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Indirect Tax Alert - Extension of pending SEZ compliances, expiry of validity of LoAs, approvals or permissions

10 May 2021

In view of the prevailing COVID situation and partial lock-down imposed by various State Governments, most government offices are either closed or are functioning with skeletal staff. In order to facilitate the SEZ industry, it is proposed to provide suitable relaxations on compliances to be met by units/developers/co-developers of SEZS as extended to them vide this department’s instruction dated 30 March 2021 and hence Development Commissioners are hereby directed by the Ministry of commerce & Industry to ensure that no hardship is caused to Developers/Co-Developer/Units and no punitive action is taken in cases where any compliance is not met during this period impacted by the above disruption.

Further, as may be possible, all extensions of LoAs and other compliances may be facilitated through electronic mode in a time-bound manner. In cases where it is not possible to grant extension through an electronic mode or in cases where a physical meeting is required, Development Commissioners shall ensure that the Developer/Co-developer/Units do not face any hardship due to the expiry of validity during this period of disruption, and ad-hoc interim extension/deferment of the expiry date may be granted without prejudice till 30 June 2021 or further instructions of the Department on the matter, whichever is earlier.

Such compliances to which the relaxations will apply, include:

  • Requirement to file Quarterly Progress Report (QPR) attested by Independent Chartered Engineers by Developers/Co-developers.
  • SOFTEX form to be filed by IT/ITES units.
  • Filing of Annual Performance Reports (APR) by SEZ units.
  • Extension of Letter of Approvals (LoA) which may expire, in the cases of:
    • Developers/co-developers who are in the process of developing and operationalising the SEZ.
    • Units which are likely to complete their 5-year block for NFE assessment.
    • Units which are yet to commence operations.

[Ministry of Commerce & Industry vide Instruction F. No. K-43022/7/2020-SEZ dated May 07,2021]