The government today clarified the policy concerning the transfer of used capital goods into special economic zones (SEZ) from outside of the enclaves, stating that a company can shift the equipment to set up units into the SEZs. However, the value of such second-hand goods should not exceed (20 per cent) to avail of the tax benefits.
This comes after a spate of incidents happened concerning some of the large-scale information technology (IT) companies such as Wipro, Mphasis and Geometric. In some of these cases, the development commissioner (DC), in charge of the SEZs, permitted the transfer of the goods from the STPI (Software Technology Parks of India) unit to SEZ and issued a letter of approval, which was later cancelled.
“There are no provisions in the SEZ Act/Rules preventing such a transfer of goods. The only deterrent for transfer of such goods is not getting the exemption under the Income Tax Act when the value of the