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CMA Final · Indirect Tax Laws and Practice · Special Economic Zone Scheme

Under the Special Economic Zones Act, 2005, the Board proposes to suspend the letter of approval of a Developer for violating its terms and conditions. What is the minimum written notice the Board must give the Developer, stating the grounds, before it can suspend the letter of approval?

The Board must give the Developer at least three months' written notice stating the grounds for the proposed suspension, and must consider any cause shown within that period, before it can suspend the letter of approval under the SEZ Act, 2005.

  1. AOne month
  2. BTwo months
  3. CThree monthsCorrect
  4. DSix months

Explanation

Section 10(3) provides that no letter of approval can be suspended unless the Board has given the Developer not less than three months' written notice stating the grounds and has considered any cause shown within that period. One or two months is shorter than the statutory minimum, and six months is longer than required.

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