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ELECTRONICS
HARDWARE
FICCI's
recommendation to Shri Arun Shourie, Minister
of Disinvestment, Information Technology
& Communications on February 3, 2004
The Issues that need
your kind attention are mentioned below
in brief
- Under Section 10A and 10B units under
Income Tax Act, 1961: The provisions of
sec 10A / 10B have been substituted by
the Finance Act, 2000. The exemption ends
up in the year 2010. A request therefore
to extend the period of exemption. Also
as stated in the sections, the sale proceeds
of articles exported out of India are
required to be brought into India in convertible
currency only which is not possible for
a 100% EOU supplying inputs to another
exporting unit. The benefits u/s 10B is
also not being extended to Units having
EOUs transacting with one another and
final product is exported out. This also
needs to be taken care of. Finally the
Sales made by an EOU to another EOU are
being treated differently for the purposes
of availing benefits under the respective
statute. These EOU should be treated as
export sales and suitable provisions should
be made under the Income Tax Act.
- Inter - unit transfer: Raw material
transfer between 2 EOUs of the same company
are not clearly defined and this requires
clarifications from the Government.
- Sale in DTA by SEZ: Duty disparity exists
between SEZ and EOU when both are exporting
into DTA. This difference needs to be
bridged.
- Service Tax: There is no exemption from
Service Tax to supplies to EOUs whereas
this is already been exempted for SEZ
Units.
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