How many excise free zones operational in India? Location Of these zones? Validity of these zones ?

Type of industries ? Tonnage and frequency of import/export? How much import duties they are paying? Possibility of EXIM for Arshiya?

EFZ

are the areas identified and developed by Government Of India in order to push the growth of economically backward

region where 100% excise duty were exempted. Exemption is available to the manufacturing units but not to those units which undertakes only peripheral activities. Various Excise free zones that are as follows.
1.

North-Eastern States: Exemption to specified goods cleared from a unit located in the States of Assam or Tripura or Meghalaya or Mizoram or Manipur or Nagaland or Arunachal Pradesh - Notfn. No.20/07-CE, dated 25.4.2007

2.

Jammu & Kashmir: Exemption to all goods (except cigarettes, cigars, manufactured tobacco and substitutes thereof, soft drinks and their concentrate) cleared from a unit located in the State of Jammu & Kashmir equal to duty of excise and additional duty of excise paid in cash - Notfn. No. 57/02 dated 14.11.2002.

3.

State of Sikkim: Exemption to all goods (except as in Annexure I) manufactured and cleared from units located in specified
areas in the State of Sikkim equal to duty of excise and additional duty of excise paid in cash - Notfn. No. 71/03-CE dated 9.9.2003.

4.

State of Uttaranchal & Himachal Pradesh: Exemption to the all goods (except as per Annexure I) manufactured by units located in specified areas in State of Uttaranchal & Himachal Pradesh-Notfn. No. 50/03-CE dated 10.6.2003.

5.

Kutch (Gujrat): Exemption to all the goods (except as per Annexure I) manufactured by units located in Kutch district of
Gujrat equal to duty of excise and additional duty of excise paid in cash - Notfn. 39/01-CE dated 31.7.2001.

North-Eastern States

The Government has approved a package of fiscal incentives and other concessions for the North East Region namely The North East Industrial and Investment Promotion Policy (NEIIPP), 2007 , effective from 1.4.2007 Incentives will be available to all industrial units, new as well as existing units on their substantial expansion, located anywhere in the North Eastern Region 100% Excise Duty exemption will be continued, on finished products made in the North Eastern Region, as was available under NEIP, 1997 100% Income Tax Exemption will continue under NEIIPP, 2007 as was available under NEIP, 1997

Validity of EFZ:
The exemption available to those units who starts their commercial production before March 31,2010 for a period of 10 year s.

Type of Industries:
Various Industries are located in excise free zones in state of Himachal Pradesh and Uttarkhand, the Gov of India offers various fiscal incentives to give a boost to economy of these states and also generating employment. But those benefits are restricted to a certain extent i.e. the benefit is not available to those units which will do peripheral activities Industries which are set in these zones comprising of SMES and Medium scale units and also new entrepreneurs constitutes pharmaceutical companies, FMCG, Food processing industry other manufacturing units etc. Some of Industries are below

BENEFITS AT EFZ

100% Excise Exemptions for 10 years 100% income tax exemption for initial period of five years and thereafter 30% for companies and 25% for a further period of five years for the entire states of Uttaranchal and Himachal Pradesh from the date of commencement of commercial production before 1 April 2012

Employment generation:The eligibility of incentives is also linked with the minimum criterion of employment to Himachalis in the industrial units which is 80% in industrially backward areas and 65% for industrially developed areas.

Helps In developing new entrepreneurs Attracts Investment Overall development of the economy and easing of balance of payments position The Package of Incentives provided by the State Govt. has resulted in high actual investment in both SSI and Medium &

large Scale Sectors in the State

Benefits for Units Located in EFZ:

If units import through normal channel they have to pay all the duties where as if they import through AFTWZ they will

pay all the duties except SAD i.e. 4% which will make them competitive in the market:
For example : Ranbaxy located in EFZ procure raw material from non tax free zones and also do take imports, than non tax free zone supplier get a benefit of CENVAT / MODVAT while Ranbaxy cant claim CENVAT because Ranbaxy is already enjoys 100% excise exemption on finished product.

But Ranbaxy cant claim 100% exemption on peripheral activities in EFZ and in case of imports Ranbaxy have also need to
pay all the duties now if Ranbaxy imports their raw material through AFTWZ than they will get 4 % SAD exemption which will make them competitive in the market.