APPENDIX 14-B
CRITERIA TO BE ADOPTED FOR AUTOMATIC APPROVAL OF EOU/EPZ/ SEZ UNITS UNDER EOU/EPZ /SEZ SCHEME
APPROVAL PROCEDURE & SECTOR SPECIFIC REQUIREMENTS
(1) APPROVAL OF NEW UNITS:
Proposals for setting up units under EOU/EPZ/SEZ scheme under automatic route shall be considered by the Development Commissioner taking into account the following :-
(i) Residence proof in respect of individuals/partnership firms (Passport/ration card/driving licence/voter identity card or any other proof to the satisfaction of Development Commissioner;
(ii) Income-tax return of the promoters for the last three years;
(iii) Experience of the promoters
(iv) Marketing tie-ups
(v) In case of EOUs, inspection of the project site by an officer.
(vi) A report from the other EPZs/SEZs as to whether any case under EOU/EPZ scheme in regard to diversion of goods etc. is pending.
Wherever necessary the above may be verified through personal interview with the promoter of the project. In the even of the promoter being a well established entity, the procedure for personal interview may be dispensed with.
No fresh proposals for setting up of units for re-cycling of ferrous and non-ferrous metal scrap may be entertained under the EPZ/SEZ scheme.
SENSITIVE SECTOR
Care shall be taken by the Development Commissioner while approving projects in sensitive sectors such as yarn texturising unit, textile processing, pharmaceuticals / drugs formulations / re-cycling of ferrous and non-ferrous metals scraps etc. Projects for setting up units in sensitive sectors under EOU scheme shall be approved by the Development Commissioner after personal verification of the Directors and inspection of the factory site before signing LUT. Verification could also be carried out through General Manager, District Industries Centre or jurisdictional Dy/Assistant Commissioner of Customs/Excise.
(Sub heading "Sensitive Sector" has been amended vide
PN. No. 40/2002-07, Dt. 08/10/2002)
[OLD - Care shall be taken by the Development Commissioner while approving projects in sensitive sectors such as yarn texturising unit, textile processing, pharmaceuticals/drugs formulations/re-cycling of ferros and non-ferrous metal scraps etc. Projects for setting up units in sensitive sectors under EOU scheme shall be approved by the Development Commissioner after personal verification of the Directors and inspection of the factory site.
]
(2) OTHER APPROVAL MATTERS:
SEZ UNITS
Wherever possible all Central/State level clearances required for setting and operation of SEZ units may be provided at the Zone itself through suitable delegation of powers. Wherever, it is not possible, an empowered Officer of the concerned agency/department may be periodically deputed to grant in-house clearances.
(Subheading "Post approval matters" read as "Other approval matters" vide
PN. No. 40/2002-07, Dt. 08/10/2002)
EOU/EPZ/SEZ Units
A committee shall be constituted at the Zone level headed by the Development Commissioner and consisting of other concerned officials to approve units and to resolve the post-approval difficulties of the EOU/EPZ/SEZ units. The Committee shall meet on Monday, every week. In case of the absence of Development commissioner, the meeting will be held by the next senior officer in the Zone. The unit shall intimate the problems being faced by them in advance. In the meetings, apart from the promoters, the other concerned agency with which difficulties are being faced by the unit, may also be called.
(Sub heading "EOU/EPZ/SEZ Units" has been amended vide
PN. No. 40/2002-07, Dt. 08/10/2002)
[OLD - A committee shall be constituted at the Zone level headed by the Development Commissioner and consisting of other concerned officials to resolve the post-approval difficulties of the EOU/EPZ units. The Committee shall meet on Monday, every week. In case of the absence of Development Commissioner, the meeting will be held by the next senior officer in the Zone. The unit shall intimate the problems being faced by them in advance. In the meetings, apart from the promoters, the other concerned agency with which difficulties are being faced by the unit, may also be called.
]
(3) Sector specific requirements for EOU/EPZ unit:
(1)
RICE:
i) Export of rice(both basmati and non-basmati)shall be subject to minimum export price(MEP) whenever inforce;
ii) The labeling of export package should declare the type of rice and country of origin. The export of rice would be under brand names suitably registered with APEDA which shall be the nodal agency in the matters relating to labeling and registration of brand names;
iii) The approval shall be granted in consultation with Ministry of Food Processing Industries with regard to capacity of the unit;
iv) EOU/EPZ rice mills will be exempted from levy orders limited to the quantity exported by them.
(2)
TEA:
The approval for setting up EOUs would be subject to the following conditions:-
i) DTA sale of Tea will not be allowed .
ii) Use of “India Tea logo” shall be allowed with the permission of Tea Board.
iii) DTA sale of instant tea would be allowed upto 20% of FOB value of exports in the form of tea bags or bulk.
(iv) Tea units may be allowed to sell tea waste in accordance with para 6.9 of the Policy.
(3)
Coffee
Export of imported coffee shall be subject to approval from Coffee Board under relevant Act.
(4)
Granite
Only those proposals involving quarrying of granite for further processing or manufacture of articles of granite for export shall be considered under Granite Sector.
(4) PETROLEUM PRODUCTS:
Proposals for setting up petroleum refineries under the EOU scheme shall require prior clearance of the Ministry of Petroleum.
(5) FLORICULTURE/HORTICULTURE EOUS:
The EOUs engaged in floriculture/horticulture may import for use at fields of other contract farmers the following irrigation equipments as these are covered in the green house equipments listed in Annexure -I notification No.126-Cus /94 dated the 3rd June, 1994 as amended from time to time.
| S.No. | Name of the equipment | HSD No. |
| 1. | Filters | 84.21 |
| 2. | Driplines & Drip Fittings | 84.24 |
| 3. | Micro sprinklers & Misters | 84.24 |
| 4. | Agriculture sprinlers | 84.24 |
| 5. | Fertilizer Tanks | 84.24 |
| 6. | Valves | 84.81 |
| 7. | Fertilizer pumps & Chemical Injections | 84.13 |
It may, however be ensured that not more than 50% production may take place at other identified place with the help of the above equipments besides normal export production on the specified area of floriculture/horticulture EOUs.
(6) HIGH GRADE IRON ORE
Proposals for export of high grade i.e. 64% Fe Iron Ore and above except iron ore of Goa origin and Redi origin are presently canalized through MMTC and its exports would be subject to annual quantity allocation by the BOA.
(7) POLYESTER YARN:
(i) No job work with EOU/ EPZ/ DTA shall be permitted. However, this shall not be applicable to units who intend to send the fabric { made out of Polyester (or) texturised yarn within the unit}for jobwork to DTA for dyeing of the fabric.
(ii) None of the units making goods out of polyester yarn-existing or new-shall be permitted to do exports through third party and they have to export directly;
(iii) These restrictions shall not apply to units in the same EPZ/ SEZ.
(8) SALE OF SURPLUS POWER:
The following procedure shall apply in regard to sale of surplus power by EOU/ EPZ/ SEZ units:-
(i) Henceforth whenever the Development Commissioner receives proposals for sale of surplus power, it would be examined in consultation with the State Government, including State Electricity Board. This shall, however, not apply to sale of power within the EPZ/ SEZ. The Development Commissioner will report the norms on raw materials and consumables required for generation of a unit of power for consideration and approval by the Board of Approval.
(ii) No duty shall be required to be paid on sale of surplus power from an EOU/ EPZ/ SEZ unit to another EOU/ EPZ? SEZ units. Development Commissioner of EPZ/ SEZ concerned would be informed in writing of such supply and proper account of the consumption of raw material would be maintained by the supplying unit. The value of imported inputs and consumables shall be taken into account for NFEP/ NFE calculations of the supplying unit.
(iii) The unit will obtain permission of the Assistant Commissioner of Customs/ Central Excise for sale of surplus power in the DTA, after obtaining permission from the SEBs under the relevant statute. Duty on sale of power to the DTA shall be as per the Notification of the Department of Revenue in this regard.
(iv) Due care shall be taken by the Development Commissioner / Board of Approval while approving the power plants by EOU/ EPZ/ SEZ units vis a vis their actual requirement.
(9) NON ITA-I ITEMS THAT MAY BE SOLD IN DTA
The following non ITA-I items may be sold in the DTA in terms of para 6.9(h) and 7.8(vii) of the Exim Policy:
(i) Colour Display Tubes ( CDT) for monitors
(ii) Deflection components for colour monitors
(Sl. No. 7. to 9. has been added vide
PN. No. 59/2002-07, Dt. 15/01/2003)
Annexure I
TO BE PUBLISED IN THE GAZETTE OF INDIA, EXTRAORDINARY, (PART I SECTION 1)
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE AND INDUSTRY
(DEPARTMENT OF COMMERCE)
New Delhi, dated the August 7 , 2001
NOTIFICATION
No. 14/1/2001-EPZ: In supersession of Ministry of Commerce and Industry Notification No. 14/1/2001 dated 19.6.2001, Government of India hereby constitutes combined Board of Approvals for EOU/EPZ and SEZ Schemes as under:-
| 1. | Additional Secretary Department of Commerce | Chairman, |
| 2. | Joint Secretary Department of Commerce | Member |
| 3. | Joint Secretary, Department of Industrial Policy and Promotion | Member |
| 4. | Member(Customs) Central Board of Excise and Customs | Member |
| 5. | Director General of Foreign Trade | Member |
| 6. | Joint Secretary, Ministry of Environment and Forests | Member |
| 7. | Joint Secretary, Ministry of Science and Technology | Member |
| 8. | A representative from Ministry of Small Scale Industries and Agro and Rural Industries | Member |
| 9. | Development Commissioner of the concerned EPZs/SEZs | Member |
| 10. | A representative of Department of Economic Affairs | Member |
| 11. | A representative of Ministry of Urban Development and Poverty Alleviation | Member |
| 12. | A representative of Central Board of Direct Taxes | Member |
| 13. | Deputy Secretary/Director (EOU/EPZ) Department of Commerce | Member-Secretary |
Powers and functions of the Board:
1. The Board shall consider proposals under EOU/EPZ/SEZ scheme that fall outside the automatic approval procedure as notified from time to time.
2. Subject to necessary empowerment under section 14 of the Industries (Development and Regulation) Act, 1951, the Board, wherever applicable, shall also consider applications for grant of industrial licence wherever such licence is compulsory. Minutes in such cases will be issued after approval of Department of Industrial Policy and Promotion. Based on the approved minutes the Development Commissioner shall issue the Letter of Intent and upon fulfillment of conditions therein convert the same into industrial licence.
3. All Cases would be submitted before the Board by the Development Commissioner along with his comments so that the units have a single interface at the level of Development Commissioner;
4. EOU cases involving foreign equity, including investment by NRIs and OCBs that fall outside the automatic route shall continue to be dealt with by the Foreign Investment Promotion Board (FIPB). In such cases, the units will apply directly to Secretariat for Industrial Assistance (SIA)) for FIPB approval with a copy to the Development Commissioner concerned.
Those falling under the automatic route shall avail themselves of the dispensation available under the automatic route.
5. Consider all application for setting up of SEZ/EPZ in the public/private/joint or State sector and make suitable recommendations in this regard.
6. Approve goods and services required for developing , maintaining and operating SEZ or any component thereof
7. Any other issues concerning development of EPZ/SEZ
Note: Separate meeting will be held to consider the proposal to set up SEZ/EPZ in the public/private/joint or State sector.”
General
The Board may prescribe any condition, as it may consider necessary while granting approval.
8. The Board may in its discretion grant or refuse the approval.
9. Chairman of the Board may co-opt any representative of any other Department or agency not already included in it, if he finds it necessary for any specific purpose.
(D.K.Mittal )
Joint Secretary to the Government of India
[No. 14/1/2001-EOU]
ANNEXURE II
(TENTATIVE-TO BE FINALIZED BY JS ON 24.3.2002)
ITEMS PERMITTED FOR IMPORT/DOMESTIC PROCUREMENT BY EOU/EPZ UNITS ENGAGED IN AGRICULTURE/HORTICULTURE WITHOUT PAYMENT OF DUTY FOR SUPPLY TO CONTRACT FARMERS IN THE DTA.
INPUTS:
1. Seeds
2. Fertilizers and chemicals for pre and post harvest treatment such as micro nutrients, plants and growth regulators and other organic and inorganic substances used for plant nutriation, insecticides, fungicides, weedicides, berbicides and the like.
EQUIPMENTS:
1. Filters
2. Dripliers, Driplines and Drip-fittings
3. Micro sprinklers and misters
4. Agriculture sprinlers
5. Fertilizer Tanks
6. Valves
7. Fertilizer pumps and chemical injections