MIDC ‘surrender’ to local bodies hits industry hard

MUMBAI: The state industrial development corporation’s indecisiveness seems to have resulted in local self-governments usurping its powers and in the process, jeopardising the industrial prospects in Maharashtra.

As per a state legislation, under which the Maharashtra Industrial Development Corporation (MIDC) was set up some 40 years ago, the corporation is the development authority in designated industrial estates, which grants or denies permission for setting up of industrial units after vetting their plans.

However, things have changed ever since. The MIDC has recently parted with some of its powers to issue various certificates, thereby exposing industrial units to the vagaries of local municipal corporations.

The MIDC Act stipulates that any changes in the rules and regulations shall be published in the official gazette and will also be laid before the state legislature for necessary approval. In these cases, the changes have been neither gazetted, nor cleared by the legislature.

Strangely enough, the MIDC is quoting a 10-year old letter issued by the urban development ministry to let go industrial control for local bodies. The letter, which is just an executive fiat having no legislative sanctity, asks “the MIDC to obtain No Dues Certificate before granting development/building permissions from the local self government”.

“But the MIDC is not following even the spirit of this letter which asked it to procure necessary certificates from the municipal body. Instead, it’s asking industrial units to acquire these clearances,” a spokesperson for the Small Scale Entrepreneurs Association pointed out. “The MIDC is asking us — lessees — to produce No Dues certificate even in case of transfer of plots.”

Even though the letter makes it clear that “the MIDC shall ask for such a certificate from local authority and in case no communication is received within a period of 60 days it will be presumed that there are no dues”, on the ground it’s forcing industrial units to procure the NoCs. “This is nothing but to oblige local powers. They demand money to issue such certificates,” an industrial association spokesperson said.

This order has another inherent absurdity. It states, “The development/building permission shall be given by the MIDC whether it is within or outside the jurisdiction of the local authority. However, it is obligatory on the part of the MIDC to obtain No Dues certificate from the local authority.”

The association representative pointed out that in many cases industrial estates are geographically divided in two municipal areas. “For example, one of the largest such estates falls in Thane as well as Navi Mumbai municipal limits. So, whom do we get the certificates from?” an industrialist asked.

“The illegal imposition of this regulation by the MIDC is tantamount to contempt of court as the Bombay High Court is still to finally hear and decide the question of municipal authority to levy taxes in Trans Thane Creek area. Compelling lessees to obtain No Dues certificate from municipal bodies amounts to pre-judging the issue still not decided by the courts,” a TTC spokesperson said.

When contacted, a senior industry ministry official admitted to “some lacuna” in the rules. “We are trying to remove them,” is all he could say.