SEZ Act has over riding effect – Customs officers, please note!
The commerce ministry has received representations that customs and excise officers are not following the provisions of the SEZ Act and Rules. So they have clarified that:-
1. The SEZ Act along with SEZ Rules has become operative w.e.f. 10th February, 2006. Now all the activities relating to the SEZ shall be guided by the provisions contained in the SEZ Act, 2005 and the SEZ Rules, 2006.
2. By virtue of Section 51 of the SEZ Act, the provisions of the SEZ Act and the Rules will have overriding effect over the provisions contained in any other Act.
3. Chapter X-A of the Customs Act, 1962, the Special Economic Zones Rules, 2003, and the Special Economic Zones (Customs Procedures) Regulations, 2003 have become inoperative w.e.f. 10th February, 2006.
4. With effect from 10th February, 2006 the activities relating to SEZs are guided by the provisions contained in the SEZ Act, 2005 and the SEZ Rules, 2006. Chapter X-A of the Customs Act, the Special Economic Zones Rules, 2003, and the Special Economic Zones (Customs Procedures) Regulations, 2003 are not in operation.
5. Clearances of excisable goods to SEZ shall now be in terms of Rule 30 of the SEZ Rules, 2006.
6. The provisions of Sections 20, 21 and 22 of the SEZ Act relating to Single Agency, Single Enforcement Officer and inspection, search and seizure have not yet been operationalised. Hence, so long as these Sections are not operationalised, different agencies and officers, as empowered under the relevant Acts before enactment of the SEZ Act, will continue to operate till such time these provisions of the SEZ Act take effect.
7. The size of social infrastructure like residential complexes, hotels, hospitals, Schools and other similar facilities shall be decided by the Approval Committees based on the guidelines to be issued by the Board of Approval. The guidelines are under preparation and will be issued shortly. Any infrastructure created in excess thereof shall not be eligible for any duty and tax concessions to the developer or co-developer as provided in Section 26 and Section 27 of the Special Economic Zones Act, 2005.
8. At the time of import of goods into the SEZ, the assessment of bill of entry shall be on the basis of the value declared by the SEZ units. However, when the goods are cleared in the domestic market, then the assessment of the goods will be as is being done in the case of import of goods for home consumption.
9. in case of import of goods by DTA importers through port, airport, ICD etc. located in a SEZ, the assessment shall be carried out by the Jurisdictional Customs Authorities and not by the SEZ Customs. SEZ Customs shall be responsible only for examination and delivery of goods.
10. Rule 73 provides for authorization of a Gazetted Officer of Customs by the Development Commissioner as Specified Officer, in cases when a Specific Officer is not posted in a SEZ. Since such situation would ordinarily arise in all newly notified SEZs, the jurisdictional Development Commissioners may issue such authorizations for officials to be identified in consultation with the jurisdictional Commissioner Customs or Commissioner Central Excise, as the case may be.
The Commerce ministry wants these instructions to be communicated to all officers dealing with SEZ for compliance.
INSTRUCTION NO. , Dated: August 3, 2006 of the Ministry of Commerce & Industry, Department of Commerce (SEZ Section)