This update you on the following instructions issued on 5 February 2021
which covers certain aspects in relation to various transactions and operations
undertaken by SEZ units.
Circular
105 (Copy attached)
This
circular has been issued in the context of IT/ ITeS SEZ units in response to a
representation filed by NASSCOM seeking (i) one time waiver of duty payment as
well as physical inspection at the stage of de-bonding and (ii) exemption for
filing bill of entry at the stage of sale/ clearance of duty paid goods
procured by the SEZ units.
This
circular clarifies the following:
1.
On the matter of duty exemption and physical verification
of goods at the stage of de-bonding
Simple duty-payment at the stage of
de-bonding shall be accepted basis documentation made available without
insisting of physical verification of assets. The circular has been
issued on consideration of the fact that, IT assets enjoy accelerated
depreciation, and amidst the pandemic where assets are located at employee
locations, a one time waiver of mandatory physical inspection of assets is
being considered.
2.
On the matter of exemption for filing bill of entry for
clearance of duty paid assets
No bill of entry is required to be filed for
DTA clearance of duty paid goods procured from the DTA (invoice shall
suffice). Bill of entry shall however be required for clearance of goods
originally imported on payment of duty.
Clarification
K-43013(16)/1/2021 (Copy attached)
This
circular has been issued in the context of certain issues flagged by NASSCOM
relating to IT/ ITES SEZ units:
1.
On the matter
of allowing temporary cross utilization of employees and assets between SEZ
units
The clarification does not provide a
specific approval. It merely refers to cross utilization of employees to
the extent allowed under Rule 70 of the SEZ Rules (by way of issuance of
temporary ID cards); and cross utilisation of assets to the extent permitted as
per Section 29 of the SEZ Act read with Rules 34 and 38 of the SEZ Rules.
To recap, Rule 34 provides that goods
admitted into the SEZ unit shall be utilized by such unit and in case where the
unit is unable to utilize the same, the said rule provides for various options
where such goods can be sold by such unit. Further, Rule 38 provides for
various conditions to be fulfilled including obtaining a prior permission from
the Specified Officer, where a unit intends to transfer the ownership or send
the goods to other units on loan basis for use in the authorized operations.
2.
On the matter
of allowing clearance of goods upon payment of duty basis the depreciated value
(where transaction value is higher)
According to the clarification,
Customs valuation shall always be based on transaction value and other relevant
provisions of the customs law.
3.
On the
difficulties faced with respect to divergent practices on the documentation and
process to be followed for warranty and maintenance spare movement (NASSCOM ask
for a standard set of documentation to be specified, particularly for inward
movement of replacement materials)
The clarification states that
sub-rules (1) to (3) of Rule 50 of the SEZ Rules covers various instances,
where the unit is allowed to temporary move the goods to a DTA without payment
of duty (to recap, various instances includes removal of goods for repairs,
replacement, testing, research and development purposes etc.) and the
procedure to be followed by the unit for such temporary removal has been
prescribed under Rule 51 of the SEZ Rules.
Accordingly, the clarification states
that the procedures as provided under the above rules shall be required to be
followed in such cases.
It may be noted that Rule 51 of the
SEZ Rules, provides that the temporary movement of goods shall be made under
cover of a challan along with an intimation to be filed with the Authorized
Officer and the goods temporary removed shall be required to brought back
within 120 days in the unit or within such extended period as may be permitted
by the Specified Officer.
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