Conversion of DTA into EOU – FTP amended
AS per Para 6.7 of the Foreign Trade policy,
(a) Applications for setting up of units under EOU scheme, other than proposals for setting up of units in services sector (except R&D, software and IT enabled services, or any other service activity as may be delegated by BoA), shall be approved or rejected by the Units Approval Committee within 15 days as per criteria indicated in HBP v1.
(b) In other cases, approval may be granted by BoA set up for this purpose as indicated in HBP v 1.
(c) Proposals for setting up EOU requiring industrial licence may be granted approval by Development Commissioner after clearance of proposal by BoA and DIPP within 45 days.
Now a new Clause (d) is added,
(d) Applications for conversion into an EOU/EHTP/STP/BTP unit from existing DTA units, having an investment of Rs. 50 crores and above in plant and machinery or exporting Rs. 50 crores and above annually, shall be placed before BoA for a decision.
As per Para 6.19,
(a) Existing DTA units, may also apply for conversion into an EOU/EHTP/STP/BTP unit, and Income Tax benefits under Section 10A and 10B will be available for plant, machinery and equipment already installed.
(b) Existing EHTP/STP units may also apply for conversion/erger to EOU unit and vice-versa. In such cases, units will remain in bond and avail exemptions in duties and taxes as applicable.
But why this “placing before the BoA ?” – More government is more nuisance.
DGFT Notification No. 95 (RE-2008)/2004-2009, Dated: March 13, 2009