Section 25(2) in The Special Economic Zones (Customs Procedures) Regulations, 2003
(2)The zone unit shall be allowed to sub-contract production in domestic tariff area subject to the following conditions, namely:-(i)the proper officer shall satisfy himself regarding the bonafide necessity of such sub-contracting of production in domestic tariff area and shall not allow such permission in routine manner to the zone unit;(ii)while giving permission for subcontracting of production in domestic tariff area or in other export oriented undertaking or software technology park unit or electronic hardware technology park unit or zone unit, the proper officer may verify the past antecedents of the zone unit as well as job-working units, and in case of any misuse of serious nature noticed by him in the past or due to any other reasons, where it is satisfied that there is no justification for such permission or there are high chances of abuse of such facility, such permission may be denied with the approval of Commissioner of Customs having jurisdiction over the zone;(iii)[ the facility of sub-contracting of production shall be allowed subject to the condition that the product is also being manufactured by the zone in the zone;] [Substituted by Notification No. G.S.R. 306(E) dated 11.5.2004 (w.e.f. 22.7.2003)](iv)in case of zone unit engaged in manufacture and export of gem and jewellery, no cut and polished diamonds, precious stones and semi-precious stones shall be allowed to be taken out of the zone;(v)other conditions as stipulated in sub-regulation (1) except clause (viii), shall apply mutatis mutandis in case of sub-contracting of production in domestic tariff area.
