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The Government has cancelled approvals of nine special economic zones (SEZ) including that of Adani, Essar and Hindalco. This decision was taken by the Board of Approvals (BoA) for SEZ, at its meeting on September 18.
With this cancellation, the nine SEZs will have to refund any tax or duty benefit, if received.
State representationAccording to the BoA, the progress made by the developers and co-developers of SEZs was not satisfactory. The BoA is an inter-ministerial body chaired by the Commerce Secretary. The States are also represented in it.
Adani Townships & Real Estate Company got the formal approval on June 12, 2007 to set up an SEZ for Information Technology (IT) and Information Technology Enabled Services (ITES) in Gujarat.
SEZ rules say such formal approval is valid for three years, during which the zone has to become operational, with production commencing in at least one unit.
The rules also prescribe the validity of extensions. However, if there is no satisfactory progress even after an extension, the approval can be cancelled.
Essar’s proposed Jamnagar SEZ (Gujarat) was for multiple products. The company received formal approval on August 21, 2006. Hindalco had got formal approval for its aluminium product SEZ in Odisha on July 30, 2007.
“The approval is subject to the Development Commissioner furnishing a certificate... that the developer has not availed itself of any tax/duty benefits under SEZ Act/Rules or has refunded any such benefits received by it and is subject to the State government furnishing its no-objection certificate to the proposal,” the minutes of the September 18 meeting said.
The other developers whose SEZs were cancelled include Asia Pacific Corporation Limited (for polymer-based products in Gujarat), Gaurinandan Property Holders Private Limited (for IT/ITES in Gujarat), Gujarat Industrial Development Corporation (for a ceramic and glass unit in Gujarat), Chennai Business Park (for IT/ITES in Tamil Nadu), Integrated Warehousing Kandla Project Development (for FTWZ in Gujarat) and Viraj Profiles Limited (for stainless steel engineering product in Maharashtra).
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