APPENDIX-14 A

APPLICATION FOR SETTING UP EOUs or UNITS IN EXPORT PROCESSING ZONE /SEZ

---------------------------------------------------------------------Note: 1.
Please see Paras 6.7 and 7.7 of EXIM Policy & Paras 6.7
and 7.7 of this Handbook.
2.
Please read the general instructions given in EXIM Policy
before filling this application and also some important
guidelines given at the end of this application.
3

The application will be treated as incomplete without its

own permanent E-mail address and will not be considered.

-----------------------------------------------------------------------INDICATE WHETHER FOR

---------------------AUTOMATIC APPROVAL
------------------

OR
--

BOARD OF APPROVAL
-----------------

The application should be submitted to the Development Commissioner of the

concerned Export Processing Zone/ Special Economic Zone (for setting up
units in EPZ / SEZ/Export Oriented Units) in 3 copies alongwith a crossed
Demand Draft of Rs. 5,000/- drawn in favour of the Pay & Accounts Officer,
Ministry of Commerce & Industry, Department of Commerce, payable at the
Central Bank of India, Udyog Bhavan, New Delhi.
-----------------------------------------------------------------------For Official Use only
Application No.

______________________________

Date :

______________________________

Date__________Month____________Year __________
-----------------------------------------------------------------------Details of Bank Draft
Amount Rs.

___________________

Draft No.

___________________

Draft date

___________________

Drawn on

___________________
(Name of the Bank)

Payable at

____________________

App-105

I.

II.

NAME AND ADDRESS OF THE

UNDERTAKING IN FULL (Block Letters)
Name of the Applicant Firm

_________________________________

Full Address

_________________________________

(Regd.Office in case of limited

companies & Head Office for
others

_________________________________
_________________________________
_________________________________

Pin Code

_________________________________

Tel. No.

_________________________________

Fax No.

_________________________________

e-Mail No.

_________________________________

Income Tax PAN No.

_________________________________

NATURE OF THE APPLICANT FIRM:

[Please tick ( ) the appropriate entry]
Government Undertaking/Public Limited Company/Private Limited Company/
Proprietor ship/Partnership/Others (please specify)

Note:-Copy of certificate of incorporation alongwith Article of

Association and Memorandum in case of companies and partnership deed
in case of partnership firms may please be attached.
III.

INDICATE WHETHER THIS PROPOSAL IS FOR

[Please tick () the appropriate entry].
Establishment of a New Undertaking
Manufacturing
[
]
Services
[
]
Effecting Substantial Expansion
Manufacturing of New product
Conversion of (i) existing DTA unit into EOU
(ii)existing STP/EHTP to EOU/EPZ/SEZ
(in case of conversion, please attach fact sheet as per Annexure)

App-106

IV.

(1)

Location of the proposed undertaking

Full Address
Pin code

(2)

__________________________
__________________________

ONLY FOR PROJECTS UNDER EOU SCHEME

( In case the unit is proposed to be located on leased premises, then

lease should be obtained from Government or any undertaking / authority of
Government)
(a)
Please indicate if the proposed location is in a Centrally Notified
Backward Area [Please tick () the appropriate entry].
No. ______________Yes_________________ If yes, indicate category
(b)

Indicate whether it is within 25 kms from the periphery of the

standard urban area limit of city having population above one
million according to 1991 census.
Yes_____________ No. __________________
(c)
Is it located in an Industrial Area/Estate designated/set up prior
to issuance of Notification No. 477(E) dated 25th July,1991.
Yes_____________No. _____________
(d)
If not, does it come under the category of non-polluting industries
as notified by the Govt.
Yes ___________ No. _______________
V.

ITEM(S) OF MANUFACTURE/SERVICE : (Including By-product/Co-products)

(If necessary, additional sheets may be attached )

Item(s) Description

Capacity(Unit =

Item Code(ITC
HS Code No.)
Not required for service

________________

unit)
________________

_______________________

________________

________________

_______________________

________________

________________

_______________________

VI.PRODUCTION (In case of more than one item, supplementary sheets may be
used)
Quantity (Unit __________)
(Value (In Rupees)
Not required for service unit)
1st
2nd
3rd
4th
5th

year
year
year
year
year

___________________
___________________
___________________
___________________
___________________

__________________
__________________
__________________
__________________
__________________

App-107
VII.

Indigenous Requirement:

a)
b)

Capital Goods
Raw material, components, consumables,
packing material, fuel etc. during the
period of 5 years

(Value in Rupees)

TOTAL:

-----------------------------------------------

VIII. FOB VALUE OF EXPORTS

(1 $ = Rs.)
Rupees (lakhs)

US $ (Thousand)

1st year
2nd year
3rd year
4th year
5th year
Total:
IX.

INVESTMENT:

(a)

Land

(b)

Building

(c)

Plant and Machinery

________________________
(I)
Indigenous ________________________
(US $ Thousand)
(ii) Import CIF value
________________________

(RS. IN LAKHS)
________________________

(iii) Total (I) + ii)

________________________

________________________

App-108
X.

WHETHER FOREIGN TECHNOLOGY AGREEMENT IS ENVISAGED

(Please tick ( \/ ) the appropriate entry )
Yes ____________
(I)
(ii)

No_____________

Name and Address of foreign collaborator __________________

Terms of collaboration
(Rupees lakhs)
(Gross of Taxes)

(a)
(b)
(c)
(d)
(e)
(f)
XI.

Lumpsum payment
Design & Drawing fee
Payment to foreign technician
Royalty (on exports )
Royalty(on DTA sales if envisaged)
Duration of agreement

_____________________
_____________________
_____________________
____________________%
____________________
___________(No.of years)

EQUITY INCLUDING FOREIGN INVESTMENT

(i)

$ Thousand)

(Rs.lakhs)

(a)

Authorized

________________

________________

(b)

Subscribed

________________

________________

(c)

Paid up Capital

________________

________________

Note: If it is an existing company, please give the break up of the

existing and proposed capital structure
(ii)

Pattern of share holding in the paid-up capital

(Amount in Rupees)

(Rs. in lakhs)

(US $ Thousand)

_____________

________________

(a)

Foreign holding

(b)

Non Resident Indian company / Individual holding

(i)

Repatriable

_____________

________________

(ii)

Non-repatriable

_____________

________________

_____________

________________

(c)

Resident holding

(d)

Total(a+b(i+ii)+c) equity____________

_________________

App-109
(e)

(iii) External commercial Borrowing ______________ _______________

Foreign Exchange Balance sheet
1st
2nd
3rd

XII.

4th

FOB value of
exports in first
five years

XIII. Foreign Exchange

outgo on
(I)

Import of
machinery

(ii)

Import of raw
matterials and
components

(iii

Import of spares
and consumables

(iv)

Repatriation of
dividends and
profits to foreign
collaborators

(v)
(vi)

Royalty
Lump sum know-how
fee

(vii) Design and drawing

(viiiiPayment of foreign
technicians
(ix)

Payment on trainin
Indian technicians
abroad

App-110

5th

Total
(5 yrs)
in Rs.
Lakhs

In US$

(x)

Commission on
Export etc.

(xi)

Foreign Travel

(xii) Amount of
interest to be
paid on
external
commercial
borrowing/
deferred
payment credit
(specify details)
(xiii Any
payments(specify
details)
Total

(i)to(xiii)

Net Foreign
Exchange earnings
in five years
XIV.

REJECTS(only for EOU/EPZ manufacturing units).

Generation of Rejects/Sub-standard __________ __________________
goods of the finished
__________ ____________________
(percentage of 5 yrs production)
Goods (In case rejects are more
than 5% estimated percentage
__________________
with justification may be given __________________
Value (Rs. Lacs)

(Qty.(Unit =
)
________________
________________

App-111
XV.

EMPLOYMENT

(All figures in number )

Existing

Proposed

--------------

XVI.

--------------

a)

Supervisory Men_____________
Women____________

_______________
_______________

b)

Non-supervisory

_______________
_______________

Men_____________
Women_____________

NET FOREIGN EXCHANGE EARNING AS A PERCENTAGE OF EXPORTS/NFE

Average NFE/NFEP on
5 years

FOB value of exports in

Percentage
_________
_________

XVII. MARKETING
a)

b)

Whether marketing tie-up/Buy-back

_______
envisaged/finalized?(Attach documents,_______
if any)
Yes

________
________
No

G. C. A.
Destination of exports(in percentage)_______
_______

R. P . A.
________
________

XVIII OTHER INFORMATION

i)

Any special features of the project proposal________________

which you want to highlight
________________
(please attach the project report, for new units)
_______________________
_______________________
_______________________

ii)(a)Whether the applicant has been issued any_________________

industrial license or LOI/LOP under EOU/ _________________
EPZ/ STP/EHTP/SEZ scheme if so, please
_________________
give full particulars especially reference number,
date of issue, items of manufacture and
progress of implementation of each project.

App-112
(b)Whether the applicant has submitted any
__________________
other application for LOI/LOP which is
__________________
pending with the Board of Approvals.
If so, please give particulars like reference
number, name under which application
made, items of manufacture etc.
iii)

Whether the applicant or any of the

_________________
partners/Directors who are also partners
_________________
/Directors of another company or its
associate concerns are being proceeded
against or have been debarred from
getting any License/Letter of Intent/
Letter of Permission under the Export and
Import(Control)Act. 1947/Foreign Trade
(Development and Regulation)Act, 1992 / FEMA/
Custom/Central Excise Act.

Place :_________

Signature of the Applicant _______________

Date

Name in Block Letters

:________

Designation
Official Seal/Stamp__________ Tel. No.
e-mail

___________________

________________________
________________________
________________________

Full Residential Address__________________

UNDERTAKING
I/We hereby declare that the above statements are true and correct to the
best of my/our knowledge and belief.
I/We will abide by any other
condition
which
may
be
stipulated
by
the
concerned
Development
Commissioner. I/We fully understand that any Permission Letter granted to
me/us on the basis of the statement furnished is liable to cancellation or
any other action that may be taken having regard to the circumstances of
the case if it is found that any of the statements or facts therein are
incorrect or false.
An affidavit duly sworn in support of the above
information is enclosed.
Place:__________

Signature of the Applicant_____________

Date:___________

Name in Block Letters________________

Designation
_________________

Official

Full Official address

Seal/Stamp

__________________

________________
________________
Tel. No.
________________
e-mail Address
________________
Full Residential address ______________
______________
Tel. No
______________

App-113
SOME IMPORTANT GUIDELINES
1.

Additional Information may be furnished by existing domestic units

seeking conversion into the EOU/EPZ/SEZ Scheme as per annexure.

2.

Normally raw material tie-ups are not insisted upon but this may be
necessary incases, such as granite products where availability of
raw materials is contingent
upon Government leases etc.

3.

Normally lumps sum amount up to US $ 2 Million and 8% royalty (net

of taxes) as amended from time to time over a period of five years
from the commencement of production is allowed as per the current
policy on account of foreign technology agreement as per the norms
of Department of Industrial Policy and Promotion.
In addition
selling agency commission is permitted as per RBI norms.

4.

In cases involving high outgo of foreign exchange for capital goods

and raw
materials, the Government prefers raising of funds
through external commercial borrowings.

App-114

ANNEXURE

PROFORMA TO BE FILLED IN BY THE EXISTING DTA UNITS SEEKING CONVERSION INTO

THE EOU/ EPZ/ SEZ SCHEME
a)

b)

c)

d)

Whether conversion of DTA Unit into the

EOU/EPZ/SEZ has been sought for the full
existing capacity of the unit or the proposal
is for partial conversion.(Please give
details of the existing capacity etc.)
Whether any expansion of the DTA unit proposed
converted into EOU/EPZ/SEZ has bee envisaged,
if so the extent thereof.(Please give details
of the existing capacity and the enhanced
capacity etc).
What is the level of existing exports of
the unit proposed to be converted into
EOU/EPZ/SEZ. (Please give details of
export performance item-wise for a minimum
of three previous years)
Whether the DTA unit is already under
obligation to export, under:
i)
Advance Licensing Scheme;
ii)
Import of machinery under EPCG scheme;
iii)
Any other Scheme.
(Give all relevant details including total
E.O. imposed, the E.O. discharged till date
etc.)

e)

Whether your unit is registered with the

Customs or Excise authorities.
(Please give details viz. Reg. No., date etc.)

f)

Are you agreeable to have your whole unit

customs bonded as required under the
EOU/EPZ/SEZ scheme?
Whether you are a merchant exporter
or a manufacturer exporter.(Please give
details)
What is the age(year of manufacture)and
residual life items of machinery already
installed in your unit, whether they are
imported or indigenous.(Please attach
separate sheets giving item-wise details
with value of the new CG as well as
existing value of machinery presently installed)

g)
h)

Date____________

Signature_____________

Name _______________________

Place __________

Address of the Applicant

App-115

APPENDIX 14-B
CRITERIA TO BE ADOPTED FOR AUTOMATIC APPROVAL OF EOU/EPZ UNITS UNDER
EOU/EPZ /SEZ SCHEME
1.
(a)

APPROVAL UNDER EXIM POLICY :

EPZ/SEZ Units:

(i)
Proposals for setting up units under EPZ/SEZ scheme under automatic
route or other approvals under Exim Policy shall be considered by a
Committee headed by the Development Commissioner and consisting of Joint
Development
Commissioner
or
Deputy
Development
Commissioner,
Assistant/Deputy Commissioner of Customs and officials of the concerned
agency posted in the Zone, as considered necessary. The Committee shall
meet every Monday. More than one meeting may also be held in a week as
considered necessary.
While considering the applications, the Committee
may also keep in view the factors such as (i) proof of address of the
promoters given in the application; (ii) financial capability of the
promoters
to finance the project (through
audited report/income tax
returns ) (iii) experience of the promoters and (iv) track record of the
promoters,
if they were earlier operating under EOU/EPZ/SEZ scheme
through report from other Zones.
(ii) Wherever necessary, the above may be verified through personal
interview with the promoters of the project.
In the event of the
promoters being a well-established entity, the procedure of personal
interview may be dispensed with.
(b)_Export Oriented Units:
(i)
Proposals for setting up units under EOU scheme under automatic
route or other approvals under Exim Policy shall be considered by a
Committee headed by the Development Commissioner and consisting of Joint
Development
Commissioner
or
Deputy
Development
Commissioner,
Assistant/Deputy Commissioner of Customs of the Zone concerned.
The
Committee shall meet every
Monday.
More than one meeting may also be
held in a week as considered necessary.
While considering the
applications, the Committee may also keep in view the factors such as (i)
proof of address of the
promoters given in the application; (ii)
financial capability of the promoters
to finance the project (through
audited report/income tax returns ); (iii) experience of the promoters;
and (iv) track record of the promoters,
if they were earlier operating
under EOU/EPZ/SEZ scheme through report from other Zones.
(ii) Sensitive Sectors: Care shall be taken by the Development
Commissioner while approving projects in sensitive sectors such as yarn
texturising
unit,
textile
processing,
pharmaceuticals/drugs
formulations/re-cycling of ferrous and non-ferrous metal scraps etc.
Projects for setting up units in sensitive sectors shall be approved by
the Development Commissioner after personal meeting with all the Directors
and inspection of the factory site.

App-116
(iii) Wherever necessary, the above may be verified through personal
interview with the promoters of the project.
In the event of the
promoters being a well-established entity, the procedure of personal
interview may be dispensed with.
2. OTHER APPROVAL MATTERS:
(a)

SEZ Units:

Wherever possible all Central/State level clearances required for

setting and operation of
SEZ units may be provided at the Zone itself
through the Committee mentioned in para 1 above through suitable
delegation of powers. Wherever, it is not possible, an empowered Officer
of the concerned Agency/Department may be periodically deputed to grant
in-house clearances.
(b) EOU/EPZ Units:
The Committee indicated in para 1(b) above shall resolve the
approval difficulties of the EOU/EPZ units. In the absence of Development
Commissioner, the next senior officer in the Zone will hold the meeting.
The unit shall intimate the problems being faced by them in advance.
In
the meetings representatives of the concerned agencies and the unit may be
invited to address the issues.
Concerned State Government would be
advised by the Development Commissioner to nominate a nodal officer of the
Department
at
the
place
of
Development
Commissioners
office
(
particularly for labour, Environment, power, sales tax & industry) who
will be invited to participate in the meetings.
(1)
i)
ii)

iii)
iv)

Sector specific requirements for EOU/EPZ unit:

RICE:
Export of rice(both basmati and non-basmati)shall be subject to
minimum export price(MEP) whenever inforce;
The labeling of export package should declare the type of rice and
country of origin. The export of rice would be under brand names
suitably registered with APEDA which shall be the nodal agency in
the matters relating to labeling and registration of brand names;
The approval shall be granted in consultation with Ministry of Food
Processing Industries with regard to capacity of the unit;
EOU/EPZ rice mills will be exempted from levy orders limited to the
quantity exported by them.

(2)
TEA:
The approval
conditions:i)
ii)
iii)
(iv)
(3)

for

setting

up

EOUs

would

be

subject

to

the

following

DTA sale of Tea will not be allowed .

Use of India Tea logo shall be allowed with the permission of Tea
Board.
DTA sale of instant tea would be allowed upto 20% of FOB value of
exports in the form of tea bags or bulk.
Tea units may be allowed to sell tea waste in accordance with para
6.9 of the Policy.
Coffee

Export of imported coffee shall be subject to approval from Coffee

Board under relevant Act.

App-117
(4)

Granite
Only those proposals involving quarrying of granite for further
processing or manufacture of articles of granite for export shall be
considered under Granite Sector.

(4)

PETROLEUM PRODUCTS:
Proposals for setting up petroleum refineries under the EOU scheme
shall require prior clearance of the Ministry of Petroleum.

(5)

FLORICULTURE/HORTICULTURE EOUS:
The EOUs engaged in floriculture/horticulture may import for use at
fields of other contract farmers the following irrigation equipments
as these are covered in the green house equipments listed in
Annexure -I notification No.126-Cus /94 dated the 3rd June, 1994 as
amended from time to time.

S.No. Name of the equipment

1.
2.
3.
4.
5.
6.
7.

HSD No.

Filters
Driplines & Drip Fittings
Micro sprinklers & Misters
Agriculture sprinlers
Fertilizer Tanks
Valves
Fertilizer pumps & Chemical Injections

84.21
84.24
84.24
84.24
84.24
84.81
84.13

It may, however be ensured that not more than 50% production may
take place at other identified place with the help of the above equipments
besides
normal
export
production
on
the
specified
area
of
floriculture/horticulture EOUs.
(6)

HIGH GRADE IRON ORE

Proposals for export of high grade i.e. 64% Fe Iron Ore and above except
iron ore of Goa origin and Redi origin are presently canalized through
MMTC and its exports would be subject to annual quantity allocation by the
BOA.

App-118
TO BE PUBLISED IN THE GAZETTE OF INDIA,
1)

Annexure I

EXTRAORDINARY,

(PART I SECTION

GOVERNMENT OF INDIA
MINISTRY OF COMMERCE AND INDUSTRY
(DEPARTMENT OF COMMERCE)
New Delhi,

dated the August 7 , 2001

NOTIFICATION
No. 14/1/2001-EPZ:

In supersession of Ministry of Commerce and

Industry Notification No. 14/1/2001 dated 19.6.2001,

Government of

India hereby constitutes combined Board of Approvals for EOU/EPZ

and SEZ Schemes as under:1.

Additional Secretary
Department of Commerce

Chairman,

2.

Joint Secretary
Department of Commerce

Member

3.

Joint Secretary,
Department of Industrial Policy
and Promotion

Member

4.

Member(Customs)
Member
Central Board of Excise and Customs

5.

Director General of Foreign Trade

6.

Joint Secretary,
Ministry of Environment and Forests Member

7.

Joint Secretary,
Ministry of Science and Technology

8.

A representative from Ministry of

Member
Small Scale Industries and Agro and
Rural Industries

9.

Development Commissioner of the

concerned EPZs/SEZs

Member

Member

Member

10.

11.

A representative of Department of
Economic Affairs

Member

App-119
A representative of Ministry of Urban
Development and Poverty Alleviation

Member

12.

A representative of Central Board of

Direct Taxes

Member

13.

Deputy Secretary/Director (EOU/EPZ) Member-Secretary

Department of Commerce

Powers and functions of the Board:

1. The Board shall consider proposals under EOU/EPZ/SEZ scheme that fall
outside the automatic approval procedure as notified from time to time.
2. Subject to necessary empowerment under section 14 of the Industries
(Development and Regulation) Act, 1951, the Board, wherever applicable,
shall

also

consider

applications

for

grant

of

industrial

licence

wherever such licence is compulsory. Minutes in such cases will be

issued after approval of Department of Industrial Policy and Promotion.
Based on the approved minutes the Development Commissioner shall issue
the Letter of Intent and upon fulfillment of conditions therein convert
the same into industrial licence.
3. All

Cases

would

be

submitted

before

the

Board

by

the

Development

Commissioner along with his comments so that the units have a single
interface at the level of Development Commissioner;
4. EOU cases involving foreign equity, including investment by NRIs and
OCBs that fall outside the automatic route shall continue to be dealt
with by the Foreign Investment Promotion Board (FIPB).

In such cases,

the units will apply directly to Secretariat for Industrial Assistance

(SIA)) for FIPB approval with a copy to the Development Commissioner
concerned.

App-120
Those falling under the automatic route shall avail themselves of the
dispensation available under the automatic route.
5. Consider

all

application

for

setting

up

of

SEZ/EPZ

in

the

public/private/joint or State sector and make suitable recommendations

in this regard.
6. Approve goods and services required for developing , maintaining and
operating SEZ or any component thereof
7. Any other issues concerning development of EPZ/SEZ
Note: Separate meeting will be held to consider the proposal to set up
SEZ/EPZ in the public/private/joint or State sector.
General
The Board may prescribe any condition, as it may consider necessary
while granting approval.
8. The Board may in its discretion grant or refuse the approval.
9. Chairman

of

Department

the
or

Board

agency

may
not

co-opt
already

any

representative

included

in

it,

if

of
he

any

other

finds

it

necessary for any specific purpose.

(D.K.Mittal )
Joint Secretary to the Government of India
[No. 14/1/2001-EOU]

App-121

ANNEXURE-II

ITEMS PERMITTED FOR IMPORT/DOMESTIC PROCUREMENT BY EOU/EPZ UNITS ENGAGED

IN AGRICULTURE/HORTICULTURE WITHOUT PAYMENT OF DUTY FOR SUPPLY TO CONTRACT
FARMERS IN THE DTA.
INPUTS:
1.

Seeds

2.

Fertilizers and chemicals for pre and post harvest treatment such
as micro nutrients, plants and growth regulators and other
organic and inorganic substances used for plant nutriation,
insecticides, fungicides, weedicides, herbicides and the like.

EQUIPMENTS:
1.

Filters

2.

Dripliers, Driplines and Drip-fittings

3.

Micro sprinklers and misters

4.

Agriculture sprinlers

5.

Fertilizer Tanks

6.

Valves

7.

Fertilizer pumps and chemical injections

App-122
Appendix 14 C

(FORMAT FOR LETTER OF PERMISSION)

OFFICE OF DEVELOPMENT COMMISSIONER/
------------------------EXPORT ORIENTED UNITS/
EXPORT PROCESSING ZONE/SPECIAL ECONOMIC ZONE
DEPARTMENT OF COMMERCE, GOVERNMENT OF INDIA
-----------------------Dated the-----------------------------

To,
M/S
Subject:

--------------------------------------------Your
unit
application
for
permission
under
the
100%
EOU/EPZ/SEZ Scheme for the production of ------------------------No.------------------EPZ/SEZ -------------- dated-----------

Dear Sir/Madam/Gentlemen,
With reference to the above mentioned application, Govt./Development
Commissioner is pleased to extend to you all the facilities and privileges
admissible and subject to the provisions of the Export Oriented Unit
Scheme as envisaged in Export Import Policy
2002-2007 for the
establishment of a new undertaking at
in
the State of ____________________for the production of the following
items(s) upto the capacities specified below on the basis of maximum
utilisation of plant and machinery :Item(s) of production

Unit

Annual capacity

The above permission is subject to the conditions stipulated in

Annexure in addition to the following conditions: (i)

The unit shall export its entire production, excluding rejects and
sales in the domestic tariff area as per provisions of Export and
Import Policy for a period of 5 years from the date of commencement
of
production.
For this purpose the unit shall furnish the
requisite legal undertaking as prescribed in the Exim Policy to the
Development Commissioner concerned. The unit would have the option
to renew its EOU/EPZ/SEZ status or debond for production for
domestic market in the light of industrial policy in force at that
time in relation to production of the items reserved for small scale
and sectoral policy prevailing at that point of time.

App-123
(ii) It is noted that Net Foreign Earning as a percentage of export
(NFEP) calculated as per formula given under the EOU Scheme, has been
projected as ----- % during the period of five years from the date of
commencement of production.
However, the unit would be required
to
achieve the minimum stipulated level of NFEP as prescribed in the ExportImport Policy, failing which the unit may be liable for penal action.
Or
The SEZ unit would be required to achieve positive Net Foreign
Exchange (NFE) as prescribed in the Export and Import Policy and Handbook
of Procedures, failing which it would be liable for penal action.
(Strike out whichever is not applicable.)
(iii) It is noted that you require imported Capital Goods valued at Rs.--------for the proposed project.
(iv)

It is noted that you have projected export turnover of US $ ----------- in five years. However, the unit would achieve a minimum Export
Performance(EP) as prescribed in Export Import Policy failing which
the unit may be liable for penal action.
Minimum EP is not
applicable to SEZ units.

v)

Import/local purchase will be permitted of all items except those

listed in prohibited list for import/export.

vi)

Possession of allotted plot/SDF will be taken within a period of 3

months of issue of approval letter and construction of the factory
building/implementation of project shall be started within next six
months in case of EPZ/SEZ units only.

(3)

This Letter of Permission is valid for 3 years from its date of

issue with in which you should implement the project and commence
commercial
production
and
would
automatically
lapse
if
an
application for the extension of validity is not made before the end
of the said period. As soon as production starts an intimation to
this effect should be sent to the Development Commissioner of
concerned EPZ/SEZ and Administrative Ministry/Departments concerned.

(4)

The approval is based generally on the details furnished by you in

your project application.

(5)

You shall be required to enter into a Legal Agreement in the

prescribed form (Appendix 14 D of HBP (Vol. I) with DC_______ for
fulfilling the terms and conditions mentioned in the LOP.

(6)

You are requested to confirm acceptance of the above terms and

condition to the undersigned within 45 days and the Administrative
Ministry/Department viz---------------------.

App-124

(7)

If you fell to comply with the condition stipulated above, this

letter of approval is liable for cancellation/revocation.

(8)

All future correspondence for amendments/changes in terms and

conditions of the approval letter or for extension of its validity,
if required etc may be addressed to the undersigned.
Yours faithfully,
Development Commissioner
---------------------EPZ/SEZ

Copy forwarded to :1.

2.
3.
4.
5.

M/o / D/o----------------(AM)
Development Commissioner(SSI),Nirman Bhavan,New Delhi.
Director of Industries, Govt. of (State)
Asstt Commissioner/Deputy Commissioner(Custom) EPZ/SEZ
(for EPZ/SEZ Units)
Deputy Commissioner, Central Excise/Customs I/C of EOU
(for EOUs)

Development Commissioner
------------------

App-125

APPENDIX - 14 D

FORM OF LEGAL AGREEMENT FOR EXPORT ORIENTED UNITS AND EPZ/SEZ UNITS
----------------------------------------------------------------------------------------------------------------------------NOTE: PLEASE SEE PARAS 6.6 & 7.6 OF THE POLICY AND PARAS 6.6 & 7.6
of
the HANDBOOK OF PROCEDURE --------------------------------------------------------------------------------------------------------------------An
agreement
made
this
_____________day
of
___________2002_____between
M/s.
_________________________________(
indicate legal status i.e. a company or firm) an Export Oriented Unit
(EOU) / a unit in the Export Processing Zone (EPZ)/a unit in a Special
Economic Zone (SEZ)
having its registered office at ___________________
and factory at ___________ (hereinafter referred to as the unit which
expression shall include its successors and assigns) of the one part and
the President of India
acting through Development Commissioner (DC) of
..EPZ/SEZ (hereinafter referred to as Government which expression
shall include his successors in office and assigns) of the other part.
Whereas
the
Government
has
communicated
vide
Letter
No.
___________dated _________to the Unit the terms and conditions for setting
up the EOU/EPZ/SEZ unit for the manufacture of __________________and the
Unit has duly accepted the said terms and conditions vide their letter
No.__________dated __________.
AND WHEREAS
the unit has been permitted to import/purchase
indigenously Plant and Machinery, raw materials, components, spares and
consumables free of Import / Central excise duty as per details given at
Annexure- I.
And whereas a license has been granted to the unit by the Government, on
the basis of their projected export
of US $_____________in five years,
(including the supplies in the Domestic Tariff Area(DTA) which are counted
towards fulfillment of export performance as per Policy) beginning from
the first day after commencement of commercial production(hereinafter
referred to as the prescribed date)after allowing admissible rejects.
NOW THIS AGREEMENT WITNESSETH AS FOLLOWS:
----------------------------------------------------------------1.

The Unit shall achieve NFE

Or
The Unit shall
achieve minimum export performance(EP)
(including the supplies in the DTA which are counted towards
export performance as per policy) for a period of five years,
counting from the prescribed date, after allowing admissible
rejects and shall also achieve minimum Net Foreign Exchange as
a percentage of export(NFEP) as prescribed in
the Export and
Import Policy.
(Strikeout which ever is not applicable)
App-126

2.

Such performance shall be subject to annual monitoring by the

Development Commissioner(DC) having jurisdiction over its
activities under the guidelines issued by the Ministry of

3.

Commerce, Government of India from time to time and the unit

shall be liable for penalty under the Foreign Trade(D&R)Act,
1992 as amended from time to time for failure to fulfill such
obligation.
For the purpose of counting export performance
under the EOU/EPZ/SEZ scheme, exports to Nepal or Bhutan shall
qualify, if payment is made in Foreign Exchange.
(a)The Export Performance(EP) undertaken by the unit under the
EOU/EPZ Scheme shall be in addition to and over and above any
other export obligation that might have been or may be imposed
on the Unit on any other ground.
(b)However, in case of conversion of DTA units to an EOU/EPZ
under provisions of the Exim Policy, where the unit may have
availed Export Promotion Capital Goods (EPCG) scheme while
functioning in DTA & has to fulfill EP under EPCG license, such
EP will be subsumed under EP of EOU/EPZ.
(Para 3(a) & 3(b) not Applicable to SEZ units.)

4.
The unit shall intimate the date of commencement of the production
for export within one
month of such date to the concerned Development
Commissioner. The unit shall maintain e-mail address regularly during the
period under bond.
The unit shall not dispose of its production in the domestic market
except in terms of the provisions of Export and Import policy and/or when
specifically allowed by the competent authority.
5.
The Unit shall after the commencement of
production for export,
submit to the concerned Development Commissioner, quarterly performance
report in the prescribed format at Annexure III for the period ending
March/June/September and December every year within 30 days of the close
of quarter through e-mail giving details of the imports/exports effected
and purchases made from the Domestic Tariff Area by the Unit during the
period.
An annual performance report shall be submitted
in the
prescribed format given at Annexure - III within a period of 90 days
following the close of financial year failing which further imports and
DTA sale will not be permitted.
Annual Performance Reports shall be
certified by a Chartered Accountant. In case of wrong submission of such
information or failure to submit such information within the stipulated
time, DC may withdraw the permission granted to the unit for operation.
6.
In the event of the Unit failing to fulfill the terms & conditions
of Letter of Permission(LOP) / Letter of Intent (LOI)
and the minimum
stipulated level of EP(for EOU/EPZ units)
and NFEP/NFE as prescribed in
the Export-Import Policy, except when the fulfillment of such conditions
is prevented or delayed because of any law, order, proclamation,
regulation/ordinance of the Government or the shortfall in fulfillment of
NFEP/NFE and EP(for EOU/EPZ units)
is within the
App-127
permissible norms specified in the monitoring guidelines given at Appendix
14-E the unit would be liable for penal action under the provisions of
Foreign Trade (Development & Regulation )Act, 1992 and the Rules & Orders
made thereunder.

7.
The unit shall also be subject to the conditions stipulated and
required for availing exemption from duty of Customs and Excise under the
relevant Customs & Excise Notifications and any customs duties/Excise
duties and interest payable to / leviable by the Government for failure
to fulfill such conditions shall also, without prejudice to any other mode
of recovery be recoverable in accordance with the provisions of Section
142 of the Customs Act 1962/Section II of the Central Excise Act 1944 and
rules made thereunder and/or from any payment due to the Unit from the
Government.
8.
Any order issued by the Government in this regard shall be final and
binding and the Unit thereby undertakes to comply unconditionally with
such an order.
9.
Any Stamp Duties payable on this document or any document executed
thereunder shall be borne by the Unit.
In witness whereof the common seal of _____________has been here into
affixed and for and on behalf _______________has set and subscribed his
hands here into. common seal of the within named Unit has been affixed
here into in the presence.

Signature______________
of
(I)
(I)_____________________

Shri

_______________________

(Residential address)
Director and (ii) Shri _______________Director who have been duly
authorized for the purpose by a resolution of the Board of Directors of
the Company passed at the meeting held on ______________and who have
signed in the presence of _________________.
1.

2.

______________(Name , Designation and Address)

(Tel. No.
(e-mail Address

______________(Name, Designation and Address)

(Tel. No.
(e-mail Address

)
App-128

Signed for an on behalf of the President of India

By Shri _________________________________in the presence of

1.

____________________________(Name , Designation and Address)

2.

____________________________(Name, designation and Address)

App-129
EXEMPTION MATERIALS
1.

Plant, Machinery and Equipment to be imported.

ANNEXURE-I

No.

2.
No.

3.

No.

Description of goods

Raw Materials, Components and Consumables

to be imported.

Description of material

Plant, Machinery and Equipment and Raw Material, Components and

Consumables to be indigenously produced and purchased without
payment of Central Excise Duties.
Description

of material

App-130
ANNEXURE-II
Period of reporting: (April-June) (July-Sept.) (Oct-Dec) (Jan-March,
) Quarterly Progress Report for the EOUs/EPZs/SEZs which are under
implementation:

1.

Details of the unit

(a)
Name of the unit
(b)
IEC No.

2.

Location of the Factory & Full Address:

a.
b.
c.

Address
Phone No.
Fax No.

3.

:
:

:
:
:

Regd.Office

a.
b.
c.
d.

Address
Phone No.
Fax No.
e-Mail No.

:
:
:
:

4.

Approval No. and date

5.

Green Card No. and date

and the period of validity :

6.

Present position in regard to

setting up of the unit (Tick whichever
is applicable)
a.

Acquisition of land

Erection of Building

To Start/ Started Over/Building

c.
Electricity
Available

Not applied

d.
Water
Available

Not applied

Applied on

e.
Telephone/Fax
Available

Not applied

Applied on

b.
purcahsed

7.

Employment:

a)

No. of Men Workers employed in

the unit
No. of Women workers employed
in the unit
TOTAL:

b)
c)

Yes

No

Applied on

Managerial

Skilled

Unskilled

Managerial

Skilled

Unskilled

App-131
8.
Imports during the quarter (Rupees in Lakhs)
Cumulative
a.

Value of Capital Goods imported

During the
Quarter

9.

b.

Value of Raw Materials, Components

etc. imported

c.

Value of indigenous Capital Goods

purchased.

d.

Value of Industrial Raw Materials

Components etc. purchased.

Sanction of bonding facilities:

Yes

a.

if "yes" date on which warehousing

licence issued

b.

if "no" date on which customs/

excise approached.

10.

Date likely to commence production

11.

Any other information

No

(Signature with seal of the company)

Place:_____________
Date:______________

App-132

ANNEXURE-III

FORMAT FOR QUARTERLY/ANNUAL PROGRESS REPORT FOR THE WORKING UNITS

Period ----PERIOD
OF
REPORTING:
QUARTERLY
(APRIL-JUNE)(JULY-SEPTEMBER)(OCTOBER
DECEMBER)(JANUARY-MARCH), ANNUAL (APRIL-MARCH)

1.

Details of the Unit

a) Name of the Unit
b) IEC. No.

2.

PERIOD OF REPORTING

Approval No. & Date

4.

Item of manufacture/service Annual Capacity

(Details of all items to be provided)
a)
b)

5.

Factory Location/Address/
Telephone No.

6.

Regd.Office Address/Tel/Fax No

7.

(a) e-Mail Address (Compulsory)

(b)

Web Site, if any

8.

Date of commencement of
production

9.

Details of Foreign Exchange

Inflow/Outflow
EXPORT(INFLOW)

10)

11)

(Rs. in Lakhs)

FOB value of exports for the

Quarter/Year
a)
GCA exports
b)
RPA exports
c)
Total:
(a)Goods sold in DTA in terms of
Para 6.10(b)for quarter/year
(b)Deemed export for other categories during the quarter/year
Total

12)

Cumulative exports during current

quarter/year.

13)

Cumulative exports for the

previous year.

14)
15.

$ in Million

App-133
Country-wise details of exports
IMPORT(OUTFLOW)
(Rs. in Lakhs)
Opening balance of imported
RM, Consumables, spares, etc.,
during the quarter/year

$ in Million

16)

Raw Materials/consumables
/components spares etc. imported
during the quarter/year

17)

RM/consumables/spares, etc.
transferred to other units
during the quarter/year

18)

RM/consumables/spares, etc.
received under the inter-unit
transfer during the quarter/year

19)

Cumulative import of
RM/consumable etc. during
the quarter/year

20)

Imported RM/Consumables/Spares,
etc., CONSUMED during the quarter/year

21)

Closing balance of imported RM/Consumables

/Spares, etc, at the end of quarter/year

22)

Opening balance of capital goods

23)

Import of capital goods

during the quarter/year

24)

Capital goods received under

inter-unit transfer

25)

Capital goods transferred under inter-unit

transfer

26)

Cumulative imports of capital goods

during quarter/year.

Sub-Total [Column No. 19 + Column 26]

27)

Other FE Outflow(Royalty/
technological know-how/investment
/Dividend payment/Travel/Commission etc.)
during the quarter/year

TOTAL OUTFLOW [Column No. 19 + 26 +27]

28)

Net foreign exchange earning

Approved
(NFE)/Net foreign exchange
(only for EOU/
earning as a percentage of exports EPZ units)
(NFEP) as per policy
App-134

29)
EP(only for EOU/EPZs to be given annually)
DOMESTIC PROCUREMENT
30)

Opening balance of indigenous

capital goods
during the quarter/year

Achieved

31)

Purchase of indigenous
capital goods during the
quarter/year

32)

Cumulative balance of indigenous

capital goods purchased during
the quarter/year

33)

Opening balance of indigenous

RM/Consumables/spares, etc.,
during the quarter/year

34)

Purchase of indigenous
RM/Consumables/spares, etc
during the quarter/year

35)

Cumulative balance of indigenous

RM/consumables/spares purchased during
the quarter/year

DTA SALE
36)

37)

(a)Sales of goods effected in DTA if

any
(b)Sales of rejects in DTA if any:
(c)Sale of Waste/Scrap/Remnant
d) Sale by product
(e)Total
DTA sale on full duty

Quantity

Value

Quantity
Quantity

Value
Value

Quantity

Value

Quantity

Value

38)

Items of manufacture/service
Annual capacity(at the end of financial year)

39)

Foreign/NRI/Indian investment
(to be submitted quarterly/annually)

Foreign

NRI

Indian

i) Authorised capital
ii) Paid up capital
iii) Foreign Direct Investment -

(I) Approved
(II)Actual Inflow
during the quarter/
year
(III)Cumulative balance
for the quarter/year

App-135
iv) NRI capital

(I) Approved
(II) Actual Inflow
during the
quarter/year
(III) Cumulative balance
for the quarter/year

40.

Employment:

a)

No. of Male Workers employed in

the unit

Total

Managerial Skilled Unskilled

b)

No. of Women workers employed

in the unit

Total

Managerial

c)
41.

Skilled Unskilled

TOTAL: (a + b)
OTHER INFORMATION :

b)

Goods exported without GR form

under intimation to the
Development Commissioner of SEZ such as (i) imported goods
found defective for the purpose of replacement by foreign
suppliers or collaborators, imported goods on loan basis,
export of free samples,
surplus goods imported from foreign
suppliers or collaborators free of cost for production
operations,
consignments
imported
for
participation
in
exhibitions etc.
(only for SEZ Units)
Overseas investment

c)

Overseas investment made by the unit at the end

quarter/year
a) Less than one years
Amount in $
(b) More than one years
-do(only for SEZ Units)
Cases of pending Foreign Exchange

a)

of

last

Cases of pending Foreign Exchange realisation outstanding for

more than 180/360 days at the end of last quarter/ financial
year
Date of export
: Name of Importer:
Address :
Amount
d)

(180 days for EOU/EPZ units and 360 days for SEZ Units)
External commercial borrowing
External commercial borrowing
quarter/year
(a) Less than three years
(b) More than three years

pending

at

the

end

Amount in $
-do-

App-136

e)

Revenue contribution
Revenue contribution by EOU/EPZ/
SEZ units
(a)
Excise duty on DTA sale during the financial year

of

last

(b)
Income tax paid, if any, during the financial year
(c)
State taxes, cess duties & levies (including CSTpaid on
domestic procurement).

(S I G N A T U R E)
With Seal of Co.
Notes :1)
2)

The above information should be given separately for each Letter

of Permission.
The information given in the formats should be authenticated by the
authorized signatory of the unit and should be certified for its
correctness by a Chartered Accountant with reference to the account
records and registers maintained by the unit.

App-137

APPENDIX 14 E
Guidelines for monitoring the performance of EOU/EPZ/SEZ/STP/EHTP units

(1)

.
(2)

The annual review of performance of each operational unit and its

compliance with the conditions of approval shall be undertaken by
the Development Commissioner before the end of the first quarter of
the following financial year;
A summary of annual performance review will be sent by each
Development Commissioner to the Ministry of Commerce for information
under the three formats indicated below latest by 31st
July every
year;
Proforma I: Comparative statement of performance and monitoring as
compared to previous year;
Proforma II:
Summary of annual
performance of the EOU/EPZ/SEZ
units, sector wise with sectoral sub totals.
Proforma III: Unit-wise statement on NFE and NFEP showing the result
of review.
PART(A)

3.

CRITERIA FOR

ANNUAL MONITORING:

The criteria for keeping the unit under watch or initiating

action in respect of EOU/EPZ units would be as follows :

penal

i)

Watch If there is shortfall in achieving the NFE/NFEP and/or

Export Performance (as per norms in Exim Policy) at the end of
1st and IInd year;

ii)

Penal action -If at the end of 3rd or subsequent year the

NFE/NFEP/EP are not achieved as per Exim Policy, Show Cause
Notice will be issued. After consideration of reply of unit,
if it is noted that the unit has not achieved NFEP/EP as per
policy
the Development Commissioner would initiate penal
action under the FT(D&R) Act, 1992;

iii)

If penal action has been initiated against a unit on account

of shortfall in NFE/NFEP/EP as stated above in a particular
year and it defaults again in subsequent year(s), fresh penal
action will be initiated against the unit. If however, during
the adjudication proceedings, it comes to light that unit has
improved performance and now fulfilling NFE/NFEP/EP as per
policy, DC concerned would consider that fact before taking a
decision.

App-138
4.

METHOD OF MONITORING:

i)

In all cases of debonding where the unit has imported inputs and
failed to fulfil the conditions of LOP with regard to NFE/NFEP/EP,
appropriate steps are to be taken for penal action after issuing

Show Cause Notice to the units.

Steps may also be initiated for
cancellation of LOP/LOA of units which is not operating for more
than a year;
ii).

The Minimum export obligation expressed as minimum FOB value of

exports shall be as per the norm for the 5 year period for various
sectors given in the Exim Policy from time to time;

(iii) NFE/NFEP is to be calculated as per Paras 6.5, 6.22 & 7.4 of Exim
Policy & Paras 6.5, 6.22 & 7.4 of the Handbook of Procedures(Vol.I).
For purpose of uniformity, guidelines for calculation of NFE/NFEP/EP
given in Exim Policy, may be followed.
5.

MONITORING PERIOD
Units which have not completed one year, from the date of
commencement of commercial production, will not be monitored
In
case a unit has completed less than five years from the date of
commencement of commercial production it will be monitored for the
number of completed years.
Annual monitoring in the cases of old
units which have completed more than five years will be undertaken
for only such number of years which fall in the second block of five
years

6.

OTHER CONDITIONS
Development
Commissioner
will
monitor
Foreign
Exchange
realization/remittance of EOU/EPZ/SEZ units in coordination with the
concerned General Manager of RBI as per instructions issued on the
subject vide
RBI circular No. COEXD. 3109/05.62.05/99-2000 dated
21.2.2000.
PART B: SCHEME SPECIFIC CONDITIONS

7.

Concurrent joint monitoring of EOU / EPZ units:

a)

The performance of EOU / EPZ units would be jointly reviewed by the

Development Commissioners of EPZs and concerned Customs / Central
Excise Officers on six monthly basis i.e. April - September each
year to be completed in the following quarter on the basis of QPRs
furnished by the EOUs and for the full financial year on the basis
of APR to be completed in the following quarter. The formats of
QPR/APR have been prescribed in the LUT at Appendix 14 D.

App-139
b)

Joint review of EP/NFEP of the EOUs would be conducted by the DC /

JDC and jurisdictional Deputy Commissioner/Asstt. Commissioner of
Customs and Central Excise in the office of Commissioner of
Customs/Central Excise where representative of units would also be
invited. This will help them to understand the scheme and clear the
doubts about operation. The Development Commissioner are advised to
identify the number of Customs and Excise Commissioners where the
meetings are to be held and work out a scheduled for visiting each

of these places. It is suggested that at least two places should be

visited each month, so that all places are covered within a period
of three months. Some places may be covered by JDC and in the next
six months, these could be interchanged between JDC and DC.
For
EPZ/SEZ units, this review will be done in the Zone itself.
c)

For publicising the scheme, advertisement in the local papers may

be arranged before the date of such meetings. Promotion program may
be organised in collaboration with local industry, Association on
any other organisation which has good presence in the area. General
Manager of District Industries Center may be associated.

d)

For each existing unit, review should be done at length to

understand their problems and their possible resolution. Efforts
should be made to identify the reasons for shortfall / poor
performance and unit-wise action plan should be prepared for removal
of bottlenecks. It should be ensured that the unit should have an
export promotion strategy as well tentative targets for next few
years, so that it has an idea as to what is to be achieved by them.
Effective action should be taken against erring units to discourage
any misuse of the scheme.

(e)

For units under implementation, separate review beheld so that their

issues could be resolved.

(f)

At such places, if any infrastructure gaps are noticed, District

Administration may be advised to prepare projects which can be
routed through State Government to the Ministry for approval under
Scheme for central Assistance for Developing export infrastructure
and other allied activities (ASID).

g)

Based on the joint review Development Commissioner concerned would

prepare a report for information of the Department of Commerce and
CBEC and suggest corrective measures to enable the defaulting units
to fulfill their obligation as per Exim Policy / Customs
Notifications.

8.

QUARTERLY AND ANNUAL MONITORING OF

a)

The performance of the SEZ units shall be monitored by a Committee

as provided for in the Exim Policy.

b)

The performance of the SEZ units to be monitored each quarter period

on the basis of reports received on formats prescribed in HBOP.

SEZ UNITS

App-140
c)

Annual monitoring would be undertaken on the basis of APR prescribed

in Annexure III of Appendix 14-D. However, penal action is to be
initiated only if NFE achieved is negative at the end of
3rd or
subsequent years. In case of existing EPZ units converting into SEZ
scheme, the date of commencement of commercial production under the
EPZ scheme will be the date for reckoning the number of years
completed by the units for the purpose of monitoring.

d)

During the joint review, efforts should be made to identify the

reasons for shortfall/poor performance and unit-wise action plan

should be
review.
(e)

prepared

for

removal

of

bottlenecks

a)
b)
c)
d)
e)
f)
II.

such

Based on the joint review, Development Commissioner concerned would

prepare a report for the information of the Department of Commerce
and CBEC and suggest corrective measures to enable the defaulting
units to fulfil their obligations as per Exim Policy/Customs
Notifications

App-141
PROFORMA-I
I.

through

APPROVAL AND IMPLEMENTATION OF EOUS / EPZ UNITS:

No.
No.
No.
No.
No.
No.

of
of
of
of
of
of

valid approved units

units cancelled
units finally debonded
exporting units
units under implementation
units yet to be implemented

RESULT OF MONITORING :

:
:
:
:
:
:

EOU/EPZ UNITS

2000 - 2001

a.

Units with shortfall in NFEP and/or EP

(as per norms in Appendix I.) at the
end of 1st and 2nd year.

b.

Units which have failed to achieve NFEP

/ EP as per Appendix-I
at the end of
3rd or subsequent years.

c.

Details of outstanding export proceeds

(where the period of realisation is not
extended by the competent authority)
beyond 180 days at the end of financial
year.
Revenue contributions by the units

d.

a.
b.
c.

d.

(a)Excise duty on DTA sale during the

financial year
(b)Income tax paid, if any, during the
year
(c)State
taxes,
cess
duties
&
levies(including CST paid on domestic
procurement).
SEZ UNITS:
Units which are operational for more
than 1 year.
Units with negative NFE at the end of
3rd or subsequent years.
Details of outstanding export proceeds
(where the period of realisation is not
extended by the competent authority)
beyond 360 days at the end of financial
year.
Revenue contributions by the units
(a)Excise duty on DTA sale during the
financial year
(b)Income tax paid, if any, during the
year
(c)State
taxes,
cess
duties
&
levies(including CST paid on domestic
procurement).
App-142

1999 - 2000

PROFORMA-II
EXPORT PROCESSING ZONE/SEZ
Summary of Annual Performance Report for the year 2002-3 Sector Wise
Sl. Name of
No. Unit with
ID No. in
Case of
EOU
1

Obligation
for last 5
years of
less as
applicable
10

Date of Item of
Commenc Manufac
ture
ement
of
product
ion
3
4

Value of
capital
goods
imported
5

Other
outflow of
FE towards
knowhow,
Commission
etc
6
7

Value
of RM
compone
nts
etc.

Total
Employment
investm Generated
ent
so far
made

Short
Value of exports
NFEP/NFE
fall
Actual (as Shortfall Norm as per Achieved
policy
during the
against
period
obligation
on col. 10)
11

12

13

14

15

Remarks
Value
of
Sales
made in
DTA
16

17

App-143

PROFORMA III
NAME OF THE UNIT
(Rupees in lakhs/
$ in Million):
Month of operation CG
Import (Actual):
1.

Item of manufacture:

2.

Industry Norm of NFEP (%)

3.

Date of Commencement:

4. Export Obligation for

last
5
years
or
less
as
applicable

Rs.

Last 5 years (or less as

applicable)

in lakhs

Last year
Last 5 years
(or less as
applicable

5.
Export
6.
Inter Unity supply
7.
C. G. debit
8.
Imported RM/inputs used
9.
Other outgo of F. E.
10.
Total Imports
11.
NFE
12.
NFEP`
13.
Difference in Export Obligation
14.
DTA Sale
15.
Details of outstanding export proceeds
(where the period of realisation is not
extended by the competent authority) beyond
180/360 days at the end of financial year.
(180 days for EOU/EPZ units & 360 days for SEZ
units)
16.

Revenue contributions by

$ in Million

the unit

(a)Excise duty on DTA sale during the financial

year
(b)Income tax paid, if any, during the year
(c)State taxes, cess duties & levies(including

:
:
:
:
:
:
:
:

CST paid on domestic procurement).

17.

Remarks

App-144

:
ANNEXURE I
CALCULATION OF NFEP/NFE

1.
While calculating NFEP/EP achieved, following basic components are
to be taken into consideration:
i.
ii.
iii.
iv.

Amortised value of capital goods and technical know how fee

Value of import of R. M. (which is consumed during the year and
consumables, spares, etc.).
Other outflow of foreign exchange towards
royalty, interest on
external commercial borrowings etc.
Value of physical exports effected excluding DTA sales but including
supplies made under para 6.9and 7.8(c) of the policy.

2.
Amortised Value of Capital Goods: For this purpose as much value of
CG is taken into account as indicated in para 6.5 for NFEP and 7.4 for
NFE of the Hand Book of procedure (Vol.I). The CG imported prior to the 5
years period is not taken into consideration for the purposes of NFEP/NFE
if the value of said CG is fully amortized. However where investment in
plant and machinery is more than Rs. 5.00 crores, the value of imported CG
will be apportioned over a period of 8 years. If any capital goods
imported duty free is leased from a leasing company or is taken in loan
the CIF value of the capital goods shall be included under the imported
inputs. However, on return of such CG its unamortized portion of value
would be excluded from the calculation formula.
3.
Import of raw material, consumables and spares etc: Whatever R. M.
Consumables and spares are imported during the year are taken into
account. However, it should be noted that whatever R. M. is in balance at
the end of the previous year is added while the RM at the end of the
current year is deducted which will give the amount of RM consumed during
the year. RM purchased as inter unit transfer is also included.
4.
Other outflow of foreign exchange: All the foreign exchange outflow
on account of
royalty, dividends, commission on exports, interest on
external commercial borrowing etc., during the particular year has to be
accounted for while calculating value addition.
However outflow on account of know-how fee would be apportioned during a
period of five years/eight years as applicable
5.
Value of
exports: While calculating value of
exports, DTA sale
made during the year are not to be accounted for. However, supplies made
in accordance with the para 6.9 and 7.8(c) of the Policy will be taken
into consideration for calculation of NFEP/NFE.

App-145
6.
Given below are details of a unit so as to calculate the NFEP for
the year 1999 2000, on the presumption that no imported RM was in
balance at the end of previous year as well as at the end of 1999-2000.
In this case, the NFEP for 1999-2000 is calculated as below: 1. Amortised value of CG.
(20% of import of CG made during the
years
1995-96 to 1999-2000)

(i.e., 20% of Rs. 50.00 lakhs)

2. Import of R. M.

Rs. 100.93 lakhs

etc

Rs. 10.00 lakhs

3. Other outflow of F. E.

Rs.

4. Value of

Rs. 173.13 lakhs

exports

10.72 lakhs

The NFEP comes to = 173.13 (10 + 100.93 + 10.72)x 100

173.13
= 29.73%

App-146

APPENDIX- 14

GUIDELINES FOR SALE OF GOODS IN THE DOMESTIC TARIFF AREA(DTA)BY

EOU/EPZ/EHTP/STP UNITS:
NOTE: Please see Paragraphs 6.8 and 6.9 of the Policy and paragraphs 6.8
and 6.9 of the Handbook of Procedures.
I. DTA SALE ENTITLEMENT FOR EOU/EPZ UNITS :
Paragraphs 6.8 of the Export and Import Policy and 6.8 of the Handbook of
Procedures provide for sale in DTA by EOU/EPZ/EHTP/STP units. Such sales
in the DTA will be governed by the following guidelines:a)

The sale of goods in

DTA
will
be subject to
the
payment of
applicable duties as notified from time to time by the Department of
Revenue, Ministry of Finance, Government of India.
DTA sale
includes clearance to any other unit within India under para 6.8.

b)

DTA sale entitlement will be

applicable only to
those goods and
services which are permissible as per EXIM Policy. No DTA sale will
be permissible if such sale is specifically prohibited in the Exim
Policy or the Letter of Permission/Letter of Intent.

c)

Units may opt for DTA sales on a quarterly, half yearly or annual
basis by intimation to the concerned
Development Commissioner of
the EPZ /SEZ .

d)

The DTA sales entitlement shall be availed of within three years of

the accrual of entitlement.

e)

An application for sale of goods in DTA as per Exim Policy by the

EOUs shall be submitted to the Development commissioner concerned
in the form given at Annexure-A. The application shall be certified
by an independent Cost/Chartered /Cost and Works Accountant and
endorsed by the Bond Officer of Customs/Central Excise
having
jurisdiction over the unit. The Development Commissioner concerned
will determine the extent of the DTA sale admissible and issue
authorization in terms of value . An EPZ unit may effect sale in DTA
on the basis of records maintained by it subject to payment of
applicable duties to Customs Authorities.

f)

Advance DTA sale permission not exceeding the entitlement accruable

on the exports envisaged in the first year shall be permitted and
such sale shall be adjusted against the subsequent entitlements
in a maximum period of two years.
However, drugs and
pharmaceuticals units can make advance DTA sale of the production
on the exports envisaged in the first two years adjustable against
subsequent entitlements within a maximum period of three years from
the date of commencement of production by the unit. The Unit shall
be required to execute a bond with the Assistant Commissioner
Customs/Central Excise concerned to cover the difference between the
amount of duties paid on the advance DTA sale and the full duties
applicable on such goods.

App-147
g)

Advance DTA sales permission would also be admissible in cases of

capacity expansion/product diversification.
In such cases, the
unit would be entitled to advance DTA sales linked to the exports
envisaged from the expansion or new production streams or through
product diversification . However, no advance DTA sale would be
admissible to a DTA unit converted into EOU except in respect of new
production stream as a result of change of technology.

h)

The DTA sale entitlement would accrue if the NFEP achieved by the
unit is not less than the minimum stipulated level in the AppendixI of the Policy on cumulative basis.

i)

EOUs
engaged
in
the
manufacture
of
perishable
items
like
floriculture, horticulture, pisiculture can also avail the facility
of simultaneous sale in DTA of such perishable items on quarterly
basis, while earning DTA entitlement on exports made during the said
quarter.
Such permission can be granted in advance by the DC
concerned subject to the condition that the unit has achieved
positive NFE cumulatively upto the previous quarter.

j)
Units in the service sector can also avail DTA sale as per procedure
mentioned above.
k)

DTA sale of instant tea will be allowed upto 20% of FOB value of
exports in the form of tea bags or bulk.

II. SALE OF GEM & JEWELLERY PRODUCTS:

DTA sale of Gem & Jewellery items will be permitted on annual basis by the
Development Commissioners upto 10% of FOB value of exports during the
preceding year subject to following conditions:
a) The application by an EOU will be submitted to DC concerned on yearly
basis (licensing-year)giving the details of production and exports made
during the preceding licensing year duly certified by a Chartered
Accountant and endorsed by the jurisdictional Custom Authority. However
an EPZ unit may effect sale in DTA on the basis of records maintained
by it subject to payment of applicable duties to Customs authorities.
b) The DTA sale of plain jewellery shall be permitted on payment of
concessional rate of duty in Indian Rupees as applicable to sale from
nominated agencies. In respect of studded jewellery, duty shall be
payable in Indian Rupees as notified by Customs.

App-148

III
.

OTHER SUPPLIES IN DTA:

(i) Sale under para 6.9 of the Policy
The following guidelines shall apply to the sale of goods in the
DTA in respect of supplies specified in paragraph 6.9 of the
Export and Import Policy and paragraph 6.9 of the Handbook of
procedures:

a)

The unit shall, at the time of application, indicate the quantity

and value of goods sought to be supplied in the DTA. If the sale
is effected against an import license held by the DTA purchaser,
the Customs/Central Excise Officer concerned will allow such sales
after making a suitable entry on the license of the quantity and
value of such sales.
The Import license shall cease to be valid
for further imports to the extent of such supplies effected by
units.

b)

If, the goods proposed to be sold by the units do not require an

import license, the Customs/Central Excise Officer concerned will
allow such supplies from the unit to the DTA.

c)

Goods supplied under (a) and (b) above will be taken into account
for the purposes of discharging export obligation and achievement
of NFEP.
The unit will file a quarterly statement to the
Development Commissioner giving details of the goods cleared in
the DTA category-wise.
(ii) Sale under para 6.8(f) of the Policy
Sale under para 6.8(f) of the Policy shall be considered by the
Development Commissioner on quarterly basis. While considering the
domestic sales, the Development Commissioner will keep the
circumstances of the case to ensure that the export orientation of
the scheme is maintained.

IV.

SALE OF REJECTS
Sale of rejects is also permitted in the DTA, as provided for in
para 6.8(a) of the Export and Import Policy and para 6.8(a) of the
Handbook of Procedures.

V.

SALE OF BY-PRODUCTS:
The sale of
by-products in the DTA is also permitted as per
provision of para 6.8(h) of the Policy after inclusion of the item
in LOP/LOI .

App-149

ANNEXURE - A

APPLICATION FOR DTA SALE PERMISSION

UNDER PARA 6.8(b) OF THE EXIM POLICY ------- FOR THE PERIOD
(QUARTERLY/HALF YEARLY/ANNUAL)
I. PROJECT DETAILS:
1.

Details of the unit

(i) Name & Address of the unit:

(ii) IEC No.
2. LOI/LOP/IL No. & Date:
3.

Details of the
products
approved for
manufacture and
export in the
LOP/LOI/IL

Present installed
capacity

Item(s) of
Manufacture/
Service

1.
2.
3.
4. Date of commencement of production:
II
5.

DETAILS OF ADVANCE DTA SALE

Details of
advance DTA sale
permitted, if any

Approval
No. and
Date

Particular
s of
products/
service
permitted

Value

1.
2.
3.
Tot
al
DETAILS OF DISPATCH UNDER PARA 6.8(a), (b), (d) & (h)
6.

1.
2.

Details of advance
DTA sale effected
(Please indicate the
period)

Description
of
goods/servic
e sold in
DTA as
advance DTA
sale

Value

3.
Total
III. PRODUCTION DETAILS FOR THE APPLICATION PERIOD
Gross production
I.

Description of
goods
produced/manufact
ured
/service

Total Production
including rejects and
waste/scrap
Quantity

Ex-factory
value

1.
2.
Tot
al

IV

DETAILS OF PHYSICAL EXPORTS FOR THE APPLICATION PERIOD

FOB value of Physical

Exports

1.
2
3.
Total

Value of
rejected
consignment, if
any

Net FOB value of

Physical Exports

App-151
NET FOREIGN EXCHANGE EARNINGS AS A PERCENTAGE OF EXPORTS (NFEP)

NFEP achieved on exports in the last five years or less as applicable

(Calculation Chart enclosed)

VI

PARTICULARS OF PROPOSED DTA SALE

Description of the items proposed

to be sold in DTA

Value

1.
2.
3.
Total
DECLARATION
I/We hereby declare that the information given above is true and
correct
Signature of the applicant
Name
Designation
Seal of the Company
CHARTERED ACCOUNTANTS CERTIFICATE
We have checked and verified the figures mentioned above from the
records and books of account of company and found them true and correct
Signature
Name
Membership No
Seal
CERTIFICATE BY CENTRAL EXCISE AUTHORITY
Verified from the records and found correct by Inspector / Supdt. Of
Central Excise & Customs I/C of the factory
Signature
Name
Seal
Note: Each page may be verified and signed by the Chartered Accountant

App-152
CALCULATION CHART (TO BE CERTIFIED BY A CHARTERED ACCOUNTANT SHOWING NFEP
ACHIEVED IN THE LAST FIVE YEARS OR LESS AS APPLICABLE
1.
i)
Ii.)
Iii)
2.

DETAILS OF EXPORTS:
F.O.B. value of physical exports made
in the last five years or less as
applicable
Value of supplies made under para 6.9
of the Exim Policy
Total

(Rs. in Lakhs)
Rs.
Rs.
Rs.

DETAILS OF CAPITAL GOODS INCLUDING DG SET AND OTHER OFFICE

EQUIPMENTS IMPORTED IN THE LAST FIVE YEARS OR LESS AS APPLICABLE

(I) CIF VALUE OF IMPORTED CAPITAL GOODS (YEAR WISE) IN THE LAST FIVE
YEARS OR LESS AS APPLICABLE
Ist year
IInd year
IIIrd year IVth year
Vth year
Total
(II)VALUE OF IMPORTED CG PROCURED FROM ANOTHER EOU/EPZ UNIT OR FROM A
LEASING COMPANY IN THE LAST FIVE YEARS OR LESS AS APPLICABLE
Ist year
IInd year
IIIrd year IVth year
Vth year
VIth year
3.

4.
(i)

AMORTISED VALUE OF CAPITAL GOODS

(Please see Note below for
calculation)
DETAILS OF IMPORTED RAW MATERIAL
Total CIF value of imported raw
materials, consumables including POL
products and components etc. in the
last five years or less applicable

iv)

5.

Rs.

Rs.

(ii)

Iii)

Rs.

Value of purchases made under Para

6.9(c), 6.14 of EXIM Policy in the
last five years or less applicable
Value of goods indicated at (i) & (ii)
above held in stock or under process
at the end of the relevant period
Value of raw materials etc. used in
goods produced and cleared from the
unit {[(i) + (ii)]-[(iii)}

Rs.
Rs.

Total value of indigenous raw materials, consumables

Rs.________________
components etc, used in goods produced and cleared
from the unit in the last five years or less as applicale

App-153
6.

OTHER OUTFLOW OF FOREIGN EXCHANGE IN THE LAST FIVE YEARS OR LESS AS

APPLICABLE

(i)

Dividends

Rs.

(ii)

Profit

Rs.

(iii)

Technical know how fee

Rs.

(iv)

Royalty

Rs.

(v)

Commission

Rs.

(vi)

Foreign travel

Rs.

(vii)

Any other outflow in foreign exchange

(Please indicate details)

Rs.

Total

7.

Rs.

NFEP achieved

100

Where A = FOB value of exports

B = Sum total of value of imported inputs used. Proportionate
(amortised) value of imported capital goods, technical know-how
fee and other expenses made in foreign exchange
Note: The proportionate (amortized) value of imported capital goods and
technical know-how fee shall be calculated @ 20% of the CIF value of
each year in the last five years or less as applicable.

App-154

APPENDIX 14 G
Procedure to be followed for reimbursement of Central Sales Tax (CST) on
supplies made to Export Oriented Units (EOUs) and units in Export
Processing Zones(EPZ), Electronic Hardware Technology Park (EHTP),
Software Technology Park (STP) and Special Economic Zones(SEZ)from
Domestic Tariff Area (DTA)
----------------------------------------------------------------------Note: Please see paragraph 6.12 & 7.9 of the Exim Policy and paras 6.12 &
7.9 of this Handbook.
----------------------------------------------------------------------The procedure given hereunder shall be applicable for reimbursement of
Central Sales Tax.
2.
The Export Oriented Units (EOUs) and units in
Export Processing
Zones (EPZs), Electronic Hardware Technology Park (EHTP), Software
Technology Park (STP) and Special Economic Zones (SEZ) will be entitled to
full reimbursement of Central Sales Tax (CST) paid by them on purchases
made from the Domestic Tariff Area (DTA), for production of goods and
services as per Exim Policy on the following terms and conditions:
(a)

(ii)

The supplies from DTA to EOU/EPZ/EHTP/STP/SEZ units must be utilised

by them for production of goods meant for export and/or utilised for
export production and may include raw material, components,
consumables, packing materials, capital goods, spares, material
handling equipment etc. on which CST has been actually paid by the
EOU/EPZ/EHTP/STP/SEZ
While dealing with the application for reimbursement of CST, the
Development Commissioner or the designated officer of EHTP/STP shall
see, inter alia, that the purchases are essential for the production
of goods meant for export and/or to be utilised for export
production by the units.

3.
The procedure to be followed in this regard is indicated hereinafter
and shall be strictly adhered to:
Procedure:
(i) The unit shall present its claim for reimbursement of CST in the
prescribed form (Annexure - I) to the Development Commissioner of the
EPZ/SEZ concerned or the designated officer of the EHTP/STP.
(ii) As soon as the goods are received by the EOU/EPZ/EHTP/STP/SEZ unit in
its premises it will be entered in the material receipt register kept for
the purpose. The register must show the details of goods, quantity, the
source of purchase and the C Form against which purchase is made, etc.
which will be subject to periodical check by the authorised staff of the
Zone/Customs administration.
A Chartered Accountants certificate
regarding the verification of the materials receipt register relevant to
the claim as at Annexure - II shall be submitted alongwith the claim.
App-155

(iii) The reimbursement of CST shall be admissible only to those units who
get themselves registered with the Sales Tax authorities in terms of
Section 7 of the CST Act, 1956 read with (Registration and Turnover)
Rules, 1957 and furnish a Photostat copy of the Registration
Certificate issued by the Sales Tax authorities to the Zone office
concerned for keeping it in the relevant file.
iv) Claims shall be admissible only if payments are made through the bank
accounts maintained by EOU/EPZ/SEZ/EHTP/STP unit or DD emanated from
its accounts.
(v)The claim shall be

submitted alongwith the following documents:

a) Chartered
Accountants
Certificate,
from
CA,
meeting
the
following criteria, certifying receipt of the goods as shown in
Annexure-II in the bonded premises, scrutiny of original
invoice/bill of the supplier and proof of payment against each
invoice/bill and its reconciliation with C Form:Eligibility criteria for C.A. firms:
(i)In case of units located in the States of J&K, Orissa,
North-Eastern
States,
Andaman
and
Nicobar
islands
and
Lakshadweep, the Chartered Accountant firm should be at least
a Sole Proprietorship firm who should be an FCA and engaged
full time with the firm.
(ii)In case of partnership Chartered Accountant firms located
in the regions indicated in (i) above, should have at least
two full time partners, one of whom should be an FCA.
(iii)In case of units located in other regions, the
partnership Chartered Accountant firms should have atleast one
full time partner, who should be an FCA.
(iv)For the regions indicated in (i) above, the Chartered
Accountant firm be located in the area where the unit is
situated otherwise qualification of (iii) shall apply.
b) Photostat copy of C Form issued by the EOU/EPZ/EHTP/STP/SEZ to
the supplier in the DTA with reference to the counterfoil
produced by the unit. The counterfoil of C form will be returned
to the unit after making suitable endorsement like cancelled/CST
reimbursed duly signed by the authorised officer of the Zone
administration. While making the endorsement only, the items for
which CST has been reimbursed should be indicated as cancelled.
and the Photostat copy will be retained by the officer for
keeping in respective file. In the event of the same `C form
being used again, the verification could be done at the time of
scrutiny from the self attested photocopies. The firm must
indicate the file No. on which the original stands submitted.

App-156
(vi) The reimbursement will be limited to the payment of CST against C
Form only.
(vii) The EOU/EPZ/EHTP/STP/SEZ shall also intimate the name of the
person/persons who are authorised by them to sign the C Form and furnish
three copies of his/their specimen signature(s) which will be kept in the
relevant file of the unit.
(viii)The reimbursement will be made on quarterly basis.
No claim for
reimbursement will be normally entertained if not claimed within a period
of six months from the completion of the quarter in which the claim has
arisen. In case of procurement of goods against payment in installments,
the CST reimbursement claim may be made in the quarter in which the full
payment has been effected against the invoice/bill.
In exceptional
cases, the Development Commissioner may consider delayed applications
after satisfying that the delay was due to genuine grounds.
(ix)

Only one consolidated claim for a quarter will be admitted for

reimbursement of CST. No supplementary claim shall be entertained.

(x)

The claim for CST reimbursement for the amount below Rs. 100/- on
any single invoice shall not be entertained.

(xi)

The disbursing authority for the claim of reimbursement of CST will

be Development Commissioner/designated officer of EHTP/STP who will
make payment to the units.
All claims shall be subjected to post
audit.

(xii) The unit shall preserve for three years all the original documents
viz. Original invoice/bill, money receipt/bank statement for
random/sample checking and produce the same as and when called for
by the office of the Development Commissioner. Random checking of
5% of the claims of a particular quarter should be done in the next
quarter through generation of computer statements on the basis of
serial numbers.
The random list will be generated by the
Development Commissioner personally.
(Xiii) In case some glaring error or irregularity is detected against any
unit
in claiming CST reimbursement, action to recover the amount
paid and levy penalty would be taken under FTDR Act against such unit.
(Xiv) Any dues of the Government viz. arrears of Lease rent, amount on
account of a Courts decree or Income tax recovery note, etc. will also
be deductible from the claim amount or it can be set off from the
subsequent payment.

App-157
ANNEXURE 1
Application for claiming reimbursement of Central Sales Tax against C
Form
for
the
goods
brought
into
the
bonded
Premises
of
the
EOU/EPZ/EHTP/STP/SEZ for the quarter ending on ----1.

Name of the applicant

2.

Full postal address

3. (a) No. and date of letter of

Approval
issued
under
EOU/EPZ/
EHTP/ STP Scheme

(b)
Whether the Letter of
Approval is still valid on the date
of this application.

4.

Registration No:

(With date or issue) issued by S.T.

Authorities under CST Act 1956
5.
Details of the goods brought
into units
(b) Name and address of the
supplier (including the
name of the state where
the supplier is located)
(c) Description of Goods
(d) Quantity
(e) Value
(f) Date
of
purchases
of
goods

6.

(g)

Date of receipt of goods

in the Customs Bonded
Premises of the EOU/EPZ
unit

(h)

Total amount of CST paid

against C Form

(i)

Sales
Tax
Registration
No.
&
date
of
the
supplier
under
Section
(7) of the Central Sales
Tax Act, 1956.

Amount of CST claimed

App-158
Undertaking and Declaration
I./We hereby solemnly undertake/declare that the particulars stated above
are true and correct to the best of my/our knowledge and belief.
No other application for claiming CST has been made or will be made in
future against purchase covered by the application.
(a)

The goods for which the claim has been made are meant for production
of goods for export and/or for export production of the
EOU/EPZ/EHTP/STP unit and will be utilised only in our factory and
we shall not divert or dispose off the material procured without
obtaining
prior
permission
of
the
concerned
Development
Commissioner.

(b)

The goods for which the claim has been made have been entered into
the stock register maintained by the unit.

(c)

Any information, if found to be incorrect, wrong or misleading, will

render/us liable to rejection of our claim without prejudice to any
other action that may be taken against us in this behalf.

If as a result of scrutiny any excess payment is found to have been

made to me/us, the same may be adjusted against any of the subsequent
claims to be made by my/our firm or in the event no claim is preferred,
the amount overpaid will be refunded by me/us to the extent of the excess
amount paid.
Signature
Name in Block Letters
Designation
Name of the Applicant
Firm

:
:
:
:
:

App-159
ANNEXURE - II
CHARTERED ACCOUNTANT CERTIFICATE
I/We hereby confirm that I/We have examined the prescribed material
receipt registers, books of account and the bank statement in respect of
the goods mentioned in the table appended, and each entry of the
application of
M/s_______________ for the period------------------------------------------- and hereby certify that:
(i)

The following documents/records have been furnished by the applicant

and have been examined and verified by me/us, namely material
handling registers certified by the zone administration/Bonding
Officer, original invoice/bill, books of accounts and l Bank
statement,

(ii)

Relevant registers have been authenticated under my/our seal,

signatures. It has been ensured that the information furnished is
true and correct in all respects, no part is false or misleading and
no relevant information has been concealed or withheld.

(iii) The
Payment
has
been
made
by
the
said
M/s.___________________________ to the DTA suppliers in respect of
goods received against the original invoice bill(s) as indicated in
the table annexed hereto.
(iv)

The payments have been made by cheque/draft and have been credited
to the accounts of the DTA suppliers.

(v)

Such payment include the amount of CST indicated in the respective

invoices.

(vi)

All the items shown in the table are admissible for reimbursement of
CST under provisions of Exim Policy and Handbook of Procedures.

Neither I/We nor any of our partners is a partner/Director or an employee

of the above named entity or its associated concerns.
I fully understand that any submission made in this certificate if proved
incorrect or false, will render me/us liable to face any penal action or
other consequences as may be prescribed in the law or otherwise warranted.
Signature & Stamp/seal of the Signatory___________
Name_______________________________________
Membership No.______________________________
Full address__________________________________
Name and address of the Institution where registered.
Date:
Place:

App-160
TABLE
DETAILS OF GOODS BROUGHT INTO UNIT AND CENTRAL SALES TAX PAID DURING THE
QUARTER__________________________________
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
(x)
(xi)
(xii)

S.No.
Name and address of the supplier
Nature and description of goods
Quantity received and accepted
Invoice value accepted
Invoice/Bill No. and date:
Date of Receipt of the goods and S.No. of entry in material
receipt register.
CST Amount paid
C Form No.
cheque/DD No.
date and amount
Name of Bank and Branch
CST Registration No. of the supplier:

Note : Table shall show supplier-wise sub-total and grand total of column
(v), (vii) and (x) Cheque/DD amount.
Signature & Stamp/seal of the Signatory________________
Name____________________________________________
Membership No.___________________________________
Full address_______________________________________
Name and address of the Institution where registered.
Date:
Place:

App-161
APPENDIX- 14 H
GUIDELINES FOR DEVELOPMENT OF INFRASTRUCTURE/CONSTRUCTION OF STANDARD
DESIGN FACTORY (SDF) BUILDINGS IN EXPORT PROCESSING ZONES (EPZs)/SPECIAL
ECONOMIC ZONES (SEZs) BY PRIVATE/JOINT/STATE SECTOR
With a view to augment the infrastructural facilities for export
production, it has been decided to permit construction of ready built up
space in the Export Processing Zones (EPZs)/Special Economic Zones (SEZs)
in the Private/Joint/State sector. The following guidelines will apply to
such proposals:
1.

Private/Joint/State sector investments may be utilised to develop

additional infrastructure facilities including construction of Standard
Design
Factory
buildings
in
the
existing
Export
Processing
Zones(EPZs)/Special Economic Zones (SEZs). For this purpose, land already
available in the EPZs/SEZs may be leased or sub-leased to developers,
inter alia, on the terms and conditions indicated below:
(1)

Units approved by the Development Commissioner of the Zone under the

EOU/EPZ/SEZ scheme, are only eligible to occupy space in the
infrastructure so created.

(2)

The land would, ordinarily, be leased or sub-leased by the Zone

administration to the developer for a period of 30 years and to be
renewed for a similar period.

(3)

A legal agreement shall be entered into between the Zone

Administration and the developer before the land is handed over.

(4)

The developer shall pay the lease or sub-lease rent for the land to
the Zone administration from the date of possession.

(5)

Private sector participation could be in either of the two ways: (i)

Build and
Own basis; and (ii) Build and Operate basis; or in
combination of both:
(i) The developer operating under the first category,
shall construct the premises and transfer the same
on outright sale basis to the units. The pro-rata
lease or sub-lease rent for the land shall be
payable annually in advance by the units to the
Zone administration from the date of possession.
The period of lease or sub-lease shall not exceed
30 years and to be renewed for a similar period.
(ii) The developer operating under the second category,
shall construct the premises and rent out the same
to the units. The period of lease or sub-lease
shall not exceed 15 years.

App-162
2.
Transfer or sub-lease of the constructed premises by the units would
not be permissible.
3.
Selection of the developer would be done by way of open competitive
bids and the parameters for evaluation would be clearly spelt out in the
bid document.
4.
Development Commissioner of the EPZ/SEZ shall have the right to
accept or reject any of the bid.
5.
Any change in the parameters/pattern of execution of the work, if
necessary, will be effected only with the prior consent of Ministry of
Commerce and Industry, Department of Commerce.
6.
During the period of construction of a private Standard Design
Factory (SDF) in an EPZ/SEZ, the Zone administration will normally not
undertake construction of any other SDF in the Zone.
7.
Proposals for development of infrastructure/construction of Standard
Design Factory buildings in EPZs/SEZs in the private/joint/state sector
are required to meet the following condition:
(a)
The EPZ/SEZ units therein will abide by local laws,
rules, regulations or bye-laws in regard to area planning,
sewerage disposal, pollution control and the like. They shall
also comply with industrial and labour laws and such other
laws/rules and regulations as may be locally applicable.
8.

Procedure for approval:

(i)
Proposal for development of infrastructure/construction of
Standard
Design
Factory
buildings
in
EPZs/SEZs
in
the
private/joint/state sector will be considered by the Board of
Approvals of EOU/EPZ/SEZ, Department of Commerce.
(ii)
A detailed project report from the developer covering
the following particulars may be submitted to the concerned
Development Commissioner of EPZ/SEZ indicating the financial details
including investment proposed, mode of financing the project and
viability
of
the
projects,
details
of
foreign
equity
and
repatriation of dividends etc., if any.

9.
On acceptance of the proposal, a Letter of Approval will be issued
to the developer by the Zone.
The approval will be subject to
cancellation in the event of any abuse or violation of the conditions of
approval.
10.
RBI guidelines on real estate ownership/development by NRI and
Foreign/Indian
companies,
will
also
apply
to
development
of
infrastructure/construction of Standard Design Factory buildings in
EPZs/SEZs in the private/joint/state sector.

App-163

APPENDIX 14 I
(TO BE PUBLISHED
EXTRAORDINARY )

IN

PART

II

SECTION

3(ii)

OF

THE

GAZETTE

OF

INDIA

S.O No.
In excise of the power conferred under Section 80 IA
Income Tax Act, 1961, read with sub rule (2) of rule 18 C of the
Tax Rules, 1962, the Central Government hereby makes the following
to develop, operate and maintain Special Economic Zones for the
beginning on the 1st day of April, 2001 for the Zones developed
before 31.3.2006.

of the
Income
scheme
period
on or

Ministry of Commerce & industry

Department of Commerce
EPZ section
* * *

1.

Objectives of the Scheme:

(a) The scheme shall aim at development of integrated world class

infrastructure for exports including carrying out manufacture of goods,
rendering of services or in connection therewith and would include
industrial, commercial and social infrastructure. Components of a Special
Economic Zone shall include roads, airports, ports, transport system,
generation and distribution of power, telecom, hospitals, hotels,
educational
institutions,
leisure
and
entertainment
units,
residential/industrial/commercial complexes, water supply sanitation and
sewerage system and any other facility required for development of the
Zone.
(b) Special Economic Zones may be developed and managed in the private
sector or jointly by State Government and a private agency or exclusively
by the State Government or their agencies.
In the case of privately
developed zones, the investors could be either Indian individuals, NRIs,
Indian or foreign companies.
(c) New infrastructural development works such as construction of Standard
Design
Factory
Building
etc.
may
also
be
undertaken
through
private/joint/State sector in the Export Processing Zones converted into
Special Economic Zones.
2.

Criteria for approval:

Proposals for setting up SEZ in the public/private/joint/State
sector are required to meet the following conditions:
(i)

Minimum size of the

hectares. This would
converting into SEZs
area as a part of such

SEZ shall not be less than 1000

however, not apply to existing EPZs
as such or for notifying additional
SEZ or to product specific SEZs.

App-164
(ii)

The SEZ and units therein shall abide by local laws, rules,
regulations or bye-laws in regard to area planning,
sewerage disposal, pollution control and the like.
They
shall also comply with industrial and labour laws and such
other laws/rules and regulations as may be locally
applicable.

(iii) Such SEZ shall make adequate arrangements to fulfill all

the requirements of the laws, rules and procedures
applicable to such SEZ.
(iv)

Only units approved under the SEZ Scheme would be permitted

to be located in these SEZ. At least 25 % area of the SEZ
shall be used for developing industrial area for setting up
of such units.

(v)

The predominant objective of development of a SEZ would be

to create infrastructure which would facilitate setting up
of industrial area for units therein as indicated in the
para (iv) above.

3. Procedure for Approval:

3.1
Applications (10 copies) indicating the name and address of the
applicant,
status
of
the
promoter
(whether
individual/private
company/State Government/NRIs etc.) along with a project report covering
the following particulars shall be submitted to the Chief Secretary of the
State:
(i)

Location of
existing and

the proposed zone with

proposed infrastructure,

details

of

(ii)

Area of the proposed SEZ and its area distance from

the nearest Sea Port/Airport/Rail/Road head etc.

(iii) Financial details including investment proposed,

mode of financing the project and viability of the
project.
(iv)

Details of foreign equity

dividends etc., if any.

and

repatriation

of

(v)

Whether the zone will allow only certain specific

industries or will be a multi-product zone.

3.2 The State Government shall, forward it alongwith their commitment to

the following, to the Department of Commerce, Government of India:
(i)

The area incorporated in the proposed Special Economic Zone

is free from environmental prohibition ;

(ii)

Water, Electricity and other services would be provided as

required;

App-165

(iii) Full exemption in electricity duty and tax on sale of

electricity for self generated and purchased power;
(iv) To allow generation, transmission and distribution of power
within SEZ;
(vi) Exemption from State Sales Tax, octroi, mandi tax, turnover
tax and taxes, duty, Cess, levies on supply of goods from
Domestic Tariff Area to SEZ units;
(vii) For units inside the Zone, the powers under the Industrial
Disputes Act and other related Acts would be delegated to
the Development Commissioner.
(viii)
The Zone will be declared as a Public Utility Service
under Industrial Disputes Act.
(ix) Single point clearances system would be provided to the
units in the Zone under State Laws/Rules.
3.3
The proposal incorporating the commitments of the State Government
shall be considered by the Board of Approval (BOA) as notified vide
notification No 14/1/2001-EPZ dated 7.8.2001.
3.4
On acceptance of the proposal by the BOA, the Department of Commerce
will issue a Letter of Permission to the applicant ; hereafter referred to
as developer.

4.

3.5

Developer
could
undertake
activities
required
for
the
development of the zone as per the approval granted by BOA.
Other entities, as approved by the BOA, may also undertake
approved
development activities of the SEZ provided that
commercial, residential and recreational facilities shall be
approved only if the developer has at least 26% equity in such
entities.

3.6

In case of converted EPZ into SEZ approval for development of

requirements in infrastructure will have to be obtained from
BOA on case to case basis.
Para 3.5 shall mutates mutandis
apply to creation of new infrastructure in the converted SEZs.

General Conditions:
(1)
The undertaking applying for approval shall undertake to
continue to operate under the SEZ scheme during the period in
which benefits under Section 80 IA of the Income Tax Act are to
be availed.
(2)
The Central Government may withdraw the approval given to an
undertaking for setting up of SEZ if the undertaking fails to
comply with any of the conditions of approval.

App-166
5.

Agreement with Central Government

The Letter of Permission issued by the Government of India

(Department of Commerce) to the developer for setting up of Special
Economic Zone shall be treated as
Agreement for availing exemption
under the Section 80-IA of the Income Tax Act.

New Delhi
Dated : 24.1.2002

(D.K.Mittal)
Joint Secretary
No F.2(1)/3/2001-EPZ

App-167

APPENDIX 14-J
STANDARD CONDITIONS FOR DEBONDING OF EOUS/EPZS/SEZ/EHTP/STP UNITS

a)

Applicable customs and excise duties would be paid, on the

imported
and
indigenous
capital
goods,
raw
materials,
components, consumables, spares and finished goods in stock.
The unit may be allowed to dispose off raw material,
components, consumables etc. against duty free licenses. The
unit
may
also
be
permitted
to
export
the
CG,
raw
material/components etc.

b)

The penalty imposed by the appropriate authority, under the

Foreign Trade(Development and Regulation)Act, 1992 for nonfulfillment of the conditions of approval, would be paid. In
case an appeal against an order imposing penalty is pending,
debonding would be considered if the unit has obtained a stay
order from Competent Authority and has furnished a Bank
Guarantee for the penalty adjudicated by the appropriate
authority unless the appellate authority makes a specific
order exempting the unit from this requirement.

c)

In case the unit has failed to fulfill the terms and

conditions of LOA and penal proceedings are to be taken up/are
in process, a legal undertaking for payment of penalties, that
may be imposed, would be executed with the concerned
Development Commissioner as per enclosed proforma at Annexure.

d)

Units located in the Export Processing Zones would , on

debonding, be required to immediately vacate their premises.
EOUs wishing to continue operations in the DTA would need to
comply with industrial, locational, environment or other laws,
rules and regulations in force for DTA units.

NOTE:

1.
The unit would fulfill the above mentioned standard
conditions in a period of six months from the date of issue of
in principle debonding letter and obtain final debonding
permission from the Development Commissioner/SIA (in case
manufacturing of item requires Industrial Licence) failing
which the approval granted would lapse automatically. DC may
however allow a further extension
for fulillment of the
standard conditions in deserving cases
2.
Further, the unit would continue to be treated as
EOU/EPZ/SEZ/EHTP/STP unit till the date of final debonding
order or issue of fresh LOP under the new scheme in cases of
conversion from one scheme to the other and subject to
monitoring of the stipulated obligations under the relevant
scheme.

App-168

Annexure

FORM OF LEGAL UNDERTAKING FOR DEBONDING OF THE UNIT

M/s ___________________________ _____________________ were granted
LOA/LOP No.______________________________________ dated ________________
for setting up a 100% Export Oriented Unit __________________________ at
________
for
the
manufacture
and
export
of
____________________________________________
subject inter-alia to the
condition that they would achieve NFEP/EP as per provisions of EXIM
Policy.
The unit filed a legal undertaking as per Appendix 14 D of Handbook
of Procedure on _______________________ with the President of India
through the Development Commissioner,_____ EPZSEZ for achieving the above
mentioned commitments.
As against the above commitments, the units actual performance has
been as under :Year
CG

Import
RM

Export

The unit applied for debonding which was approved vide letter
No._________________________
dated _______________ subject inter-alia
to the condition that penalty imposed by appropriate Authority under the
F.T.(D&R) Act, 1992 for non fulfilment of the conditions of approvals
would be paid.
In view of the approval for debonding, I/We
________________________________________________________________ hereby
undertake as under :
i)

That I/We _______________________________________________________

shall pay whatever penalties are imposed by the Development
Commissioner under FT(DR) Act for non-fulfilment of the terms and
conditions of LOA/LOP.

ii)

That I/We____________________________________________________ shall

adhere to the mode of payment of penalties, if any, and time frame
in which penalties are required to be paid to the Director General
of
Foreign Trade without any demur or protest.
Full and expanded description
of The unit with full address.

App-169
IN WITNESS WHEREOF the unit hereto has duly executed this agreement
on ______________________________ this ______________________________ day
of ___________________________200__ signed, sealed and delivered by the
unit in the presence of :
1.

Name __________________________
Address__________________________
__________________________

2.

Name____________________________
Address___________________________
____________________________

(To
Public)

be

authenticated/affirmed

by

Ist

class

Magistrate/

Notary

Accepted by me on behalf of the President of India.

Dy./Jt. Development Commissioner, ___EPZ/SEZ

App-170

APPENDIX - 14 K
Guidelines on revival/debonding of sick EOU/EPZ Units
(Please see paragraph 6.28 of Exim Policy & para 6.20
Handbook)

this

To revive units which may have become 'sick' and to

provide an exit route to those units, who may want to move
out of the EOU/EPZ Scheme, the following guidelines are
prescribed :1.

Revival of operations :

(i) A unit which has been declared sick by the appropriate

authority shall
submit a revival package through the
Development Commissioner concerned to the Board of Approval
for consideration and approval.
The Board shall consider the following :
(a) Extension in the period for fulfilment of EP and NFEP
for a further period upto a maximum of 5 years at the
prevalent norms indicated in Appendix I of the EXIM Policy.
(b)
On extension of the period, unutilized raw material and
imported/domestically procured
capital goods shall be
allowed to be carried forward at their original value.
(ii) On grant of
extension, the LUT executed by the unit
shall be suitably revised.

App-171
2

Transfer

of sick unit

(i) In case an entity is willing to takeover all the assets

and liability of a 'sick unit', transfer of such assets and
liability as per the dispensation indicated in Part I above
shall be considered by the Board of Approvals. An application
for such
takeover may be submitted through the Development
Commissioner concerned to the BOA for approval.
(ii) The
sick
unit
could
also
transfer
the
imported/domestically procured capital goods and raw material
to another EOU/EPZ/SEZ units. For the buying units, it shall
be treated as a domestically sourced goods for the purpose of
NFEP/EP.
3.

Utilisation of space

(i)
In the event of a unit being granted an extension of
period for fulfillment of NFEP/EP
as indicated
in Part I
above, the space provided by the zone administration would
continue
to
be
in
its
possession.
The
Development
Commissioner shall not charge any penal interest payable on
rental for the period for which the unit has remained closed
upto the date of the new bonding period.
(ii) In event of the unit debonding as indicated at Part II
(i) and (ii), the unit shall to be
liable to pay all the
rental dues as decided by the Development Commissioner.
However, if the unit is being taken over by another unit, the
liability shall pass on to the unit which is taking over the
sick unit, subject to an undertaking being given by the
latter. However, no penal interest on rental dues shall be
charged for the closure period before take-over.
iii) All adjudication proceeding under FTDR Act shall remain
in
abeyance in case of revival/take over of sick unit and
approval of it by the Board of Approval.

App-172

APPENDIX-14 L
NORMS OF SCRAP/WASTE MATERIAL FOR AN EXPORT PRODUCT UNDER
EXPORT ORIENTED UNITS AND UNITS IN EXPORT PROCESSING ZONES
----------------------------------------------------------------------Note :
Please see Para 6.8 of the Policy and Para 6.8 of this
Handbook.
----------------------------------------------------------------------S.No
Goods used
Percentages
Goods Manufactured
.
of scrap or
waste
on
imported
goods
2.
3.
4.
1.
1.

Stainless steel
utensils

Stainless steel sheets and

circles

2.

Spectacle frames, if
produced-

Cellulose nitrate sheets and

cellulose acetate sheets

(i) by fabrication
out of cellulose
nitrate sheets and
cellulose acetate
sheets

25%

65%

20%

(ii) by moulding from

cellulose acetate
powder
3.

Pharmaceuticals.

Chloramphenicoloral
anspenium chloramphenicol
capsules celatia capsules

2.8%
4.28%
6.67%

4.

Granulated tablets mass.

1.5%

5.

Adelphane Esiderex
tablets.
Remactane Capsules

a)
b)
c)

Rifampicin, USP
Lactose Crystalline
Empty Gelatine

0.83%
0.83%
6.00%

6.

Embroidery on fabrics

Imported nylex fabrics and

other embroidery materials
like straw yarn, metallic
yarn and sequences

4.23%

7.

Salted peanuts and

cashewnuts
Hand Knitting
Machines

Imported tin sheets

8.9%

Imported components such as

selectors, carries, needles,
beds and brushes
a) PVC Plastic
b) Metal Parts for hand bags

0.40%

8.
9.

Imitation Jewellery

8.0%
1.3%

c) Metal Parts for Jewellery

d) Glass Chatons and Beads

3.5%
2.7%
App-173

10.

Polythene Bags

PVC Granules

5%

11.

Ivory Carvings

Raw Ivory

30%

12.

Plain ivory bangles

Raw ivory

10%

13.

Industrial chains
(I)1/2 pitch chain
(ii) 3/4 pitch chain

Cold rolled steel

-do-

40%
35%

14.

Soap

5%

15

PVC pipes

16.

Lead Glass tubing

Fatty Acid, Oils and

perfumes
PVC resin, PVC Stabilizer
PVC lubricants, filter
processing acids, pigments
and plasticisers
Glass Tubes

20%

17.

Lead in Wire

Wire

15%

18.

Fluorescent starter

a) Lead Glass tubings.

b) Bimetal
c) Lead in wire(small)
d) Lead in wire(big)
e)Glow lamps
f) Capacitors
g) Revetting
h) Aluminium alloy rods
I) Bakelite sheets

14.96%
24.70%
25.00%
23.50%
6.5%
7.5%
5.5%
25%
35%

19.

Builders hardware

Brass rods, profiles

sections of brass etc.

34.00%

20.

Combs and brushes

50.00%

21

Jeens

Cellulose nitrate and

acetate sheets
100% cotton denim

16.00%

22.

Bed Linen sets

100% cotton printed sheeting

5.37%

23.

Jacket

Knitted fabrics

23.00%

24.

Shirts

Plain fabrics
Check (printed)fabrics

19.16%
20.00%

25.

PVC reinforced
hoses,extruded
moulded plastic
products

PVC Resin
PVC Stabiliser
PVC Lubricants
Filter processing aids,
Pigments and plasticisers.

5.00%

5%

App-174
26.
27.

Corrugated sheets and

boxes.
Baraglin tablets.

28.

Skirts

Fabrics

20.00%

29.

Embroidered Kaftan

22.00%

30.

Air compressors

65% polyester/35% cotton

fabrics.
M.S.Plates

31.

Detergent Powder

32.

Neocidol 60 Ex.

33.

Stainless steel
Cutlery
Domestic Mixers

34.
35.
36.
37.
38.
39.

Kraft paper & flutting media

10.00%

Lactose
Analgin

5.00%
3.00%

4.20%
5.00%

Alkyl benezene, soda ash,

caustic soda, sodium tripry
phosphate, carbonyl methyl
cellulose perfumes.
Diazionon stablised Neocidol
bulk
Stainless steel sheets.

35.00%

i)Copper enamelled
ii)Insulating paper

1.5%
23%

Aluminium Rod and Steel Wire

1.75%

HDFE,PP, LDPE, & PVC

5%

L.D.P.E. Granules

10%

Woollen Pullovers and

other Knitted
Garments.
Agarbatti

Woollen and other yarn

10.02%

(a) Packing Tubes

for Agarbatti

MIS Sheets/Tin Plates

5%

Foil Board Sheet(Paper

Board-Gold)
-do-do-

22.5%
32.7%
37.5%

AAC/ACSR Overhead
Conductors
Injection/blow
moulded plastic
articles.
Flexivial

3.00%

(b) Packing Cartons

for Agarbatti
(i) 15 agarbatti
Unit Carton
(ii) 10 Agarbatti
Unit Carton
(iii) 5 Tola 55
Series Unit Carton
(c) Bamboo Sticks
Waste

21.78%
Bamboo Sticks

App-175
40.

HRC Fuses

(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(I)
(j)
(k)
(l)
(m)
(n)
(o)
(p)
(q)
(r)
(s)
(t)

41.

Carry Strappings

42.

Polypropylene Bags

43.

Fire Hoses

44.

Processed Vegetable
Oil

45.

Lipsticks

46.

Powder Compacts

Resistance Wire
Indicator
Contact Knives
Exconal (Aluminium
Profiles)
Shrinkage Plastic
Pull Lugs
Hexagonal-1 Nut
Cylinder Head Screw
Spring Washer
Name Plates
Silicon Rubber
Striker Plat
Striker Hose
Striker Pin
Extractor Rivets
Compression Spring
Support Card Boards
Soldering Wire
Phenol Chalk Mineral
Copper Strips

Polypropylene,Colour and
pigments
Polypropylene

10%
10%
1%
13%
15%
2%
1%
1.05%
5.25%
1%
2%
1%
1%
1%
3%
5%
3%
10%
5%
8 to
10%
7.5%
5.5%

Aluminium Coupling(nut &

tail piece)
(a) Oil Blend
(b) Tins/Jars
(c) Outer Cartons
(d) Cellophane Sheets/Bopp
Rolls
(e) Gum Tape/Cello Tape
(f) Carry Stripping Rolls
(a) Base Mechanisms/Case
(b) Inner Cartons
(c) Outer Cartons
(d) Labels/Stickers
(e) Gum/Cello Tapes
(f) Carry Stripping Rolls

5%
5%
5%
1%
1%
1%

(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(I)
(j)
(k)

5%
5%
5%
5%
1%
5%
5%
1%
1%

Raw Bulk Powder

Holding Cases
Godets
Pressing Cloth
Acetate Sheets
Applicators/Brushes
Labels/Stickers
Innner Cartons
Outer Cartons
Gum/Cello Tapes
Carry Stripping Rolls

1%
0.62%
5%
5%
3%
1%
1%

App-176
47.

Eyebrow /Eye Shadow

Pencils

(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)

48.

Perfumary Products

(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)

49.

Shampoo/Conditioner

(a)
(b)
(c)
(d)
(e)
(f)
(g)

50.

Hand Bags

Raw Pencils
Foils
Caps
Trays
Inner Cartons
Plastic Cover for Trays
Outer Cartons
Gum/Cello Tapes/
Carrystrap Rolls
Bottles/cans
Caps
Valves
Actuators
Lables/Stickers
Inner/Outer Cartons
Gum/Cello Tapes
Carrystrap Rolls

5%
5%
5%
5%
1%

Bottles
Inner Cartons/Polybags
Outer Cartons
Cellophane Sheets/Bopp
Rolls
Gum Tape
Cello Tape
Carry Stripping Roll

5%
5%
5%
3%
1%
1%
1%

5%
5%
2%
5%
1%
5%
1%
1%

27.15%

(a) Gobelin
Tapestry/Fabric(Basic
Fabric)
(b) Nylon Lining Fabric
(c) Frames
(d) Chains
65% Polyester/35% Cotton and
all types of Fabrics
Aluminium Sheets

30.83%

Polyester Pongee cloth

Steel

30%
4.6%

Plastic Shets

4%

Polyester/Cotton Fabrics

19.48%

Printed Fabrics

17.04%

-do-

06.12%

35.75%
7.40%
6.30%

51.

Ladies Nighties

52.

57.

Aluminium Claded
Stainless Steel
Utensils
Artificial Flowers
Marine Freight
Containers
Disposable Food
Containers
Overalls(Industrial &
Institutional
Garments)
Bags

58.

Pareos

59.

Shorts

Fabrics

22.82%

60

Polycarbonate Cans

Polycarbonate granules

06.00%

53.
54.
55
56.

11.27%

App-177
61.

Polyester Film
Capacitors

I) Aluminium Foils
ii) Polyester Foils
iii)Coply wire
iv)Resin
v) Adhesive Tapes
vi) Capacitors

02.00%
01.50%
02.50%
05.00%
100%
04%

62.

High Carbon Steel wire

44.86%

63.

Domestic sewing
machine needles
Silver

105.23%

64.

Carved Limestones

Lithographic Films(different
sizes)
Unifinished Limestones

33.33%

65.

Carved marbles

Unfinished Marbles

22.75%

66.

Bone China Tablewares

a)
b)
c)
d)
e)
f)
g)

7.8%

67.

Printed cartons

Duplex Board

31.18%

68.

Leaflets (Folder)

Maplitho paper

15.06%

69.

Shirts Band

Art paper

20.00%

70.

Sticker

Presumed paper

27.00%

71.

Jackets Quilted

100% polyester
Filler Taffata 100% Nylon

21.42%

72.

Night shirts

100% polyester Satin fabrics

15.00%

73.

Dressing Gown

100% polyester
Terry Fleece Fabrics

18.98%

74.

Quilted House
Coats/Dressing Gown

a) 100% Polyester Fabrics

b) 100% Polyester Wadding
c) Nylon Fabrics:

Bone Ash
Ball Clay
China Clay
Feldapar
Quartz
Vir.Body
CER.GLAZE

22.42%

App-178
75.

76.
77.

Stainless Steel
Utencils
a) Colander in 4 size
b) Colander stand in 3
size
c) Colander handle in 2
size
d) Multi Cookerware set- a
set of 4 pcs
e) Cocktail Shaker
f) Thala
g) Stainless steel Boerner
Ring
h) Zara in 5 size
I) Thavetha in 5 size
j) Laddle 4 size
k) Bhaji spoon pan in 4
size
l) Champage Bucket
m) Charni
n) Vegetable Steamer
o) Supreme Bowl
p) Cannister in 8 size
q) Pickle Tray
r) Double body cup and
saucer
s) Tiffin 28 swg Dabba,
Frame, Lock clip
t) Pasta Cannister
u) Tea Kettles
v) Q Tip Container
w) Charge Plate
x) cotton Container
y) Kettle Covers
z) Pressure Cooker
aa)Stock pot
bb)Butter Warmer
cc)Mixing Bowl, Serving
Bowl
dd)Cookware set Sandwich
Bottom-Casserol in 6 size
saucepan in 2 size and
Frypan in 3 size.
Hings with Ball Bearings
Syringes with or without
needles

Stainless Steel Coil

39.00

I) Brass Sections

39.00

Plastic film medical

disposable film
422mx100micron

11%

App-179
78.

Synethic yarn/blended yarn

Input material for

synthetic/blended yarn

2%

79

LDPE, HDPE, LLDPE, EPPS, ABS

& HIPs etc.
Rubber

5%

80

Plastic granules & plastic

articles
Hot water bottles of rubber

81

Denim fabrics

Waste in the form of

cotton(from cotton to yarn

14%

Waste in the form of hard

waste(from yarn to fabric)

4%

Waste in the form of

fabrics(fents, rags/chindies
during the process of
finishing and packing

9.23%

60%

5%

82

Surimi(minced fish paste)

fresh and frozen fish etc.

Surimi fish paste

83

Bicycle Frames and forks

Steel sheets

i)

Bicycle frames(wt.3000 gms)

Model genius

ERW Steel tubes

7.69%

ii)

Bicycle frames(wt.3000 gms)

Regular model MTB

ESW Steel tubes

6.25%

Fork MTB (wt.1061 gms)

ERW steel pipes

12.53%

Halogen Lamps

Input material for

Lamps

Iii
)
84

Halogen

5%

App-180
Input powder

30%

Terry Towel without

border

Input thread

5.66%

ii)

Terry Towel with

border

Import thread

10.80%

87.

Embroidered fabrics

Base
cloth(Blended/100%polyester)

15%

Yarn waste(Embroidered yarn)

9%

Waste of out put allowed

Bran
Broken Rice
Sortex(Rejects)
Impurities(Organic/Inorganic

8%
20%
15%
2%

85

Barium Ferrite
Powder/Strontum
Ferrite Powder

86.

Terry Towels

i)

88.

Rice

App-181
89.

Wire wheels

HR sheet for Rim

HR sheet for shell
Billets for shell
Spoke wire
Nipple wire

21%
41%
69%
13%
39%

90.

Servo Control
Mechanism and
components

Stator Housing G4x2

32.7%

Stator Housing G4x3

29.5%

Stator Housing G4x4

26%

Front Flage G4x4

11.9%

Resolver Housing G4x2

19.56%

Resolver Housing G4x3

15.6%

Resolver Housing G4x4

15.6%

Nozzie Block as per

drgB65804

18.46%

G4x2 Stator Complete copper

wire
Radex cable
Stator Core scrap
G4x3 Stator Complete copper
wire
Radex cable
Stator core scrap
G4x4 Stator Complete copper
wire
Radex cable

6.25%
1%
4%
4.3%
1%
4%
5%
1%
2.4%

Stator Core Scrap

91.

Knitted cotton sports

and dress socks

Nylon and lycra yarn

10%

92.

Upto 24s carded yarn

24s to 60s carded
yarn

Cotton
Cotton

14%
13%

App-182
93.

Bulk
drugs/intemediates

Acetone
Methanol
Isoprophy Alcohol
Acetic Acid

30%
6%
65%
90%

94.

Paper Cone for Yarn

Input material

40%

95.

Bicycle and bicycle

components(Rims)

96.

Watch screw and parts

Aluminum alloy rims

profiles
26
24
20
Watch screws
Watch pinions
Watch reverts

97.

Charge Chrome

Charge Chrome

50%(of
granulated
slag.)

98.

Acrylic Blankets(one
ply and two ply)

Acrylic yarn

17%

99.

Printed books and

related products

Paper
Graphic films
Pre-sensitized
Aluminimum plates

11.9%
4.6%
2.6%

100

(a) Combed cotton

yarn

Cotton

30%

101

Disposable Gas
Cylinders

CRC Sheets

31%

102

Oil Seal plates

Stainless steel
Journal Bearing

Steel bar
SS bar
(i) Phosphor bronze tube
(ii) Phosphor bronze bar

50%
43%
40%
50%

103

Engg &Textile
machinery components

i)Iron castings, Steel Bars

non ferrous metals and
non-Metals and aluminum
ii) CR/HR Sheets

10%

7.75%
6.34%
7.24%
82.66%
92.72%
78.24%

15%

App-183
Double throttle Check
valve

Casting
Steel bar

0.974/Kg
0.036/Kg

Double check
Valve

Casting
Steel bar

0.594/kg
0.663/kg

Gear Pump

Aluminum Extrusion

0.830/kg

105

Guar Gum refined

splits

Guar Seeds

1.3%

106

100% Cotton gauze

Swabs

Cotton yarn

11%
11%

104

Cotton bandage &

Length wise elastic
cloth
107

Silk fabrics

108

Silk Garments
i)Ladies skirt
ii)Ladies blouse
iii) Ladies dress
iv) Ladies Jacket

Cotton yarn

Mulberry raw silk/Douppion

yarn

35%

100% silk fabric

-do-do-do-do-do-do-

10%

2%

v) Ladies trousers
vi) Men's shirt
vii)Ladies shirt
109

100% silk fabric

100% silk

110

Plain Jewellery and

articles and
ornaments like
Mangalsutra
containing gold and
black beeds/imitation
stones, cubic
zirconia etc. but
excluding diamonds,
precious, semiprecious stones.

(i) Gold/ Platinum

(by weight)

3.5%

(ii) Silver
(by weight)

4.5%

App-184
111

112

Studded jewellery
other then those
covered by S.No.110
above and articles
thereof
Mountings and
findings manufactured
indigenously

i) Gold/ Platinum
(by weight)
(ii) Silver
(by weight)
i) Gold/ Platinum
(by weight)
(ii) Silver
(by weight)

9%

10%
3.5%

4.5%

Chains/Bangles
manufactured by a
fully mechanised
process and
unstudded.

i) Gold/ Platinum
(by weight)

1.25%

(ii) Silver
(by weight)

1.25%

Mountings whether
imported or
indigenously
procured/manufactured
, used in the studded
jewellery
Gold/silver/platinum
medallions and coins
(excluding the coins
of the nature of
legal tender)

i) Gold/ Platinum
(by weight)

2.5%

(ii) Silver
(by weight)
i) Gold/ Platinum
(by weight)

2.5%

(ii) Silver
(by weight)

0.25%

115.

Repair/remaking of
plain /studded
gold/silver/platinum
jewellery

Gold /silver/ platinum

jewellery

2%

116

(i)
(ii)

Ethylene(HMHDPE)
Ethylene(LD/LLDPE)

5%
12%

113

113

114

Garbare bass
Carry bars with
handle

0.25%

App-185
117

Semi woolen yarn

Woolen Fibres/sliver/roving
etc

7.13%

118

Decorative glass
window panels

Glass

20%

119

Bulk drugs and bulk

drugs intermediates

Acetone, Methanol
Isoprophy, Alcohol,
Acetic Acid

40%

120

Timing Gears

Gear Lubricant Oil RH, Gear

Water
Pump RH, Gear Crank
RH, Gear Idler LH, Gear
Accessory RH, Gear Idler
RH, Gear Hyd. Pump LH,
Gear Cam Shaft(Hobbed)

24.56%

121

Items not covered

above
(excluding Gem &
Jewellery)

As applicable

Upto 5%

App-186

TO BE PUBLISHED IN THE GAZETTE OF INDIA EXTRAORDINARY

(PART-I, SECTION-1)

GOVERNMENT OF INDIA
MINISTRY OF COMMERCE AND INDUSTRY
PUBLIC NOTICE No 21 /2002-07
NEW DELHI: the 1st July, 2002
In exercise of powers conferred under paragraph 2.4 of the Export and Import Policy, 2002-07, the Director
General of Foreign Trade hereby makes the following amendment/correction in the Handbook of Procedures
(Vol.1):
1) Paragraph 3.6 pertaining to the Export Promotion Council is amended as under:
The general policy relating to the Export Promotion Councils is given in Chapter 2 of the Policy. A list of
Export Promotion Councils/ Commodity Boards is given in Appendix 27.
2) Paragraph 6.15 (a) to (f) pertaining to the provision of Sub Contracting is corrected. The corrected paras
would read as under:
(a) EOU/ EPZ/ EHTP units may be permitted to remove moulds, jigs, tools, fixtures, tackles, instruments,
hangers and patterns and drawings to the premises of the sub contractors subject to the conditions that these
shall be brought back to the bonded premises of EOU/ EPZ/ EHTP unit on completion of the job work within a
stipulated period.
(b) Export of finished good directly from the job workers premises may be permitted provided the job
workers premises is registered with the Central Excise authorities. However, export of such products from the
job workers premises shall not be allowed through third parties as provided under paragraph 6.10 of the
Policy.
Accordingly para 6.15 (g) pertaining to Contract farming is renumbered as 6.15 (c).
3) Paragraph 7.12 pertaining to the provision of Sub Contracting for SEZ units is corrected. The corrected
para would read as under:
(a) Export of finished goods directly from the job workers premises may be permitted provided the job
workers premises are registered with the Central Excise authorities. Export of such products from the job
workers premises shall not be allowed through third parties as provided for under paragraph 7.10 of the
Policy.
(b) In case of SEZ units undertaking job work for export on behalf of DTA unit in terms of paragraph 7.12 of
the Policy, the finished goods shall be exported directly from the SEZ unit and export documents shall be in
the name of DTA unit.
(c) SEZ units may be permitted to remove moulds, jigs, tools, fixtures, tackles, instruments, hangers and
patterns and drawings to the premises of sub contractors subject to the conditions that these shall be brought
back to the bonded premises of SEZ units on completion of the job work within a stipulated period.
4) The last sub- para of paragraph 8.6.1 is deleted without making any alterations in the first two sub paras.
Hence para 8.6.1 is amended as under:8.6.1 In respect of supplies under paragraph 8.2 (b) of the Policy, the DTA unit shall claim the Advance
Licence for deemed export from the concerned licencing authorities. Alternatively, the DTA unit may claim
deemed export drawback from the concerned Development Commissioner. However, for supplies to EHTP/
STP , the DTA unit shall claim deemed export benefits from the licencing authorities concerned.
Such supplies shall be certified by the receiving agencies.
5) S.No 2 of the documents to be enclosed with the application form in Appendix 10 B pertaining to the
Application Form for Grant of Advance Licence under Duty Exemption Scheme is amended as under:
2. Project Authority Certificate in case of application for Advance Licence for deemed export (except in the
case of supplies to an EPCG licence holder wherein the invalidation letter would suffice) or a copy of
invalidation letter in case of application for Advance Licence for intermediate supply.
6) Four new Agri Export Zones are added at S. Nos 25, 26, 27 & 28 in Appendix 15 pertaining to Agri Export
Zone. Similarly the Agri export zone at S.No 6 which was restricted to 13 mandals of Chitoor district of
Andhra Pradesh has been expanded to cover the entire Chitoor district. All these amendments/ additions are
tabulated as under:
S.No
Product
State
Districts covered
6
Mango Pulp & Fresh Vegetables Andhra Pradesh
Chitoor

25

Sikkim

East Sikkim

26
27

Flowers (Orchids) & Cherry

Pepper
Ginger
Rose Onion

Sikkim
Karnataka

28

Flowers

Karnataka

North, East, South & West Sikkim

Bangalore (Urban), Bangalore (Rural),
Kolar
Bangalore (Urban), Bangalore (Rural),
Kolar, Tumkur, Kodagu and Belgaum

This issues in public interest.

(N.L.Lakhanpal)

Director General of Foreign Trade

(A.B.Menon)

Dy.Director General of Foreign Trade

(F.NO. 01/94/180/26/AM03/PC-IV)

(TO BE PUBLISHED IN THE GAZETTE OF INDIA EXTRAORDINARY (PART-I, SECTION-1)

GOVERNMENT OF INDIA

MINISTRY OF COMMERCE AND INDUSTRY

PUBLIC NOTICE No. 16/2002-07

NEW DELHI: the 5th June, 2002
In exercise of powers conferred under paragraph 2.4 of the Export and Import Policy, 2002-07, the Director
General of Foreign Trade hereby makes the following amendment in the Handbook of Procedures (Vol.1):1. Para 6.2 (j) is corrected as under:
(j) The unit shall be able to account for the entire quantity of goods imported/procured duty free, by way of
exports and sales in DTA or transfer to other EOU/EPZ/ EHTP/ STP/ SEZ units, and balance in stock.
However, at no point of time the units shall be required to co-relate every import consignment with each
category of homogenous goods exported, transferred to other EOU/ EPZ/EHTP/STP/SEZ units, sales in DTA
and balance in stock. In case of doubt the matter shall be referred to BOA for decision.
2. Note (i) of paragraph 6.5 is corrected as under:(i) If any goods are obtained from another EOU/EPZ/EHTP/STP unit, or procured from an
international exhibitions held in India and precious metals procured from nominated agencies, the value
of such goods shall be included under B.
3. Paragraph 6.8 (c) is corrected as under: DTA sale shall be admissible only to similar goods as that of the goods manufactured and exported
from the unit. In case of doubt in regard to similar nature of goods, the matter shall be referred to the
BOA for decision.
4. In paragraphs 6.8(e) and 6.8 (f), the words and expression Appendix 14-M is corrected to read as
Appendix 14-L.
5. A new paragraph 6.9 (d) is added as under:
ITA I items to be cleared in the DTA shall undergo tariff change at four digit level. Only the value added
products, which have undergone the process of manufacture would be allowed to be clear in the DTA.
6. Paragraph 6.20 (d) is corrected as under:
The depreciation norms for capital goods of units, including electronics, would be subject to an overall limit
of 90% as notified by the Department of Revenue.
(i) Depreciation for computers and computer peripherals for all types of electronic units would be as follows:
10% for every quarter in the first year;
8% for every quarter in the second year;
7% for every quarter in the third year;
(ii) For capital goods, other than the above, the depreciation rate would be as follows:
4 % for every quarter in the first year;
3 % for every quarter in the second and third year; and
2.5 % for every quarter in the fourth year and thereafter.
7. Paragraph 6.22 (a) is corrected as under :
(a) NFEP and EP shall be monitored in terms of paragraph 6.22 of the Policy as per the guidelines given in
Appendix 14-E of the Handbook (Vol.1).
8. The sub- paras of Paragraph 6.27 b) (v), are re-numbered as (a), (b),(c),(d),(e) & (f).
9. Paragraph 6.29 is corrected as under:
A fast track procedure will be separately notified for EOU/EPZ units with actual investment in plant and
machinery, both imported and indigenous imported of Rs.5 crores and above.
10. A) The Note at S.No 1. of Appendix 14-A pertaining to the Application for setting up EOUs or Units in
Export Processing Zone / SEZ is corrected as under:
1. Please see Paras 6.7 and 7.7 of EXIM Policy & Paras 6.7 and 7.7 of this Handbook.
B) In Annexure to Appendix 14 A pertaining to Proforma to be filled in by the existing DTA units seeking
conversion into the EOU/ EPZ/ SEZ Scheme , clause (h) is deleted and the existing entry (i) is
renumbered as (h)
11. A) The Note at the beginning of Appendix 14-D pertaining to Form of Legal Agreement for Export
Oriented Units and EPZ/ SEZ Units is corrected as under:

Please see paras 6.6 & 7.6 of EXIM Policy and Paras 6.6 & 7.6 of the Handbook of Procedure.
B) The words and expression Central Excise and Salt Act 1944 at S.No 7 of Appendix 14 D, is substituted
by the words and expression Central Excise Act, 1944.
12. Appendix 14-E pertaining to the Guidelines for monitoring the performance of EOU/ EPZ/ SEZ/ STP/
EHTP units is corrected as per the Annexure to this Public Notice.
13. Appendix 14-F pertaining to the Guidelines for sale of goods in the Domestic Tariff Area (DTA) by EOU/
EPZ/ SEZ/ STP/ EHTP units is corrected as per the Annexure to this Public Notice.
14.
A)
The note at the beginning of Appendix 14-G pertaining to Procedure to be followed for
reimbursement of Central Sales Tax (CST) on supplies made to Export Oriented Units
(EOUs) and units in Export Processing Zones (EPZ), Electronic Hardware Technology Park
(EHTP), Software Technology Park (STP) and Special Economic Zones (SEZ) from
Domestic Tariff Area (DTA) is corrected as under :
Please see Paras 6.12 & 7.9 of EXIM policy and paras 6.12 & 7.9 of this Handbook.
B)
Clause (c) in the Undertaking and Declaration to Annexure 1 of Appendix 14 G, is deleted
and the exiting clause (d) is renumbered as (c).
15. The note at the beginning of Appendix 14-K pertaining to Guidelines on revival/ debonding of sick EOU/
EPZ units is corrected as under:
(Please see Para 6.28 of EXIM Policy & Para 6.28 of this Handbook)
16. A) The note at the beginning of Appendix 14-L pertaining to the Norms of Scrap/ Waste Material for an
export product under export oriented units and units in export processing zones is corrected as under:
Please see Para 6.8 of Policy and 6.8 of this Handbook.
B) S.No 107 of Appendix 14 L is amended as under:
S.No
Goods Manufactured
Goods Used
Percentage of scrap or waste on imported
goods
107
Silk fabrics
Mulberry raw silk/ Douppion 35%
yarn
17. The email ID of Development Commissioner, Cochin at S.No 36 of Appendix 24 pertaining to List of
Licensing Authorities and their Jurisdiction, is corrected as under :
[email protected]
18. The following corrections are made in Appendix 35 pertaining to the List of Agencies Authorised to issue
GSP Certification
S.No.
Agencies Authorised to issue GSP Certification Authorized for
8.
Madras Export Processing Zone, Administrative All products manufactured by Units in Madras EPZ
Office Building, National Highway 45, and EOUs. Located within the respective jurisdiction
of Development Commissioner
Tambaram, Chennai 600045
9.
Kandla Special Economic Zone, Gandhidham, All products manufactured by Units in Kandla &
Surat SEZs. and EOUs. located within the respective
Kutch,
Gujarat, 370230
jurisdiction of Development Commissioner
10.
SEEPZ Special Economic Zone Andheri (East), All products manufactured by Units in SEEPZ SEZ
Mumbai, 400096
and EOUs. located within the respective jurisdiction
of Development Commissioner
11.
Cochin Special Economic Zone Kakkanad Cochin All products manufactured by Units in Cochin SEZ
682037
and EOUs. located within the respective jurisdiction
of Development Commissioner
12.
Noida Export Processing Zone Noida Dadri Road, All products manufactured by Units in Noida EPZ
Noida 201305
and EOUs. located within the respective jurisdiction
of Development Commissioner
*14.
Visakhapatnam
Export
Processing
Zone, All products manufactured by Units in
Administrative
Building,
Duvvada Visakhapatnam EPZ and EOUs. located within the
Visakhapatnam 530046
respective
jurisdiction
of
Development
Commissioner
15
Falta Export Processing Zone 2nd MSQ Building All products manufactured by Units in Falta EPZ and
4th Floor Nizam Palace, Kolkata 700020
EOUs. located within the respective jurisdiction of
Development Commissioner
* At present Visakhapatnam and Falta EPZs. are combined at S.No. 14.

19. The following corrections are made in Appendix 35 A pertaining to the List of agencies to issue
Certificates of Origin for SAPTA and Bangkok Agreement
29.
SEEPZ Special Economic Zone
Andheri (East),
Mumbai, 400096
30
Kandla Special Economic Zone,
Gandhidham, Kutch,
Gujarat, 370230
32.
Cochin Special Economic Zone
Kakkanad
Cochin 682037
This issues in public interest.
(N.L.Lakhanpal)
Director General of Foreign Trade
Annexure to Public Notice No dated

Appendics E & F

AMENDMENTS IN HOP
1. Para 6.2 (j) is corrected as under:
(j) The unit shall be able to account for the entire quantity of goods imported/procured duty
free, by way of exports and sales in DTA or transfer to other EOU/EPZ/ EHTP/ STP/ SEZ
units, and balance in stock. However, at no point of time the units shall be required to corelate every import consignment with each category of homogenous goods exported,
transferred to other EOU/ EPZ/EHTP/STP/SEZ units, sales in DTA and balance in stock. In
case of doubt the matter shall be referred to BOA for decision.
2. Note (i) of paragraph 6.5 is corrected as under:(i) If any goods are obtained from another EOU/EPZ/EHTP/STP unit, or procured from an
international exhibitions held in India and precious metals procured from nominated
agencies, the value of such goods shall be included under B.
3. Paragraph 6.8 (c) is corrected as under: DTA sale shall be admissible only to similar goods as that of the goods manufactured and
exported from the unit. In case of doubt in regard to similar nature of goods, the matter shall
be referred to the BOA for decision.
4. In paragraphs 6.8(e) and 6.8 (f), the words and expression Appendix 14-M is corrected
to read as Appendix 14-L.
(e) Norms for disposal of Waste/scrap/remnants arising out of production process and in
connection therewith, including wastage or manufacturing loss on gold/silver/ platinum
jewellery and articles thereof, is given in Appendix 14-L of the Handbook (Vol.1).
(f) In respect of items not covered by Appendix- 14-L, Development Commissioner shall fix
the wastage keeping in view the norms notified under Duty Exemption Scheme. For items
not covered by these two, the Development Commissioner shall send proposals to the Board
of Approval for decisionAll cases where wastage norms have not been fixed by the
Development Commissioner within 45 days from the date of receipt of application, the same
shall be referred to the Board of Approval for information alongwith reasons for delay.
5. A new paragraph 6.9 (d) is added as under:
ITA I items to be cleared in the DTA shall undergo tariff change at four digit level. Only
the value added products, which have undergone the process of manufacture would be
allowed to be clear in the DTA.

6.

Paragraph 6.15 is amended as follows:-

(a) EOU/ EPZ/ EHTP units may be permitted to remove moulds, jigs, tools, fixtures,
tackles, instruments, hangers and patterns and drawings to the premises of the sub
contractors subject to the conditions that these shall be brought back to the bonded premises
of EOU/ EPZ/ EHTP unit on completion of the job work within a stipulated period.
(b) Export of finished good directly from the job workers premises may be permitted
provided the job workers premises is registered with the Central Excise authorities.
However, export of such products from the job workers premises shall not be allowed
through third parties as provided under paragraph 6.10 of the Policy.
c) EOUs in agriculture/horticulture engaged in contract farming may on the basis of annual
permission from the Customs authorities take out inputs and equipments to the DTA farm
subject
to
the
following
conditions:
i) Supply of inputs by the EOU to the contract farm(s) shall be subject to the input-output
norms
notified
by
the
Directorate
General
of
Foreign
Trade.
ii) There shall be contract farming agreement between the EOU and the DTA farmer(s);
iii) The contract farm(s) shall be within the jurisdiction of the same Commissioner of
Customs/Excise
under
whose
jurisdiction
the
unit
is
registered.
iv) The unit has been in existence for at least two years and engaged in export of agriculture/
horticuture products; otherwise it shall furnish bank guarantee equivalent to the duty
foregone on the capital goods/inputs proposed to be taken out to the Assistant
Commissioner of Customs/ Central Excise till the unit completes two years.
7. Paragraph 6.20 (d) is corrected as under:
The depreciation norms for capital goods of units, including electronics, would be subject
to an overall limit of 90% as notified by the Department of Revenue.
(i) Depreciation for computers and computer peripherals for all types of electronic units
would be as follows:
10% for every quarter in the first year;
8% for every quarter in the second year;
7% for every quarter in the third year;
(ii) For capital goods, other than the above, the depreciation rate would be as follows:
4 % for every quarter in the first year;
3 % for every quarter in the second and third year; and
2.5 % for every quarter in the fourth year and thereafter.
8. Paragraph 6.22 (a) is corrected as under :
(a) NFEP and EP shall be monitored in terms of paragraph 6.22 of the Policy as per the
guidelines given in Appendix 14-E of the Handbook (Vol.1).

9. The sub- paras of Paragraph 6.27 b) (v), are re-numbered as (a), (b),(c),(d),(e) & (f).
(v) Change of location/expansion: To permit change of location from the place mentioned in
the LOP/LOI to another and/or include additional location provided that:
(a) no change in other terms and conditions of the approval is envisaged.
(b) the new location is within the territorial jurisdiction of the DC.
(c) other locational, zoning, land-use or environmental conditions are also complied with;
(d). Extension of validity of LOP/LOI: To extend validity period of LOP/LOI by two years
beyond the initial validity period of the LOP/LOI (except in case where there is a restriction
on initial period of approval, like setting up of oil refinery projects) ;
(e). To recommend extension of LOP/LOI to BOA along with field inspection report of the
unit for the sixth year.
(f).

The

Development

Commissioner

may

also

cancel

LOI/LOI/IL

wherever

warranted.

10. Paragraph 6.29 is corrected as under:

A fast track procedure will be separately notified for EOU/EPZ units with actual
investment in plant and machinery, both imported and indigenous imported of Rs.5 crores
and above.