A very Good morning to all the member's of CCI family. Today i am here to discuss upon a very vital topic i.e."SEZ - Special Economic Zone" - A Need for Enterprises. I promise you all, I will not use any law language, so that you all can understand the concept quite easily.
1. Meaning -
SEZ - It is basically a area in a state which is considered to be Duty free zone. Govt. provides tax exemption (IT, Excise, customs, sales etc.), subsidized water and electricity etc.SEZ is deemed to be territory outside the custom territory of India in relation to authorized operations.
Developer - A person who obtains letter of approval from C.G to establish SEZ , i.e. to develop that place and undertake authorized operations.
Co - Developer - A person who intends to provide infrastructural facility in SEZ along with developer and has been granted Letter of approval from the C.G.
Contractor - He is a person who can be appointed by Developer/ Co developer to undertake authorized operations in SEZ. He can avail all the exemptions available to a developer.
SEZ Units - Units can be set up in SEZ for following purposes - Manufacturing, Rendering of services, Trading, etc.
Domestic Tariff Area ( DTA ) - means the whole of India ( including Indian territorial water and continental shelves ) but does not include the area of SEZ.
So, friend's till now, you all must have got an overview of terms used in SEZ. I hope you must be enjoying it. Now lets move ahead -
Instructions issued by MOC " Ministry of Commerce " -
1. For the purpose of availing benefits under the act , Trading should be confirmed to import of goods for the purpose of re- export.
2. Goods should not be procured by a trading unit from DTA ( Domestic Tariff Area ).
Benefits to units under SEZ Act -
1. Custom Duty -
Goods imported for authorized operations are exempt from duty .
Custom duty are not attracted on goods exported by a unit to any place outside India.
2. Excise duty -
All goods bought from DTA into a Unit to carry on authorized operations are exempted from levy of duty of excise.
" Authorized operations " means activities proposed to be undertaken by an entrepreneur as approved by a LOA GRANTED BY DC.
3. Service Tax -
Exemption from service tax on taxable services received by and consumed within SEZ units for their authorized operations..
Exemption from service tax for services exported by units as per Export of service rules.
Friends this was the part 1 of " SEZ - Special Economic Zone ". I Hope you will all like it and will appreciate my effort.
Best Regards
Sanyam Arora
CAclubindia
