The Ministry of Commerce and Industry (MoCI) on December 06, 2023, issued the Special Economic Zones (Fifth Amendment) Rules, 2023 to further amend the Special Economic Zones Rules, 2006.
The following amendment has been stated:
• After rule 11A of the Special Economic Zones Rules, 2006, Rule 11-B has been inserted, namely: -
“11-B. Non-processing areas for Information Technology or Information Technology Enabled Services Special Economic Zones: -
(1) Notwithstanding anything contained in Rules, 5,11,11A or any other rule, the Board of Approval, on request of a Developer of an Information Technology or Information Technology Enabled Services Special Economic Zones, may, permit the demarcation of a portion of the built-up area of a Information Technology or Information Technology Enabled Services Special Economic Zone as a non-processing area of the Information Technology or Information Technology Enabled Services Special Economic Zone to be called a non-processing area.
(2) A Non-processing area may be used for setting up and operation of businesses engaged in Information Technology or Information Technology Enabled services, and at such terms and conditions as may be specified by the Board of Approval under sub-rule (1),
(3) A Non-processing area shall consist of a complete floor and part of a floor shall not be demarcated as a non-processing area.
(4) There shall be appropriate access control mechanisms for Special Economic Zone Units and businesses engaged in Information Technology or Information Technology Enabled Services in non-processing areas of Information Technology or Information Technology Enabled Services in Special Economic Zones, to ensure adequate screening of movement of persons as well as goods in and out of their premises.
(5) The Board of Approval shall permit the demarcation of a non-processing area for a business engaged in Information Technology or Information Technology Enabled Services Special Economic Zone, only after repayment, without interest, by the Developer, —
(i) tax benefits attributable to the non-processing area, calculated as the benefits provided for the processing area of the Special Economic Zone, in the proportion of the built-up area of the non-processing area to the total built-up area of the processing area of the Information Technology or Information Technology Enabled Services Special Economic Zone, as specified by the Central Government.
(ii) tax benefits already availed for the creation of social or commercial infrastructure and other facilities if proposed to be used by both the Information Technology or Information Technology Enabled Services Special Economic Zone Units and businesses engaged in Information Technology or Information Technology Enabled Services in non-processing area.
(6) The amount to be repaid by the Developer under sub-rule (5) shall be based on a certificate issued by a Chartered Engineer.
(7) Demarcation of a non-processing area shall not be allowed if it results in decreasing the processing area to less than fifty per cent of the total area or less than the area specified in column (3) of the table below:
(8) The businesses engaged in Information Technology or Information Technology Enabled Services Special Economic Zone in a non-processing area shall not avail any rights or facilities available to Special Economic Zone Units.
(9) No tax benefits shall be available on operation and maintenance of common infrastructure and facilities of such an Information Technology or Information Technology Enabled Services Special Economic Zone.
(10) The businesses engaged in Information Technology or Information Technology Enabled Services Special Economic Zone in a non-processing area shall be subject to provisions of all Central Acts and rules and orders made thereunder, as apply to any other entity operating in domestic tariff area.”
They shall come into force on December 07, 2023.
[Notification No. G.S.R. 881(E)]
