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CS Executive · Economic, Commercial and Intellectual Property Laws · Law relating to Special Economic Zones

Bharat Fabrics, an SEZ Unit, buys raw material from a supplier in the Domestic Tariff Area for its authorised operations. Which benefit does the SEZ Act, 2005 expressly provide on such goods brought from the DTA?

The Act provides exemption from duty of excise on goods brought from the Domestic Tariff Area to the SEZ or Unit for authorised operations, and also drawback or other benefits admissible from time to time. Origin in India does not remove these entitlements.

  1. AExemption from duty of excise, and drawback or other admissible benefitsCorrect
  2. BOnly a reduction in customs duty at the SEZ gate
  3. CExemption from corporate registration requirements
  4. DNo benefit, since the goods originate in India

Explanation

Section 26(1)(c) exempts goods brought from the DTA into an SEZ or Unit from excise duty for authorised operations, and clause (d) gives drawback or other admissible benefits on such goods. Option D is wrong because these benefits exist precisely for DTA supplies.

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