State to consider Tata proposal

As per official records, during the Sena-BJP rule, Ratan Tata had taken up the case with the then Chief Minister Manohar Joshi, saying, in view of the stiff competition in the market, the Indica car should be exempted from payment of sales tax. In fact, then Joshi had moved a cabinet proposal, which was approved unanimously, however, no official notification was issued to give effect to the cabinet decision. “In 1998, the cabinet had decided to grant exemption. But the Sena-BJP government never promulgated an order. Even during the tenure of Narayan Rane, the proposal was mooted afresh, but no orders were issued by him too,” a senior official said.

The official said Ratan Tata, accompanied by Bombay Dyeing Company Chairman Nusli Wadia, submitted that the 12 per cent tax on the Indica Cars, so that it will be able to withstand the competition in the open market. “Ratan Tata specifically submitted to the Chief Minister that they should be offered concessions on par with the concessions given by the neighbouring states like Tamil Nadu and Uttar Pradesh. In fact, even for the Fiat company, the state government has granted exemption to,” the official added.

The official said at a juncture when the Congress-led Democratic Front government is passing through a financial crisis, it was unlikely that Deshmukh will concede the demand of the Tatas. “During Manohar Joshi’s tenure too, though the cabinet had approved the proposal, there was rethinking on the decision, as a result, the official notification was not issued,” the official said, adding, when the Chief Minister himself has launched a drive to recover arrears of sales tax, he was unlikely to accept the proposal.

Secondly, if the proposal is accepted, then the government will have to concede at least half a dozen identical proposals.