Does working from Special Economic Zone allow full exemption on Import Duty

On SEZ website under the facilities and incentives section few terms are creating confusion as follow :-

"Duty-free import/domestic procurement of goods for the development, operation and maintenance of SEZ units."
but they have also mention
"Exemption from customs/excise duties for the development of SEZs for authorized operations approved by the BOA."

Do the above lines in simple words telling that "If you are importing any goods to SEZ, for example from USA to 'India SEZ' then there will be no Custome duty and no Import duty"

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"100% Income Tax exemption on export income for SEZ units under Section 10AA of the Income Tax Act for first 5 years, 50% for next 5 years thereafter and 50% of the ploughed back export profit for next 5 years. (Sunset Clause for Units will become effective from 01.04.2020)"

but they have also mention
"Income Tax exemption on income derived from the business of development of the SEZ in a block of 10 years in 15 years under Section 80-IAB of the Income Tax Act. (Sunset Clause for Developers has become effective from 01.04.2017)"

Does the above lines in simple words telling that "if you are earning from export as a proprietor then you don't have to pay Income tax for 5 years (0% Income tax) and then after 50% tax is exempted for next 5 year and then after "50% of the ploughed back export profit for next 5 years." I didn't understand this term 'ploughed back'

1. Duty-Free Import / Customs Duty Exemption in SEZ

"Duty-free import/domestic procurement of goods for development, operation and maintenance of SEZ units" means:
If your SEZ unit imports goods from outside India (say from USA to your SEZ unit in India), you don't pay customs duty or import duty on those goods. The SEZ is considered a foreign territory for customs purposes.
"Exemption from customs/excise duties for the development of SEZs for authorized operations approved by BOA" means:
When the Board of Approval (BOA) permits, you also get exemption on customs and excise duties for goods used to develop or run the SEZ (like infrastructure, machinery, raw materials).

In short: Yes, if you import goods into SEZ units (from abroad or from India), you get full exemption from customs and import duties, subject to approvals.

2. Income Tax Exemption under Section 10AA

"100% Income Tax exemption on export income for first 5 years" means:
For the first 5 years of your SEZ unit’s operations, export profits are fully exempt from income tax.
"50% exemption for next 5 years" means:
For the following 5 years, only 50% of the export profits are taxable (so you pay tax on half the profits).
"50% of the ploughed back export profit for next 5 years" means:
For the subsequent 5 years, you get a 50% tax exemption only if you reinvest (plough back) the export profits into the business. So, if you use your profits to buy assets or expand the business instead of withdrawing them, you get 50% exemption on that reinvested portion.
The Sunset Clause means these benefits apply only to units set up before a certain date (usually April 1, 2020). After that, the benefits might be reduced or discontinued.

3. Income Tax Exemption for SEZ Developers (Section 80-IAB)

This is for developers who build and maintain SEZ infrastructure, not for units operating inside SEZ.
Developers get exemption for 10 years within a block of 15 years on income from SEZ development business.
The sunset clause means this benefit ended for new developers after April 1, 2017.

Summary in Plain English:

Benefit	Meaning
Duty-free import for SEZ units	You can import goods for SEZ operations without paying customs/import duty.
100% tax exemption on export income for 5 years	You pay zero tax on export profits in first 5 years.
50% tax exemption next 5 years	After 5 years, half your export profits are taxable.
50% exemption on ploughed back profits next 5 years	For years 11-15, if you reinvest profits into business, half of those reinvested profits are exempt.
Developer tax exemption	Builders of SEZ infrastructure get separate 10-year tax holiday (ended for new developers in 2017).

So yes, importing goods into SEZ means no customs duty. And exporting from SEZ gets you progressive tax benefits over 15 years, with the "ploughed back" part encouraging reinvestment.