Section 22 in The Special Economic Zones (Customs Procedures) Regulations, 2003
22. Sale of goods by a zone unit in domestic tariff area.
(1)The zone unit shall be allowed to sell goods manufactured or produced in the zone unit including reject waste, scrap remnants and by-products arising out of such production, in the domestic tariff area on payment of customs duty in terms of clause (b) of section 76F of the Act.(2)The zone unit engaged in trading activities shall be allowed to sell imported or indigenously procured goods in domestic tariff area on payment of duty under clause (b) of section 76F of the Act subject to the condition that the zone unit has achieved positive Net Foreign Exchange Earning cumulatively at the time of making sale in domestic tariff area and such sale of goods shall be allowed to the extent that Net Foreign Exchange Earning of the unit remain positive.(3)Domestic tariff area unit intending to buy goods from the zone unit shall be required to file bill of entry for home-consumption giving therein complete description of the goods such as make, model number, serial number, specification, alongwith invoice and packing list with the customs officers in the zone.(4)Notwithstanding anything contained in [sub-regulation (3)] [Substituted words "clause (4)" by Notification No. G.S.R. 306(E) dated 11.5.2004 (w.e.f. 22.7.2003)], the bill of entry for home consumption may also be filed by the zone unit on the basis of authorization by buyer located in domestic tariff area.(5)The valuation of the goods cleared into domestic tariff area shall be determined in accordance with section 14 of the Act and rules made thereunder.(6)[ Where the goods so procured from domestic tariff area by the zone unit are supplied back to the domestic tariff area as it is or without substantial processing, such goods shall be treated as re-imported goods and shall be subject to such procedure and conditions as applicable in the case of normal re-import of goods from outside India: Provided that in the case where such goods are supplied back to the domestic tariff area as it is and where the import duty on such goods is "Nil" and while procurement of such goods no export benefits were allowed against such goods, the zone unit may be allowed to supply back such goods to domestic tariff area on the basis of invoice only and filing of bill of entry in such cases shall not be required.Explanation. - For the purpose of this regulation "export benefits" includes drawback, duty entitlement passbook scheme, rebate, advance license or counting of proceeds as export earnings 'or counting of proceeds as fulfillment of export obligation under any scheme.] [Substituted by Notification No. G.S.R. 306(E) dated 11.5.2004 (w.e.f. 22.7.2003)](7)Where the zone unit has surplus power generated in its captive power plant or diesel generating set, such surplus power may be allowed to be transferred to domestic tariff area on payment of duty on consumables and raw materials used for generation of power so sold on the basis of norms worked out for raw materials and consumables used, as may be approved by the Board of Approvals subject to the following conditions, namely:-(i)the proposal for sale of surplus power received in the office of the Development Commissioner shall be examined in consultation with the concerned State Government including State Electricity Boards of that State;(ii)the norms for production of unit of power that may be finalized shall be submitted to the Board of Approval for consideration;(iii)in case of sale of surplus plus to other unit in the same zone or other zone or to other export oriented undertaking or to electronic hardware technology park unit or to other software technology park unit, as the case may be, the same shall be allowed without payment of duty:Provided that the quantity of consumables and raw materials used for generation of power so transferred to another special economic zone unit or export oriented undertaking, electronic hardware technology park unit or software technology park unit, as the case may be, as quantified and approved by the Board of Approvals is accounted for by the supplying as well as receiving units for the calculation of Net Foreign Exchange Earning.
