Rule 11A - Bifurcation of non-processing area - Special Economic Zones Rules, 2006

1 [11A. Bifurcation of non-processing area: The non-processing area can be bifurcated into two parts, namely:- (1) Where the social or commercial infrastructure and other facilities are permitted to be used by both the Special Economic Zone and Domestic Tariff Area entities: No exemptions, concessions or drawback shall be admissible for creation of such infrastructure. The Customs duty, Central Excise duty, 2 [ Central Goods and Services Tax, Integrated Goods and Services Tax and State Goods and Services Tax ] and such other Central levies and tax benefits already availed for creation of such infrastructure shall be refunded by the Developer in full, without interest. However, in cases of short payment of the amount refundable to the Government on account of dual use permission, interest will have to be paid at the rate of fifteen per cent per annum from the day the said amount becomes payable to the date of actual payment. Utilisation of SEZ land shall be subject to following conditions: (a) the land is to be put to only such use which is as per the regulations of the concerned State Government or local bodies; (b) if any exemption or refund has been taken from State or local taxes like stamp duty 3 [ State Goods and Services Tax, ] , change of land uses, etc., the same shall be refunded back to State Government or local authorities and a certificate to this effect shall be produced from the concerned authorities; (c) No Objection Certificate (NOC) from the concerned State Government shall be produced before. the consideration of the request by Board of Approval (BoA). State Government may issue No Objection Certificate (NOC) taking into consideration (a) and (b) above. (2) Where the social or commercial infrastructure and other facilities are permitted to be used only by Special Economic Zone entities: This portion shall be bonded and physically segregated from the Domestic Tariff Area, non-processing area, specified at (1) above and the processing area of the Special Economic Zone. The infrastructure, as may be approved by the Board, for this part of non processing area shall be eligible for exemptions, concessions and drawback. (3) The Department of Commerce has provided the following norms with respect to areas to be earmarked for residential, commercial and other social facilities:- (a) The Developer or Co-developer shall submit an application in the format as specified by the Central Government to the Development Commissioner indicating therein the portion of the non-processing area where social or commercial infrastructure and other facilities are proposed to be used by both Special Economic Zone and Domestic Tariff Area entities and the said application shall be accompanied with a copy of the Infrastructure Plan and No Objection Certificate from the concerned State Government and supporting documents. (b) The Development Commissioner shall forward the said application to the Board of Approval (BoA) for approval. (c) The area restrictions for duty paid dual use non processing area in the Special Economic Zones shall be as follows: (i) Housing - not more than twenty five per cent of non-processing area; (ii) Commercial- not more than ten per cent of non-processing area; (iii) Open area and circulation area-not less than forty five per cent of non processing area; (iv) Social and institutional infrastructure including schools, colleges, sociocultural centres, training institutes, banks, post office, etc., in the remaining area. (d) Floor Area Ratio or Floor Space Index shall conform to the norms of the concerned local authorities. (e) No sale shall be permitted of such duty paid dual use infrastructure in the non-processing area and only lease hold rights can devolve upon the users Of transferees of the said dual use duty paid infrastructure in Non Processing Area of Special Economic Zones; and (f) Any other conditions as may be specified by the Department of Commerce or Board of Approval] ********** Notes:- 1. Inserted vide C.1/2/2014-SEZ - GSR 5 (E) - Dated 2-1-2015, 2. Substituted vide Notification No. G.S.R. 909(E) dated 19-09-2018 before it was read as Service Tax, 3. Inserted vide Notification No. G.S.R. 909(E) dated 19-09-2018