Confed considers revoking ban on vendors

Chennai: Confed-ITA, the association working for the welfare of the IT associations across Tamil Nadu is considering revoking the ban it imposed on the vendors in the state. The ice is said to have broken after the association got assurance from vendors stating that they are working with their respective legal team in providing assistance to partners on the backend payments being service taxed. “Vendors have come back to us stating that they are working with their legal team in providing assistance to the channel. We will get a clear cut idea in a day or two on what support would be extended form their end, which is a positive sign,” informed PN Prasad, President, Confed-ITA.

He also said that the vendors have promised to take the issue forward with government and industrial bodies such as MAIT and NASSCOM. “As the channel is asked to pay service tax for their backend payments since 2004, the issue is a bit critical and the vendors have written to us stating that they would take it up with the government officials and industrial bodies such as MAIT and NASSCOM,” Prasad claimed.

However, the ban is said to be lifted only for those vendors, who come out with proper clarity and support and the rest of the brands would continue to be suspended from the trade by the channel.

Meanwhile, Confed-ITA is overwhelmed by the stupendous support that it received from the associations, particularly in upcountry locations for the endurance they showed in implementing the ban for the past one week.

Partners across various associations like Coimbatore, Madurai, Erode, Salem, Tirunelveli, Tutucorin, Nagercoil, Trichy and Tirupur, to name a few, remained without billing even a single product with the national distributors. “None of the partners in Tirunelveli, Tutucorin or Nagercoil, billed any products with the national distis for the past week and we have proved our unity again to the vendors. We will act through ,” said N Ananthavaradharajan, President, Computer Dealers Association Tirunelveli.

Claiming that the impact of the ban was hundred percent in Erode, N Balakrishnan, President, Erode IT Association said that the act of implying service tax on the backend payments provoked the partners, as they were selling materials cost to cost without any margins.

P Manikandan, Treasurer, Salem IT Association (SITA) said that all the partners in the association welcomed the move of Confed-ITA as it echoed the interest of each and everyone in the community and hence channels didn't bill even a single product in the region.

A Dhanasekar, President, Coimbatore Information Technology Association (CITA) said that the ban was a good sign for partners' unity and thanked Confed-ITA for taking the issue seriously for the benefit of whole community.

Informing that the Madurai partners would support any activity of Confed-ITA, G Ravikumar, President, Computer And Media Society, Madurai (CAMS) claimed that there was zero percent billing in Madurai and the partners would continue that indefinitely until Confed revokes it.

However, the Chennai IT market had mixed reactions for the strike, where majority of sub-distributors, who rule the market, remained without billing even a single product while rest of the people were billing as usual. “There were many interpretations regarding the ban, where we were asked to bill those products that didn't have any issue with backend rebates. However major sub-distributors in the city remained unbilled,” informed MC Jain, President, IT Traders Association, Chennai (ITTA).

PN Prasad, President, Confed-ITA claimed that the ban has clearly demonstrated the unity within Confed-ITA “With the support we have received from our channel associations it is clear that the issue is genuine. Despite the issue being a huge one, only after writing to all the concerned parties and when we didn't get any reply, Confed took the extreme step of suspending trade. We should also thank our distributors for supporting us and ensuring that we got necessary attention from  vendors to jointly address and get an amicable solution to our issue,” Prasad averred.