THE SPECIAL ECONOMIC ZONES ACT, 2005

2005 · State unknown · central · act_text

Sections (65)

1 · Short title, extent and commencement . — (1) This Act may be called the Special Economic Zones Act, 2005.

2 · Definitions . — In this Act, unless the context otherwise requires,—

1 · 10th February, 2006 (ss. 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 25, 26, 27, 28, 29, 30, 42, 43, 44, 45, 46, 47, 48, 49, 50, 51, 52, 53, 54, 55, 56, 57 and 58), vide Notification No. S.O. 196(E), dated 10th February, 2006, see Gazette of India, Extraordinary, Part II, sec. 3(ii).

1 · Ins. by Act 8 of 2019, s. 2 (w.e.f. 2-3-2019).

2 · Subs. by s. 2, ibid., for “authority or company” (w.e.f. 2-3-2019).

3 · Procedure for making proposal to establish Special Economic Zone . — (1) A Special Economic Zone may be established under this Act, either jointly or severally by the Central Government, State Government, or any person for manufacture of goods or rendering services or for both or as a Free Trade and Warehousing Zone.

4 · Establishment of Special Economic Zone and approval and authorisation to operate it to , Developer . — (1) The Developer shall, after the grant of letter of approval under sub-section (10) of section 3, submit the exact particulars of the identified area referred to in sub-sections (2) to (4) of that section, to the Central Government and thereupon that Government may, after satisfying that the requirements, under sub-section (8) of section 3 and other requirements, as may be prescribed, are fulfilled, notify the specifically identified area in the State as a Special Economic Zone:

5 · Guidelines for notifying Special Economic Zone . — The Central Government, while notifying any area as a Special Economic Zone or an additional area to be included in the Special Economic Zone and discharging its functions under this Act, shall be guided by the following, namely:—

6 · Processing and non-processing areas . — The areas falling within the Special Economic Zones may be demarcated by the Central Government or any authority specified by it as—

7 · Exemption from taxes, duties or cess . —A —Any goods or services exported out of, or imported into, or procured from the Domestic Tariff Area by,—

8 · Constitution of Board of Approval . — (1) The Central Government shall, within fifteen days of the commencement of this Act, by notification, constitute, for the purposes of this Act, a Board to be called the Board of Approval.

9 · Duties, powers and functions of Board . — (1) Subject to the provisions of this Act, the Board shall have the duty to promote and ensure orderly development of the Special Economic Zones.

10 · Suspension of letter of approval and transfer of Special Economic Zone in certain cases . — (1) If, at any time, the Board is of the opinion that a Developer—

11 · Development Commissioner . — (1) The Central Government may appoint any of its officers not below the rank of Deputy Secretary to the Government of India as the Development Commissioner of one or more Special Economic Zones.

12 · Functions of Development Commissioner . — (1) Every Development Commissioner shall take all steps in order to discharge his functions under this Act to ensure speedy development of the Special Economic Zone and promotion of exports therefrom.

13 · Constitution of Approval Committee . — (1) The Central Government shall,—

14 · Powers and functions of Approval Committee . — (1) Every Approval Committee may discharge the functions and exercise the powers in respect of the following matters, namely:—

15 · Setting up of Unit . — (1) Any person, who intends to set up a Unit for carrying on the authorised operations in a Special Economic Zone, may submit a proposal to the Development Commissioner concerned in such form and manner containing such particulars as may be prescribed:

16 · Cancellation of letter of approval to entrepreneur . — (1) The Approval Committee may, at any time, if it has any reason or cause to believe that the entrepreneur has persistently contravened any of the terms and conditions or its obligations subject to which the letter of approval was granted to the entrepreneur, cancel the letter of approval:

17 · Setting up and operation of Offshore Banking Unit . — (1) An application for setting up and operation of an Offshore Banking Unit in a Special Economic Zone may be made to the Reserve Bank in such form and manner as may be prescribed.

18 · Setting up of International Financial Services Centre . — (1) The Central Government may approve the setting up of an International Financial Services Centre in a Special Economic Zone and prescribe the requirements for setting up and operation of such Centre:

19 · Single application form, return, etc . —N —Notwithstanding anything contained in any other law for the time being in force, the Central Government may, if required,—

20 · Agency to inspect . —N —Notwithstanding anything contained in any other law for the time being in force, the Central Government may, by notification, specify any officer or agency to carry out surveys or inspections for securing of compliance with the provisions of any Central Act by a Developer or an entrepreneur, as the case may be, and such officer or agency shall submit verification and compliance reports, in such manner and within such time as may be specified in the said notification.

21 · Single enforcement officer or agency for notified offences . — (1) The Central Government may, by notification, specify any act or omission made punishable under any Central Act, as notified offence for the purposes of this Act.

22 · Investigation, inspection, search or seizure . — The agency or officer, specified under section 20 or section 21, may, with prior intimation to the Development Commissioner concerned, carry out the investigation, inspection, search or seizure in the Special Economic Zone or in a Unit if such agency or officer has reasons to believe (reasons to be recorded in writing) that a notified offence has been committed or is likely to be committed in the Special Economic Zone:

23 · Designated Courts to try suits and notified offences . — (1) The State Government, in which the Special Economic Zone is situated, may, with the concurrence of the Chief Justice of the High Court of that State, designate one or more courts—

24 · Appeal to High Court . —A —Any person aggrieved, by any decision or order of the court designated under sub -section (1) of section 23, may file an appeal to the High Court within sixty days from the date of communication of the decision or order of the courts so designated to him on any question of fact or law arising out of such orders:

25 · Offences by companies . — (1) Where an offence has been committed by a company, every person, who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

26 · Exemptions, drawbacks and concessions to every Developer and entrepreneur . — (1) Subject to the provisions of sub-section (2), every Developer and the entrepreneur shall be entitled to the following exemptions, drawbacks and concessions, namely:—

27 · Provisions of Income -tax Act, 1961 to apply with certain modification in relation to Developers and entrepreneurs . — The provisions of the Income-tax Act, 1961 (43 of 1961), as in force for the time being, shall apply to, or in relation to, the Developer or entrepreneur for carrying on the

28 · Duration of goods or services in Special Economic Zones . — The Central Government may prescribe the period during which any goods brought into, or services provided in, any Unit or Special Economic Zone without payment of taxes, duties or cess shall remain or continue to be provided in such Unit or Special Economic Zone.

29 · Transfer of ownership and removal of goods . — The transfer of ownership in any goods brought into, or produced or manufactured in, any Unit or Special Economic Zone or removal thereof from such Unit or Zone shall be allowed, subject to such terms and conditions as the Central Government may prescribe.

30 · Domestic clearance by Units . — Subject to the conditions specified in the rules made by the Central Government in this behalf,—

31 · Constitution of Authority . — (1) The Central Government shall, by notification in the Official Gazette, constitute, for every Special Economic Zone established by it before the commencement of this Act or which may be established after such commencement by the Central Government, an Authority to be called the ...... (name of the Special Economic Zone) Authority to exercise the powers conferred on, and discharge the functions assigned to, it under this Act:

32 · Officers of Authority and other staff. f. — (1) Every Development Commissioner of the Special Economic Zone, for which he is appointed as such, shall be the chief executive of the Authority concerned and exercise such powers and perform such functions as may be prescribed.

33 · Special provision for transfer of officers or other employees to Authority . — (1) It shall be lawful for the Central Government to transfer to each Authority, by order, and with effect from such date or dates, as may be specified in the order, any officer or other employee holding office as such (except officers or other employees on deputation) in the existing Special Economic Zone concerned:

34 · Functions of Authority . — (1) Subject to the provisions of this Act, it shall be the duty of each Authority to undertake such measures as it thinks fit for the development, operation and management of the Special Economic Zone for which it is constituted.

35 · Grants and loans by Central Government . — The Central Government may, after due appropriation made by Parliament by law in this behalf, make to every Authority by way of grants and loans or such sums of money as that Government may think fit for being utilised for the purposes of this Act.

36 · Constitution of Fund and its application . — (1) There shall be established by every Authority a Fund to be called the.......... (the name of the Special Economic Zone concerned) Authority Fund and there shall be credited thereto —

37 · Accounts and audit . — (1) Every Authority shall maintain proper accounts and other relevant records and prepare an annual statement of accounts in such form as may be prescribed by the Central Government, in consultation with the Comptroller and Auditor-General of India.

38 · Directions by Central Government . — Every Authority shall be bound to carry out such directions as may be issued to it from time to time by the Central Government for the efficient administration of this Act.

39 · Returns and reports . — (1) Every Authority shall furnish to the Central Government at such time and in such form and manner as may be prescribed or as the Central Government may direct, such returns and statements and such particulars in regard to the promotion and development of exports and the operation and maintenance of the Special Economic Zone and Units as the Central Government may, from time to time, require.

40 · Power to supersede Authority . — (1) If at any time the Central Government is of the opinion that an Authority is unable to perform, or has persistently made default in the performance of the duty imposed on it by or under this Act or has exceeded or abused its powers, or has wilfully or without sufficient cause, failed to comply with any direction issued by the Central Government under section 38, the Central Government may, by notification, supersede that Authority for such period not exceeding six months, as may be specified in the notification:

41 · Members, officers and other employees of Authority to be public servants . —A —All Members, officers and other employees of every Authority, shall, when acting or purporting to act in pursuance of any of the provisions of this Act or the rules made thereunder, be deemed to be public servants within the meaning of section 21 of the Indian Penal Code (45 of 1860).

42 · Reference of dispute . — (1) Notwithstanding anything contained in any other law for the time being in force, if—

43 · Limitation . — (1) The period of limitation in the case of any dispute which is required to be referred to arbitration shall be regulated by the provisions of the Limitation Act, 1963 (36 of 1963), as if the dispute was a suit and the arbitrator is civil court.

44 · Applicability of provisions of this Act to existing Special Economic Zones . —A —All the provisions of this Act (except sections 3 and 4) shall, as far as may be, apply to every existing Special Economic Zone.

45 · Person to whom a communication may be sent under this Act . —A —A communication by any competent authority or person under this Act may be sent to the person who has the ultimate control over the affairs of the Special Economic Zone or Unit or where the said affairs are entrusted to a manager, director, chairperson, or managing director, or to any other officer, by whatever name called, such communication may be sent to such manager, director, chairperson, or managing director or any other officer.

46 · Identity Card . — Every person, whether employed or residing or required to be present in a Special Economic Zone, shall be provided an identity card by every Development Commissioner of such Special Economic Zone, in such form and containing such particulars as may be prescribed.

47 · Authorities responsible for administration . — Any authority which has been conferred upon any power, or, is, required to discharge any function under any Central or State Act, may, subject to the provisions of this Act, exercise such power or discharge such functions in any Special Economic Zone under that Act.

48 · Protection of action taken in good faith . —N —No suit, prosecution or other legal proceeding shall lie against the Central Government or any Chairperson, Member, officer or other employee of the Board or the Approval Committee or the Authority or Development Commissioner for anything done or intended to be done in good faith under this Act.

49 · Power to modify provisions of this Act or other enactments in relation to Special Economic Zones . — (1) The Central Government may, by notification, direct that any of the provision of this Act (other than sections 54 to 56) or any other Central Act or any rules or regulations made thereunder or any notification or order issued or direction given thereunder (other than the provisions relating to making of the rules or regulations) specified in the notification—

50 · Power of State Government to grant exemption . — The State Government may, for the purposes of giving effect to the provisions of this Act, notify policies for Developers and Units and take suitable steps for enactment of any law—

51 · Act to have overriding effect . — The provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act.

52 · Certain provisions not to apply . — (1) The provisions contained in the Chapter XA of the Customs Act, 1962 (52 of 1962) and the Special Economic Zones Rules, 2003 and the Special Economic Zones (Customs Procedure) Regulations, 2003 made thereunder shall not, with effect from such date as the Central Government by notification appoint, apply to the Special Economic Zones.

53 · Special Economic Zones to be ports, airports, inland container depots, land stations, etc., in certain cases . —A —A Special Economic Zone shall, on and from the appointed day, be deemed to be a territory outside the customs territory of India for the purposes of undertaking the authorised operations.

54 · Amendment to First Schedule . — (1) The Central Government may, having regard to the objects of this Act, and if it considers necessary or expedient so to do, by notification add to, or as the case may be, omit from the First Schedule any enactment specified therein.

55 · Power to make rules . — (1) The Central Government may, by notification, make rules for carrying out the provisions of this Act.

56 · Power to remove difficulties . — (1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act, as may appear to it to be necessary or expedient for removing the difficulty:

57 · Amendment of certain enactments . —W —With effect from such date as the Central Government may, by notification, appoint, the enactments specified in the Third Schedule shall be amended in the manner specified therein:

58 · Savings . —A —All rules made or purporting to have been made or all notifications issued or purporting to have been issued under any Central Act relating to the Special Economic Zones shall, in so far as they relate to matters for which provision is made in this Act or rules made or notification issued thereunder and are not inconsistent therewith, be deemed to have been made or issued under this Act as if this Act had been in force on the date on which such rules were made or notifications were issued and shall continue to be in force unless and until they are superseded by any rules made or notifications issued u nder this Act.

1 · In section 2C, in sub -section (1), after the third proviso, insert:—

2 · After section 2C, insert—

1 · Section 53 shall be re -numbered as sub -section (1) thereof and in sub-section (1) as so re-numbered, for " banking company or institution or to any class of banking companies " , substitute,—

2 · After sub -section (1) as so numbered, the following sub-section shall be inserted, namely:—

Subordinates (23)

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PUBLISHED IN THE GAZETTE OF INDIA , EXTRAORDINARY , PART-II SECTION -3 , SUB-SECTION (ii)

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[To be published in the Gazette of India, Extraordinary, Part II, Section(3), Sub-section (i) ]

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PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART-II SECTION- 3, SUB-SECTION (ii)

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GOVERNMENT OF INDIA MINISTRY OF COMMERCE AND INDUSTRY (Department of Commerce)

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[To be published in the Gazette of India , Extraordinary , Part II , Section(3) , Sub-section (i) ]

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