HIMA BK

KATHMANDU: The Board of Directors of the Industrial District Management Limited (IDML) has decided to collect outstanding dues from industrialists based on rates established six years ago.

The IDML is a corporate entity established by the government in 1988 for the overall management and supervision of industrial districts as well as promotion of industries within those districts.

During the IDML’s board meeting on Saturday, the Board of Directors resolved to collect arrears according to the rate established on July 17, 2018. The decision was based on the recent verdict of the Patan High Court ordering the implementation of the rate from that particular date.

Dissatisfied with the High Court's order, industrialists operating in the industrial areas have filed a case in the Supreme Court. Although the case is sub judice, the board decided to proceed with the High Court's order. As a result, industrialists now owe Rs 690 million to the government based on the established rate effective from July 17, 2018.

Krishna Bahadur Pun, information officer of Industrial District Management Limited, stated that the board's decision mandates industrialists to pay land rent based on the rate fixed six years ago. Letters will be sent to all 10 Industrial District Management Offices to implement this decision.

The offices will then notify industrialists to make the payments. A discount facility is available for timely payments. A three percent discount is available for payments within 30 days while the industrialists will have to make the full payments between 30 to 90 days, while a 12 percent annual fine will be imposed for payments later than 90 days.

There is ongoing tension between the IDML and the industrialists regarding the payment of dues. Ramheera Pathak, president of the Federation of Nepal Industrial Sector Industries, who attended the board meeting, disagreed with the decision to collect arrears as per the High Court's order.

Pathak questioned the board's decision-making process, especially given the pending Supreme Court case filed by the industrialists. He argued that the decision could negatively impact the industrial environment and suggested that the government might need to take sole responsibility for running the industries.

Pathak emphasized that industrialists are willing to pay rent hike aligned with relevant regulations but oppose arbitrary increases. He noted that since 2018, 45 industries have left the sector, raising concerns about the feasibility of collecting arrears from these entities.

Pathak also pointed out discrepancies in the IDML’s financial practices, such as not reflecting amounts receivable from industrialists in its balance sheet.

The Federation of Nepal Industrial Sector Industries represents 10 industrial associations in Balaju, Patan, Bhaktapur, Hetaunda, Dharan, Nepalgunj, Pokhara, Butwal, Birendranagar, and Rajbiraj. Industrialists had filed a case in the Patan High Court on July 16, 2023, demanding the cancellation of the rate set by the IDML. The High Court dismissed the case on February 18, 2024, and ordered the implementation of the rate established on July 17, 2018.