DQW EXCLUSIVE: Hardware exempted from e-sugam in Karnataka

An official
release dated December 23, 2011 from Commercial Taxes Department,
Government of Karnataka states that all kinds of hardware excluding
computer hardware will enter the transaction details in Karnataka
Government's website for e- sugam project, thereby exempting
computer hardware.

Apparently,
the exemption has also brought out the quest for further clarity on
the transaction of networking and software products, among others,
under e-sugam's domain. However, there is a big relief for
Karnataka based channel partners as this issue attracted a lot of
outcry and apprehensions from channel partners to an extent that
Association of IT Dealers (AITD), Bengaluru conducted a fellowship
meet debating on the pros and cons of the issue. To discuss the same,
BN Biradar, assistant commissioner, commercial tax, Government of
Karnataka was called upon to propagate e-sugam's benefits.
Surprisingly, the news of exemption came late to tax channel
partners.

Anand Rao
Balluru, CEO, Par Data Systems said, “We had no idea about the
exemption at the time of our fellowship meet held on December 26 as
the notifi cation has to be a gazette and then released .” Ballaru
further added, “Though the date mentioned on the release is
December 23 but it came to our notice only on December 28. We are
pleased that computer hardware is exempted otherwise it would have
increased a lot of manual interventions. Also, there is a low
possibility of irregularity in IT transaction and as it is pretty
much organized and there is no room for any default. The decision has
saved a lot of time.” Another important issue regarding selling of
products other than hardware like software and networking products,
nothing is mentioned in the notification. Channel partners may also
get more updates on e-sugam.

Sathya
Prasad, CEO, VANPAC Systems, Bengaluru said, “We are happy with the
government's move in this direction. We are expecting more
amendments on e-sugam from tax-department before December 31 as we do
not have any clarity on the transaction of software and networking
products.” The channel community still has to wait and watch for
any further clarifications made by commercial tax department as when
The DQ Week contacted Biradar to seek his opinion, he declined
to comment anything officially.

Anantharam V
Varuyar, VP, AITD spoke to The DQ Week on whole issue and
said, “There are numerous loop holes which are coming to our
notice. Apart from the problems arising on dealing with software and
networking products, rental is also one of the key issues which needs
clarification. We are waiting for the final amendment from the tax
department.” The Karnataka government plans to roll e-sugam wef
January, 2012 where commercial transaction in all market segments for
more than Rs 20,000 would be registered on the department website.