Nearly two years into the pandemic and multiple lockdowns, instances of economic difficulties faced by businesses are multifarious. Another such incident that is bringing to the focus the economic impact of the pandemic is a bus owner in Kochi who has decided to sell his air-conditioned premium bus coaches at Rs 45 per kilogram. (Yes, you read it right. It is Rs 45 per kilogram).
Royson Joseph, who is in the tours and travel industry in Kochi, has already sold 10 of his 20 vehicles in the same way and has decided to sell three more of his remaining seven buses in a similar fashion.
The decision was mainly based on a simple idea — if he sells a vehicle which was not bought on debt, he can repay the EMI for other vehicles at hand. Speaking to TNM, Contract Carriage Owners Association’s (CCOA) president Binu John said that this was not the first time that tourist buses were being sold at a per kilogram rate. With one bus weighing roughly 9 to 10 tonnes, the owners manage to get at least Rs 4-5 lakh when they sell it for scrap, as no travel business is coming forward to buy buses.
"Many have done it, and I did it myself. I had 26 vehicles, and sold three this way, and am going to sell a couple more the same way. We are doing it merely for survival. The bus owners are in deep trouble as none of the restructuring and moratorium announced by the government has been effectively implemented," said John. The number of members in CCOA stood at 3,500 in December 2020, but no one since renewed their membership and now, he said they have lost track of how many members are even part of the organisation anymore.
John says that the major issue currently is that when a vehicle is when a loan is taken out and repayment is delayed for more than 90 days, it is considered as a Non-Performing Asset (NPA) and seized. “Previously, the days were calculated from the month end (the month when EMI is not paid), but now it is calculated from the day when we fail to pay it. Also, an NPA is converted to standard asset only when the entire arrears of interest and principal are paid by the borrower, which was not the practice earlier. The government is bringing in these difficult changes during a crucial period”, he said.
John adds that over 2,000 buses of its members have been seized in the last two months for non-repayment of monthly installments.
Another issue they face, he says, is the tax collection by Kerala government. “We have to pay at least Rs 15,000 per month as tax, which means we have to earn Rs 500 per day. With weekend curfews and cancellation of trips due to COVID-19, buses don’t run on all days, and we have to take care of the expenses of those working also. So, in the end, we don’t have money to pay anything,” he adds.
In the last two years, the Kerala government has waived some portion of taxes for three quarters. However, the CCOA has sought more assistance as things are yet to return to normal and the travel industry has been severely impacted due to the pandemic.
John added that a grievance redressal cell must be set up for them to seek assistance from and raise complaints.
“Also, we have to invest at least Rs 2-3 lakhs, when we restart the business. To change the spare parts and repair the vehicle. So, it puts an additional burden on us”, John said.
Royson Joseph, the man who is in the news for selling his buses per kilo, told IANS, "Things have become really tough and me and my family are finding the situation really tough. All my buses have taxes to the tune of Rs 44,000 and insurance of around Rs 88,000 that has to be paid. Last week when the Sunday lockdown was there, even when the rules clearly stipulated that prior booked travel is possible, I was asked to pay a fine of Rs 2,000 by the police during a tourist trip to Kovalam. We are being harassed for no reason and today at the click of a button if the vehicle registration number is punched in by authorities, they can get if our papers are in order, but despite all that, we are being fleeced”.