Transfer of Units from one SEZ to another
THIS issue had been considered by the Board of Approvals in its meeting held on 8 th June 2010.
BOA noted that there have been requests for shifting of units from one SEZ to another SEZ and there are no specific provisions under the SEZ Rules for these shifts and also there are no rules prohibiting the shifts. With the consolidation of SEZs, shifting of units may become more frequent and to deal with such shifts laying down guidelines have become necessary.
There could be three kinds of situations where the shifts can take place (a) the unit has not commenced any activity (b) the unit has started imports / procurement of goods but not started exports or commenced production and (c) the unit has commenced production and starting exporting. In the first two cases, there may be no difficulties in permitting the shifts subject to all the monitoring, in respect of the third case, the relevant provisions of Income Tax Act for seeking exemptions in respect of migration of goods may come into play.
Based on this, the Department of Commerce has issued Instruction. No. 59.
Government has been receiving requests for shifting of units from one SEZ to another SEZ due to various reasons. These requests were considered but could not be acted upon as there are no specific provisions under the SEZ Rules for these shifts and also there are no rules prohibiting the shifts, with the consolidation of SEZs, shifting of units may become more frequent and, accordingly, the entire issue was placed before Board of Approvals for its directions. After due deliberations, it has been decided by the Board that in principle there is no objection for such shifting. However, all proposals for shifting of units from one SEZ to another must be placed before the Board for its consideration.
Department of Commerce Instruction No. 59 Dated: June 18, 2010