Wednesday, March 10, 2010


The Asean Car Rally from Guwahati of Assam to Myanmar and onwards of the South East Asian countries in November, 2004 was the land mark maiden venture to initiate and to mobilize the ties of fraternity between India and the South Eastern Countries, namely; Myanmar, Thailand, Malaysia, Indonesia, Laos, Combodia, Vietnam, Philippines aiming at to go ahead in creating international understanding and prospective commitments. It was a prelude to establish a good and constructive gesture for acceleration of the potential trade activities between the two regions, on the fast symbolic globalization era. The abandoned road, was improved and made convenient for the car rally mission. The road, as is known as ‘Steelwell Road’, had its base structure in the Second World War period. The construction of the portion of the road from Mynamar and onwards is said to have already been completed. China of East Asia also constructed and expanded the portion of the road to link up with the Steelwell road with the aims and object to associate itself in extending its trade perimeter to India. A horn of dilemma, however, prevails in the Indian counterpart over the question of security of the eastern sector of the sub-continent, as road is penetrated through the dense and arduous Patkai Hill range, the extended base of Himalayas, making an easy access by the ultras. The Government of India, however, accorded budgetary sanction of Rs. 48 crore of rupees two years aback and it is learnt that the road is nearing completion.

Steelwell, the great hero
‘Steelwell Road’ has a historic significance, which was baptized after the name of Steelwell. A question naturally crop up ‘who was Steelwell?’ The history marks Steelwell as a prominent military officer in the Brigadier rank of the Second World War, whose untired efforts and immense costly sacrifices had the consequential effect of achieving the victory of England and its alliances in the war front against Japan and the alliance components. The rival nations got vanquished in the terrific battle.
‘Joseph Warren Steelwell’, popularly known as ‘Zo’ was born in 1883 A.D at Florida, but he passed his early days at New York. After acquiring the degree in the West Point Military Academy, the 5 feet 8 inches 1.7 meter tall, Steelwell got appointment in service at Philippine. 14 months later, he came back to West point, where he was engaged to learn different languages. After wedding Winfred Smith, he again backed to Philippines. At the late hours of the First World War, he was sent to China as the teacher to provide education in military languages and he simultaneously availed of the opportunity to learn the Chinese language as well. He became the father of five children, while he was in China. Steelwell was elevated to the rank of Brigadier and soon after that the Second World War broke out spreading over Europe, North Africa and South East Asia. Steelwell rushed by air to Chungking to meet Chiangkoi Shwek immediately after he assumed the war charge in South East Asia. He found that the only way of supplying food-stuff and war materials was by air from Ledo to Kunming, but that, too, was hardly possible in the 1000 kilometer long hazardous air flight. On 7th March, 1942 Rangoon, the capital of Burma, was captured by the Japan-alliance militants. Steelwell came by air from Chunking to Mandalaya, where the British Lieutenant General Sir Herald Alexander took shelter after the crack down of Rangoon. Incidentally, this Alexander jas withdrew the British army from Dandrik of Europe, when failed to face the sharp German aggression in 1940 and this has been a repetition to the earlier event. Both Steelwell and Alexander tried their best to save the middle part of Burma, but all efforts proved to be the futile exercise. Japanese army caused dislocation of rail and air communication in North Burma. Steelwell had no other way, but to retreat. After a strenuous and hazardous journey on foot and partly by boat, his troops reached Imphal without there being, however, any loss of life. Steelwell rushed to Delhi and furnished a detailed report on the catastrophe. The unbecoming circumstances forced Steelwell to remain away from Burma since June, 1942 to October, 1943. Japanese army captured the eastern coast of China and created havoc in its Southern border by frequent air raids. A profound necessity, therefore, cropped up for construction of a new road connecting Burma to get it hostile free. The Manipur- Pelel Road, was an alternative road, but it was not possible to be utilized for carrying the food-stuff and war equipments during the summer. Steelwell was restless and held marathon discussions in Delhi and Chunking to chalk out plan and programme. In 1942, the prospect of construction of an alternative road from Ledo-Pangchao pass-Hukang valley-via Misina to Burma was in sight. The practical aspects were examined, but it revealed that standing hills, dense forests, loose and muddy soil, deep-unsmooth ditches, heavy rainfall and unhygienic climate posed to be a hindrance to materialize such plan. This 768 kilometer road is to be constructed through three high ranges of hills, over three rivers beds with hundreds of bridges. Steelwell and Chiangkain shwek paid great importance for construction of the road at any cost, but the British Prime Minister Winstone Churchill was against such venture. The Americans were, however, adamant and gave high stress towards construction of the road linking Ledo – Burma at any cost in order to frustrate the territorial expansion of Japan to Burma. The American sent 330 skilled engineers and road construction materials and heavy machineries and equipments from 18,000 kilometer distance, by ocean, sea and road and this was routed through the western corridor of Assam. The military convoy congregated by Indian, African, American militants rushed enthusiastically to face the combat. The war mission, as we enjoyed in our early days, was really very much thrilling. The construction work was started in December, 1942 and 187 kilometer was completed on 27th December, 1943. The war footing construction made an end in the last part of 1944 connecting Ledo - Burma within a period of two years.
The posiion of the road is as below :
In Burma (Myanmar portion) In China
Pangchao Pass - 61 K.M. Mangyung – 740 K.M.
Tagap Ga - 127 “ Banting - 811 “
Sind Bowang - 165 “ Baochan -1043 “
Jambubam - 287 “ Yungpin - 1208 “
Barajup - 304 “ Chuyung - 1543 “
Michchhina - 403 “ Kunming - 1726 “
Bhamo - 595 “
Namkham - 707 “

Steelwell was the pioneer architect in the road construction project as well as the tactful management of the war front. The Japan and its alliances were kept busy otherwise and they could hardly imagine the far sighted diplomatic way of the road construction mission. The counter attacks on the showering attacks by the rival army continued. Japan had ultimately to surrender after Atom Bomb blast at Nagachaki and Hirosema. German also got vanquished. Thus the Second World War thus came to an end with the victory of England and alliances.
The untired, sincere and diplomatic services of Steelwell were profoundly recognized and the newly constructed road was named after him. It is unfortunate that the said road, constructed at high coast with deployment American, African, Chinese, Kacin, Oria, Nepali, Bengalee, Naga, Bodo and tea garden labourers, lost its importance and remained abandoned soon after the World War was over. This rather became a thoroughfare of a section of anti-socials and ultras. Steelwell became old; the incessant hard labour with deep sense of anxiety ruined his health. He was laid down by liver cancer. The Distiguished Service Medal, Legion Merit, Distinguished Service Cross was awarded to him. On the previous day of his sad demise on October, 12th, 1946, he was ornamented with the rare award ‘Combat Infantryman Badge’.

Trade scenario
The South East Asian countries are rich in precious resources like agricultural, forestry, fishery and mineral ores. The development of modern technology upgraded as well the industrial platform. India has immense potential resources including raw materials of different types, which are still to be mobilized. The aim and object of Asean Car Rally, as stated earlier was a token of good gesture towards reciprocation of trade venture. The road beyond the Indian portion has already been completed. China is also eager to expand its trade base to India. News
projected by the media reveals that India has to think twice in adhering to the proposed scheme of trade activities. China, in fact, is maintaining hostility with India since about last five decades. With provocative words, it is demanding Tawang of Arunachal Pradesh of India as a part of Chinese territory, though, in fact, it is a part State of India. Their modus operandi seems to be hostile and aggressive. Any accommodation of China in the field of trade activities through the eastern corridor, it is feared, may not be congenial to the security of the country.

It is recalled that for this blunder, the British Raj overthrew the Ahom Kings by expanding the trade base through the East India Company. The inner fall out was main factor. There is strong apprehension of repetition of such event, as Assam is confronted with many ghastly odds. Myanmar is also not playing a cordial role with India. It will be evident that it accommodated the United Liberation Front of Assam (ULFA) and other hostile ultras and afforded armed training at Kachin. Of late, the news media published that the Maoist of the north east India are importing Chinese arms from Myanmar and stored at Nagaland to spread terrorism and unrest in the sub-continent. The ulterior motive of such international folks can be easily guessed. Such ultras entered Assam through this road oft and on with destructive arms and ammunitions and applied for brutal killings of the brethren citizens of the soil . ‘Look before you leap’- this doctrine is now the main theme of consideration by the Government of India.

(Mrinal Kanti Chakrabartty)
“ Rudra Bhawan”,R.G.Barua Road, 10-Lakhimi path, Guwahati-781-024


The Constitution of India, a symbolic ideal of Sovereignty, Socialism, Secularism, Democracy and Republicanism in the global scenario, was enforced since the 26th day of January, 1950. It is like the holy Geeta in the Hindu Philosophy in socio-economic and political-administrative spheres of the country in as much as the national activities are carried on and are governed by its formulated principles and guide lines. While it laid down the divergent powers and functions of the Centre and the States, any clash or conflict in the field of power exercise is not generally visible.

Introduction of sales tax measures in Assam

Article 246 of the Constitution empowered Parliament and the States Legislatures to make laws on the subject, specified in the Seventh Schedule:
246(1)- The powers to make law in respect of the matters, enumerated in List-1 (Union List) of the Seventh Schedule of the Constitution has been vested upon Parliament.
246(3)- The powers to make law in respect of the matters, enumerated in List-II (State List) of th Seventh Schedule, of the Constitution, has been vested upon the States Legislatures.
246(2)- The powers to make law in respect of the matters, enumerated in List-III (Concurrent List) the Seventh Schedule of the Constitution, has been vested upon Parliament and subject to clause (1) of Article 246 of the Constitution to the State Legislatures.
The tax on the Sales and purchases of goods within the State, as enunciated in entry 54 of List II of the Seventh Schedule, is a State subject, while the tax on the sales and purchase of goods in the course of inter-State trade or commerce, as envisaged in entry 92A of List I of the Seventh Schedule
of the Constitution, is a Union subject.
The Assam Sales of Motor Spirit and Lubricants Taxation Act, 1939, a measure of tax on the sales of petroleum and lubricants was introduced from 1.4.1939 under the authority of Section 100(3) read with entry 48 of the
Government of India Act, 1935 This act was repealed and replaced by ‘ The Assam (Sales of Petroleum and Petroleum Product including Motor Spirit and Lubricants) Taxation Act, 1955 on 1.5.1956 under the authority
conferred in List II entry 54 of the Seventh Schedule of the Constitution. After the independence of India, but before
the adoption of the Constitution of India, a new measure tax on the sales or purchases of goods was introduced and ‘ the Assam Sales Tax Act, 1947’ came into effect from 24.12. 1947. Thereafter, a measure of tax on the sales or
purchases of some specified goods, imported from out side the Assam or such identical goods manufactured, made or processed in State was introduced with effect from 1.7.1956 by enactment of the Assam Finance (Sales Tax) Act, 1956. With the said authority a tax measure was as well adopted on the last point purchase of some specified goods by way of enactment of ‘the Assam Purchase Tax Act, 1967 from 3.7.1971. All these taxation Laws were amalgamated consolidated and amended to give birth to the unified ‘ Assam General Sales Tax Act, 1993 on

Central Sales Tax measures
Parliament enacted ‘the Central Sales Act, 1956’ for the purpose of levy of tax on the sales made in the course of inter-States sales-purchases by virtue of the aforesaid powers and the same was effective from 5.1.1957. This tax
measure obviously provided a strong guard In respect of inter-State deals made between one State and another and it ensured proper levy and collection of taxes at the State level as well.

General Sales Tax

The traditional and chronological exercise of levy of tax on the sales or purchases of goods in the States since 1939 made way for acceleration of revenue trend and it played a pivotal role in the healthy growth of economy of
Assam. The Assam General Sales Tax Act, 1993 plugged some persistent lacunae and upgraded the power exercise scenario by the taxing Authorities for smooth and efficient administration.

Value Added Tax
The prolonged tax measures got a halt and a changed system of tax measure came into effect from 1.5.2005 by enforcing ‘the Assam Value Added Tax Act, 1993’ (VAT). VAT is a multifarious system of tax to be levied and
collected at every stage of sale subject to, however, the refund of the tax paid (in put) on the previous purchase of goods. In fact, following heavy pressures from the international fiscal agencies, like World Bank, Asian Bank,
International Monetary Fund etc., the Government of India made an imposition to the State Governments to introduce the VAT Regime in the States without allowing thm to judge and opine on the propriety of dispensing with the prolonged heritage. The heavy pressure from the Govt. of India alerting against the providing monetary support etc. compelled the States to agree. Assam was the first State to welcome the proposal. The neighbouring territories like Bangladesh, Nepal, Pakisthan and Sree Lanka already introduced this system of VAT. These small countries found no difficulty to proceed on.
There is no denial of fact that VAT is a unique and methodical system of tax. It is self-designed and moved by self-driven wheels. That means, the success of VAT regime is entirely dependable on the honesty, sincerity and good will of all sections of people, traders and the tax machinery. India is a Federal structure of country with the conglomeration of as many as 28 part-States and 7 Union Territories. The Constitution provided power to the States to frame the sales tax law for levy, collection and augmentation of revenue vis-à-vis ensuring the growth of economy. The centre’s imposition to make uniform rates of tax of different commodities could not be rigidly maintained by the States, as the safe guard of public interest was equally imperative.It is pertinent to say a large section of people of Assam are illiterate or half literate. They are not capable enough to abide by the requirements, conditions and restrictions of the VAT law. The issue of ‘Tax Invoice’ and ‘Retail Invoice’ are not properly and rigidly enforced, which resulted in improper and inaccurate maintenance of accounts. So, this amounted to be a farce. The
claims of Input tax credit lack proper discipline. There is acute collusion and collaboration between the traders, customers and the tax machinery in the tax dodging episode on which no proper and adequate preventing, arresting and detecting measures have been enforced.
The main theme of the VAT is to levy tax at every stage of sales, but to the utter deviation of the said principle, the Govt. of Assam adopted the measure of tax at the stage of first sales on some commodities, like crude oil, petrol, diesel, petroleum products, tea, liquor, bitumen etc. in the VAT Law Assam. The incorporation of tax free sales of oil products between Oil Companies seem be detrimental to the ideology, norms and procedure of either the VAT regime or first point tax scenario. The system of payment of composition of tax on the production of brick (not on sale) , import of marble (not on sale) and on the total value of works contract (instead of transfer of property of goods) seems to abusive of the constitutional footing, as envisaged in Article 366 (29A) of the Constitution. The composition of tax levied and collected at source obviously created a systematic fracture in the process of realization of tax on subsequent sales and inter-State sales. The VAT regime was thus on the way of crack down the clock-wise deals. It is believed that the system of VAT regime did not yield the expected revenue generation scheme. The States like Assam is maintaining the revenue equilibrium on the first point sales of taxable goods. Assam is an industrially backward State. The major industries like oil sectors, tea sectors have been isolated in the VAT net of Assam. Any short supply of crude oil has the consequential effect of deficiency in collection of sales tax.
Goods and services tax
It has been learnt from the news media that the Government of India has proposed to introduce ‘the Goods and Services tax’ in the country in replacement of the present VAT regime from 1.4.2010. It may not, however, be done immediately, as the States are not central exercise duty and for that purpose, the Constitution will be amended. That means, the States are likely to lose matter of traditional sales tax revenue administration.
We expressed our apprehension before the VAT regime was proposed to be introduced projecting some ill consequences in the measure. Such apprehension, we believe partly accomplished. We also endorse our similar anxiety and apprehension on the proposed measure of ‘Goods and Services tax.’
We hope, the Government of India will not unilaterally take such a decision by the seizing the power of the State and consider it to be incumbent to hold marathon discussions with the States’ economists, intellectuals in a phase manner on this grave and austere thought provoking issue.

(Mrinal Kanti Chakrabartty)