The All-India Motor Transport Congress (AIMTC) called off its week-long strike after a marathon nine hour negotiating session last Friday night with the Ministries of Finance and Road Transport & Highways.

The ministries agreed to sign two separate agreements on the various contentious issues of service tax and tax deducted at source (TDS), scrapping of old vehicles, third-party insurance and tolls on highways.

“A joint committee comprising representatives from the transport industry and the government will look into the issue of service tax,” AIMTC president BS Dhumal told reporters as he announced the end of the strike, which began on August 21 and seriously affected supplies of components to some vehicle makers.

Revenue secretary Vineeta Rai confirmed the government’s stand that the service tax on goods transported will not affect transporters but will be passed on. New rules will clarify the service tax levy, ensuring that truck owners and operators do not need to pay nor collect the service tax.

The procedural problems faced by truck owners and operators on obtaining TDS refunds will be eased by the income tax department in “due course”.

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On the issue of scrapping of eight to 15 year-old vehicles, the government will ask the Insurance Regulatory and Development Authority to ensure that insurance companies follow guidelines on third party insurance.

Deepesh Rathore / Tilak Swarup