Udaipur: An awareness session on the Building and Other Construction Workers Welfare Cess Act, 1996 was organised at the Udaipur Chamber of Commerce and Industry (UCCI) in collaboration with the Labour Department of the Rajasthan Government. The session was held at the Pyrotech Tempsons Auditorium at the UCCI premises and focused on the applicability, assessment, payment and compliance requirements related to labour cess.

Addressing the participants, Assistant Labour Commissioner Mahendra Singh Rathore said that the Labour Cess Act has been applicable in Rajasthan since 2009. The cess collected under the law is utilised through the Building and Other Construction Workers Welfare Board for implementing various welfare schemes for registered construction workers.

UCCI President Sandeep Bapna welcomed the Labour Department officials and participating members. He briefly introduced UCCI’s activities and highlighted the objective and importance of the awareness programme for the industry and business community.

During the session, Rathore explained that the welfare cess mechanism has been introduced for the benefit of workers engaged in the unorganised construction sector, including civil construction workers, plumbers, electricians, carpenters, flooring workers, painters and other related workers. The Rajasthan Building and Other Construction Workers Welfare Board was constituted on July 27, 2009, which was also fixed as the cut-off date for cess collection. He clarified that there is no provision for limitation on the liability to pay cess on construction work.

Rathore explained that under Section 3 of the Act, cess is payable at 1% of the construction cost on building and other construction works undertaken by employers engaging 10 or more construction workers. While calculating the cess, the cost of land is excluded from the total construction cost, along with compensation paid to workers or their dependants under the applicable workers’ compensation law. He also informed participants that labour cess is not payable on private residential construction costing up to ₹10 lakh.

Employers are required to submit details of construction work in Form-1 before the competent cess assessment authority. The session also covered cess assessment, payment procedures, statutory provisions, returns and online compliance, interest on delayed payment, penalties for non-payment and the appeal process.

According to the information shared during the session, delayed payment attracts interest at 2% per month, while non-payment may invite a penalty up to the amount of cess payable. An appeal against an assessment order can be filed before the Labour Commissioner, Jaipur, within three months.

Regarding payment timelines, Rathore said cess is generally required to be deposited within 30 days of completion of construction work or final assessment. For projects extending beyond one year, annual payment provisions are applicable. Advance payment of cess is also permitted at the time of obtaining construction approval.

Labour Inspector Gavaresh Dave informed participants that every employer is required to submit Form-1 within 30 days of commencement of construction work. Any subsequent change or amendment must also be reported within 30 days. Labour Department officials may inspect construction sites and verify relevant documents and registers, besides taking measurements and photographs wherever required.

Labour Inspector Hemant Shukla provided detailed guidance on the applicability of cess, its calculation and payment, statutory provisions, due dates, online compliance and the consequences of delayed or non-payment. He also shared suggestions for ensuring better compliance with labour regulations.

UCCI Senior Vice President Anshul Mogra shared important suggestions on effective compliance with labour laws, while former president Manish Galundia also expressed his views.

During the interactive question-and-answer session, Assistant Labour Commissioner Mahendra Singh Rathore and Labour Inspectors Hemant Shukla and Gavaresh Dave addressed participants’ queries and clarified various issues related to labour cess and compliance.

A large number of representatives from industries, builders, contractors, developers and other business stakeholders participated in the programme.

UCCI Honorary Secretary General Ashish Chhabra conducted the session and delivered the vote of thanks.