Polyester companies flay under-invoicing

The government should impose the specific duties to keep a check on speculative imports and prices, he said. While polyester which is in the demerit list attracts 34.5 per cent duty, the much more expensive cotton attracts only 9.2 per cent duty. There are around 36 polyester manufacturers in the country of which around 7 have already closed down and many more are on the verge of closure.

There is no justification to tax polyester at a very high excise level of 34.5 per cent when white goods like color televisions and refrigerators attract only 16 per cent excise duty.

He urged the government departments to adopt proactive policies to guard against the ill-effects of economic crisis of other nations, particularly the South-east Asian countries, he said, adding that European countries and the US have safeguarded the interests of their domestic polyester industries through this route.

“There are well-defined provisions under GATT to impose specific import duty to protect the domestic industry against the competition from other products,” he added.

The polyester filament industry contributes more than Rs 1,400 crore to the exchequer by way of excise duty alone. Presently, the industry is losing revenue of Rs 500 crore and the exchequer around Rs 175 crore due to lower excise realisation, he said.

He said the recently announced technology modernisation fund was not made available to partially oriented yarn. Unless the existing PoY units are suitably modernised, the texturisers, weavers and modernisers may not reap complete benefit of modernising their units, he said. “We are not worried about imports but are concerned about unethical imports,” said RD Udeshi, senior vice president, Reliance Industries.