 the special economic zones bill, 2005 a bill,{0 provide for the establishment, development and management of the special economie zones forthe promotion of exports and for matters connected therewith or incidentat thereto be it enacted by partiament in the fifty-sixth year af the republic of india as follows - chapter!  prevnatiary1, (2) this act may be called the special economic zones act, 2005, (2) itextends to the whole of india, short tile, leat and mene(3) it shall come into force on such date asthe central government may, by uotification in the official gazette, appoint, and different dates tray be appointed for different provision of this act and any ceference in any such provision to the commencement of this act shat] be construed as a reference ta the coming into force of that provision definitions, 2 tn this act, untes the context other ise requires, ( "appointed duy" with reference to a special economic zone means the date on which the special econamic zone is notified by the centrat goverment under sub-section (1) of section 4; (6) "approval committee" menns an approval committew constituted under ¢~ sub-section (7) of section 13, {€) "authorised operations" means operations which may be authorised under sub-sectiod (2) of section 4 and sub-scotion (9} of section 15; (@ "authority" means a special economic zone authority constituted under sub-section (1) of section 31; lo (©) "board" means the board of approval constituted under sub-section (j) of section 8; ()"co-developer" means a person who, ora state government which, has been sgrapled by the central government a letter uf approval under sub-section (12) of section 3: is (g) "developer" means a person who, of a state government which, has been sranted hy the central government « letter of approval under sub-section (10) of section 3 and includes an authority and a co-developer; () "development commissioner" means the development commissioner appointed fr one or more special econamic zones under sub-section (j) of section 11; 2 () "domestic tariff area" means the whole of india (inchiding the territorial yaters and continental shelf} but does not iriclude the areas of the special economic zones; () "cotzepreneur" moans a person who has been granted a letter of approval by the development commissioner urider sub-section (8) of section 15; a (8) "oxisting special economic zone" means every special reonomic zane which is in existence on or before the commencement of this act; ( "existing unit" means every unit which has been set up on or before the commencement of this act in an existing special economic zone; (im) "export" means— ge (0) taking goods, or providing services, out of india, from a special economic zone, by land, sea or air of by any other mode, whether physical or otherwise; ot (giysupplying goods, or providing services, from the domestic tarif area toa unit or developer; or re git) 'supplying goods, or providing services, from one unit to 'another unit or developer, in the same or different special economic fone; (n), "bree trade and warehousing zone" means a special economic zone wherein mainly trading and warehousing and other activities related theretn are yo carried on; {e)"iraport" means— bringing goods or receiving services, in a special reonomic zone, by 8 unit or developer from a place outside india by land, sea or air or byany other mode, whether physical or otherwise; or 4s (a) receiving goods, or services by a unit or developer from anothor unit '9x developer ofthe same special economic zone or adifferent special econornic zone, () "infrastructure fucilities" means industrial, commercial or social infrastructure sor other facitities necessary far the development ofa special evunomic zone or such other facilities which may be prescribed, (q) "international financial services centre" means un international financial services centre which hus been approved by the central govemment under sube section (7) of section 18; jo) manufacture" means to make, produce, fabricate, assemble, process or bring into existence, by hand ar by machine, a new product having a distinctive name, character or use an shall include pravesses such as reftigeration, cutting, polishing, blending, repair, remaking, re-engineering and includes agriculture, aquaculture, animal husbandry, floriculture, horticulture, pisciculture, poutity, seicultare, {5 viticulture and mining; (8) "notification" means @ notification published in the official gazette and the expression "notify" shall be construed accordingly: (® "notitied offences" means the offences specified as such under sub-section (2) of section 21; 29 —— (v) "offshore banking unit" means a btanch of a bank located in a special hconomic zone and which has obtained the permission under clause (a} of subsection (/) of section 23 of the banking regulation act, 1949; (0) "person" includes an individual, whether resident in india or outside india, a hindu undivided family, co-operative society, a company, whether incorporated in 2s india or outside india, « firm, proprictary concern, or an association of persons or body of individuals, whether incorporated or not, locat authority and any agency, office or branch owned or contruiled by such individual, hindu undivided family, coe 'operutive, assoctation, hady, authority or company; bed" means prescribed by rules made by the central government 69) "pres bo under this act; (3) "reserve bank" means the reserve bank of india constituted under section 3 ofthe reserve bank of india act, 1934, () "schedule means schedules to this act; (} "services" means such tradable services which - as (hare covered under the gencrat agreement on trade in services annexed as ib 10 the agreement establishing the world trade organisation concluded at marrakes on the 15th day of apri, 199¢; {gi} may be prescribed by the céntral gaverainent for the parposes ofthis act; and ue (2) eam foreign exchange; (a) "special economic zone" means each special economic zone notified under the-proviso to sub-section (4) of section 3 and sub-section (j) of seetion 4 {including free trade and warehousing zone) and includes an existing special economic zone; us (z6) "state government" means a stats government of the state in which a special economic zone is established or proposed to be established; gc} "unit" means a unit set up by an entrepreneur in a special economic zone and inclades an existing unit, an offstore banking unit and a unit in an international nancial services centre, whether established before or established after 52 commencement of this act; (¢¢) all other words and expressions used and not defined in this act but defincd in the central excise act, 1944, the industries (deyclopment and regulation} act, h uf ta 195], the income-tax act, 1961, the customs act, 1962 and the foreign trade {3 6° ees {development and regulation) act, 1992 shall have the meanings respectively assigned sp of 196 to them in those acts, § pot 199,  chapteril estasishuen of sreciat beainona: zone3 (j)a special economic zone may be established under this act, either jointly o | procedure    | for     ||--------------|---------|| making       |         || severally    |         || by           |         || the          |         || central      |         || goverament,  |         || state        |         || government,  |         || or           |         || any          |         || person       |         || for          |         || manufacture  |         || of           |         || propane      |         || t©           |         || goods        |         || ar           |         || rendeting    |         || services     |         || or           |         || for          |         || hoth         |         || or           |         || as           |         || a            |         || pree         |         || trade        |         || and          |         || warehousing  |         || zone        |         || it           |         || special      |         || (2)          |         || any          |         || person,      |         || who          |         || intends      |         || to           |         || set          |         || up           |         || a            |         || special      |         || economic     |         || zone,        |         || may,         |         || after        |         || identifying  |         || economic     |         || the,         |         || arca,        |         || make         |         || a            |         || proposal     |         || fo           |         || the          |         || state        |         || government   |         || concemed     |         || for the      |         || purpose      |         || of           |         || setting      |         || up           |         || zone         |         || the          | special |{3) notwithstanding anything 'contained in sub-section (2), any parson, who intends to set up a special economie zone, may, after identifying the area, at his option, make a proposal directly to the board for the purpose of setting up the special economic zone: provided that where such a proposal has been reccived directly fram a person uncer this sub-section, the board may grant approval and after receipt af such eppraval, the person concerned shall obtain the concurrence of the state government within the period, us may be prescribed ()in case a state government intends to set up a special eeninomie zooe, it may after ideitifying the area, forward the proposal directly to the board for the purposeof selling up the special economic zone: provided that the central gavecratient may, after identifying the arca, sue moro set up and notify a special economie zone without referring the propasal ta lhe state government concerned or the board, (3) rvery proposal under sub-sections (2) to (4) shall be made in such form and manner coviaining such particulars as tay be presoribed (6) the state government may, on receipt of the proposal made under sub-section (2), corward the satne together with its recommendations to the board within such period 36 as may be prescribed (7) without prejudice to the provisions contained in sub-section (4), the board may, after receipt of the proposal inder sub-sections (2) to (4), approve the proposal subject to such terms and conditions as it may deem fit to impose, or modify or reject the proposal (8) the centrat goyeroment may prescribe the following requirements for 2s a establishment of a special economic zone, namely:— (@) the minimura atea of land and other weems and-conditions subject to which the board shall approve, modily or reject any proposal received by it under sub- : sections (2) to (4); and 3 (@) the terms and conditions, subject to which the developer shall undertake yp the authorised operations and his obligations and entitlements provided that different minimum area of land and other terms and conditions referred to in clanse (a) may he prescribed by the central government for a class or classes of special economic zanes, (9) if the board - (2) approves without any modification, the propesul received undet subsections (2) to (4), it shall communicate the same 10 the central government; (5) approves with modifications the proposal received under sub-sections (2) to (), it shall, communicate such modifications to the person or the srate government concerned and if such madifieations have heen accepted by such person of state government, the board shall communicate the approval to the central government; (¢) fejects the proposal, received under sub-sections (2) 0 (4), it shall rovord the reasons therefor and communicate the tejection to the central goverament whieh, spall intimate to the state government or the person concented (70) vhe central government shail, on receipt of communication under clause (2) of fsase (5) of sub-wection (9), pram, within such time as may be prescribed, a eter of approval such terns and conditions and obligations and entitlements as may fe approved by the gard, to the developer, being the person dr the state government concerned: provided that the central government may, on the basis of approvel of the board, approve mare than ore developer in a special economic zone in cases where ane develupcr ies not have io bis possession the minimum area of contiguous land, as may be prescribed, focsctting up a special economic zone and in such cases, cach developer shat be considered 'a developer in respect of the land in his possession, (u1) any person who, ora stale government which, fatends to provide any inffastructare ifites in the identified area referred to in sub-sections (2) lo (4), ar undertake any authorised eration may, after entering into an agroeenicnt with the developer referred a in sub-section "nade by such person or state government, (12) every person or state government referred to in sub-section (4), whose proposal thas been approved by the boatd aad who, or which, bas been granted letter of approval by 'the central governmient, shall be considered as a co-developer of the special economic i zone = (13) subject to the provisions of this section and the fetter of approval granted lo a = developer, the developer may allocate space or built up area or provide infrastructure services g6to the approved units in accordance with the agreement entered into by him with the nfcepreneurs of such units, 4 (2) the developer shall, after the grant of telter of approvat under sub-section (9) of section 3, submit the exsct particulars of the identified area referred to in sub- =f seotions (2) to (4) of that section, to the central government and thereupon that '2 government may, after satisfying that the requirements, under sub-section (8) of section 3 and other requirements, as may be prescribed, ace fulfilled, notify the specifically identified area in the state as a speciat economic zone: 5 provided that an existing special econtomic zone shall be deemed to have been notified > _and established in accordance with the provisions of this act and the provisions of this act af shall as far as may be, apply to such zone accordingly:  provided further that dhe central govorament may, after notifying the special economic | © zone; iit considers appropriate, notify subsequently any additionat area to be included as, ie a pact of that special rennomic zone, : (2) after the appointed day, the board may, authotise the developer to undertake in a yo special economic zone, such operations which the central goverment may authorise : 5, the central government, while notifying any area as a speciat 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:— (@) generation of additional economic activity (0) promotion of exports of goods and servic (©) promotion of investment from domestic and foreign sources; {d creation of employment opportunities; (©) development of infrastructure facilities; and e (a maintenance of sovercigaty and integrity of india, the security of the state a s-@ and friendly relations with foreign states extablishaeat of specil economie zone ond approval und authorities 'woperaieitto, developes guidelines for notifying special economic zone processing 6, the areas falling within the special economic zones may be demarcated by the ind non central government or any authority specified by it as— fen (a) the processing ares for setting up units for activites, being the manufacture of goods, or rendering services; or () the area exclusively for trading or warehousing purposes; ot gs j (©) the non-processing areas for activities other than those specified under hl clause (a) o clause (2) exemption any goods or services exported out of, or imported into, or procured from the | fem tees, domestic taff area by,— hss of ass (© @ unit in a special recnomic zone; or jo (i @ developer, 4 shall, subject to such terms, conditions and limitations, as may be prescribed, be exempt from the payment of taxes, dutias or cess under all enactments specified in the first schedule 3   chapter il 1s consmirution gf boaro of arrnovatconstitution 8, (7) the central government shall, within fifteen days of the commencement of 3 cred ot this act, by notification, constitute, forthe purposes of this act, 2 board to be called the t approval board of approval (2) the board shall consist of - ao i (a) an officer not below the rank of an additionat secretary to the government of india in the ministry or department of the central goverment dealing with commerce—chairperson, ex officio; (b) two officers, not below the rank of a joint secretary to the government of india, 'to be nominated by the central government to represent the ministry or 36° department of the central government dealing with revenue—members, ex officio, e {c) one officer nat below the rank of a joint secretary to the government of 2 india to be nominated by the central goverment to represent the ministry or depariment ofthe central government dealing with economic affairs (financial services) { meniber, ex aficia; be | (4) such number of officers, not exceeding ten, not below the rank of the joint secretary to the government of india, to be nominated by the central government to represent the ministries of departments of the central government dealing with commerce, industria! policy and promotion, science and technology, small scale industries and agro and rural industries, home affairs, defence, environmontand forests, jaw overseas indian a stirs and urban development—members, ex officio, (€) nominee of the state government concemed—member, ex officio; (ft the director general of foreign trade or his: nominee—member, ex offici i (g) the development commissioner concemed—member, ex afficio a (4) a professor in the indian jostitute 'of management, being a society registered under the societies registration act, 1860 or the indian institute of foreign trade, f being @ society registered under the societies registration act, 1860, an may be, i rominated by the central government—member, ex officio; 21068 (an officer not below the rank of deputy secretary to the government of _ india desling with the special economic zones in the ministry or department of the 4s central government, dealing with commerce to be nominated by the central government —member-scoretary, ex officio: provided that the member, being the joint 'secretary nominated under clauses (b)t0 (a) of this sub-section may, if he is unable to attend the meeting of the beard, authorise any other officer to attend the meeting of the board on his 'behalf (3) the term of office of an ex officio member shall come to an end ag goon as he ceases to hold the office by virtue of which he was so nominated (4) for the purposes of performing its functions, the board may 2a-opt as members, such number of persons as it deems fit, who have special knowledge of, and practical experience in, matters relating to, or relevant to activity connected with the special economic zones and any such person shall have the right to take part in the discussions of the board but shall not be counted for the quorum and shail not be a member for any other purpose and such person sball be entitled to receive such aflowances or fees, as the case nay be, fixed by the board (5) the board shall meet at such times and placos as may be appointed by it and shall have the power to regulate its own procedure (6) one-third ofthe total members of the board shall form a quorum, and all the acts of the board shall be decided by general consensus of the members present (7) no act or proceeding of the board shall be called in question on the ground merely of existence of any vacancy in, or any defect in the constitution of, the board (8) allordets and decisions of the board and all other instruments issued by it shall be authenticated by the signature of the member-secretary, or any other member as may be authorised by the boaed in this behalf 9 (2) subject to the provisions of this act, the board shall have the duty to promote and ensure orderly development of the special economic zones duties, powers and functions of boerd (2) without prejudice to the generality of the provisions contained in sub-section (2), the powers and functions of the board shall include— ing such proposals for (@) granting of appraval or rejecting proposal or mo establishment of the special beonomic zones; (®) granting approval of authorised operations to be carried out in the special economic zones by the developer; (©) granting of approval to the developers or units (other than the developers or the units which are exempt from obtaining approval under any law or by the central government) for foreign collaorations and foreign direct investments (including investments by & person resident outside india), in the special economic zone for its developroent, operation and maintenance; (@ granting of approval or rejecting of proposal for providing infrastructure facilities in a special economic zono or modilying such proposals; (©) granting, notwithstanding anything contained in the industries (development and regulation) act, 1951, a licence to ar industrial undertaking referred to in clause g@) of section 3 of that act, if such undertaking is established, as a-whole or part thereof, or proposed to be established, in 2 special economic zone; (psuxpension of the letter of approval granted to a developer and appointment of an administrator under sub-section (7) of section 10; up @ disposing of appeals preferred under sub-section () of section 15; (8) disposing of appeats preferred wrider sub-section (4) of section 16; (0) performing such other functions as may be assigned to it by the central government (3) the board may if so required for purposes of this act or any other law' fot the ime being in force relating to special economic zones, by notification, deéide as to 'whether a particular activity constitutes manufacture a3 defined in clause (r) of section 2 and such decision of the board shal! be binding on all ministries and departments of the central government (4) the board may detegate such powers and functions aé it may deem fifto one or more developinent commissioners for effective and proper ditcharge of the functions of e board, (3) without prejudice to the foreyoing-provisions of this act, the board shall, in 'exercise of its powers or the performance of its functions under this act, te bound by sucht directions on questions of policy a the central goverament may give in writing to it from time fo time (6) the decision of the central government whether a question is one af policy at not skall he final, suspeision of 19-() 16 at any tie, the board i ofthe opinion thal a developer fete of 1 (a) is unable to discharge the functions at perform the duties imposed on him ty tenner ar ar under the provisions of this act or rules made thereunder: ur ° spesiad (0) has persistently defaulted in complying with any direction given by the econatnic board under this act or se aces (©) has violated the terms and conditions ofthe tetter of spproval: or lo (@) whose financial position is such that he is unable to fully aud efficiently discharge the duties and obligations imposed on him by the letey of approval, and 'o be recorded in writing, suspend the letter of approval, gronted ta the developer for a is econoinic zone, for a period not exceeding cone year and appoint an administator to discharge the functions of the developer in accordance with the terms and conditions of the jetter of approval and manage the special loonomic zone accordingly, (2) consequent upon appointment of an 'administrator, the matiagement of the special 20 economie zone of the developer referred to in sub-section (1) shat vest in the administrator  @) no leter of approval shall he suspended under 'sub-section (1) unless the board has given to the developer not jess than three months" notice, ia writing, stating the grounds on whieh it proposes 10 suspend the tetler of approval, and has considered any cause as shown by the developer within the period of that rotice, against the propased suspension, (2) the board may, instead of suspending the letter of approval under sub-s (), permit ito remain ia farce subject ta such further tees and conditions as it thinks fit to impose, and any-frther terms or conditions so imposed shall be binding upon and be complied with by the developer und shalt be of like force and effect-as if they were 3a contained in the letier of approval, (5) in case the board suspends a fetter of approval under this section, it shall setve, x notice of suspension upon the developer and fix a date on which the suspension shatt take effect (©) upon sospension of the fetter of eppraval under sub-section (/), the special 35- economic zone of the developer referred to in sub-section (3) shall vest in the administrator under sub-section (2) for a period not exceeding one year or up to the date 'on, which the letter ef approvat for such special economic zone ig fansferred, whichever is earlier, in aevordance with the provisions contained in sutb-sections (7) and (9), as the case may be yo (7) where the board has given notice for suspension of totter of approval under sub-section (3), the developer may, after prior approval of the board, transfer his letter of approval to any person who is found eligible by the board for 'grant of such approval (2) if s¢any time, it appears to the board that the purpose of the: 'order appointing the administrator has been fulfilled or that for any reason it s undesirable that the order of 4s" appointment should remain in force, the board may cancel the order and thereupon the administrator shall be divested of the inanagement of the special economic zone which (oar the board suspends the letter of approval, under this section in respect 5% the developer, whose approval has been suspended and selgcr the person or persons, in acoordance with the procedure as may be prescribed, to whom the miteron approval ofthe developer in the special econamic zone may by transferred; sx (2) upon selection of person or persons under sub-clause (a), the board may, by notice in writing, require the developer to wausfer his letter of approvi in & special feonomie zone to the person or persons s0 seiected and thereupon the developer shall transfer his interests, rights and liabilities in the special feonomie zone to any of the persons (heteafter in tis section refereed 10 a5 te "transferwe") who has been selected by the board on such terms and conditions and cansiderstion as may be agreed upon between the developer and the transferees (e) al the rights, duties, obligations and lisblities of the developer, om and from the date of suspension of letter of approval or on and from the date, if earlier, on which bis letter of approval in the special economic zane of the developer has been tmansterred fo the transferee, shall cease absolutely except for any hibilities which have accrued prior to that date; (@)_the board may make such interim arrangements in regerd to the operation of the special economic zone as may be considered appropriate 3 {@) the administrator shalt exercise such powers and discharge such functions as the board may direct, (20) the board may, in order to promote export or to protect the interest uf units ot in the public interest, issue such directions or formulate such scheme as it may consider necessary for operation of the special economic zone  chapteriv devevorweht connisstonen,development cornmissiones, mt, (2) the central goverament may appoint any of lis officers not helow the rank of deputy secretary to the government of india as the development commisslaner of one or more speciat reonomie zones, (2) the central goverament tay appoint such officery and other employees ay it considers necessary to assist the development commissioner in the performance of his funetious in the special economic zones established by developer (other than the central government) under this act on such terms and conditions ax it deems fi (3) every development commissioner, offiver and other ewplayee shall be entitled to sueh salary aud allowanees and subject ¢o such terms and conditions of service in respect of feaye, pension, provident fund and other matters aa may, fcom time ta time, he specified by the central gaveroment, 12 ()) every development commissioner shull take all steps in order to discharge bis functions under this act to ensure speedy development of the special economie zone and promotiog of exports therefrom, functions of development comunissionee (2) without prejudice to the generality ofthe foregoing provisions, the development conwmissioner shall— (@) guido the entrepreneurs for setting 'up of units in the special beonomic zone; (2) onsure and take suitable steps for effective promotion of exports from the special economie zone; (©) ensuré proper co-ordination with the' central government or state government departments concemed or dgencies with respect to, of for the purposes, of clauses (a) and (8); () monitor the performance of the developer and the units in a special roonomic zone; (@) discharge such other fonctions as may be assigned to him by the central government under this act or any other law for the time being in force; and (a discharge such other functions as may be delegated to hitn by the board, (2) every development commissioner shall be overall in-charge of the special evanomic zone and shall exercise administrative control and supervision over the officers and employes appointed under sub-section (2) of scetion 11 (including the officials deputed to such special economic zone) to discharge anyof the fictions under this act ae ( without prejudice to the provisions of sub-sections (j) to (3), every development commissioner shall discharge such functions and exercise such powers as may be delegated to him by a general or special order by the central goverment or the state government concemed, a5 the case may be, (3) every development commissioner may call for such information from a {2 developer or unit from time to time a5 may be hecessary fa monitor the performance of the developer or the unit, as the case may be, (6) the development commissioner may delegate any or all of his powers or functions to any of the officers employed under him  chapterv 'si sino: wovcow cleakance i constiionor 43, (1) the centeal government shall - are g) in the case of existing special economic zones, within six months: from the date of commencement of this act, (5) in case of other special economic zones established after the 20 commencement of this act, within six months from the date of establishment of such special economic zone, by notification, constitute a committee for every special economic zone, to bé-called the approval committee to exercise the powers and perform the functions specified in section 14, as (2) every approval commitiee shall consist of - {2) the development commissioner—chaitperson, ex officio: (6) two officers of the centrat government to be nominated by that government—-memhers; ex officio; f (€) two officers of the central government to be nominated by that government 32; to represent the ministry or department dealing with revenue —- member ex officio; (@) one officer of the central government to be nominated by that government (0 represent the ministry or department dealing with economic affaire (financial services); member ex officio; (©) two officers of the state government concemed to be nominated by that 35¢ state government —members, ex officio; : (a representative of the developer concemed—special invitee (3) for thé purpose of exercising its powers and performing its functions, the approval committee may invite to its meetings, such persons as the committee deems fi, whose assistance of advice it may consider necessary (a) every approvel committee shall meet at such times and places as it considers necessary and shell have the power to regulate its own procedure, ' (5) one-half of the total members of the approvel committee shall form a quoruni, and all the acts of the approval committee shall be decided by a general consensus of the members present provided that in case the approval committee is unable to decide any matter by a general consensus, such maiter shall stand referred to the board of approvat for its decision, (0) no act of the approval committee shall be called in question on the ground merely of existence of any vacancy in, of any defect'in the constitution of, the approval committe, (7) all orders and decisions of the approval committee and ail other comraunications sued by it shall be authenticated by the signature ofthe chaimperson or any other meniber as may be authorised by the approval committee in this behalf, u | powers     ||------------|| functions  || at         || approval   || conmunitze |eer anne (tee of anex officio member shall come to an end a3 soon as he "ceases 10 hold office by victue of which he was so nominates 14) buen) approval coramitte may discharge the imetions end exercise the powers insespect ofthe following matters, namely £2) approve the import or procurement of goods from the domestic tariff area, inthe special bconomie zone for carrying onthe authorised operations bby a developer; {6) approve the providing af services by a service provider, from outside india, gy ftom she domestic tariff area, for carrying on the sathorigcd 'operations by the developer, in the speciat economic zone, i (6) monitor the utilisation of goods or services or warehousing or trading in the special economic zone: : {2 approve, modify or reject proposals for setting up units for manufacturing ce troe int setvices of warehousing or trading inthe special becncesre zone fother thas ibe grant of licence under clause (}of sub section cy ferrin 9] im accordance 'with the provisions of sub-section (6) of section 13 5 frovided thet where the approval comenitte is unable to decide whatever a peon e eess constitutes manufacture or not it shall refer the seme the board of approval for decision; {6) allow, on receipt of approval under clause (c) of sub-section ()otsection 9, foreign collaborations and foreign direct investmene (including investments by a person outside india) for setting up a units g monitor and supervise compliance of conditions subject to which the letter of approval or permission, ifany, has been granted to the developer or entrepreneur: and in sub-section (7) in relation to- a developer, being the ceatrat ified, by notification, by the central government: setting up of unit 2 provided that an appeal may be admitted after the expiry of the period prescribed therefor if the sppelian satisfies the board thee he had sufficient cause for not preterring j the appeal within the prescribed time, such for und shalt (6)" every appeal made under sub-section (4) shall be in appealed against and by such fe "es as may be: prescribed suck as may be prescribed: 8 of an appeal shall be disposing of sn appeal, the appell (2) the procedure for disposing provided that before opportunity of being heard lant shall be given a reasonable (6) the central government may prescribe, - nit may be set y {@) the requitersens (inclading the period for which a ui subject to which the approval commitee sh referred to in sub-section (3) hell approve, modify or teject any proposal all undertake the j (0) the terms and conditions, subject to which the unit st authored operations and its obligations and entitlement @) the development commissioner may after approval of the proposal referred ta jy sub-section (2), grant a liter of approval tothe person concerted t set up a unit ang underiske such operations which the development commissioner may authorise and every sush operation 0 authorised shall be mentioned ig the letter of appravat, is cancellation of 162) the jette of believe that the enivepreneur has approval fo fnteprensir 8 obligations subj provided that no such letter of approval sh all be cancelled uni been afforded & rea ssthe entreprencur has 26 sonable opportunity of being heard benefit or deditction available the capital goods, finished insuch manner as may ] therefor: | provided that an appeat may be admitted after the expiry of the period prescribed therefor ifthe appellant satisties the board that he bad sutficient cause for not preferring the 35" appeal within the prescribed time, | the appellant shall be given a reasonable uo opportunity of being heard i i sentiog up and 17, (2) an application for setting up and operation of an offshore banking unit in a oitenne special boonomic zone may be mere 'othe reserve bank in such form and manner as 'may be doorn pts setting up and operation sub-section (1), the reserve bank shall, ifitis ys" all the conditions specifi ied under sub-section (3), grant of an offshore banking unit, @) the reserve bank may, {o which an offshore banking by notification, specify unit may be set up and 6 the terms and conditions subject erated in the special economic ¢ zone and prescribe the requirements for setting up 18 (1) the central govemment may: 'services centre in a special economie 'and operation of such centre: provided thatthe centcal government shall approve only one international finanei ial services centte in 8 special economic zone (2) the central government may, subject to such guidelines as may reserve bank, the securities and exchange board of india, development authority and such other concemed authacit {he requirements for setting up and the terms and cond an international financial services centre, 19, notwithstanding anything contained in an 'y other law for the time being in force, the central government may, if required - lication form for obtaining any licence, 2 developer, or an entreprencur under of (@) prescribe a single ap or vegistfation or approval by central acts; (6) authorise the board, the development commis; committee, to exercise the powers of the centval gover {0 the development of a special economic zone or settn, (©) prescribe a single form for furnishing returns or information bya developer of an entrepreneur under one or more central acts 20, notwithstanding anything contain in any othor law forthe time being in force, the central government may, by notification, specify any officer agency to cary out ba inspections for securing of compliance with the provisions of any central act by a developer or an entrepreneur, as the case may be, and seh officer or agency stall submit verification and compliance report, in such marner and within such time as may be specified in the said notification, 21 (2) the central government may, by notification, specify any act or omission 'made punishable under any central act, as m lotified offence for purposes of this act: {2) the central government may, by general of special order of agency to be the enforcement officer offences committed in a special econo authorise any offices of agency in respect of any notified offence or mic zone (3) brery officer or agency authorised under sub-section (2) shall have all the corresponding powers of investigati hon, inspection, search or seizure as is provided under 'he relevant central act in respect of the notified offences 2 the agency or oficer, specified under section 20 or section 21, may, with prior maimation to the development commissioner concerned, carry out the investigation inspection, search or seizure i i i provided further that any offi ised by the central government, may-carry out the inves seizure in the special =: commissioner economic zone ar unit without prior intimation or approval cr the development approve the setting up of'an intemational financ ial scting up of jaternational financia) services cente, be framed by the the insurance regulatory an: d 8, as it deems fit, prescrit a ns of the oneration of units in single application form, return, permission "te ne of more ioner or approval ament on matters relating ig up and operation of uh agency to inspect single enforcement officer of agency for natified offences, investigation, inspection and seach or g3{{) the state governments ib "yhich the special economic zane situated, may, wth the soncrence ofthe ce sustcs 'ofthe high court of that state, designate one or more courts— designated cours 10 wy fits and wafied fence, (wiry all sits ofa civil atte arising inthe special beonomle zone and (ayo try notified offences cqmunted inthe speciat peanomic 7012 s (2) na count, other than the cote designated under subsection (> shal try aay sit cor conaet the tral of any notified fence referred to in dhaksub-seoten provided thatthe cours, in which ary suit of acivit nature in 2 spaciah heonomie zone 'nad been filed before the oamnencement ofthis ac, shall 'continue to try such suit afler such commencement: 1 provided further that the cours % ies any trial of any noted offene® is being conducted before the enmmencement bis aet, shall continue conduct the trial of such, 'fence after the commencement of this act provided also that the courts competent to try any notified offence, before the commencement of this act shall ted tbe trial in respect of such offence after the 15° semnencement of tis act unl the veya have been designated weer sub-section (1) sad all such cases rejating t0 such 'ints shail thereafter be transferted (> such courts 80 designated which shall conduct the rat from the stage at which such cass swore $0 transferred appeal 10 tigh cour '4, any person aggrieved, by any decision ot order of the cout designated under 20 sub-section (7) of ection 23 may he an appeat tothe high court within sixty days from the gate of communication of the decision % moder of the courts so designated 1° him on any question af fact or baw arising tt of such orders! provided that the high court mys itis sotinfied thatthe appellant wes prevented by safficient cause from filing an appes! eatin the said period, allow ito be 'filed within a further 2° period nat exceeding sixty g75 explanation,— in section 23 204 snip section "high court" tmeans the sigh court aftho state in whicb the special feogom'= zone is situated offences by companies 435, (1) where an offence has bee? cenmnpitied by 2 company, every poon vaio at the time the offence was commit wes tt charge of, and was responsible ( the cormpany 3° for the conduct of te business of he company, a5 well as tbe company shall be deemed 19 be guilty ofthe offence and shall be rable tobe proceeded against aid punished aecordinely provided that nothing contained ia his sub-section sbalh render 207 gach person table to any punishment provided fof tre offence, i he has proved that the offence was dee itted without his knowledge of at re had exercised all due diligence prevent ihe 35 commission of such offence (2) notwithstanding anything contained io subssection (1), where 29 offence has been commited by 8 company and it is proved that the offence has been committed with she consent or connivance of, of fe attributable to any neglect of 'he part of, any director ynanager, secretary or other officer of the company, such director, manager, secretary rather 4° ffficer shal also be doemted £0 'be guilty of the offence 'and shall be liable to be proceeded against and punished accordingly explanation —for the purposss of this sevtion—~ {o)"company" means any boay corporate and includes firm or other associatiot of individuals; and " (8) "director", in eefation t0 8 fama, means @ partner in the firm  chapter vi : special fiscal provisions for sitciat ecowosue zonesexemptions, drawbacks and < 26 (1) subject to the provisions of sub-section (2), every developer and the ¢: entrepreneur shall be entiiled to the following exemptions, drawbacks and concessions, 5 namely: - | 10             ||----------------|| developer      || nd             || centrepeenenr, || @              || exemption      || trom           || any            || duty           || of             || customs,       || under          || the            || customs        || act,           || 1962           || or             || the            || custos         || tatiff         || act,           || 1975           || ot             || any            || other          || law            || for            || the            || time           || being          || in             || force,         || an             || goods          |2 imported into, or service provided in, x special economic zone or a unit, tocarryon the authorised uperations hy the developer or entrepreneur, a (®) exemption from any duty of customs, under the customs act, 1962 of the : customs tarif! act, 1975 or any other law for the time being in force, on goods exported from, or services provided, from a special econumic zone or from a unit, to any plnce outside india; (©) exemption fiom any duty of excise, under the central excise act, 1944 or the central excise tariff act,1985 or any other law for the time being in force, on : goods brought from domestic turiff arca to a special econumic zone or unit, to carry on the authorised operations by the developer or entrepreneur; {d) drawback or such other bencfits as may be admissible from time to time on goods brought or services provided ftom the domestic tariff area into a special economic zone or unit or services provided in a special economie zone or unit by the service providers tocated'ootéide india to carry on the authorised operations by the developer or entrepreneur; ny (e) exemption from service tax under chapter v of the finance act, 1994 on taxable services provided to a developer or unit to carry on the authorised operations 25 ina special economic zone; ( exemption from the securities transaction tax leviable under section 98 of the finance (no 2) act, 2004 in case the taxable securities transactions are entered into by 2 non-resident through the international financial services centre; (g) exemption frum the levy of taxes on the sale or purchase of yoods other than 'newspapers under the centrat sales tax act, 1956 if such goods are meant to catry an the authorised operations by the developer or entrepreneur (2) the central government may prescribe the manner in which, and the terms and conditions subject to which, the exemptions, concessians, draw back or other benefits shall be granted to the developer or enterpreneur under sub-section (/) | provisions    | of    ||---------------|-------|| income-tax    |       || act,          | 1961  || apely         | with  |27 the provisions of the income-tax act, 1961, as in force for the time being, shall apply to, or in relation to; the developer or entrepreneur for carrying on the authorised sperations in a special economie zone or unit subject to the modifications specified in the second schedule modification in relation to developers and enterpreneurs duration of goods of 28, the central government may preserite the period during which any goods brought e40 into, or services provided in, any unit or special economic zone without payment af taxes, © dutfes of cess shall remain or continue 16 be provided in such unit or speciat bconornic zone special eensomic zones transfer of 29, the transfer of ownership in any goods brought into, ot produced or manufactured ownership 20d ip, 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 ions specified in the rutes made by the central government in 30 subject to the con this bebalf:— | temoval    | af    ||------------|-------|| gods      |       || domestic   |       || clearance  | by    || unis      |       |(a) any goods removed from  special economic zone to the domestic tariff 'ares shall be chargeable to duties of customs including anti-dumping, countervailing and cafeguard duties under the customs tariffact, 1975, whore applicable, as leviable shot i on such goads when imported; and (8) the sate of duty and tariff valuation, ity, applicable te goods removed from 44 special economic zone shail be atthe rate and tariff valuation in force as on the date of such removal, and where such date is not ascertainable, on the date of payment of duty  chapter vil srectat economic zone authority31 (/) the central government shall, by notification inthe official gazette, constitute, constitution of authority for every special economic zane established by it before the commencement of this act or which may be established by it after such commencement by the central government, an 'authority to becalied the _ (name of the special economic zone) authority to exercise the powers conferred on, and discharge the functions assigned w, ic under this act: provided that in respect of existing special economic zones established by the central government, such authority shall be constituted by the central goverament within six months from the date of commencement of this act a5 provided further that until such authotity is constituted, the person or the authority (including the development commissioner) exercising contra! over such existing special economie zones shall continue to exercise such control over the special beonomic zone till the authority [s constitute (2) every authority shalt be a body corporate by the name uforesaid, having perpetual succession and a common seal, with a power, subject to the provisions of this act, to yo acquire, hold and dispose of property, both movable and immovable, and to contract and shall, by the said name, sue and be sued (2) the head office of every authority shall bs at such place as the central government may spevify in the notification referred tovin sub-section (7) (4) any authority may, with the previous approval of the ceatral government, establish branch offices at other places in india (5) every authority shall consist of - (©) the development commissioner of the special economic zone over which the authority exercises its jurisdiction—chairpereon, ex offieto; ue (®) two officers ofthe central government to be nominated by that government paving knowledgoof, or experience in, dealing with maiters relating to special economic 'zones—members, ex officios as 5 (©) an officer of the government of india in the ministry or department dealing with commerce on mhatters relating to special bconomic zone—member, ax officio; (a) not more than two persons, being enterpreneurs ot their norninee, to be nominated by the central goveriment—members, ax officio; (6) the term of office of the members of an authority (other than ex officio members) and the manner of filling of vacancies shall be such as may be prescribed, (7) an authority may associate with itself in such manner, subject to such conditions and for such purposes as may be prescribed, any person whose assistance or advice it requises in discharging its functions effectively and that person shall be entitled to receive such allowances or fees as may be fixed by the authority, {2 one third ofthe total members of the authority shall form @ quorum, and al the ats ofthe authority shall he decided by a majority of the members prevent (no actor praceeding of an authority shall be invalidated merely by resiun of - (any vacancy in, of any defect inthe constitution of, the ahority; or (6) any defect inthe appointment ofa person actingas a member ofthe authority; or (©) any imegularity in the procedure of te authority not affecting the merits af the case s 10) every authority shall meet at such times and places and shall ubserve such rules jp of procedure in regacd to the transaction of busines a ts meetings (nctuding quorum at > 'such meetings) as may be prescribed 7 32 (1) every development commissioner of the 'special economic zone, for which he officers of s appointed as such, shall be the chief executive ofthe authority concemed and enereve authority and such powers and perform such functions as may be prescribed, - other stat, ©) bvery authority may, in addition tothe officers and employees transfered to ft under section 33, appoint such other officers and employees, a it considers necessary far the efficient discharge of its functions under this act (3) the method of appointment, the conditions of service und the seates of pay and allowances of such otbur officers and employees apainted under sub section (2) shall be such as may be prescribed, other provided that the scale of pay of the post to which such officer or other employee is &™loyees to transferred shall not be lower than the scale of pay of the ost which he was hulding 'thority fremediately before such transfer and the other ters and conditions of sersien including seer ene ave, provident fond and medical benefits) of the post fo which fee wanton es pa et be less favourable than the terms and conditions of service in eelation ve fe ost held by him immediately hefore such transfer, we 'o & & provided further tat if, immediately before the date of his transfer, any such officer o ciher employes is officiating ina higher post under the central gavemment ther ig a leave mar? or inany vacancy ofa specified duration, his pay and other allowances, ifany, on hewat, shall be protected forthe snexpired period of sach vacancy and thereafter he shall ost under the central governnient ta which the authority, {2} if any question arises as to whether the prescribed terms and conditions of service pene ofany matte, including remuneration, pension, leave, provident find and medical benefis, are less favourable than those attached to the post held by an officer or other guplover immediately bofore his ansfer to the authority, the decision of ihe cenirat, government in the matter shall be final 34 (2) subject to the provisions of this act, it shall be the duty of each authority 10 functions of undertake such measures as it thinks ft for the development, operation and management of authority the special econotnic zone for which it is constituted 2) withéut prejudice to the generality of the provisions of sub-section od, the asures referred to therein may provide for - {2} the development of infrastructure inthe spectal economie zanes (2) promoting expors from the special economic zone; (© reviewing the functioning and performance ofthe speciat eeonomi¢ zone; special provision fur aicers ar other employees on deputation} in creer of (a levy wer or service charges o fes of rent forthe use of properties belonging to the authority, (©) performing such ether funetions as may be prescribed: grants and 436the central government may,atler due appropriation made by par finment bylaw guat 0 this behalf make to every authority by way of grams and loans or sue s008 ofmoney $ gert nent asthat goverament may think fit for being utilised for the purposes of this act constitution '35 (1) there shall be established by every authority a fund fo be 'called these of fund and (the name of the special economic 'zone concerned) authority fund and there shall be  credited thereto— application {q)all sims ofmoney, which he central government may, after due appropriation fe made by parliament by fav inthis behalf, provide co the authority: (6) all grants of loans that may be made 10 the authority under this act {call sums seceived on ascount of user or service charges a+ fees of ent forthe use of properties belonging to the authority; (a) all sums received by the authority from such othér sourcesas maybedecided 15 upon by the central government {2) the fund shalf be applied for meeting - {c) the salaces, allowances and other remuneration ofthe members, offieets and other employees of the authority; (8) the expenses of the authority in the discharge of its functions under 20 section 34; (©) repayment of any toan; (@ the expenses on objects and for purposes authorised by this acts (© meeting any other administrative expenses ofthe authority accounts and 439 (1) every authority sal maotain proper accounts and other relevant records and 25° suai prepare an annual statement of accounts jn such form as may be prescribed by the central bevernment, in consultation with the comptroller and audivor-gerieral of india, (2) the accounts of every authority sll be audited by the comptroller and auditor genotlof india at such ftervals a5 may be specified by him and any expenditure incured in connection with such sudit shall be payable by the authority to the comptroller and auditor- jo general of india (3) the comptroller and auditor-general of india or any person appointed dy tir in "connection with the audit ofthe accounts ofthe authority shall have the same righis and privileges and authority in connection with such audit as the comptroller and auditor general yeneraliytas in connection with the audit of the government accounts 'and, particule, shall have the right demand the production of books, accounts connected ear nets and other documents and papers and 0 inspect any of the ofices of the authority (4) the accounts of every authority as certified by the comptroller and 'auditor 5 genera! of india or any other'person appointed by him in this behalf together with the audit report thereon shail be forwarded annually to the central government and the central 4g 'government sball cause the same to be laid before each house of parliament dicections by 438 every authority shall be bound to carry out such directions as may be issued ¢2 cental, ftom timete time by the central government fot the efficient administration ofthis act returns and 439, (7) every authority shall furnish fo the central goverament at such time and in reports such for and manner 23 may be prescribed or asthe central goverament may direct, such coe : particulars in regard to the promotor and development of zone and units 2s the exports and the operation and m: 'central government niay, iaintenarice of the special eeonomic from time to time, require, (2) without prejudice to the provisions of subse, soon as possible, after the end af each financial year, st 2° report in such form and before such date, as may he pres ction (2), every authority shal, ag ubmit to the central government a cribed, giving a true aud fil uccount 'ious floancial year ot ts activities, poticy and programmes during the pres @) a copy of every report received under 88 soon as may > be after itis received, before each house of pa sub-section (2) shail be laid, iament power to ' performance of the duty impased supenols » or as wilfully or without authority suficient cause, failed to comply with any dtection isuee by the central government under section 38, the central government may, by natifiean mr supersedé that authority for such period not exceeding six months, as may he specified in he notification: proy section, the central resentation against the ifany, of the authority, (@) the chairperson and other memb 'hat their term of office has not expired ay offices as su {@) all the powers, famotions and duties which ma this act, be exercised or 2) on the expiration of the periad of su wader sub-section (7), the central persession specified in the notification issued government may— {@) extend the period of supersession for such further period not exceeding six months; or shall, when acting members, the rules made olficers and 'on 21 of the indian other employecs of authority (0 be public servants refereoue of aispute (b) the court or the courts to try suits in respect of such dispute had not been designated under sub-section (2) of section 23, such dispute shalt be referred to arbitration: provided that no'sispuie shatl be referred tn the arbitration on or after the date of the designation of court or courts under sub-section (/) of section 23 = (2) where a dispute has been referred to arbitration under sub-section (/), the satne shall be settled or decided by the arhitrator to be appointed by the central government (2) save as otherwise provided under this act, the provisions of the arbitration and conciliation act, £996 shall apply to all arbitration under this act as ifthe proceedings for 26 of 1 arbitration were referred in settlement or decision under the provisions ofthe arbitration and 10 conciliation act, 1996, 43 (1) the period of limitation in the case of any dispute which is required to be limitation referred to arbitration shal be regulated by the provisions ofthe limitation act, 1963, as ip 36 or imp the dispute was a suit and the arbitrator is eivil cour (2) notwithstanding anything contained in sub-section (/), the arbitrator may admita 15° dispute after the expiy ofthe period of imitation ifthe applicant satisfies the arbitatr that he had sufficient eause for nut referring the dispote within such period appa 44 all the provisions of this act (except sections 3 and 4) sbatl, as far as may be, apply of provisions tp every existing special econami of bovislrs to every existing special economic zone, sisting special economic panes person to 45 a communication by any competent authority or person under this act may be 20 whom a sent to he person who has the ultimate control over the aflairs of the special economic zone communeaton gy {nor whore the sald affairs ae entrusted to amannger, director, chairperson, or managing ontertis director, orto any other officer, by whatever name called, such communication may be sent act to such manager, director, chairperson, or managing director or any other officer, entity cart 46 every person, whether employed or residing ar required to be present ina special 25° economic zone, shall be provided an identity card by every development commissioner of such special economie zone, in such form and containing such particulars as may be prescribed authorities 47 any authority which, bas been conferred upon any power, of, is, required to s responsible gischarge any function under any central or state act, may, subject to the provisions of this $° for ciminisvation, act, exercise such powers or discharge such function in any special economic zone under that act protsetion of 48, no suit, prosecution or other legat proceeding shall lie against the central aution tke government or any chairpersun, member, officer or other employee of the board or the mgood feith  soroval committee or the authority or development commissioner for anything done or -75 intended to be done in goad fhith under this act power tu 49 (1) the central government may, by notification, direct that any of the provision of ody or this act (other than sections 54 to 56) or any other central act or any rules of reguletions fneactr made thereunder or any notification or order issued or direction given thereunder (other than other 'he provisions relating to making of the rules or regulations) specified in the notificatim— yo enactments in " felation 1 {@) shall not apply to a special eoonomie zone or a class of special econontic spee zones or alt special economic zones; or econacvie anes (b)shall apply to a special economic zone or a class of special economic zones orall special economie zones only with such exceptions, modific as niay be specified in the notification, (2) a copy of every notification proposed to be issued under sub-section (1), shall be taid in draft before each house of parliament, while it is in session, fora total period of thirty days which may be comprised in ene 3ession or in two or more successive sessions, and if before the expiry of the session immediately following the session or the successive sessions aforesaid, both houses agree in disapproving the issue of the notification or beth houses agree in making any modification inthe notificativa, the notification shall not be issued ot, as the case may be, shall be issued only in such modified form as may be agreed upon by both the houses, 59 the stats government may, forthe purposes of giving nffect to the provisions of this act, notify policies for developers and units and take suitable steps for enactment of any law— (a) granting exemption from the state taxes, levies and duties to the developer or the entrepreneur, ae (®) directing that any of the provisions of any state act relating to trade unions, industria! and labour disputes, welfare of labour including conditiris of work, provident finds, employers' fability, workmen's compensation, invalidity and old age pensions and maternity benefits ot any other activity relating to the special economic zones— shall not apply to1a specist economic zone ot aclass of special beonomic 'zones or all special economic zones; of (i shall apply toa special economic zone of a class of special econornic zones of all speciat economic zones only with such exceptions, modifications and adaptations, as may be specified in the notification; (@) delegating the powers confecred upon any person or authority under any state act to the development commissioner in relation to the devaloper or the entrepreneur 51 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, (1) the provisions contained in the chapter ka of the customs act, 1962 and the special economic zones roles, 2003 and the special economic zones (customs procedure) regulations, 2003 made thereunder shall not, with effect fram such'date as the central government by notification appoint, apply to the special economic zones (2) notwithstanding anything contained in sub-section (1), all offences committed, before the commencement of this act, under any provisions of the customs act, 1962 and the special economic zones rules, 2003 and the special economic zones (customs procedure) regulations, 2003 made thereunder, shall continue to be governed by the said 'act or rules, as the case may be yo (3) anything done or any action' taken or purported to have been done or taken including any rule, notification, inspection, order'ot notice made or issied or any permission, authorisation or exemption granted or any document cr instrument executed under the said provisions of the act, rules and regulations referred to in sub-section (2) shall in so far as they are not inconsistent with the provisions of this act, be deemed to have been done or taken or made ot issued or granted under the corresponding provisions of the act ot rules or regulations seferred to in that sub-section, 53, aspecial economic zone shall, oi and from the appointed day, be deemed to be a tervtory outside the customs territory of india forthe purposes of undertaking the authorised operations (2)a special economie zone shalt, with effect from such date as the central government may notify, be deemed to be a port, airport, inland container' depot, land station and tand customs stations, as the case may be under section 7 of the customs act, 1962: provided that the for purposes of this section, the central government may notify different dates for different special economic zanes q power of state goverament to grant exempt 'act ca have verti fect, certain provisions fat 10 apply s special economic zones to 66 pers, airport intand 'oontainer depots, land stad 8, et, 84(2) the central government may, amendment tu fest, schedure 'having regard to te objects ofthis act, and if considers necessary or expedient soto da, fom the first schedale any enactment spe y notification add to; or as the case may be, omit citied therein, 9 @) a copy of every notification proposed to be iasued under sub-section (7), shall he [sid in draftbefore exch house of partiament, while iis in session, fora total period of thirty be ssive sessions, und if, fication or both houses jeree in aiaking any modification inthe notification, the notification shall not be issued-or, as the case may be, 'hall be issued onty in such modified form as may be agreed upon by hoth 10 the houses, power ta 'make rates, 58 (/) the central governmen ttmay, by notification, provisions of this act make rules for carrying out the @) ln particu, anid without prejudice tothe generality ofthe foregoing power, such ules may provide for all or 'any ofthe following matters, namely:— is {2} the infrastructure facilities necessary for the development of the speci economie zones under clause (p) and services tn the special economic zones under 'lause (2) of section 2; (©) the period wit thin which the person concerned sha obtain the concurrence of the state government i under sub-section (3) of section 3; (©) the form and the manner in which a fa be contained therein w 20 proposal may be made and the particulars inder sub-section (3) of section 3; (@) the period wnain which the state gove 'miment may forward the proposal 'fogether with its recommendation under sub-secti ion (6) of section 3; (6) the requirements subject to which the board 'may approve, modily or reject 2 the proposal under sub-section (8) of section 4; od the period within which the grant of liter of approval shat be communicated to the state goverment or developer or entreprencer weden sub-section (/0) of section 3; (2) the other requirements for notify ing the specifically identified area in a state 8 4 special econom : ie zone under sub-section (1) of section 4; {i the terms, conditions and limitations subg exported out of, of imported into, or special economie zone, be exempt section 7; ject to which the goods or services procured from the domestic tatiff area to, a fom payment of taxes, duties, or cess under: (0 'te procedure for transfer of tetter of approval in case of suspension of lett, of approval of a developer under ei lause (a) of sub-scction (9) of section 10; () the form and ihe manner in which a proposal may be submitted and the particulars to be contained therein under sub-section (2) of section 15; fe and the fees for making suc isbrieved by the order of the approva commitice may prefer an appeal under aub-sastion (4) of section 15; {0 the form in which the appeal shall be mad appeal under sub-section (6) of section 15; (on) 'the procedure for disposing of en 'appeal under sub-section (7) section 15; : is act, and itt tmay be, omit (0) the terms and conditions for the unit subject to which it shail mndertake authorised operations under clause (b) of sub-section (8) of section 13 and the obligations and entitlements of the unit; {p) the time within which a person aggrieved by the order of the approval committee may prefer an appeal under sub-section (4) of section 16; (q) the form in which the wppeat shall be made and the fees for making such appeat under sub-section (6) of section 16; 1d, shall be 'riod of thiny sions, and if, sive sessions roth houses itsuedoras (the procedure for disposing of an appeat under sub-section (7) of section 16; non by bath (og (8) the form and the manner in which an application may be made for setting up of au offshore banking unit jn a speciat economic zone under sub-section (/) of section 17; 'ng out the wer, such @ the requirements for setting up and-operation of an international financial services centee in a special economic zone under sub-section-(1) of section 18 ; t © special es under (2) the requirements and terms and conditions subject to which 9 unit in the international financial services centre may be setup and operated ina special economic 'zone under sub-section (2) of section 18; durence () the form of singie apptication for obtaining any hicence, permission or registration or approval tnder clause (a) of section 19; tticulars (0) she forra oi'single return or information to he furnished by an entrepreneur or developer under clause (c) of section 19; 'posal {@) the manier in which and the terms and conditions subjéct to which the exemptions, concessions, drawr back ot other benefits shall be granted fo every developer and cutreprencu under sid-section (2) of section 26; reject 25 () the pertod during which any goods brought into, or services provided in, any special economie zoste shall remain ar continue to be provided iasuch unit or special economic zone under section 28; vated 9% of (the terms and conditions subject to which transfer of ownership in any goods brought into, at produced or manufactured in, any unit or special economic zone, or rerpoval thereof ftom such unit or zone, shall be allowed under section 29 ; hate 3: 40 (2a) the conditions subject to which the units shal be entitted to sell the goods manufactured in a special economic zone to the domestic tariff area under section 30; ces da (2b) the term of office of the members, other than ex officio members, of every authority and the manner of filling of vacancies under sub-section (6) of section 31; (ze) the manner in which and the conditions subject to which and the purposes for which any person may be associated under sub-section (7) of section 31: (2a) fhe times and the places of mectings and the procedure to be followed in the transaction of business at the meetings under sub-section (/0) of section 31; 'ge) the powers and the functions of every development commissioner under sub-section (1) of section 32; (af the method of appointment of officers and other employees of every authority, conditions of their service and the scale of pay and allowances under sub-section (3) pf section 325 2p) the other functions to be performed by the authority under clause (e) of us" sub-section (2} of section 34; (2h) the form in which the accounts and other relevant records of every authority shall be maintained and annual statement of accounts shall be prepared under subsection (j) of section 37; (@) the form and the manner in which and the time at which every authority shalt furnish retums and statements and other particulars to the central government under $~ sub-section (/) of section 39; (gi) the form in which and the date before which every authority shail furnish to the central government the report ofits activities, policy and programmes under subsection (2) of section 39; the identity cards 10 (a) the form in which and the particulars to be containe: undef section 46; gf any other matter which, isto be, or may be, prescribed (8) every rule made by the central government under this act shall be laid, as soon as may be after itis mada, before each house of parliament, w! in session, for a totat period of thirly days which may be comprised in one session ot in two or more successive (57 sessions, and if, before the expity of the session immediately following the session of the successive sessions aforesaid, both houses agreein making any modification in the rule ot 'both houses agree thatthe rule should not be made, the rute shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shail be without prejudice to the validity of anything previously 20 done under that rule, remove difficulties, 56 (j) if any difficulty arises in giving effect to the provisions of this act, the central government may, by ardor published in thé official gazétte, make such provisions not inconsistent with the provisions of this act, as tay appear to it to be necessary or expedient for removing the difficulty: as provided thate such order shall be made under this section after the expiration of bo years ftom the date of commencemient of this act (2) every order made under this section shall be faid, as soon as may be afterit is made, 'before each house of parliament, 57 with effect from such date as the central government may, by notification, 3° appoint, the enactments specified in the' third schedule shall be amended in the manner 'specified there' provided that different dates may be appointed on which the amendments specified in the third schedute shall apply to a particular special economic zon or-a class of special | economic zones ar all special economic zones b savings 58, all rales made or purporting to have been made or al siotifications fssued or purporting to have been issued under any central act relating ta the special economic 'zones shall, in s0 far as they relate to maiters for which provision is made in this act or rules made ot notification issued thereunder and ate not inconsistent therewith, be deemed to hhave heen made oniasued under this actas ifthis act had been in force on thé date on which 4o auch 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 under this act  (see sections 7 and 54)bracewents 'the agricultural produce cess act, 1940 (27 of 1940) 'the coffee act, 1942 (7 of 1942) "the mica mines labour welfare fund act, 1946 (22 of 1946) 'the rubber act, 1947 (24 of 1947) 'the tea act, 1953 (29 of 1953) the salt coss act, 1953 (49 0f 1953), 'the medicinal and toilet preparations (excise duties) act, 1955 (16 of 1955) 'the additionat duties of excise (goods of special importance) act, 1987 ($8 of 1957) 'the sugar (regulation of production) act, 1961 (55 of 1962) 'the textiles comittee act, 1963 (41 of 1963) 'the prodibée cess act, 1966 (15 of 1966) "the marine products export development authority act, 1972 (13 of 1972) 'the coal mines (conservation and development) act, 1974 (28 of 1974) "the oit industry (development) act, 1974 (47 of 1974), 'the tobacco cess act, 1975 (26 0f 1975) 'the additional duties of excise (textiles and tentile artictes) act, 1978 (400f1978), 'the sugar cess act, 1982 (3 of 1982) 'the jute manufactures cess act, 1983 (28 of 1983), 18, 'the agricultural and processed food products export cess act, 1985 (3 of 1986) 19, 2 the spices cess act, 1986 (11 of 1986) 'the research and development cess act, 1986 (32 of 1986) a (see section 27) mopietcartons 10 te income tax act, 1964 (4308 1961) n10,— (@) insect (a) in clause (15), after sub-clatise (nf), the following clause shall be inserted at the end, namely— "(viit) any income by way of interest received by a non-resideat or a person who is not ordinarily resident, in india on a deposit made on or after the ist day of april, 2005, in an offshore banking unit referred to in clause (x) of (0 section 2 of the speciat economie zones act, 2005;"; (b) in clause (23g), after the words, brackets, figures and letters "sub-section (4) of section 80-14", the words, brackets, figuies-and letters "or sub-section (3) of section $0-iab" shall be inserted; (c) in clause (34), the following explanation shall be inserted, narnely:— "bxplanation—for the removal of doubts, itis hereby declared that the dividend referred to in section 1 15-o shalll net be included in the total income of the assessee, being a developer or enterprencir, (6) inzection 10a, after sub-section (74), the following sub-section shail be inserted, namely:—~ "(7b) the pravisions of this section shall not apply to any undertaking, being & unit referred to in clause (zc) of seotion 2 of the special rcoucmic zones act, 2005, which inas begun of bogins to manufacture «> produce articles or things or eomputer software during the previous year relevant to the assessmeat year commencing on or | after the 1at day of april, 2006 in any special economic zone" 4 (©)after section 10a, the following section shall be inserted, namely:— "1oaa (1) subject to the provisions of this section, in computing the total spoil provisions in income of an assessee, being un entrepreneur as referred to in clause (/) of section (2) fespect of of the special economic zones act, 2005, from his unit, who kegins to manufacture ot ead produce aticles or things or provide any survices during the previous year relevant to 3 i : speci fy assessment year commencing on or after the ist day of april, 2006, a deduction : zone of () hundred per cent, of profits and gains dorived from the export, of such ' anictes or things of from services fora petiod of five consecutive assessment 3 years beginning with the assessment year relevant to the previous year inwhich 35° be: the unit begins to manufacture or produce such articles or things or provide services, as the case may be, and fifty per cent of such profits and gains for further five assessment years and thereafter, _ (i) for the next five consecutive assessment years, so much ofthe amount not exceeding fifty pet cent of the profit as is debited to the profit and loss 40 account of the previous year in respect of which the deduction isto be allowed uy and credited to a reserve account (ta be called the "special heonomic zone re~ investment reserve account") to be created and utilised for the purpose' of the business of the' assessee in the manner laid down in sub-zection (2) (2) the deduction under clause (if) of sub-section (7) shall be allowed only ifthe following conditions are fulfilied, narsely:— @ the amount credited to the special bconomic zone re-investment reserve account is to be utilised— (for the purposes of acquiring machinery or plant which is first putio use before the expiry ofa period ofthrce years following the previous year in which the reserve was created: nd {ty entil the acquisition ofthe machinery or plantas aforesaid, for 'he purposes of the business ofthe undertaking other than for distribution by way of dividends or profits at for remittance outside india as profits or for the creation of uny asset omtside india, (@) the particulars, a8 may be specified by the central board of direct 'taxes in this bebalf, under clause (b) of sub-section (2b) of section 10 have been furnished by tho ssessce in respect of machinery of plant along with the 'return of incom for the assessment year relevant to the previous year in which such plant of machinery was fest put to use, (3) where any amount credited to the speciat economic zone revinvestment reserve account under clause (i of sub-senton (7) (@) has been utilised for any pucpase other than those referred to in subsection (2), the amount so utilised; or (2) has not been utilised before the expiry ofthe period specified in sube lause (of clause (a) of sub-section (2, the amount not 50 etled, shall be deemed to bs the profits, - ) in a case referred to [n clause (a), inthe year in which the amount was 50 utilised; or {ifn a case cetered to in claus (2), inthe year immediately following the period of three years specified in sub-cluse (fof clause (a) of sub-section (2), and shall be charged to tax accordingly: provided that where in computing the total income of the unit for: 'any assessment ear, ts profits and gsins had not been included by application ofthe provisions of sub-section (72) of section 10a, the undertaking, being the unit shall he entitled tp 'eduction eferred to inthis sub-seetion only forte unexpieed petiad often vonsecutine assessment years and thereafier it shall be eligible for deduction fron income oe provided in clause (i) of sub-section (1); explaviation:—for the removal of doubts, it is hereby declared that an undertaking, boing tae unit, which had alceady availed, before the commencement of the special economie zéues act, 2005, the deductions referred to in section 1oafor ten consecutive assessment years, such unit shall not be eligible for deduction fmm income' under this section, provided further that witore a unit initially focated in ony free trade zone or export processing zane is aubsequently located ina special economie zone by reaton ofconversion of such fre rade zone or eport processing 2onsinta a special economie zone, the period of ten consecutive assessment years referred to above shal be reckoned from the assessment year relevant fo the previous year in which the unit began to manufacture, or produce or pracess such articles'or things or servived in such: free trade zone or export protessing zone: provided also that where & untistaly located in any free trade zone or export processing zone is subsequestly located ina special economic zone by reason of conversion of such free trade zone or export processing zone into special economie zone and has completed the period of ten consecutive assassment 'years referred to above, it shall not be eligible for deduction 'ftom income as provided in clause (i of sub-section (7) with effect from the ist day of apri, 2008, to any undertaking being the unit, which hes beau of ings or services during the previous xy of april, 2006, (4) this section applic negins to manufacture or produce articles o  sear elevantio the wssessment yer eomenene}me oh rafter the 1st jn any special eeonoraic zone; {gy whete any undertaking being the unit which is entitled to the deduction, 57 under this section is transferred, before the explny fof the period specified in this cotion, to another undertaking, being the unit in & scheme of amalgamation of demergety— {2) no deduation shai be admissible under tis section to the amalgamating or the demetged unt, being the company for the previous y°2° in which the ja smatgamation or the demerger tes places and (8) the provisions of this section shatl, es they 'would have apptied to the amalgamating or the deaerzed unit being the company os if the amalgamation or demerger had not taken place, : (©) loss referred to in sub-section (j) of section 72 of sub-section (dorsub- 1 i sation (8) of section 74, so fer as suc los eles he business of the undertaking, being the unit shall be allowed to be carried forward or set off (7) for the purposes of sub-section (2), the profits derived from the export of articles of things or services (including computer software) shall be the amount which tears to the profits of the business of the undertakings 'being the unit, the same 20 i proportion as the export turnover in fesreet 'of such atticles or things or services bears rethe total turmower ofthe business carried on by the assesses: i (8) the provisions of subsections (2) and (6) of section joa shall apply fo the i articles or things ot services referred to in sub-section (uy as if i (a) forthe figures, letters and word "ist april, 2001", the iguees, letters as and word "ist april, 2006" had been substituted; (8) for the word "undertaking", the words "undertaking, being the unit" pad been substituted, : (9) the provisions of sub-section (8) and sub-section (10) of section 80-ta ' choll,so tras may be, apply inselation co the ndevtaking referved to inthis section as 3? hey apply forthe purpases ofthe undertaking 'eferred to in section s0-la explanation }—for the purposes of this section, - ("export tumover" means the consideration is respect of export by the undertaking, being the unit of articles orthings or services received in,or brought |, jnio, india by the assessee bot does not include freight, 'elecommunication 35 charges of insurance attributable tothe delivery ofthe articles or things outside india ot expenses, if any, incurred in foreign exchange in rendering of services including computer software) outside india, "export" and "import" in elation to the 'special economic: zonestaking | goods ar providing services out 'of india froma special economic zone py land, 4% pea, ai, or by any other made, whether physical or otherwise; | ; ii) manufacture" shall have the same racenine assigned to it in ; clause (r)of section 2 of he special economie zones act, 2005; (iv) "relevant assessment year" moans any assessment year falling within a period of fifteen consecutive assessment years referred to in thia section; or us 6, () "special economic zone" and "unit" shall huve the same meanings 28 assigned to them under clause (za) and (ze) of section 2 of the special econotnic zones act, 2005 5 on iis or explanation 2— for the removal of doubls, itis hereby declared that the profits and gains derived trom on site development of computer software (including services for development of software) outside india shall be deemed to be the profits and gains derived frow the export of computer software outside india; {d) after section 34g, the following section shall he insorted, aamely:— ng he o he mn is be 1s b "sega (p) notwithstanding anything contained in section $4( where the capital gain arises from the transfer ofa capital asset, being machinery or plant os building or fand or any rights in building or land used for the purpuses of the business of an industrial undertaking situate in an urban area, effected ia the course of, ot in consequence of the shifting of such industrial undertaking to any spectal evonomic zone, whether developed in any urban area or any other area and the assessee has within a period of one year before or three years after the date on which the transfer rook place - o 20 (2) purchased machinery of plant for the pumases of business of the industriel undertaking in the special economic zone 19 which the said undertaking is shifted; b (6) acquired building or tand or constructed building for the purpases of his business in the special economic zone; e (©) shifted the original asset and transferred the establishment of such undertaking to the spesial zconomic zone; and tm : (@) incurred expenses on such other purposes as may be specified in a scheme framed by the central goverent fbr the purposes of this section, » » then, instead of the capital gain being charged to income-tax as incomeof the previous 'year in which the transfer took place, it shall, subject to the provisions of sub (qj be dealtwith in accordance with the following provi: say— s 3 (8 if she amount of the capital gain is grester than the cost ankt expenses incutred in relation to alt cr any ofthe purpases mentioned in clauses (@) 10 (a (uch cost-and expenscs being heresfler in this section seferced to as the new asset), the difference betwen the amount of the capital gain and the cost of the new asset shall be charged under section 45 as the income of the previous yeer: ang for the purpose of computing in respect of the new asset any capital gain acising from its tansfec within a period of tree years uf its being purchased, acquired, constructed or transferred, as the case may be, he cost shall be nil: o¢ t wp  (i ifthe arnount of the capital gain is equal fo, or less than, the cost ofthe new asset, the capital gain shail not he charged under section 45, und for the purpuse of computing in respect af the uew asset any capital gain arising from ' its transfer within a period of three years of is being purchased, acquired, constructed or transferred, as the case: may be, the cost snes be reduced by the atnount of the capital gain, as explanation —in this sub-section, - {a) "special economic zone" shall have the meaning acsigned to il in clause (za) of the special economic zones act, 2005; | exemption    | of       ||--------------|----------|| capita       | geins    || tm           | transfer || asset        | in       || of           | shilling || industrial   |          || nderaking    |          || ftom         | bas      || area         | to       || special      |          || evonomis     |          || zane,        |          |section sions of this sextioa, that is to (8) "urbon area" means any such area within the limits of a municipad corporation or municipality es ke central government may, having regard tothe population, concentration of industries, need for proper planning of the ares and other relevant factors, by general or special order, declare to be att urban area for the purposes of this sub-section (2) the amount di capital gain which is not appropriated by the assessee towarug the cost and expenses incurred in relating to all or any of the purposes mentioned in clauses (a) to {d) of sub-section (/) within one year before the date on which the transfer of the original asset took place, o which is not utilised by him tor all of any of the purposes aforesaid before the date of furnishing the return of come under section [e 139, shall be deposited by him before furnishing such return (such deposit being made in any case not later than the due date applicable in the case of the assessee for fiaishing the return of income under sub-section (7) of section 139] in an account in any such bank or institution as may be specified in, and utilised in accordance with, any scheme which the central goverament may, by notification, frame in this behalf [s~ and such return shall be accompanied by proof of suck deposit: and, for the purpnses of sub-section (/), the amount, ifany, already utilised by the assessee forall or any of the aforesaid purposés together with the amount so deposited shall be deemed 10 be the cost of the new asset: provided that if the amount deposited under this sub-section is not utilised 20 wholly or partly for all or any of the purposes mentioned in clauses (a) t¢ (d) of subsection (/) within the perind specified in that sub-section, then,— (0 the amount not so utilised shall be charged under section 45 a5 the income of the previcus year in which the period of three yeats from the date of the tcansfer of the original asset expires; and 5 (gi) the assessce shall be entitled to withdraw such amount in accordance with the scheme aforesaid" {e) in section 86-ia, after sub-section (/2), the following section shalt be inserted, namely - "€13) nothing contained ia this section shall apply to any spectal economic 30 zones notifiedion or after the ist april, 2005 in accordance with the scheme referred to in sub-clause (iif) of clause (¢) of sub-section (4)"; (f after section 80-1a, the following section shal be inserted, camely:— reductions it "80-1 ab, (1) where the gross total income of an assessee, being » developer, respect of incluites any profits and gains derived by an undertaking or an enterprise from any 35 prot ea business of developing a special economie zone, notified on of afler the ist day of tndertaking april, 2005 under the special economic zones act, 2005, there shall, in accordance senta 'with and subject to the provisions of this section, be allowed, in computing the total evelopment income of the assessce, a deduction of an amount equal to one hundred per cent, of of special the profits and gains derived from such business for tea consecutive assessment ue zone years (2) the deduction specified in sub-section (7) may, at the option of the assessco, bbe claimed by him for any ten consecutive assessment years out of fifteen years beginning from the year in which a special economic zone has been notified bythe central government: 45 provided that where i computing the total income of any undertaking, being a developer for any assessment year, its profits'and gains had not been included by application of the provisions of sub-section (7) of section 80-1a, the undertaking being the developer shall be entitled to deduction referred ta in this section only for the unexpired period of ten consecutive assessinent years and thereafter it shail be $= celigibte for deduction from income as provided in sub-section (7} or sub-section (2), as the case may be: provided further that in a case where an lnderaking, being a developer who 1 municipal wd to the of the area = gevelops a special economic zone on o after the ing day of abril, 2005 and teansiane 2 an arban, ss § {g) the provisions of sub-section (5) 379 sub-sections(7) 10 (12) of section 80 e |e under subsection (7) s lie aa pa eomeic zs rte pamela ene : explanction:—for the purposes of this sectinn, "developer" sind "speciat economic zone" shall have the same sneaultge respectively as assigned to thera i slauses(g) and (20) of section 2 ofthe special economic zanes act, 2005" ; (2) (or section sola, the following section shall be substituted, namely: 2etowaras 2ioned in thie the oteny of arsection jo ingmade sssee for counting ce with, sbohalf /s~ urposes rany of dio be "ola (2) where the geass total income of an assessee, - deductions in respect at (@ being a scheduled tank, ar, any bank incorporated by or underthe taws cemect of country outside india; sad having an oftthoce banking unit ina specigt incomes of boonomic zone; or be ain {a being a unit ofan interaatione financiat services centre, imernational amount equal to— e t i finsacial e22 includes any income reterredto in sub-section 2}, there shal be alowed, in aocoreance' feet with and subject to the 'provisions of this 'section, a deduction from such income, ofan centre as () of section 23 of thy 5 tion under the securitiog a lovant daw was obtained, = ) fifty percent of such income for five consecutive 'assessment years, ee 30 2) the income refered ta in subsection ©) shall be the income— (@) frorn an offshore banking unit na special economic zone; of (2) fom the business refered to in éub-section (2) of section 6 of the banking regulation act, 1949 with an lundertaking located ina special economie zone of any other undertaking which develops, develops and operates oy as develops, aperates and maintains a special economie zone; or {6} trom any unit ofthe intemational financial services contre from itg business for which it has been approved for setting up in such a contre in a special economic zone, (no deduction ander this section shall be allowed unless the assesses furnishes ye along with the retum of income, - {2} 2 copy ofthe permission obtained under clause (@) of sub-section (7) ofsection23 ofthe banking regulation act, 1049 explanation —for the puryoses of this section, {6) "international finanvial services cente" shall have ih, sain meanin dong, 84 (2h in clause (4) of section 2 of the speviot booman zones act 2005; ; (8) "scheduled bank" shall have the same meaning as ass ed to it clause (@) of section 2 of the reserve bank of india act, iq os 2 or iy (6) "special economie zone" shall have the same 'meaning as assigned to 'tin clause (ca) of section 2 of the special economic zonce act, 2005; g { "unit" shalt have the same meaning 2s esvgned (0 sn sinuse(zcyof section 2 ofthe special economic zones act, 2005"; to {2) ia section 11s1b, after sub-section (3) the following sub-section stall be inserted namely: - ° 1 i "(© the provisions of this section shall not apply to the income accrued or arising on ar afler the ist day of april, 2005 trom any businags 'satried on, or services renilered, by on entrepreneur ora developer, in aunitor speci economic zone, ag [ the case may be", seetlon 115-0 after sub-section (5, the following sub-section shat be inserted, i "6 notwithstanding anything contained inthis section, no tax on distributed profits shall be chargeable in respect ofthe total income of an 'uadertaking or enterprise' 20 engaged in developing or developing and operating or developing, operating and q 'maintaining a special economic zone for any assessment year oy ny amount declared, distributed or paid by such developer or enterprise, by way of dividends (whether anc tteriee) on or afer the int day of april, 2005 out of is orn income sither in the hands ofthe developer or enterprise orthe person teceiving such dividend 25° not falling under clause (23g) of section 10" () in section 1974, efter sub-section (1c), the following sub-section shall be insected, amely:— "cd) notwithstanding anything contained inthis section, yo deduction of tax 5 shal be made by the offshore banking unit from the interest paid 3008 (2) on deposit made on or after the ist day of april, 2005, by anoneresident or a person not ordinarily resident in india; or (2) on borrowing, on or after the ist dxy of april, 2005, from anon-resident ora person not ordinarily rosident in india, explanation—for the purposes of this sub-section "offshore banking unit shall 35° have the saree meaning as assigned to it in clause (2) of section 2 of the special economie zanes act, 2005"  (see section $7) amendment to chrtatn enactment a part i amindments to the risuranct act, 1938 (401938) 4 in section 2g, in sub-section (1), after the third proviso, inscrt "provided also an insurer, being an indian insurance company, insurance cooperative society or a body corporate referred to in clause (c} of this sub-section carrying on the business of insurance, may carry on any business of insurance in any special economic zone as definee in clause (za) of section 2 of the special economie zones act, 2005" 2 after section 2c, insert - "2ca the central government may, by notification, direct that any of the power of provisions of this act,— see ent e (2) shall not apply to insure, being an indian insurance company, insurance f¢ zppiy co-operative society ora body corporate referred to in clause (c}oof sub-section (j), peovisies of cofsection 2c, carrying on the business of insurance, inany special economic zone' this act to sdefined in clause (2a) of section 2 of the special economic zones act, 2005; or see ie (8) shall apply to any insurer being an indian insurance company, insurance 750° co-operative society or a body corporate referred to in clause (c) of sub-section gofsection 2c, carrying on the business of insurance, in any special economic zone as defined in clause (za) of section 2 of the special economic zones act, 2005 only with, such exceptions, modifications and adaptations 2s may be specified in the notification" part e amendments to the banking regulation ac, 1949 i (300 1949) c 1, section 53 shall be renumbered as sub-section (j) thereof and in sub-section (/) £99 as so re-numbored, for"bunking company or institution or to any class of banking companies", substitate,— "banking compeny or institution or f0 any class of banking companies or any of theit branches functioning or located in any special economic zone established under the special beonomic zones act,2005",  35° 2 alter sub-seotion (1) as so mumbered, the following sub-section shail be inserted, amely:— "@2) a copy of every notification proposed to be issued under sub-section (1), shall be laid in draft before cack: house of parliament, while itis in session, for total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session of the successive sessions aforesaid, both houses agree in disapproving the issue of the notification or both houses agree in making any modification in the notification, the notification shalt not be issued or, as the case may be, shail be issued only in such modified form as wiay be agreed upon by bath the houses", partie -amenoment to the indian stamp act, 1899 in section 3, in the proviso, after clause (2), insert: '@) any instrument executed, by, or, on behalfof, or, in favour of, the developer, or so 'unit or in connection with the carrying out of purposes of the special economic zone, explanation—for the purposes of this clause, the expressions "developer", "special economic zone" and "unit" shail have 'meanings respectively assigned to them in clause (g), (2a) and (zc) of section 2 of the special economic zones act, 2005"  (2or1899) statement of objects and reasons'the government of india had announced a special economic zone scheme in april, 2000 with a view to provide an intemationally competitive environment for exporis the objectives of speciat economic zones include making available goods and services free of {axes and duties supported by integrated infrastnicture for export production, expeditious and single window approval mechanisin and a package of incentivcs to attract foreign and domestig investments for promoting export-led growth 2 there are at present eleven functioning special eeenomic zones while seven zones have been set up by the central goverament, four by the private/foint/state sector in addition, approvals have been given for setting up of thirty-five ew special economic zones in the private'joinvstate sector 3 while the poticy relating tothe special economic zones is contained in the foreign 'trade policy, incentives and other faciities offered tothe special economic zone developer and units ate itsplemented through various notifications and circulars issued by the concemed ministries/departments, the present system, therefore, does not lend enough confidence for investors to cormmit substantia funds for development of infrastructure and for setting up of the units in the zones for export of goods and services in arder to give a tong {erm and stable policy framework with minimum regulatory regime and to provide expeditious and single window clearance mechanism, a central act for special eeonomic zones hasbeen foundio be necessary inline with international practice, 'to achieve this purpose, a""special economic zones bill, 2005" is proposed, the satient features of the bill are as under:— @ matters relating to establishment 6f special economic zone and for setting up of units therein, including requirements, obligations and entitlements, gd mamerg relating to requirements for setting up of off-shore banking units and 'units in interpational financial service center in special economic zone, include ing fiscal regime governing the operation of such units gi) the fiscat regime for developers of speciat economic zones and units set up therein; @) single window clearance mechanism at the zone level; ©) establishment of an authority for each' special economie zone set up by the central government to impart grester administrative autonomy; and (4) designation of special courts and single enforcement agency to ensure speedy 'rial and inivestigation of notified offences committed in special economic zones 4 the bill secks to achieve the aforesaid objects, kamal nath new dats; the sth may, 2005,  presidents recommendation under article 117 and 274 of tre constitution of andia,{cony of etter no nil, dated the 6th may, 2006 from shri kamal nath, minister of commerce and industry to the secretaty-general, lok sabha} 'the president, having been informed ofthe subject matter of the proposed special economic zones bill, 2605 recommends o the house the introduction and consideration ~ ofthe bill under article 117(u), 117(3} and 274(1) of he constitution, notes on clauses clause 2—this clause defines certain expressicns used in the bill clause 3-— this clause relates to procedure for making proposal to establish special economic zone, this clause provides that the central government, state goverament, of any other person, jointly or severally, may establish a spectal economic zone any person who, intends to set up a special economic zone, may, afer identliying the area, make a proposu! to the state government concemted for the purposes of setting up a specis! economie zone it also provides that the person, at his option also make a proposal directly to the board for the purpose of setting up special economic zone in cases where such proposal has been received directly from @ person, the board may grant approval and after receipt of such approval, the person concerned, shall obtain the concurrence of the state goverament within prescribed (ime, tn a case where a state government intends to set up the special eoonomic zone, it may after identifying the area, may forward the proposal direolly to the board of approval for setting up the special economic zone however, the central 'government can set up and notify the special economic zone without referring the proposal to the state government concemed or the board the state government may, on receipt of the proposal for setting up a special economic zane forward the proposal together with its recommendations to the board of approval within the time specified by rules made by the centrat government the board of approval may, after receipt of the proposal for setting up a special economic zone either approve the propusel ot, approve the proposal subject to, such terms and coriditions as it may deem fit to impose it can alsa modify or reject the proposal for setting ups special economic zone, the central government lias been conferred the power to specify by rules the minimum area of land for setting up a special economic zone and other terms and conditions subject to which the board may approve, modify or reject any such proposal reavived by it, this clause further provides that if the board of approval approves the proposal without any modification, it shall communicate the same {othe central government fitapproves the propasat with modification, itshal, communicate the same to the person or the state government concamed, after hearing the views of such person or siate goyerument and thereafter, the board of approval shall communicate the sppreval to the ceniral govertment if it rejects the proposal, it shall record the reasons therefor and communicate the rejection to the person or the state government concerned 'this clause surther provides that the central governiment shal, on receipt af communication from the board of approval, grant, within such time 2s may be prescribed, a letter of approval 'on such terms and condition, as approved by board of approval, tothe person of the state government concerned, however the central government ruay, on the axis of approval of the board, approve more than one developer in ons special economic zone in such cases where one devetoper does not have in his possession the minimuta area of land, as may be prescribed, for-sutting up 2 special economic zone and in all such cases, each developer shall be considered as a developer in respect of the land in his possession this elause also provides that any person ot a state government, who intends to provide any infrastructure facilities in @ special economic zone may, after entering into an 'agreement with the developer, make a proposal for the sameto the board of approval, for its approval, every such person or sjate government, whose proposal hax been approved by the board and who, ot which, has been granted letter of approval by the central governmen, shail be considered a co-developer clause 4,—this clause relates to establishment of special economic zone and approval for, and authorisation it to operate to developer 'this clause provides that the developer shall, alter the grant of letter of approval submit the exact purticulars ofthe identitied aréa to the central goverment and thereupan that government may, after satisfying that the requirements, as may be specitied by rales, are fulglled, notify the specifically identified area in the state as « special hoonomie zone however the central government can also notify any additional area as a part of a special econemiic zone, this clause further provides that the centra! goverament may, after the appointed day, authorise the developer ta undertake in a special economic zone, such operations which the central government may suthorise, clause 5—this clause relates to guidelines for notifying special this clause provides that the centeat government, white notifying any area as & special economic zone and for discharging its functions under the proposed legislation shall be guided by factors such as (a) yeneration of additional economic activity; (6) promotion of exports of goods and services; (c) promotion of investment from domestic and foreign sources; (d) creation of employment opportunities; {e) develapment of infrastructure > facilities; and () maintenance of sovereignty and integrity af india, the security of the state and friendly rolations with foreign states clause 6—this clause telates to the processing and non-processing arens htprovides thatthe areas falling within the special eéonomic zones may be demarcated by the ceatrat government or any authority specified by it as (a) the processing area for setting up units for activities, being the manufacture of goods, or rendering services; (6) the area exclusively for trading or warehousing purposes; and (c) the non-processing areas for activities other than those specified under (a) or (6) above (clause 7— this clause ralutes to the exemption from taxes, duties or cess this clause provides that any goods or services exported out of, or imported into, or procured ftom the domestic tariff ares, to 6 unit or developer in a special economic zone 'hall, subject to such terms, conditions and limitations, as may be specified by rules made by the contral government, be exeenpt from the payment of taxes, duties of cess under any or ait ofthe central acts which are specified in the first schedule ta the proposed legislation, the ceniral acts specified in the first schedule generally celaie to levy and payment of cess clause 8—this clause relates to the constitution of board of approval + this clause provides that the central government shall, within fifteen days of the 'commencement of the proposed legislation, by notification, constitute, for the purposes of the proposed legistation, a board to be calied the board of approval and the composition of such board has been specified in the sub-clause (2) of the said clause, this clause further sontains provisions for the term of office of members, co-option of certain persons as members of the board of approval, its meetings and quorum, 2, clause 9— this clause relates to the duties, powers and fimctions of board of approval this clause provides that it shall be the duty of the board to promote and ensure orderly development of the special economic zones, the powers and functions of ke board specified in this clause, inter afia, include (a) granting of approval or reiccting propasal or modifying such propbsals, for establishment of the special economic zones; (4) granting approval of authorised operations to be carried out in the special economic zones by the developer; (c) granting of approval to the developers o units (other than the developers or 'the units which are exempt from obtaining approval under any law or by the central government) for foréign collaborations und foreign direct investments (including investments by a person resident outside india) in the special economic zone for its development, operation and maintenance; (¢) granting of approval or rejecting proposal for providing infrastructure facilites ina spectat eoonomic zone or modifying such proposals; e) granting, 'nobithstanding anything contained ins the industries (development anct regutation) act, 1951, a licence fo an indnstrial underiaking referred to in clause (dj af section of that act, if such undertaking is established, as a whole or part therzot, or preposed ro be established, in 4 special economic zone; ()} suspension of the letter of approval granted io a developer and appointment of an administratne under clatise 10; (g} disposing of appeals preferred under sub-clause (4) of clause 15; () disposing of appeals preferred under sub-clause (4) ofciause 46; @ performing such other functions as may be assigned to itby the contral government this clause further confers power upon the board of approval to delegate such powers and sconamic zone, functions as it may deem fit to one or more development conunissioners for effective and proper discharge of the finctions of the board it also provides that the bosid, while exercising powers and discharging fonctions under the proposed legistation shall be guided by the directinns relating to policy issued by the contral government and euch direction shall be binding on the board it also provides that the board may, ifso required for purposes of direction or any other law for the time being in force relating to special economic zone, by notification, decide as to whether a particular activity constitutes manufacture ag detined in sub-clause (7) of clause'2 and such decision of the board shall be binding on all ministry and departments of the central government  |clause 10;— this clause telates to the suspension of leter of approval and transfer of special economic zone in certain cases i this clause contains provisions far suspension of the letter of approval granted to the developer for a whole or part of his area established as special economic zene for a perind not exceeding one year and appoint an administrator to discharge the functions of the  |developer in accordance with the terms and conditions of the letter of approval and menage the special economic zone accofdingly however, no letter of approval can be suspended unless the board has given lo the developer not less than three months' aatice, in writing, stating the grounds on which it proposes to suspend the letter of approval, and has considered any cause shown by the developsr within the period of that notice, against the proposed suspension it further provides that the board may, instead of suspending the letter of approval permit il (0 remain in force subject to such further terms anid conditions as it thinks fit to impose, and any further terms or conditions so imposed shall be binding upon and be complied with by the developer and shail be of like force and effect as ifthey were contained the letter of approval in case the board suspends 2 letter of approval under this secticn, itshall serve a notice of suspension upon the developer and fix a date on which the suspension shall take effect upon suspension of the letter of approval, the speciat economic zone of the developer shall vest in the administrator for a periad not exceeding one year or up tothe " date on which his létter of approval for such special economic zone is transferred to the i 'transferee, whichever is eatlier this clause also contains provisions for transfer of the i | special economic zone ofa developer whose licence has been suspended and take other actions consequent upon the suspension of the letter of approval the board of approval fhas been-conferred power, to issue sitch dicections or formulate such scheme as it may ; consider necessary for operation of such special economie zorie clause 1/-— this clause relates to the development commissioner this clause contains provisions for the appointment ofthe development commissioner for one or more special economic zones and for appointment of such officers and other employees as it considers necessary to assist every development conmmissioner it also contains provisions for salary and allowances and - other terms and conditions of service in respect of leave, pension, provident fund and other matters ofthe development commissioner, i officers and other employees  clause 12—this clause relates to the functions of the development commissioner this clause provides that the development commissioner would ensure speedy ut development of the special economie zone and promotion of exports therefrom the functions ofthe development commissioner specified in tis clause are to (a) guide the entrepreneurs for setting up of units in the special economic zone; (6) ensure and take suitable steps for 4 effective promotion af exports from the special economic zone; (c} ensure proper coordination with the central government or state goveriment departments concerne: agencies with respect t, of forthe purposes of (a) 10 (b) above; (d) monitor the performance i of the developer and the unit; (e} discharge such other functions as may be assigned to him 3 by the central government under the proposed legislation or any other law for the ime being in force; und (/) any other functions as may be delegated to him by the board of approval the officers employed under him, horised to delegate ant or all of hig powers or fonctions to any of clause 13—this clause rotates to the constitution of approval committee this clause provides thet the centeal government shall, by notification, constitute a comeniies for every special economie zone, to be called the approval committse to exercise {hepowers and perfor the fuactions specified in clause 1¢ ofthe hill in the case of existing poscial eronomic zones, the approval commitee shall ky constituted within six months from the date of commencement of the proposed legislation and in case of other spectal ~ feonomic zones established aftr the commencencens of the proposed legislation, the approval committee shall he constituted within six 'months from the date of establishment of such sptcial economic zone, this clause also conten: provisions for meetings and its ae alt gen (its also provides tha alt crders and decisters of the approval committee and all other insiruetions issued by it shall be authenticated by the signature of the chairperson or any otter member as may be 'uthorised by the approval corumitive clawsel4—this cause roles io the powers and tea for csirying on the authorised operations y the developer, in the spe: zone: (c) monitor the utilise speical eeonomic zone; (i government concerned, as the cae is clause furtber provides that he approval commitee stall not discharge much fonction, sud exercise such powers in relation to developer being the central government ag 'may be specified by it, clause 15—this clause relates to the setting up of unit, this clause provides that any person, who 'tends to'st up @ unit for carrying on the 8 special econorsic zone, may submit proposal tothe developsent 4 iefurthet provides tat the developmen 'commissioner shall, on = the beoposal before the approval conumitiee fe its approval the approval committee nay, citer approve the proposai ito 'iodification, or approve ihe proposal with modificlions subject to seek 'erms and conditions as it may deom ft to oa s20" telectthe proposal i accordance with the provisions contained inthis case of modification or rejection of & proposal, the appr feesonable opportunity of being heard to the person concemed and afier freon therefor, either modify or reject the proposal this cisuse also conte commiinee may approve, modify or eject the proposal, the dévelopmes wer ater the sppreval ofthe proposal, granta let, of approval to the p stup eolt and undertake ine unit such operations which the deve an, ubtorise und every such operation so authorised shall be mientioned in the letter of approval clause 16—this clause relates to the cancellation of letter of approval geanted to entrepreneur, this clause, ner alle, conters power upon the approvil commitee fo cancel the letter of approval of an entrepreneur after reasonable pportusity of being heard has bean aflorded fo the entreprenvut the approval committee my, at any time, cancel the feler of spbroval i it has any reason or cause fo believe that the entrepreneur hee persistently comavened any'of the terms and conditions subject to which the letter of approval was bsranted to the entrepreneur ie further provides that where the letter of approval fas heen ancelled, the unit shalinot, fom th date of such cancellation, be entitled ve any exemption, direct: it atko contains provisions for making an appeal by 'ny person aggrieved from an order of the approval committee, clouse 17, unit this claose relates tothe setting up and operation of oftahace banking banking unit in a special i 1 se further provides that the resérve bank by ottication, specify the tems and conditions subject o whieh on offhore banking 'unit may be set up and operated in the spectal econamic zone clause 18—this clause relates to the setting up of internétional financial services centre : this clause confers intemational financial ser fhe rules made by it tho requirements for clause 19—this clause relates tothe single application form, return, eéc, 'this clause provides thatthe central government may, ifrequires, specify by thesules inade by it asingle application torm for obtaining any heence, poboniseian ce tegistration or grbroval by a developer, or an entrepreneur under ove af more cental ace and a single form for furnishing returns or information by a developer or an 'entrepreneur under one or more central acts clause 20-—this clanse relates to the agency to inspect this clause conferé power upon the cenfrai government to specity, by nattiion any officer ov agency for carrying out survays ge inspections to ensum ox verify complfance clause 21—this clanse relates tothe single forcement officer or apeney for nati offence, {tis clause provides thatthe central goverment may, by | notification, specify any act or omission made punishable under any cental act, xa notified offence ne purposes of the _ offence committed in a special economic zone every officer ot agency authorised under sub-clause (2) of this clause shall have all the corresponding powers of investigation, | search or seizure as is provided under the relevant central act in respect of the notified offences : clause 22—this clause relates to investigation, inspection, search or seizure, this cause provides thatthe agency or offices, specified under clause 20 or clause 21, 'of the bill may, with prior intimation to the development commissioner concerned, carry cut the investigation, inspection, search or seizure in the special ecouomsic zone or in a unit if such ageney or officer has reasons to betieve (reasons to be recorded in writing) that a notified offence has been committed or is likely to be committed in the special economie zone however, ao investigation, inspection, search or seizure shall he carried out in a special economie zone by any agency or officer other than those reterred to in sub-clause @) or sub-clause (3) of clanse 21 of the hillwithout prior approval of the development commissioner concemed, however an officer or agency, if so authorised by the central government, may carry out the investigation, inspection search or seizure in the special 'economic zone or unit without prior intimation or approval of the development commissicher clause 23—this clause relates to designated courts to try suits and notified offences, 'this clause requires that designated courts shall ry all suits ofa civil nature arising in the special economic zone and conduct trial of notified offences committed inthe special  economic zone, no court, other than the court designated under this clause can try any or conduct trial af any suit or offence referred above this clause also contains provision of transitory in nature so far as trial of the suits of a civil natire and conducting of trial of hotified offences arising in the special ecortomie zone are concerned, clause 24—this clause tontains provisions for appeal to high court, 'this clause provides that any person aggrieved by any decision or order of the court designated under sub-clause (1) of clause 23 of the bill, may file an appeal ta the high court 'mithin sixty days from the date of communication of the decision or order of the said court to 'im on any question of factor aw arising out gf such orders however the high court can, z-_if tis satisfted that the appeltant was prevented by sufficient cause from filing an appeat thin the said perioid, altow it to be filed within a further period not exceeding sixty days 'this clause further defines the expression "high court" which meana the high court of the state in which the special economic zone is situated clouse 25 —this clause relates to offences by companies, this clause provides that where an offence under the proposed legislation has beén committed by a company, every person who at the time the offence was committed was in charge of and was respansibie to, the company for the conductof the business of the company, as well as the company, shall be deemed ta be guilty of tho offence and-shall be hable to be proceeded against and punished accordingly, however such person shall not be liable to any panishment if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence ii futher provides that where an offence has been committed by a company and it is proved that the offence has been cornmitted with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary ar other officer of 'the company, such director, manager, secretary or other officer shali, alsa be deemed to be guilty ofthe offence and shall be liable to be proceeded against and punished ackardingly clause 26:~this clause relates to exemptions, drawbacks and concessions fo every : developer or entrepreneur 'this clause contains provisions for the exemptions, drawbacks and concessions to developer or entreprenéur from any doty of customs under the customs act, 1962, the : customs tariff act, 1975, the central excise act, 1944 or the central excise tariff act, 1985 or arly dther law for the time being in force which may be admissible to them from time to 'ime, exemption from the service ax under chapter v ofthe finance act, 1994 and exemption fom lesy of trxes an soe ot purchase of yoods thr carrying on authorised operations, thy genial gavernenent las been also proposed fo be conteeed power to specify by rules the mer yn which snd the terms and conditions subject to'which, the exemptions and concessions shall be granted clouse 27-—this classe applies the provisions of the income-tox act 196 with certain modification in relation ta developers and onteepceneus fhis clatse, inter ats, proposes 0 unply te provisions ofthe incometax act, 1961 wih veriain modification in relation tthe developer and entrepreneur fev canying on the authorised operations th ibe specis| economic zones or nit and such modifications are specified in the second schedute to the bill 'he modifications which are, iter afiu, specified ia the second schedule are as under: - (@) it is proposed to insert a new elanse 10aa in the tneome-ta act, 1961 homeenas eceai special provisions intespecto newly established unitsin speci conomic zones providing deductions of hundred pr ceut, of profits ane eins derived from the export braadly on the lines of section (oa of te fncome tnt i361 ©) its rurter proposed to grat exemption of eaptal gains on transite of esate in case of shifting of industrial undertakite fran urban aren or any other area to @ spetia! economie zone bronaly onthe tes of existing section 340 ofthe income tax act, 1961  {6) wis also proposed to aliow deductions in espect af pratits and goins by an lavderiaking or enterprise engaged in devsiopment ofa snociat eeanoraie zane broadly onthe ties of existing section 80-1 af the income-tax ace, 1961 {g) tsalso proposed to allow dedutica in spect of enain ingomes of offthare banking units and international financia! services center broadly on the fines af existing section 80-la of the income-tax act, 1961, {6) ks also proposed to make provision inthe tncometax act 1961 te provide 'hal no tx on distributed profs shel be chacgeable in eapest of the total inne ofan undertaking or enterprise engezed in developing or developing and operating or developing, operating ant maintsining a speciat economie zone or any asaessment se or daeginount declared, datributed o paid by uch developer or entexprisn ty ay af dividends (whether utetim or otherwise) on or afer the ist dey of aprit, 2005 cu of ts eurrent income ether in the hands of developer or enterprise or the person 'meeiving such dividend not falling under section 19 ofthe incomes act 19¢1 {0 tals proposed to provide thatthe provisions of section 115jb ofthe inconnetaxact 1361 sall not apply to the incom accriedor arising from any businens ened fane ees rendered, by an enteeprencure duveloper, n'a unit or special reonomie zone clause 28— this clause splaes to duration of gaods in spestal foonomic zoass 'the central government may specif, by nls made by i the period during which any goods brought into, or services provided in, any unit withnae payment of taxes, duties, fevies or cess, shall remain or coatinue to be provided in such unites special economie zoe clouse 29—this clause reaies to transfer of ownership and removat of goods, the tsasfer of ownership in any gnods brought late, of produced a 'manugactured in, any unit ot special economic zone or romoval thereof from such unit or zoe eho be alfowed, subject to such toms and conditions as the cenmat govern eet nay specify by tales made by il, clause 30— this cbse relatos to domestic cieerance by units this clause provides that (3) aay goods removed from a special economie zone the pmestic tariff arca shall be chargeable to duties of custome including anti-dumping, sountervailing and safeguard duties under the customs tariff act, 1975, where applicable, as zoviable on such goods when iinported; and (h) the rate of dury and tari vetuation, if any, 'applicable to goods admitted to or removed fear, a special icenomie zone stall he at the vate and tariff valuation in force at on the date of such removal, and where such date is not ze ascertainable, on the date of payment of duty clause 31-- this clause relates to constinition of authority this slause provides that the central gavorament shatl, on every appointed day, _ sonstitutc, for overy special economic zone establistied before commencement of the proposed legislation oc which may he established aftec such commencement by the central government, an authority to discharge the functions assigned to fl undet proposed legislation the head office ofevery authovity shail be al such place as the central government p may specify the authority may, withthe previous approvel of the central government, < gstablish branch offices at other piaces in india, this clause, inter alia, also containg __ provisions for the composition of the authority, terms of office ofthe members, manner of filling of vacuncies, allowances or fees of members and such rules af procedure in rezard to the transaction of business at its meetings (including quorum at such meetings) of the 'authority, et clause 32— this clause relates to officers of autharity and other staff, this clause provides that every development cummissioner ofthe speciat economic 'zone for which he is appointed ws such shall be the chief executive ofthe authority concerned and exercise such powers and perfom such functions as may be spevitied by rules made by the central government, this clause also contains provisions relating to method of appointment, the conditions of service and the scales of pay and allowances of such other officers and employees of the authority clause 33— this clause relates to spesiat provision for transfer of employees to authority, this clause contains provisions for, transfer by the central government of vertain officers or employees to each authority, seale of pay of such officers end employees and ether terms and conditions of service of such employees and officers, clause 34— this clause relates to functions of authority 'this clause ieaposes a duty upon the authority (constituted for every special economic zone) to undertake such measuces as it thinks (ft for the development, operation and management of the special fconomiczone for which it is constituted such measures are (2) the development of infrastructure in the spsciat economie zone; (8) promating exports from the special econom's zone; (¢} reviewing the fimetioning and performance of the special economic zcine; (d) levy user or service charges or fees of rent for the use of properties belonging to the authority; {e) performing such other functions ax may be prescribed clouse 35~- this clause relates to grants and loans by the central government this clause provides that the central government may, after due appropriation made by parliament by law in this behalf, make to every autharity by way of grants and foans such sutis of money as that government may think fit for being utilised for the purpuses of the proposed legislation, cleuse 36—phis clause relates to constitution of fund and its application this clause provides for establishment of fund there shall be credited to the fund {@) all sams of money, wbich the central government riay, aftec due appropriation made by parliament by law in this behalf, provide tothe authority (b) all grants or loans that muy be made to the authority under the proposed tegislation; (c) all sums received af uccount of user or service charges or fees or rent for the use of properties belonging tothe authority; (4) all sums received by the authority from such other sources ax may be decided upon by the centrat government i further provides thatthe fund shaltbé epplied for meeting (a) the salaries, alloyrasces and ofher rcinuneration of the maembers, officers and other employees of te authority, (6) fhe expenses of the authority in the discharge of ts functions under clause 34; (c) repaytnent of any loan; (a) the expenses on objects and for purposes authorised by the: propesed 'egislation and (¢) meeting any other administrative expenses of the authority  clause 37— this clause relates to accounts and audit,this clause provides that every authority ofthe special beomomic zone set up by the central government shall maintain proper accounts and other relevant records and prepare an annual stafemtent of accounts in such form 28 may be specified by-rules made by the central government in consultation with the comptroller and auditor-general of india, the accounts of every authority shall be audited by the comptroller and auditor-general of india at such intervals a8 may be specified by him and any expenditure incurred in connection 'with such aadit shall be payable by the auchority ta the comptroller and audilor-general of indie, the comptrolier atid auditor-general of india or any person appointed by him in connection with the audit of the accounts of the authority shall have the same rights ond privileges and authority in connection with suck audit as the comptroller and auditer- general generally has in connection with the audit of the government accounis and, in particular, shall have the right to demand the production of books, accounts, connected oucrs and other dacuments and papers and 9 inspect any of he offices ofthe authority the accounts of every authority as certified by the compurailer and auditor-general of india or any other person appointed by him in this behalf together with the audit repuct thereon shall be forwarded eanually to the central government and the central government shall 'cause the sameto be itid before each house of parliament  clause 38 —this clause confers power upon the central government to give directionsthis clause provides that every authority ofthe special bconomic zone set up by the central government shail be hound to carry out such directions a3 may be issued to it rom time to time by the central goverment for the efficent administation of the proposed legislation clause 39—this clause relates to retums and reports, "this clause provides tat every authority ofthe special economic zone setup by the ceutzal goveroment stall furnish to the central government soch returns and statenaonts and stich particulars in regard tothe promotion and development of exports and the operation snd maintenance of the special economic zone ard units as that goverement may, from time to time, require, ft irther provides that every authority shall, as soon as possible, ater the end of each financial year, sebinit to the central gavernmenta report in sch form ead before such dite, as may be specitied hy rules made by the central governmesi, giving true and {ull account of is activities, policy and programmes during the previous financial yeac, a copy of every such report received shal be laid, as soon as may be, ater itis rectived, before ach house of parliament  clause 40— this clause rélates to power to supersede authority,this cause provides that ifat any time the centra! government isof the opinion that an authority is unable ta perform, br has persistently made default in the performsnce of, the duty imposed on it by or under the proposed ingislation or has exceeded or abused its powers, or has witfully ot without sufficient cause, failed to comply with any direction issued by the central government under clause 38, the central government may, by notification supersede that authority for such potiod not exceeding six months, as tay be specified in the notification, hdwever before: issuing @ notification under this sub-clau: se, the central 'goverment stall give reasonable time ta that 'authority to show cause 'why it should not be superseded and shall consider the explanation, ifany, of the authority it further provides that upon the publication ef the notification superseding the authority, (a) all the members of the authority shalt, 'notwithstanding chat their term of office has not expired as from the date of supersession, vacate their offices as stich members; (b) ail she powers, fisnctions and |) duties which may, by or under the provisions of the proposed legistation, be exercised or: © discharged by ar on bebalf of the authority shall, during the petiod of supersession, be exercised and performed by such person or persons as the central government may direct, (c) all property vested in the authority shail, during the period of supsrsession, vest in the central government, it also provides that on the expiration af the period of supersexsion specified inthe notification issued under sub-clause (2), the central government may extend the period of supersessian for such further period not exceeding six months or reconstinle the authority in the manner provided in clause 31 of the bill clause 41—- this clause provides that members, officers and other employers of every authority to be public servants - it provides that alt members, officers and other employees of every authority, shall, 'when acting or purporting to act in pursuance of any of the provisions of the proposed legistation orany ule made thereunder, be deemed to be public servants within the meaning of section 21 of the indian penal code clause $2— this clause relates to reference of dispute this clause provides that notwithstanding anything contained in any other law for the time being in farce, if (a) any dispute of civil nature arises among twa or more entrepreneurs or fwo or more developers or between the entrepreneur and developer in the speciat economic zone; and (2) 'the court ot the courts to try suits in respect of such disputé had not been designated under sub-clause (/) of clause 23, such dispute shall be referred to arbitration, however no dispute shall be referred to the arbitration on or after the date ofthe designation of court o¢ courts under sub-clause (/) of clause 23 it further provides that where a dispute hhas been reterred to arbitration, the same shall be settled or decided by the arbitrator 1o be appointed by the central government, italso provides that, the provisions of the arhitration and cuncifiation act, 1996 shall apply to all arbitration under the proposed legislation as if the proceeding for arbitration were referred in settlement or decision under the provisions of the arbitration and conciliation act, 1996 (clause 43,— this ctause relates to limitation 'this clause provides that the period of limitation in the case of any dispute which is required to be referred to arbitration shail he regulated by the provisions of the limitation act, l963, as ifthe dispute was a suit and the arbitrator is civil court it further provides that the arbitrator may admit; a dispute after the expiry of the period of limitation, ifthe applicant satisfies the arbitrator that he had sufficient cause for not referring the dispute within such period clause 44— this clause telaies to applicability of provision af the proposed legislation to the existing special econtmic zones, this clause provides that all the provisions of the proposed legislation (except provisions contained in clauses 3 and 4) shall, as far a8 may be apply, fo every éxisting special economic zane: clause 45—this clause celates to person to whom a comnwnication may be sent under the proposed legislation this clause provides that a communication ty any competent authority of person under the proposed legislation may be sent to the person who has the uitinate contral over the affairs of the special keogomic zone or unit or where the said affairs are entrusted to a manager, director, chairperson, or managiog director, or to any other afficer, by' whatever 'name called, such communication may be sent fo such manager, director, chairperson, or managing director or any athet officer, 'clause 46~this clause relates to identity card this clause provides that every person whether employed or residing or required to be present in a speciat economic zone shall be provided an ideatity card by every  attevelopment commissioner in such form and containing such particulars as may be specified by rules made by the ceatral government clause 47 —this clause relates to authorities responsible for administration, this clause provides that any authority which, has been conferred upon any power or, fs, required to discharge any function under any central or state act, mzy, subject to the provisions of the proposed legistation, exercise such powers or discharge such functions in any special economic zane under that act clause 48,—this clause relates to protection of action taken in-good faith it provides that no suit, prosecution or other legal proceeding shall lig against the central government ar any chairperson, membet, officer or ather emplayce of the board of approval, approval committee, the authority or develapment commissioner for anything, done or intended to be done in good faith under the proposed legislation clause 49—this clause relates to power to modify provi iegistation or other enactments in relation to special economic zones, 'this clause provides that the central government may, by notification in the oificixl garette, direct that any of the provision of thé proposed legislation or any other central act, <3 any cules or regulations made thereunder or atty notification or arder issued or direction sven thereunder (other than the pravisions relating to making of the rules or regulations) specified in the notification (2) shall not apply ta a special economic zone ar a class of special economic zanes or all special economic zones; or (6) shall apply to a special economic zone or a class of special economic zones or all special economie zanes anly with such exceptions, modification and adaptation, as may be specified inthe ntification, a copy of every notification proposed to be issued under sub-clause (7), shull be [aid in draft before each house of parliament, the notification shall not be issued of, as the case may be, shall be issued only in such modified form as may be agreed upon by bath the houses clause 50,—this clause retates to the pawer of state government to grant exemptions 'this clause confers power upon the state governinent to notify policies for developers and units and to take suitable steps for enactment of any taw {a} grunting exemption from the' state taxes, levies und duties fo the developer or the entrepreneur; (b) directing that any of the provisions of any state act relating to trade unions, industrial and labour disputes 'welfare of labour including conditions of work, provident funds, employers liability, workmen' compensation, invalidityand old age pensions and maternity béoefits or any other activity relating to the special economic zones shall not ypply or shall apply, with such exceptions modifications and adoptions as may be notified jn the notifications, to « special economie zone ot aclass uf special economic zones or all special feanumic zones, and (¢) delegatin the powers conferted upon any person or authority under any state act to the developed 'commissioner in relation to the developer or the entrepreneur, clause 51—this clauce rctates to the proposed legistation to have overriding eff this clause provides thatthe provisions of the proposed legislation shall have eff notwithstanding anything inconsistent therewith contained in any other law for the fag being in force or in any instruraent having effect by virtue of any law other than the propate fogislation q clause 52— this clause relates fo certain provisions not to apply 'this clause, inter alia, provides that the chapter x-a of the customs act, 1962, the special economic zones rules, 2003 and the special economic zones (cust procedure) regulations, 2003 made thereunder shall nat apply to the special econo 'zones, it further provides that all offences committed, undes any provisions of the cust act, 1962 and the special econamic zones rules, 2003 and the special feonomic (customs procedure) regulations, 2003 made thereunder, before the coming into foree oi proposed legislation shafl continue to be governed by the said acts or mies fons of the proposed | the pro 'make 5 legishat halle blended bsurance hes ame eh), by m hendon bp eis allance 4 fatto, lon-carry specialy sbill, 2 fer pow: shall ve soe), ness of ee propo pany isi, ton (7), bs defitieg bons, mox clouse 53—special economic zones to be ports, airports, inland container depots, land stations, in curtain cases, this clause provides that a special economic zone, onand liom the appointed day, be deemed to be ateritory outside the eustoens ceritory of india forthe purpose of undertaking the authorised operations, «gl farther provides that» special economic zane shall, with effect from such date as the central government may wotity be deemed to bes port, icportinfad conan 'depot, ia sition and laud customs stations under section 7 of the customs act, 1962, tie uifferent special economie zones, clause 54— this clause retates to amendment to the fist schedule this clause provides hat the central government may, having regard to the objects of the proposed legislation and if it considers necessary or expedient so todo, by notification add oy of us the ease may be, omit rom the first schedule any entry relating to any central act a copy of every notification proposed to be issued shall be lid in deat beta each house of parliament, the notification shall nat be issued or, as the cave smay be, shall be issued only in stich modified fortn as may be agrced upon by bath the houses ot parliament 'clause 55— this clause relates to power to make cules, nk clause confers power upon the cental govéenment ta make res in sespet of matlers specified in the said clause the rules muade by the central government shall be ©) "published in the official gazette and be laid before cach house of parliament clause 36 is clause relates to power to remove difficulties, of the proposed legislation clatse 57 —this elause relatus to amendntent of certain enactments jl "late provides that the enactments specified in the thitd schedule shall be fiended in the manne specified therein, these enactments proposed tobe amended oe the insurance 'act, 1938, the banking regulation act, 1949 and the tndisn stamp act, 1899, 'these sntendments shall take effect with effect from such date asthe cental government 2y, by notification appoint however different dates may be appointed on which the amencments specified inthe third schedte shall apply 1 is proposed to insert the tlre provision in sub-section (j) of section 20 of the  hisurance act, 1938 so a5 te provide that an insurer being an indian tnsuranee company, sect cayrgeerative socety ot & body corporate teferred to in cfnuse (c) of hit eo zi section carrying on the business of insurance, may carty on any busines gh insurance in ack shall not apply to an insute, being un indian insurance company, emcee coe tre rane of abot corporate refered to in clase (2 of his sub-section, caine the business of insurance, in any special economic zone as defined fn clause (20) of clause j  2of the proposed legislation; or (i shail apply to any insurer being on ind insurance fo company, insurance co-operative society or a body eorporats referred t in clause (c) at exid jape ten of section 2c, catrying onthe business of surance, many spevet og a zane 36 defined in clause (2a) of clase 2 ofthe proposed tegilaton solv et such xceptions, modifications and adspravions as may be specified fn the notte sion the banking regulation act, 1949 soas -ompany of institution or to any class of ning or located in any special evimomic it is further proposed to amend section 53 of to extend the scope of exemption to the banking c banking companies or any of their branches function zone established under the proposed legislation, ils also proposed to insert paragraph (3} in the proviso of section 3 of the indian stamp act, 1899 s0 as t include within the seope of said provision any instrument executed ty, or on behalf of, o in favour of te developer, of unis or in connection with the carrying cut of purposes of the special economie zone as refered to in clause (ra) ofclause 2 of the proposed legistatiot clause 58, - this clause relates to sat gs 'this clause provides that al] rules made or purporting to have been made ar all notifications issued or purporting to have been issued under any central acts relating to special economic zone shall, in so far as they relate to matters for which provision is made in the proposed legislation and are not inconsistent therewith, be deemed to have becn made or iseued under the proposed legislation as ifthe proposed fegislation had beew in force on the dafe on which such rules were made or notifications were issued and shall continue to be jn force unless and until they are superseded by any rules made or notifications issued under the proposed legislation  financial memorandumclause 11 of the bill provides for appointment of development commissioner und other officers and employes to assist the development commissioner in the performance of his fimctions the ministry of commerce and industry (department of commerce) presently meets such expenditure further, clause 35 of the bill provides for grants and loans by the central government 10 the authority in respect of the special economic zones set up by the central government far being utilised for carrying out its functions since at present special econamic zones are functioning as subordinate offices of the ministry of commerce and industry (department af commerce) and their administrative expenditure is being met from the budget of ministry of commerce and industry (department of cammerce), there is no likelihood of additional expenditure on account of grants and loans by the central government to the authority hence, at this stage, no additional recurring or non-recurring expenditure is involved in the administration af the proposed segistation  memorandum regarding delegated legislationclause 49 of the bill empowers the centeal government to modify provisions of the proposed legislation or other enactments in relation to special economie zones, sub-clause () of this clause provides that the central government may, by notification in the official gazette, direct hat any ofthe pravision of the proposed legistation (other than clauses 54 to 56) or any other central act, any nules or regulations made thereunder or any notification op order issued or direction given thereunder (otber than the provisions relating to making of the rules or regulations) specified in the notification (a) shall nat apply toa special econoinic zone ar aclass of special economic zones or ll special economie zon; of (8) shall apply (0 4 special economic zone or a class of speciat economic zones or all special eeonomie zones only with such exceptions, modification and adaptation, as may be specified in the notification 2: clause 54 of the bill empowers the central government to make amendment to the first schedule to the bill, sub-clause(/) of this clause provides that the central government ay, having regard to the objects of the proposed icgislation, and if it considers necessary or expedient so ta do, by notification add to, of as the case may be, omit from the first schedule any entry relating to any central act specified therein, 3 acopy of every notification proposed to be issued under clauses 49 and $4, shall be laid io draft before cach house of parliament, white itis in session, fora total period of thirty days which may be comprised in one session of in iwo of mare successive sessions, and if before the expiry ofthe session immediately faltowing the session or the successive sessions aforesaid, both houses agree in disapproving the issue of the notification or bath houses agree in making any modification inthe notification, the notification shall nat be issued or, as the cage nay he, shatl be, issued only in such modified form as may be agreed upon by both the houses; 4, clause $5 of the billempowers the central goverment to make rules, by notification, {0 carry aut the provisions of the proposed, legislation the matters in respect of which such rules may be made are specified therein, these matters rotate, inter alia, to provide for (2) the infrastructure facilities necessary for the devclapment of the special evenomic zone under elaise (p) and services in the special economic zone under clause (2) of section 2; (4) the period within which the persan concerned shail obtain the concurrence of the state 'government under sub-section (2) of scution 3; (the form and the munner in which proposal may be nade and the particulars to be contained thercin under sub-section (5) of section 3; {d) the period within which the state government may forward the proposal tngether with its fecommendation under sub-section (6) of section 3; {6} the requirements subject to which the board may approve, modify er reject the propose! under sub-section (8) of section 3:(/) the period within which a letter of approval ar rejection shall be communicated to the state government ar developer or entrepreneur under sub-section (/0) of section 3: (g) the other requirements for notifying the specifically identified area in a state as a speciat econtomic zone under sub-section (1) of section 4; (a) the tetms, conditions and limitations subject to which the goods or services exported out of, or imported into, of procured from the domestic tariff area to, a spcciat economie zone, be exempt from payment of taxey, duties or cess under section 7; (7) the procedure for transfer of leter of approval in case of suspension of letter of approval of a developer under clause (a) of sub-section (9) of section 10; () the fort and the manner in which a proposal may be submitted and the particulars to be contained therein under sub-section (j) of section 15;(4) tine within which a person aggrieved by the order of he approval committee may prefer an appeal under sub-section (4) of section £3: (2) the form in which the appeal shall be made and the fees for makidg appeal under sub-section (o) of section 15, (m) the procedure for disposing of an appeal under sub-section (7) of section 15, (4) the requirements, subjectto which the proposal may be upproved, modified of rejected under clause (a) of sub-section (8) of section 15; (o) the tents and conditions, obligations and entitlements for the unit subject to-wiich it shall undertake authorised operations under clase (6) of sub-section (8) of section 15; (p) time within which a person ey) aggrieved by the order of the approval committee may prefer an appeal under sub-section (a) of section 46; (q) the form in which the appeal shall be made and the fees for making appeal under sub-section (6) of section 16; (7) the procedure for dispasing of wn appeal inder sub-section (7) of section 16; (5) the form and the manner in which an application ay be made for setting up of an offshore banking unit in a spectal economic zane under sub-section (/} of section 17; (2) the requirements for setting up und operation of the international financial services centre in a special economic zone under sub-section (7) of section 18; (4) the terms and conditions subject to which « unit in the international financial services centre may be set up and operated in special economic zone under sub-section (2) cf section 18, (v) the form of single apptication far obtaining any licence, permission or registration or approval under clause (a) of section 19; (v8) the form of single return dr jnformation lo be furnished by un eutrepreneur or developer under clause (c) of section 19; (0) the manner in which and the terms and conditions subject to which the exemptions coricessions and drawback or other henefits shall be granted to every developer and entrepreneur under sub-section (2) of section 26; (y) the period during which any goods brought into, or services provided ii, any spectal economic zone shall reraain of continue to be provided in such unit or special economie zone under section 28; (2) the conditions subject to which transfer of ownership of any gouds brought into, or produced or manufactured in, a special economie zone, or removal thereof from the zone, shall be allowed under svetion 29;-(za) the conditions subject to which the units shall be entitled fo sell the gouds mamufactured in a special economie zone to the domestic tariff area under section 30; (26) the terms of office of the members, other than ex officio members, of every authority and the manner of filling of vacancies under sub-section (6) of section 41; ge) the manner in which and the conditions snbject to which and the purposes for swhich any person may be assaciated wnder sub-section (7) of section 31; (2d) the tines and the places of meetings and the procedure io be followed in the transaction of business meeting under sub-section (10) of section 31; (ze) the powers and the functions of every development commissioncr under sub-section (2) of section 32; (z/) the method of appointment of officers and othér employees of every authority, conditions of their service and the scale of pay and allowances under sub-section (3) of section 32; (zg) the fictions to be performed by the authority under clause (¢} of sub-section (2) of section 34; (ch) the form in which the accounts and other relevant records of every authority shal! be maintained and annual statement of acuounts shall be prepared under sub-section (1) of section 37; (zi) 'he form and the manner in which and the time st which every authority shall furnish returns and statements and other particulars (o the central government under sub-section (/) of section 39; (zj) the form in which and the date before which every aulhority shall furnish to the central government the report of its activities, policy und programmies under subscotion (2) of soction 39; (z) the form in which and the particulars to be contained in the identity cards under section 46; and (ai) any other matter which is to be, or may be, prescribed 5 the rules made by the central government shall be laid, as soon as may be after they are made, before each house of parliament 6, 'the matters in respect of which rules and regulations may be made are yenerally tnatters of procedure and administrative detail and itis not praeticable to provide for thera in the bill itself 'the delegation of legislative power involved is of a norrnal character,  annexure, lectragts bets the ines tak act, 1961(43 of 1961) (2g) any income by way of dividends other than dividends referred to in section 115- ©, interest or fong-term capital gains of an infrastructure capital alnd''or an infrastructure 'capital company or a co-operative bank from investments made on or after the ist day of june, 1998 by way of shares or long-term finance in any enterprise or undertaking wholly 'engaged in the business referred to in sub-section (7} of section 80-ta or a housing project referted to in sub-section ({0) of section 80-18 or a hntel project ot a hospital project and which hasbeen approved by the central government on an application made by it in accordance with the rules made in this bebalf and which satisfies the prescribed conditions, (24) any income by way of dividends referred to in section 1154; sola(/) where the gross total income of an ussessea,— (ipheing a scheduled bank (not being a bank incorporated by or under the laws of a country outside india); | deduction    | in    ||--------------|-------|| respect      | of:   || certain      |       || ineumes      | of    || offshore     |       || banking      |       || units       |       |(owning an offshore banking unit in a special economic zone, inchides any income referred tn in sub-section (23, there shall be allowed, in accordance with and subject to the provisions of this section, a deduction from such income, ofan amount equal to— oor (@) one hundred per vent of such income for three consecutive assessment years beginning with the assessment year relevant tothe previous year in which the permission, under clause (a) of sub-section (/) of section 23 of the banking regulation act, 1949 was obtained, and thereafter; (b) fifty per cent of such income for two consecutive asessment years (2) the iocame referred to in sub-section (2) shal be the income— (a) from an offshore bankingunit in a special ecortomic zones loot (6) from the business, referred to in sub-section (f) of section 6 of the banking regulation act, 1949 with an undertaking located in a spectal economic zone ot any other undertaking which develops, develop and operates or operates and maintains a special economie zone; soft {e) received in convertible foreign exchange, in accordance with the regulations niade under the foreign exchange management act, 1999 (3) no deduction under this section shall be allowed unless the assassee furnishes along with the returrof income,— (0) in the prescribed form, the report of an accountant as defined in the explanation bclow sub-section (2) of section 288, certifying that the deduction bas bbven correctly claimed in accordance with the provisions of this section; and woof (da copy of the permission obfained under clause (a) of sub-section (7) of 'section:23 of the banking regulation act, 1949 explanation —for the purposes of this section, - (a)"conyurtibie foreign exchange" shall have the same moaning assigned to it ia clitise (a) of the explanation below sub-section (4c) of section 80hhc; 2 (6) "offshore banking unit" means a branch of a bank in india focated in the special economic zone and has obtsined the permission under clause (a) of subsection (7) of section 23 of the banking regulation act, £949; (e) "scheduiled bank" shall have the same meaning assigned to it in clause (e) of section 2 of the reserve bank of india act, 1934; (@)"special economic zone" shall have the sarce meaning assigned to it in clause (will) of the explanation 2 to section 104 (4081938)  parti provisidns aiplicable to surersprohibition 2c (2) save as hereinafter provided, no person shall after the commencement of the of insurance (amendment) avt, 1950, begin to carry on any class of insurance business in haan india and no insurer carrying on any class of insurance business in india shall after the tismensty expiry of one yeur from such commencement, continue fo carry on uny stich business unless ecrtain he is— perso (e) a public company, or @) a society registered under the co-operative societies act, 1912, o under any other lave for the time being in force in any state relating to ca-operative societies, or ' (o)'a body corporate incorporated under the law of any country outside india not being of the nature of a private company: provided that the central government may, by notification in the official gazette, cxempt from the operation of this section to sueh extent for such period and subject to such conditions as it may specify, arly person or insurer for the purpase of carrying on the business of granting superannuation allowances und annuities of the nature specified in sub-clause (¢} of clause (jj) cf section 2 ot for the purpose of carrying on any general insurance business provided further that in the ease of an insurer carrying on any general 'insurance 'business 60 such notification shglt be issued having effect far more than thee years at any 'one time: provided also that no insurer other than an indian insurance company shall begin to carry on any class of insurance business in india under this act on or after the commencemteat of the insurance regulatory and development authority act, 1999 latton aer, 1949  entract from the bankine ris (lor 1949)power (0 453, the central government may, ob the recommendation of the reserve bank, declare, cxempt in by notification in the official gazette, that any or all af the provisions of this act shal! tot certain <8505 " aboly to any banking company or institution or to' any élass of banking companies either géneraily or for such period as may be specified 'extract from th indian stanp-act, 1899 (of 899)  chapter tl stanp-punies a—of the liability of instruments to dutyinstruments chargeable swith duty 3 subject to the provisions of this act and the exemptions comtained in scitedule i, he following instruments shail be chargeable with duty of the amount indicated in that schedule as the proper duty therefor, respectively, that is ta say-— (a) every instrument mentioned ia that schedule which, not having been previously executed by any person, is executed in india on or after the firstday of july, 1899; (0) every bill of exchange payable otherwise than on demand or promissory note dravm or made out of iudia on or after that day and accepted or paid, or presented for acceptance or payment, or endorsed, transferred ot otharwise neyotiated, in india: and (2) overy instrument (other than abill of exchange, or ptomissory note) mentioned in that schedule, which, not having been previously executed by any person, is exceuted 'out of india on or after that day, relates to any property situate, or to any matter dr thing done or to be done, in india and is roceived in india: provided that no duty shall be chargeable in respect of - (7) any instrament executed by, of on bebalf of, or in favour of, the government in cases where, but for this exemption, the government would be jtabie to pay the duty chargeable int respect of such instrument; (2) any instrament for the sale, transfer or other disposition, either absolulcly or by way of mortgage or otherwise, of any ship or vessel, or any part, interest, share or property of or in any ship or vessel registered under the merchant shipping act, 1894, or under act 19 of 1838, or the indian registration of ships act, 1841, as amended by subsequent acts, 