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APPENDIX-14-I
EXPORT
ORIENTED UNITS (EOUs), ELECTRONICS HARDWARE TECHNOLOGY
PARKS (EHTPs) AND SOFTWARE TECHNOLOGY PARKS
(STPs) SCHEME
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Scheme
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1.
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Definitions
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2.
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For
the purpose of Export Oriented Units, Electronics Hardware
Technology Parks (EHTPs) and Software Technology Parks (STPs),
unless the context otherwise requires, the words and
expressions shall have the following meanings attached to them
as given in the Policy.
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Eligibility
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3.1
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Units
undertaking to export their entire production of goods and
services, except permissible sales in the DTA, as per this
Policy, may be set up under the Export Oriented Unit (EOU)
Scheme, Electronic Hardware Technology Park (EHTP) Scheme or
Software Technology Park (STP) Scheme for manufacture of
goods, including repair, re-making, reconditioning,
re-engineering, and rendering of services. No trading
units shall, however, be permitted.
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3.2
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Software
Technology Park (STP)/Electronics Hardware Technology Park (EHTP)
complexes can be set up by the Central Government, State
Government, Public or Private Sector Undertakings or any
combination thereof, duly approved by the Inter-Ministerial
Standing Committee (IMSC) in the Ministry of Communication and
Information Technology (Department of Information Technology).
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Approval/
Application
and renewal of Application
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4.1
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For
setting up an EOU, three copies of the application in the form
given in Appendix- 14-IA may be submitted to the Development
Commissioner (DC) of theSEZ concerned.
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4.2
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Applications
for setting up of units under EOU scheme other than proposals
for setting up of unit in the services sector (except software
and IT enabled services, or any other service activity as may
be delegated by the BOA), shall be approved or rejected by the
Units Approval Committee within 15 days as per the criteria
indicated in Appendix-14-IB and Sector specific
conditions relating to the approval given in Appendix- 14-IC .
In other cases, approval may be granted by the Development
Commissioner after clearance by the Board of Approval.
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4.3
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4.4
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Only
project having a minimum investment of Rs.1 crore and
above in building, plant and machinery shall be considered for
establishment under EOU scheme. Minimum investment
should take place on coming into production of the unit.
(This shall, however, not apply to existing units and units in
EHTP/STP/ handicrafts/ agriculture/floriculture/ acqua-culture/
animal husbandry/ information technology, services and such
other sectors as may be decided by the BOA).
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4.5
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Application
for setting up EHTP/STP unit shall be in the format prescribed
by the Ministry of Communication and Information Technology
(Department of Information Technology) and shall be submitted
to the officer designated by the Department of Information
Technology for this purpose.
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Letter
of
Permission/
Letter
of Intent/Renewal
of approval
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4.6
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On
approval, a Letter of Permission (LOP)/Letter of Intent (LOI)
shall be issued by the Development Commissioner to EOU/EHTP/STP
unit. The LOP shall have an initial validity of 3 years for
commencement of production. Its validity may be extended by
another 3 years, beyond initial validity, by the competent
authority. However, proposals approved prior to 1.4.2002 shall
be considered on case to case basis by BOA.
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4.7
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The
LOP/LOI shall specify the item(s) of manufacture/service
activity, annual capacity, projected annual export for the
first five years in dollar terms, Net Foreign Exchange
earnings (NFE), limitations, if any, regarding sale of
finished goods, by-products and rejects in the DTA and such
other matter as may be necessary and also impose such
conditions as may be required.
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4.8
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LOP/LOI
issued to EOU/EHTP/STP units by the concerned authority would
be construed as a licence for all purposes. Standard format
for LOP for EOU units is given in Appendix 14-IE .
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4.9
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LOP/LOI
shall be valid for a period of 5 years from the date of
commencement of production. This period may be extended
further by the Development Commissioner concerned for period
of 5 years at a time.
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4.10
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EOUs
shall have separate ear-marked premises for separate LOP.
Similarly, EOUs may be approved on leased premises provided
the lease has been obtained from Government Department/
Undertaking/Agency. However, in case lease is obtained from
private parties, it shall have a validity period of five years
from the date of LUT and the Development Commissioner shall
satisfy himself of genuine nature of the lease.
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4.11
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On
completion of the approval period as provided for in paragraph
8.9, it shall be open to the unit to continue under the scheme
or opt out of the scheme. If no intimation in this regard is
received from the unit within a period of six months of expiry
of the approval period, the Development Commissioner will take
action, suo moto, to cancel the approval under the EOU scheme
and take further action in this regard. Where the unit opts to
continue, the Development Commissioner concerned will extend
the approval period.
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Re-conditioning
Repair and Re-engineering
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4.12
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EOU/EHTP/STP
units may be set up with the approval of BOA to carry out
reconditioning, repair, remaking, testing, calibration,
quality improvement, up-gradation of technology and
re-engineering activities for export in freely convertible
foreign currency. Such units may import goods of any origin
for the above activities. The provisions of paragraphs 12.1,
13, 15, 16.1, 18.1 and 24.1 shall not, however, apply to such
activities.
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Legal
Undertaking
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5.1
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The
approved EOU/EHTP/STP unit shall execute a legal undertaking
with the Development Commissioner concerned as per the format
given in Appendix- 14-IF.
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5.2
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With
effect from 1.4.2003, all EOUs should have their own web site
and permanent E-Mail address. No LUT for new units after
1.4.2003 shall be executed unless the unit has its own web
site and permanent e-mail address. In the event of an
EOU not having permanent e-mail address and own website,
further, imports and DTA sale shall not be permitted by the
Development Commissioner.
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Export
of goods and services
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6.1
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An
EOU/EHTP/STP unit may export all goods and services except
items that are prohibited in ITC(HS) (HS). Export of
Special Chemicals, Organisms, Materials, Equipment and
Technologies (SCOMET) shall be subject to fulfillment of the
conditions indicated in the ITC(HS) (HS).
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6.2
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Software
units may undertake exports using data communication links or
in the form of physical exports (which may be through courier
service also), including export of professional services
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6.3
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EOU/EHTP/STP
unit, other than service units, may also export to Russian
Federation in Indian Rupees against repayment of State
Credit/Escrow Rupee Account of the buyer subject to RBI
clearance, if any.
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6.4
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The
EOUs shall be permitted to export jewellery on the basis of a
notional rate certificate issued by the nominated agency. This
rate will be based on the prevailing Gold/US$ rate and the
US
$/INR
rate in the notional rate certificate. The certificate
issued by the nominated agency should not be older than 3
working days of the date of shipment.
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6.5
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The
exporter shall have the flexibility to fix the price and repay
the gold loan within 180 days from the date of export. The
price shall be communicated to the nominated agencies who will
issue a certificate showing the final confirmation of the rate
to the bank negotiating the document, to ensure export
proceeds are realized at this rate
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6.6
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Gem
& Jewellery and Jewellery EOUs may re-export imported
goods and export domestically procured goods, including goods
generated out of partial processing/ manufacture. Besides,
supply of unsuitable/ broken cut and polished diamonds,
precious and semi-precious stones upto 5% of the value of
imported or indigenously procured goods to the DTA against the
valid Gem & Jewellery REP as applicable on payment of
appropriate duty is also permitted.
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Import/
domestic
procurement of goods
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7.1
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An
EOU/EHTP/STP unit may import and /or procure from DTA or
bonded warehouses in the DTA/international exhibitions held in
India
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without payment of duty, all types of goods required by it for
its activities or in connection therewith, provided they are
not prohibited items of imports in the ITC(HS) (HS).
However, any permission required for import under any other
law shall be applicable.
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7.2
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Goods
permitted to be imported /procured from Domestic Tariff Area
shall include:
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(a)
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Raw
materials, components, consumables, intermediates, spares and
packing materials:
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(b)
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Capital
goods, whether new or second-hand, including inter-alia the
following and their spares:
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(i)
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DG
sets, captive power plants, transformers and accessories for
all above.
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(ii)
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Pollution
control equipment.
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(iii)
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Quality
assurance equipment.
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(iv)
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Material
handling equipment, like fork lifts and overhead cranes,
mobile cranes, crawler cranes, hoists and stackers.
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(v)
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Un-interrupted
Power Supply System (UPS), Special racks for storage, storage
systems, modular furniture, computer furniture, anti-static
carpet, tele-conference equipment, Servo Control System,
Air-conditioning system, panel for electricals.
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(vi)
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Security
Systems.
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(vii)
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Tools,
jigs, fixtures, gauges, moulds, dyes, instruments and
accessories;
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(c)
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Raw
material for making capital goods for use within the unit
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(d)
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others
including:
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(i)
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Prototypes
and technical samples for existing product(s) and product
diversification, development or evaluation.
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(ii)
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Drawings,
blue prints, charts, microfilms and technical data;
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(iii)
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Office
equipment, including PABX, Fax machines, projection system,
Computers, Laptop, server.
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(e)
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Spares
and consumables for all the above items
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(f)
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any
other items not mentioned above with the approval of Board of
Approval.
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7.3
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The
units shall also be permitted to import/procure goods and
services required for its activities, including capital goods,
free of cost or on loan from clients.
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7.4
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STP/EHTP/EOU
may import/procure from DTA without payment of duty specified
goods for creating a central facility for use by software
development units in STP/EHTP/EOU. The central facility for
software development can also be accessed by units in the DTA
for export of software.
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7.5
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An
EOU engaged in agriculture, animal husbandry, aquaculture,
floriculture, horticulture, pisciculture, viticulture, poultry
or sericulture may import/procure all types of goods, without
payment of duty, required by it for its activities or in
connection therewith as available to other EOUs.
However, such units may be permitted to take only specified
goods for use outside the bonded area.
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7.6
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Gem
and jewellery units may also source gold/silver/platinum
through the nominated agencies on loan basis subject to the
condition that the gold/silver/platinum jewellery shall be
exported within 120 days from the date of release. This shall
not, however, apply to outright purchase of precious metals
from nominated agencies or if the same is obtained on loan
other than from the nominated agencies.
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7.7
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EOUs
may import plain/studded gold/platinum or silver jewellery for
export after repairs/remaking.
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Conditions
of Import
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7.8
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The
import of goods by EOU/EHTP/STP units shall be subject to the
following conditions:
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(a)
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The
goods shall be imported into the EOU/EHTP/STP premises.
However, agriculture and allied sectors and granite sector
units in EOU may supply/ transfer the capital goods and the
inputs in the farms/fields/quarries with prior intimation to
the jurisdictional Customs/ Central Excise authorities,
provided the ownership of the goods rests with EOU units.
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(b)
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The
procedure as prescribed under Customs/Excise rules for EOUs
and units in EHTP/STP will be followed and appropriate bond
executed with Customs/ Excise authorities
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(c)
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The
goods, except capital goods and spares, shall be utilised by
EOU/EHTP/STP units within a period of three years or as may be
extended by Customs authorities.
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(d)
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Goods
already imported/shipped/arrived before the issue of LOP/ LOI
are also eligible for duty free clearance under the EOU/EHTP/STP
scheme provided customs duty has not been paid and the goods
have not been cleared from Customs.
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Fax
machines/ laptop computers outside approved premises
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7.9
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EOU/EHTP/STP
units may install one fax machine at a place of its choice,
outside the premises of the unit, subject to intimation of its
location to the concerned Customs/Central Excise authorities.
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7.10
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EOU/EHTP/STP
units may, temporarily take out of the premises of the unit
duty free laptop computers and video projection systems for
working upon by authorised employees
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7.11
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EOU/EHTP/STP
units may install personal computers not exceeding two in
number, imported/procured duty free in their
registered/administrative office subject to the guidelines
issued by Department of Revenue in this behalf.
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7.12
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For
IT and IT enabled services, persons authorized by the software
units may access the facility installed in the EOU/EHTP/STP
unit through communication links
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