IDLS Scheme – Submission of ‘Operational and Performance Report’ to SIDBI

No. CLE / ILDP / IDLS / 2009-10
Oct 27, 2009

Members of the Council

Dear Members,

Sub:IDLS Scheme – Submission of ‘Operational and Performance Report’ to SIDBI

As you are aware, Integrated Development of Leather Sector (IDLS) Scheme is an investment grant scheme approved for the 10th Five Year Plan period for technology upgradation, modernization, capacity creation in all segments of the Leather Industry. The scheme was implemented with effect from Nov 3, 2005. The scheme provided financial assistance of 30% of the cost of plant and machinery for SSI units and 20% of the cost of the plant and machinery for Non-SSI units, subject to a ceiling of Rs.50 lakh in case of both SSI and Non-SSI units. The IDLS scheme is continuing in the XIth Five Year Plan period 2007-2012 with effect from 29th Aug 2008. Under the new scheme, the financial assistance has been increased from the earlier ceiling of Rs.50 Lakh (30% for SSI and 20% for Non-SSI units) to Rs.2 Crore @ 20% to all units above the assistance of Rs.50 Lakh.

The CLRI is the Programme Implementation Unit (PIU) for tanneries, and FDDI is the PIU for Leather Products. SIBDI is the nodal agency for release of assistance to the applicants. With effect from May 1, 2009, the CLE has been assigned the role of the Facilitating Agency for the IDLS Scheme to promote the scheme amongsts the industry, and coordinate with all the involved agencies namely CLRI, FDDI, SIDBI and Department of Industrial Policy & Promotion, Ministry of Commerce & Industry, Govt. of India.

The IDLS scheme guidelines, Application Forms I, II & III, Checklists of supporting documents required and all such relevant information has been hosted in the CLE website www.leatherindia.org for easy reference and use of member-exporters.

OPERATIONAL AND PERFORMANCE REPORT:

Please refer to Para 6.4 of the IDLS Scheme guidelines, according to which all the units who have obtained investment grant is required to submit operational and performance details in Form:IDLS III to the SIDBI. This Report has to be given from the date of compeletion of the modernization programme (Date of Completion Certificate given by units to the SIBDI) upto two years.

Vide Para 6.5, in case the unit becomes non-operational within 2 years of the receipt of Government financial assistance, it will be liable to refund the financial assistance availed, along with the interest to be charged from the date of closure till the date of refund at the prime lending rate of SIDBI (as the case may be). In case of non-compliance, the Bank concerned will take necessary legal action.

In the Workshop held on the IDLS Scheme on Oct 3, 2009 in which officials from Department of Industrial Policy & Promotion, Ministry of C&I, CLE, CLRI, FDDI and SIDBI participated and discussed various aspects of the IDLS Scheme, the most important requirement of units submitting Reports of operational and performance details as per the Form: IDLS-III to the SIDBI was discussed in detail. SIDBI mentioned that many units have not submitted the Operational and Performance Report as per Form IDLS III to the SIDBI Branches.

Taking a serious note of this, the Department of IPP has desired the Council to issue a common/general circular to all members of the leather industry to sensitize the industry on the need to submit the Operational and Performance Report to the SIDBI so as to satisfy the terms and conditions of obtaining the GOI financial assistance.

The Council therefore would urge all the units in the leather sector which have availed financial assistance under the IDLS scheme right from Nov 3, 2005 to till date, to kindly comply to the requirements indicated in Para 6.4 and 6.5 of the IDLS Scheme notified for both Tenth and Eleventh Five Year Plan periods.

Accordingly, in case your unit has availed financial assistance under the IDLS Scheme from SIDBI during the period Nov 3, 2005 to till date, please immediately arrange to submit OPERATIONAL AND PERFORMANCE REPORT as per Form:IDLS III, to the SIDBI Branch (from where you have obtained the GOI assistance).

This Report (hard copy) has to be submitted to SIDBI, separately for each of the grant amount received from SIDBI, for each Product Line.A copy of the same may also be marked to CLRI or FDDI (as the case may be) and CLE, for information and follow up.

Please treat this as most important and top most priority. In case of non-compliance by units, SIDBI will be entitled to take necessary punitive action as per Para No.6.5 of the IDLS Scheme as well as SIDBI will take recourse to the legal action as per the banking practice.

In case you have not availed any GOI assistance under the IDLS Scheme, please ignore this circular.

If you had availed GOI assistance and already submitted the Operational and performance Report to the SIDBI, please submit a copy of the same to the concerned SIDBI Branch under copy to the CLE.

With warm regards,

Ali Ahmed Khan
Executive Director