The Building & Other Construction Workers' (Regulation of Employment and Conditions of Service) Act,
Rajarshi Ghosh
(Querist) 18 July 2011
This query is : Resolved
Under the said Act & Rules made thereunder, 'Cess' to be calculated including all costs by an employer but excluding
1. Cost of Land &
2. Any workers' other welfare cost
My specific queries are:
1. since the scope of the Act is to provide workers' welfare, why the 'materials' component of the construction cost be included for calculation of cess? only 'labour cost' should be included.
2. further is there any exemption regarding 'cost' of materials which are imported? because, the manufacture cost of imported materials do not involve workers' contribution from India even.
Jacob Pratap
(Expert) 20 July 2011
Dear Ghosh,
'Cost of Construction' has been explained in rule 3 of the Building and other Construction Workers Welfare Cess Rules, 1998 which is reproduced as under:-
3. Levy of cess.- For the purpose of levy of cess under sub-section (1) of section 3 of the Act, cost of construction shall include all expenditure incurred by an employer in connection with the building or other construction work but shall not include-
-cost of land;
-any compensation paid or payable to a worker or his kin under the Workmen's Compensation Act. 1923.
Hence, there may be hundred 'whys'.... but what the Parliament has thought it fit, has to prevail. Therefore, cost of material has to be included - whether indigenous or imported.
Jacob Pratap
