A NOTE ON BOCW WELFARE CESS ACT- 1996 AND RULES- 1998

 THE BUILDING AND OTHER CONSTRUCTION WORKERS’ WELFARE CESS ACT, 1996

(BOCW WELFARE CESS ACT - 1996)

 

INTRODUCTION

The building and other construction works have inherent risks. The construction work is mostly casual and contractual with long working hours, lack of basic amenities, unsanitary conditions and lack of welfare facilities.  Hence, due to the unorganized nature and construction workers' vulnerability to many aspects, the BOCW welfare cess act is necessary for regulating workers' safety, health, welfare and other conditions of service.

Building & Other Construction Workers’ WELFARE CESS act, 1996 is a means to provide Health and Welfaremeasures for all the workers engaged in building and other construction works by levying and collecting a cess on the COST OF CONSTRUCTION incurred by employers to improve the resources of the Building and Other Construction Workers’ Welfare Boards constituted under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996.

As defined It is “ An act to provide for the levy and collection and collection of a cess on the cost of construction incurred by employers to augment the resources of the Building and Other Construction Workers Welfare Boards constituted under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996”.

DEFINITIONS

1. BUILDING AND OTHER CONSTRUCTION WORK: The construction, alteration, repairs, maintenance or demolition, concerning buildings, streets, roads, railways, tramways, airfields, irrigation, drainage, embankment and navigation works, flood control works (including stormwater drainage works), oil and gas installations, electric lines, wireless, radio, television, telephone, telegraph and overseas communications, dams, canals, reservoirs, watercourses, tunnels, bridges, viaducts, aqueducts, pipelines, towers, cooling towers, transmission towers and such other work as may be specified by the appropriate Government by notification but DOES NOT INCLUDE any building or other construction work to which the provisions of the FACTORIES ACT 1948 or the MINES ACT  1952 apply
2. EMPLOYER: One who carries the construction work either through the specific or local authority or through ESTABLISHMENT:  It is defined as any establishment with ten or more workers, and that particular establishment is under the control of, 

a.          Government

b.         Corporate or firm

c.          Individual 

d.     Association or other body of individuals

 

Who employs building workers in any building or other construction work and this “This does not include an individual who employs such workers in any building or construction work about his own residence the total cost of such construction not being more than rupees ten lakhs”

 

3. BOARD:  Board  means a Building and other Construction Workers ‘Welfare Board constituted by  State Government 
4. FUND:  means the Building and Other Construction Workers‘ Welfare Fund constituted by a Board

 

    THE MAIN POINTS OF THIS WELFARE CESS ACT

• The purpose of this welfare cess act is to collect CESS on the cost of construction at 2% maximum and not less than 1% of the total cost of construction of the project.
• The collected CESS( amount)  is transferred to WELFARE BOARD 
• Every employer involved in construction work to furnish RETURNS to ensure and check that employers have paid the CESS
• The state government have the authority to send an officer to any place of construction to check the correctness of particulars furnished by the employer, like the actual cost of construction work is correctly furnished and paid by the employer.
• The authority can enter any time into the premises for checking  the above cess is properly done as per the requirement
• The government can levy a penalty if the amount is not paid within the  stipulated time

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THE BUILDING AND OTHER CONSTRUCTION WORKERS’ WELFARE CESS RULES 1998

(BOCW WELFARE CESS RULES - 1998)

 

1)     COST OF CONSTRUCTION MEANS 

·       This includes -  all expenditure incurred by an employer in connection with the building or other construction work, this is only taken as the means to calculate the CESS that needs to be paid at between 1% to 2% of the total cost of construction

·       For calculating CESS, the following things are not included 

o   Cost of land 

o   Compensations paid or payable to a worker or his kin under the Worker‘s Compensation Act, 1923.

 

2)     LEVYING OF CESS 

·       The CESS levied shall be paid  within thirty days of the completion of the project work 

·       If the of the construction project or construction work exceeds one year, cess shall be paid within thirty days of completion of one year from the date of commencement of work 

·       Any collection done either by a state government or any authorised cess collector (means an officer appointed by the State Government for collection of cess under the Act) shall transfer the collections to the BOARD within 30 days of the collection

·       The assessing officer (means a gazetted officer of a State Government or an officer of a local authority holding an equivalent post to a gazetted officer of the State Government appointed by such State Government for assessment of Cess under the Act.) is responsible for assessing the correct CESS to be levied on the construction and check for accuracy of the amount paid by the employer in all aspects and accordingly send the information to both the state government and the BOARD

·       To have correct CESS being  levied, the assessing officer is empowered to 

o   Enter any establishment where building and other construction work is going on

o   Taking stock of materials, machinery or other articles PRESENT at the workplace

o   Enquire about the number of workers engaged in various activities

o   Assess the stage of construction work 

o   Take measurements, notes or photographs

·       The employers can be levied  penalties for not paying  the CESS on time or providing false information on the COST OF CONSTRUCTION and verified by assessing officer as assessed by assessing officer, and at the same time the employers can also  raise complaints  

·       If the employers find that the imposed penalty is wrong or  reasonable assessment is not carried out, the employer can raise a complaint with concerned authorities

Disclaimer:  The information represented above is only guidance for students for getting some information relevant to the act and rules with regards to benefits. The information represented above does not constitute legal or professional advice and cannot be quoted for any application purpose (or) statutory requirements (or) dispute resolution.

Article by PJ Mohan 

Sr.Faculty, NIFS