Date:28/09/2005 URL: http://www.thehindubusinessline.com/2005/09/28/stories/2005092803030900.htm

Back Report on doing business in 2006: `World Bank findings present far too bleak a picture based on limited inputs'

Our Bureau

The DIPP pointed out that the Government has already initiated a number of steps to simplify and speed up the process of PAN allotment.

New Delhi , Sept. 27

THE Government has refuted the findings of the recent World Bank report on `Doing Business in 2006' that ranked India 116th out of 155 countries in terms of ease of doing business.

The Department of Industrial Policy and Promotion (DIPP), under the Ministry of Commerce and Industries, in an official release on Tuesday, said the World Bank report is based on limited information and has not taken into account the initiatives already taken to simplify procedures.

The conclusion is based on the feedback from selected resource-persons for Mumbai in January 2005, the release said.

"It appears that the report, which is based on the feedback by a few resource-persons, has not taken into account the initiatives which are already in place. In fact, reduction of time taken in allotment of PAN/TAN itself would mean that the total time required to set up business would be less than 30-40 days, which will come down further with the completion of the MCA-21 e-governance initiative," the release said.

Speeding up: The DIPP pointed out that the Government has already initiated a number of steps to simplify and speed up the process of PAN allotment. These include appointment of professional agencies to receive and verify PAN applications, facility of Tatkal allotment of PAN, setting up of call centre and other similar reformative moves.

These moves have improved the functional efficiency to the extent that in 2004-05 a total of 63.70 lakh PANs were allotted against 44.60 lakh in 2003-04. On an average, more than five lakh PANs were allotted every month during 2004-05.

An analysis of the applications received during January-June 2005 shows that in more than 99 per cent of the cases, PAN cards were issued within 10 working days which is substantially lower than the 30-day period reported in the World Bank report, the release said.

The work of issuing TAN (TAX Deduction and Collection Account Number) has also been outsourced to National Securities Depository Ltd and currently TAN is being issued in less than 15 days, against 45 days suggested in the report. It may also be clarified that TAN is not a pre-requisite for starting a business.

E-governance: The Government has also initiated a major e-governance initiative known as MCA-21 through the Ministry of Company Affairs for putting in place an operational system for electronic transactions in respect of the core activities under the Companies Act.

The pilot projects for the office of the Registrar of Companies in Coimbatore and Delhi are scheduled to become operational by mid-February 2006 and work in the remaining 18 locations in a phased manner by April next year.

All the services relating to the incorporation of companies such as availability of name, incorporation and issuance of certificate of incorporation will be available on-line on a real time basis. After completion of the projects, it will be possible to complete the process of request for incorporation of the company, filed on-line, within two to three days, the release said.