building and other Construction Workers, which was constituted under the provisions of  the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 (Act no. 27 of 1996). Earlier there was an Ordinance namely, the Building and Other Construction Workers’ Welfare Cess Ordinance, 1995 was promulgated by the President on 3rd day of November, 1995 and for replacing this a Bill was introduced in the Lok Sabha, however, the same was not taken up for consideration and passing. But in the year 1996 there were three attempts made by passing three more Ordinance and for replacing them three more Bills were tabled before the house of Parliament, but the third amongst those three, being in furtherance with the Building and Other Construction Workers’ Cess Third Ordinance was passed by both the Houses of the Parliament. And the same resulted in the present enactment which has received the assent of President of India on 19th day of August, 1996. There provisions of this Act were brought into effect on 3rd day of November, 1995 and extended to the entire Indian territories.

The Act provides for most important provisions being relevant to the main purpose of this Act, from section 3 thereof. For the purpose of the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 (Another Act of 1996), the present Act sought for imposition and collection of Cess at the rate between 1 and 2 per cents of the Construction cost incurred by an Employer. The actual levy and collection rate to be fixed as between the given percentage by the Central Government by notifying in the Official Gazette. Such cess are also required to be collected from all the employers, including deducted at source relating to the such work being building or other construction work of a Government or of a public sector undertaking or advance collection through a local authority.

Further, the Act requires the employers to furnish prescribed returns in the prescribed manner and for failure to furnish such returns by the Employer carrying on the building or other construction work who was being liable for payment of Cess under this Act, the officer or the authority is required to issue notice against such employers asking them to furnish those returns before mentioned date in the notice.

The another important provisions being section 5 of the Act provides for the Officer and Authority who are responsible to entertain the furnished returns under previous provisions, to make necessary enquiries for satisfying that the returns and their particulars are correct and thereafter to assess the amount of Cess which the employer will be liable to pay. Even such officer and authority can without any such furnished return, also assess the Cess amount payable by such employer, after satisfying against the necessary enquiry made by them.

Further, the Central Government is empowered to notify the exemptions of any employer or any class thereof in any State, from the payment of Cess under this Act. Further, as per provisions of section 9, there can be penalty for non-payment of the Cess required under this Act within the given time period. The said due payment will be recovered as an arrears and penalty will be on such employer which will be within limits of amount of Cess and not more than that. The Act further provides for Appellate authority, before whom the aggrieved persons can prefer appeals against the Assessment orders made under this Act within the prescribed time period.

The provisions relating to offences and punishments under this Act are also provided, where furnishing a false return being required under this present Act is an offence thereof, and the punishment includes the maximum provided imprisonment up to 6 months period or fine maximum up to 1000 rupees or even there can both penalties. Further, persons liable to pay Cess under the provisions of this Act, if intentionally evaded payment as such or attempted thereof is also an offence and punishment includes the maximum imprisonment up to 6 months, or with fine, or even with both. For taking cognizance in such offence, the complaint made by the Authority of the Central Government is necessary for the Court. Further provision explains the offences commission by the companies and the persons who should be held liable thereof.

The Act further, empowers the Central Government, that it can make rules by notifying the same in the Official Gazette for the purpose to carry out the provisions of this present Act and also on the matters enlisted under the provisions of section 14 thereof. Moreover, such rule so made by the Central Government are required to be first taken to the Houses of Parliament while the same are in session and other given procedure to be followed. Last provision of the Act being section 15 provides for repealing of the aforesaid concerned Ordinance being the Building and Other Construction Workers Welfare Cess Third Ordinance, 1996, however, the provision remained effected the actions taken and thing done in pursuance to that Ordinance and stated that to be treated as has been taken or done under the relevant provisions of this present Act.

The present Act is recently in the year 2013 was sought to be amended by the Building and Other Construction Workers Related Laws (Amendment) Bill, 2013 which was introduced in the Rajya Sabha by the Minister of Labour and Employment on 18th day of March, 2013. The Amendment includes beside other relevant ones, the alteration in the prescribed limits to thirty days period for the Authorities collecting Cess to deposit the same with the Welfare Board.

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