Slowing economy singes art market
Overpriced art also a let-down at Sotheby’s Mumbai auction
The second edition of Sotheby’s Indian art exhibition failed to attract the attention of art buyers, thanks to the ongoing economic slowdown and “overpriced” valuation sought by the sellers.
The auction, held in Mumbai on Friday, even failed to sell the highlight of the evening -- a $3 million (~21.4 crore) Gaitonde painting. Besides, the total lot on sale fetched only ~23.8 crore, as against the expected realisation of ~37 crore. Of the 61 pieces of art on sale, 11 failed to find a buyer.
Ashvin Rajagopalan, director of the Piramal Foundation of Art, said art collectors were generally holding on to their cash due to the economic mood in the country which was wellknown. “Inherent challenges with auctions in India are that if you are sourcing works in the market, then they have already been seen many times over by collectors, which can cause fatigue for a buyer,” he said. “The other problem is that if you don’t have a piece of art that is truly exceptional and outstanding, then it won’t get attention.”
He said recession indices typically showed that the art market only fell by 3 to 4 per cent when the stock market fell by 20 per cent. “So this is not a normal retraction in prices, which means that perhaps collector attention is shifting to other areas such as western or other areas of Indian art like architecture photography or (art) institution-building.”
The Sotheby’s auction was held a day after global ratings firm Moody’s Investors Service cut India’s calendar year 2019 gross domestic product growth forecast to 5.6 per cent from 6.2 per cent, citing a consumption slowdown.
Sandeep Goyal, former adman and art collector, said that in times of an economic slowdown, buyers became more discerning. “Also, sometimes, the reserve price of ‘average’ works is higher than what the market will accept. Such works then don’t sell,” he said.
The new GST return is available on the GSTN portal for trial and 85,000 have been filed so far on a voluntary basis.
The FM has sought regular interactions between GSTN and the Central Board of Indirect Taxes and Customs (CBIC) to help improve the interface for users. GST collections have been dismal with revenue falling short of the ~1-trillion target for the third straight month in October. It was in fact 5.3 per cent lower than that in the corresponding month last year at ~95,380 crore. "As compared to the value-added tax regime, the compliance rate is much better. But there is a big scope for improvement," said Pandey.
Earlier in the day, stakeholders, in their meeting with the FM, tried filing the summary return form GSTR 3B, outward supply form GSTR1, annual return form GSTR9 and the reconciliation statement 9C, besides raising issues pertaining to GST refunds.
"Many of the issues that came up pertained to making amendments and corrections in a more convenient manner, issue of credit or debit notes. Some wanted the facility of downloading GSTR 2A return data in a custom range as against only month-wise available now," said Pandey.
They also.highlighted the prevailing confusion where officers were asking for physical copies of invoice of items shown in the GSTR2A. "We told them that it was not correct on the part of officers to ask for physical invoices when data has been captured in GSTR2A.
GSTR 2A is a purchaserelated tax return that is automatically generated for each business by the GST portal . When a seller files his GSTR-1, the information is captured in GSTR 2A.
“Just b e caus e a work is from a certain artist does not automatically ensure that it will get picked up blindly. Average works of any artist tend to get onto a slow track,” he added.
Yamini Mehta, deputy chairperson for Indian and Southeast Asian art at S o theby ’s, said just because an auction missed its estimated sales target did not mean that the overall appetite for art amongst buyers had extinguished.
In t he case of V S Gaitonde painting from Fr i d ay ’s “Boundless: India” auction, the valuation sought by the seller was too high, said a potential buyer. The projected reserve price for the untitled Gaitonde was perhaps too high for the present market.
A source said though the reserve price of Gaitonde painting was high, there were bidders for as high as $2 million (~14 crore). That still didn't get to the expected price and the seller withdrew the piece of art. Some pieces of art did buck the trend at the auction, including Francis Newton Souza, Jehangir Sabavala, and Bhupen Khakhar.