Thursday, April 18, 2024

KHADC puts trade licence for banks in cold storage


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By Our Reporter

SHILLONG, March 18: The startling issue of District Council’s show cause notice issued in January last to certain banks in Shillong regarding trade licence or the lack of it, has gone into cold storage. Some of the banks have responded to the notice by giving legal status of the banks as against normal trading body.
Apparently, there was intervention from government authorities who counseled the KHADC against pursuing the issue.
The KHADC admits that it has decided to put on hold its decision to make it mandatory for all private banks operating within its jurisdiction to obtain trading license from the council.
“We have decided to keep this matter in abeyance since it requires further deliberations,” Executive Member in-charge Trade, Gigur Myrthong told The Shillong Times here on Monday.
He said that it is necessary to have more clarity whether or not the banking institutions are required to obtain trading licenses.
Ever since the Sixth Schedule came into existence in 1952, the banks were exempted for not being a normal trading entity.
Myrthong played it down saying that they had not issued reminders or any fresh notices to any of the banking institutions. He however hastened to add that “we will issue trading licenses if any of the banks on their own approach the council for the same.”
The EM further stated that there are many banks who have responded to the notice.
“We are presently studying the arguments which they have mentioned in response to the notices issued by the council,” Myrthong said.
He also informed that they have also received a query from the Law department on this matter.
It may be recalled that the council’s licensing officer in January had issued notices to some of the banking institutions in accordance to the provisions laid down under the United Khasi-Jaintia Hills District (Trading by Non-Tribals) Regulation of 1954.
Earlier, KHADC Deputy Chief Executive Member PN Syiem had said any trade or business for profit that includes the exchange of goods or services for other goods or money shall come under the purview of Section 2(5) of the regulation.
He, however, said the council will examine whether the nationalised banks such as State Bank of India or Meghalaya Rural Bank fall under the regulation.
Asked why the council has only now realised that banks need to obtain the trading licenses, Syiem had said the officials noticed this recently after going through the provisions of the relevant regulation.
The KHADC had written to Laitumkhrah branches of the UCO and Canara Bank asking why action should not be taken against them for conducting their businesses without obtaining a trading license.
Section 3 of the United Khasi-Jaintia Hills District (Trading by Non-Tribals) Regulation 1954, as amended to date, requires that businesses obtain a valid trading license from the council before starting operations.
The licensing officer’s order on January 22 stated: “You are hereby directed to show cause in writing within 15 (fifteen) days from the date of receipt of this order as to why action should not be taken against you under the provisions of the aforesaid regulation.”
The rationale behind the banks’ requirement to obtain trading licenses from the council is being questioned, though. Questions are also being raised as to whether government offices would also need to obtain trading licenses from the KHADC.


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