CUS NTF NO. 61/2004 (NT) DATE 11/05/2004

Amendment in the Special Economic Zones Rules, 2003

G.S.R.305 (E).-In exercise of the powers conferred by sub-section (1) of section 156 read with Chapter XA of the Customs Act, 1962 (52 of 1962), the Central Government, hereby makes the following rules further to amend the Special Economic Zones Rules, 2003, namely:-

1. (1) These rules may be called the Special Economic Zones ( Fourth Amendment) Rules, 2004.

(2) They shall come into force on the date of their publication in the Official Gazette.

2. In the Special Economic Zones Rules, 2003,-

(A) in rule 2,-

(i) in clause (c) , for the words “permitted by the Commissioner of Customs ”, the words, brackets, letter and figures “approved by the Board of Approvals as defined in clause (c) of regulation 2 of the Special Economic Zones (Customs Procedures) Regulations,2003 ” shall be substituted.

(ii) after clause (i), the following clause shall be inserted, namely:

‘ (ii) “ Unit Approval Committee”, in respect of a special economic zone, means a committee set up for the special economic zone as notified in the Official Gazette by the Central Government in the Ministry of Commerce and Industry’ ;

(B) in rule 5 , in sub-rule (4) , for the words “ Commissioner of Customs”, the words “ Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be “ shall be substituted;

(C) in rule 9, in sub rule (1), -

(i) in clause (a) , the words “ or on the transaction value, whichever is higher” shall be omitted ;

(ii)for clause (c), the following clause shall be substituted , namely:-

“ (c) the depreciation shall be allowed in straight line method as specified below, namely:-

(i) for computer and computer peripherals:

for every quarter in the first year	@10%
for every quarter in the second year	@8%
for every quarter in the third year	@5%
for every quarter in the fourth and fifth year	@1%

(ii)for capital goods other then computer and computer peripherals:

for every quarter in the first year	@4%
for every quarter in the second year	@3%
for every quarter in the third year	@3%
for every quarter in the fourth and fifth year	@2.5%
and thereafter for every quarter	@2%

Explanation.- For the purpose of computing rate of depreciation for any part of a quarter the full such quarter shall be taken into account; and”;

(D) for rule 11, following rule shall be substituted, namely:-

“11. Removal of goods from a special economic zone unit to an export oriented undertaking or software technology park unit or electronic hardware technology park unit or to other special economic unit in the same or other special economic zone.- (1) With the prior permission of the Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the case may be, goods may be allowed to be removed from a special economic zone unit to an export oriented undertaking or software technology park unit or electronic hardware technology park unit or to another special economic zone unit in the same special economic zone or in other special economic zone without payment of duty for the purpose of carrying out authorised operations within the receiving export oriented undertaking or software technology park unit or electronic hardware technology park unit or special economic zone unit, as the case may be:

Provided that in case the goods admitted into special economic zone unit from any domestic tariff area, on which benefit under duty exemption pass book scheme or duty draw back has been availed, are removed as such or after subjecting them to a process not amounting to manufacture, to an export oriented undertaking or software technology park unit or electronic hardware technology park unit directly by the special economic zone unit or through any unit in the same special economic zone or another special economic zone, the duty equal to benefit availed under duty exemption pass book scheme or duty drawback shall be liable to be paid.

(2) In case of clearance of goods by a special economic zone unit to another special economic zone unit within the same special economic zone, no prior permission of Assistant Commissioner of Customs or Deputy Commissioner of Customs shall be required, but both supplying and receiving special economic zone units shall be required to maintain records for such transaction.” ;

(E) in rule 12, in sub- rule (1), for clause (i), the following clause shall be substituted, namely:-

“ (i) in case of destruction of goods procured from domestic tariff area, the special economic zone unit shall be required to pay back the export benefits taken by the domestic tariff area supplying unit or taken by the special economic zone unit on the basis of disclaimer from domestic tariff area unit:

Provided that where such goods have been procured by the special economic zone unit against payment of foreign exchange, the special economic zone unit shall not be liable to pay back the export benefits, taken by the domestic tariff unit from which such goods have been procured or, taken by the special economic zone unit on the basis of disclaimer from such domestic tariff area unit, in case of destruction of such goods; and “ ;

(F) for rule 14, the following shall be substituted namely:

“14.Submission of returns.- Every special economic zone unit shall endorse, a copy of the quarterly and annual return which it furnishes to the Development Commissioner, to the Assistant Commissioner of Customs or Deputy Commissioner of Customs, as the case may be, in a format as specified for such purpose in Appendix 14IF of the Handbook of Procedures( Vol I), notified by the Director General of Foreign Trade, Government of India in the Ministry of Commerce and Industry under Public Notice No.1 ( RE-2003)/2002-07, dated the 31st march, 2003

(G) in rule 18 for the words “ Commissioner of Customs” the words “ Deputy Commissioner of Customs or Assistant Commissioner of Customs, as the case may be,” shall be substituted;

(H) for rule 19 the following rule shall be substituted , namely:-

“ 19. Monitoring.- The performance of a special economic zone unit and a developer of the concerned special economic zone shall be monitored by the Unit Approval Committee in which the Commissioner of Customs having jurisdiction over concerned special economic zone or his nominee shall be a member”;

(I) in rule 20, in clause (a),

(i) for the words “ either exported or” the words “ either exported or shall be transferred to another special economic zone unit in other special economic zone or to export oriented undertaking or unit in electronic hardware technology park or software technology park with out payment of duty or” shall be substituted ;

(ii) after the proviso, the following proviso shall be inserted, namely:-

“ Provided further that in case the goods admitted into special economic zone unit from domestic tariff area, on which benefit under duty exemption pass book scheme or duty draw back has been availed, are removed as such or after subjecting them to a process not amounting to manufacture, to an export oriented undertaking or software technology park unit or electronic hardware technology park unit directly by the special economic zone unit or through any unit in the same special economic zone or another special economic zone, the duty equal to benefit availed under duty exemption pass book scheme or duty drawback shall be liable to be paid.”

[F. No. 314/24/2001-FTT(Pt-IV)]

( V.Kezo.)
Under Secretary to the Government of India

Note:The principal notification No. 52/2003-Customs (N.T.), dated the 22nd July, 2003, was published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) with G.S.R 570 (E), dated the 22nd July, 2003 and was last amended by notification No 58/2004-CUSTOMS (N.T.), dated the 30th April, 2004 [G.S.R 294(E), dated the 30th April, 2004].

(Please refer CUS NTF NO. 102/2004(NT) DATE 06/09/2004 for further amendments in above ruel)

(Please refer CUS CIR NO. 33/2004 DATE 12/05/2004)

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