Package Scheme of Incentives, 2001
(courtesy www.maharashtra.gov.in


  GOVERNMENT OF MAHARASHTRA
INDUSTRIES, ENERGY AND LABOUR DEPARTMENT

Resolution No. IDL-1021/( CR-73 )/IND-8, Mantralaya, Mumbai - 400 032,
Dated the 31st March 2001
Read:
  1. Government Resolution, Industries and Labour Dept., No. IDL-7064/IND-I, dated the 25th September, 1964,
  2. Government Resolution, Industries and Labour Dept., No. IDL-7069/IND-I, dated the 2nd April, 1969,
  3. Government Resolution, Industries and Labour Dept., No. IDL-7069/IND-I, dated the 10th March, 1970,
  4. Government Resolution, Industries and Labour Dept., No. IDL-7073/34605/IND-I (B), dated the 23rd October, 1973,
  5. Government Resolution, Industries, Energy and Labour Dept., No. IDL-7076/6212/(5)/ IND-8, dated the 18th January, 1977,
  6. Government Resolution, Industries, Energy and Labour Dept., No. IDL-7076/48287/(295) / IND-8, dated the 17th September, 1977,
  7. Government Resolution, Industries, Energy and Labour Dept., No. IDL-7079/81133/(1925)/ IND-8, dated the 18th October, 1979,
  8. Government Resolution, Industries, Energy and Labour Dept., No. IDL-7079/(2043)/ IND-8, dated the 5th January, 1980,
  9. Government Resolution, Industries, Energy and Labour Dept., No. IDL-7079/95227/ (2540)/ IND-8, dated the 11th August, 1980,
  10. Government Resolution, Industries, Energy and Labour Dept., No. IDL-7082/(3559)/ IND-8, dated the 5th July, 1982,
  11. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1082/(4096)/ IND-8, dated the 31st March, 1983,
  12. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1082/(4077)/ IND-8, dated the 4th May, 1983,
  13. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1088/(6612)/ IND-8, dated the 25th March, 1988,
  14. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1087/(6245)/ IND-8, dated the 21st July, 1988,
  15. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1088/(6603)/ IND-8, dated the 30th September, 1988,
  16. Government Resolution, Industries, Energy and Labour Dept., No. IDL-2188/(11324)/ IND-14, dated the 8th November, 1988,
  17. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1088/(7018)/ IND-8, dated the 31st January, 1989, and
  18. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1088/(7056)IND-8, dated the 22nd February, 1989,
  19. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1093/(8889)/ IND-8, dated the 7th May, 1993,
  20. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1093/(9378)/ IND-8, dated the 6th July, 1994,
  21. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1095/(10092)/ IND-8, dated the 3rd January, 1996,
  22. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1096/(13251)/ IND-8, dated the 12th March, 1997,
  23. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1096/(13211)/ IND-8, dated the 20th June, 1997,
  24. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1097/(13563)/ IND-8, dated the 27th November, 1997,
  25. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1097/(13637)/ IND-8, dated the 28th November, 1997,
  26. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1097/(13478)/ IND-8, dated the 29th November, 1997,
  27. Government Circular, Industries, Energy and Labour Dept., No. IDL-1097/(13385)/ IND-8, dated the 17th January, 1998,
  28. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1098/(121)/ IND-8, dated the 11th August, 1998,
  29. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1098/(293)/ IND-8, dated the 30th September, 1998,
  30. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1098/(109)/ IND-8, dated the 31st December, 1998,
  31. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1099/(620)/ IND-8, dated the 31st March, 1999,
  32. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1098/(351)/ IND-8, dated the 16th April, 1999,
  33. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1098/(351)/ IND-8, dated the 29th June, 1999,
  34. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1098/(620)/ IND-8, dated the 30th June, 1999,
  35. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1099/(780)/ IND-8, dated the 9th July, 1999,
  36. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1099/(884)/ IND-8, dated the 29th October, 1999,
  37. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1020/((5)/ IND-8, dated the 23rd March, 2000,
  38. Government Resolution, Industries, Energy and Labour Dept., No. IDL-1020/(204)/ IND-8, dated the 12th May, 2000,
PREAMBLE

In order to encourage the dispersal of industries to the less developed areas of the State, Government has been giving a Package of Incentives to New / Expansion Units set up in the developing region of the State since 1964 under a Scheme popularly known as the Package Scheme of Incentives.

2. The Package Scheme of Incentives, introduced in 1964, was amended from time to time. The last amended Scheme, commonly known as the 1993 Scheme was operative from the 1st October, 1993 to 31st March, 2001.

3. Government recognizes the need to address the emerging challenges in the phase of second generation economic reforms, the need for encouraging hi-tech and sunrise industries in the Information Technology and other fields to reap the strengths of the State in its developed areas, and to facilitate exports from the State. In the wake of the national consensus for abolishing the sales tax based incentives, the further rationalization of incentives, their scales and mode of release was under the consideration of the Government. Government have decided to revise the 1993 Scheme and bring into force a New Scheme, viz. the Package Scheme of Incentives, 2001 (hereinafter referred to as the 2001 Scheme) for intensifying and accelerating the process of dispersal of industries to the less developed regions and promoting high-tech industry in developed areas of the State coupled with the object of generating mass employment opportunities.

RESOLUTION

The Package Scheme of Incentives as last modified was continued upto the 31st March, 2001 by Government Resolution, Industries, Energy and Labour Department, No. IDL- 1020/(204)/IND-8, dated the 12th May, 2000. Government is pleased to direct that the Package Scheme of Incentives 2001 will be brought into effect from the 1st April, 2001 upto 31st March, 2006, with the following provisions:

1. SCOPE  : 
1.1 Coverage under the 2001 Scheme -

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The following categories of Eligible industrial and other Units in the Private Sector, State Public Sector/ Joint Sector, and the Co-operative Sector but not in the Central Public Sector will be considered for incentives under the 2001 Scheme -

(i) Industries listed in the First Schedule of the Industries (Development and Regulation) Act, 1951, as amended from time to time,

(ii) Industries falling within the purview of the Small Scale Industries Board / SIDO, Coir Board, Silk Board, All India Handicrafts Board, All India Handloom Board, Khadi and Village Industries Board, or any other agency constituted by the Government for industrial development,

(iii) Information Technology (IT) units registered with Directorate of Industries or SICOM Limited,

(iv) Hotels (subject to guidelines of the Government of India as applicable from time to time),

(v) Poultry and agro industries,

(vi) Cold storages

(vii) Biotechnology (BT) units as specified by Government from time to time, which are outside the purview of any registering authority or Board mentioned above,

(viii) Non-conventional Energy units such as Wind Farms, Solar Energy units, conventional units and units generating electricity from biogas, municipal waste, etc. as may be specified by Government from time to time.

Explanation:

In the case of poultry and agro industries, only capital expenditure on land, building and equipment will be considered eligible for incentives.

1.2 Period of Operation-

                  The 2001 Scheme, as may be amended by the Government from time to time, shall remain in operation for a period of five years from 1st April, 2001 to 31st March, 2006.

1.3 Classification of Areas-
                  For the purpose of the 2001 Scheme, the classification of the areas of the State shall be as indicated below:-

(i) Group A: comprising the developed areas, viz. Mumbai Metropolitan Region (MMR) and Pune Metropolitan     Region (PMR).

(ii) Group B: comprising the areas where some development has taken place.

(iii) Group C: comprising the areas, which are less developed than those covered under Group B.

(iv) Group D: comprising the lesser developed areas of the State not covered under Group A/ Group B/ Group C.

(v) Group D+: comprising those least developed areas not covered under Group A/Group B/Group C/Group D.

(ix) No Industry District: as may be specified by Government. The detailed talukawise classification of the areas of the State made accordingly has been indicated in Annexure I to this Resolution.

Consequent upon creation of new Districts in the State, viz. Gondia, Vashim and Nandurbar, a few Talukas are also created by carving out some area from the erstwhile un-bifurcated adjacent Talukas . In such cases, the classification of the areas so carved out will be the same as that of the erstwhile Taluka (s) from which the areas are carved out.

The matter of revision of the area classification is under consideration of the Government. A Committee under the Chairmanship of the Minister (Industries) will consider revision of the area classification, which will be notified in due course, with prospective effect.

2. IMPLEMENTING AGENCIES:

The Implementing Agencies for the purpose of the 2001 Scheme shall be as follows:-

(1) For Small Scale Industry (SSI) Units, and Information Technology units, Biotechnology Units and Non-conventional energy units (which may not be registerable as SSI but as may be specified by Government from time to time) having investment within the ceiling prescribed for SSI -
The concerned District Industries Centre (DICs) and the Office of Joint Director of Industries (Mumbai Metropolitan Region) [JDI (MMR)] in respect of Mumbai and Mumbai Suburban Districts.

Explanation -

(a) The Maharashtra State Financial Corporation (MSFC) shall, however, monitor the SSI Units financed by it for the purpose of sanction and disbursement of incentives after the eligibility is determined by the DIC / JDI (MMR). It shall also monitor the working of such Eligible Units. The MSFC and the concerned DICs / JDI (MMR) shall co-ordinate in the matter.

(b) The eligible unit will continue to remain with the JDI (MMR) or DIC which had issued an Eligibility Certificate (EC) in favour of the Eligible Unit, for the purposes of incentives and other connected matters, even if the Eligible Unit ceases to be an SSI Unit or exceeds the investment ceiling prescribed for SSI. In other words, even when an Eligible SSI Unit graduates to Large Scale Sector, the Eligible Unit shall continue to remain with the JDI (MMR) / DIC, which issued the EC in favour of the Unit.

(c) Where an Eligible Unit has been issued an EC under any of the Schemes prior to the 1993 Scheme by a Regional Development Corporation (RDC), it will be covered for benefits under the 2001 Scheme according to its status as SSI or Large Scale Industry (LSI) consequential to new/expansion/diversification project. It shall accordingly file its application with the concerned Implementing Agency.

(2) For Large Scale (LSI) Units, Hotel Units, and for Information Technology units, Biotechnology Units and Non-conventional energy units exceeding the investment ceiling prescribed for SSI the application should be filed with SICOM Limited,

3. DEFINITIONS : 

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3.1 Date of Effect of Eligibility-

An Eligibility Certificate under the 2001 Scheme will be issued by the Implementing Agency after ascertaining that the eligible unit has complied with the provisions of the Scheme and has commenced its commercial production. The EC will be issued with effect from the date of commencement of commercial production by the Eligible Unit. The date of commencement of commercial production will be determined by the Unit supported by the relevant extract of the excise register or, in case excise is not applicable by the first sale bill is issued by the unit in respect of such production. For the purpose of the EC, the date of commencement of commercial production will be deemed to be the first day of the month following the month in which such production has commenced.

The Implementing Agency will send a copy of the EC to the MSEB, BSES, or other such agency supplying power, and the Electrical Inspector.

3.2 Earlier Scheme-

'Earlier Scheme' shall mean and include-

(i) The 1964 Scheme outlined in the Government Resolution, Industries and Labour Department, No. IDL-7064/IND-I, dated the 25th September, 1964.

(ii) The 1969 Scheme outlined in the Government Resolution, Industries and Labour Department No. IDL-7069/IND-I, dated the 2nd April, 1969.

(iii) The 1973 Scheme outlined in the Government Resolution, Industries and Labour Department, No. IDL-7073/34605/IND-I (B) dated the 23rd October, 1973.

(iv) The 1976 Scheme outlined in the Government Resolution, Industries, Energy and Labour Department, No. IDL-7076/6212/(5)/IND-8, dated the 18th January, 1977.

(v) The Special Capital Incentive Scheme outlined in the Government Resolution, Industries, Energy and Labour Department, No. IDL-7076/48287/(295)/IND-8, dated the 17th September, 1977.

(vi) The 1979 Scheme outlined in the Government Resolution, Industries, Energy and Labour Department, No. IDL-7079/(2043)/IND-8, dated the 5th January, 1980 read with the Government Resolution, Industries, Energy and Labour Department, No. IDL-7082/(3559)/IND-8 dated the 5th July, 1982.

(vii) The 1983 Scheme outlined in the Government Resolution, Industries, Energy and Labour Department, No. IDL-1082/(4077)/IND-8, dated the 4th May, 1983 read with the Government Resolution, Industries, Energy and Labour Department, No. IDL-1088/(6612)/IND-8 dated the 25th March, 1988 and the Government Resolution, Industries, Energy and Labour Department, No. IDL-1087/(6245)/IND-8 dated the 25th July, 1988.

(viii) The 1988 Scheme outlined in the Government Resolution, Industries, Energy and Labour Department, No. IDL-1088/(6603)/IND-8, dated the 30th September, 1988 read with the Government Resolution, Industries, Energy and Labour Department, No. IDC-2188/(11324)/IND-14 dated the 8th November, 1988, the Government Resolution, Industries, Energy and Labour Department, No. IDL-1088/(7018)/IND-8 dated the 31st January, 1989 and the Government Resolution, Industries, Energy and Labour Department, No. IDL-1088/(7056)/IND-8 dated the 22nd February, 1989, and

(ix) The 1993 Scheme outlined in Government Resolution, Industries, Energy and Labour Department, No. IDL-1093/(8889)/IND-8, dated the 7th May, 1993 as amended from time to time.

3.3 Effective Steps-

Effective Steps shall comprise Initial Effective Steps and Final Effective Steps defined as follows:-

I. Initial Effective Steps shall mean and include:-

(i) Effective possession of land by an Eligible Unit for a further period of at least 15 years. For land outside the Maharashtra Industrial Development Corporation area (MIDC) / Government sponsored and/or financially assisted Co-operative/Mini Industrial Estate/Gram Udyog Vasahat / Municipal Council / Corporation, a NOC from Gram Panchayat shall be a pre-requisite. However, in case the unit is located outside the above areas but within an area covered under a draft or final Regional Development Plan approved by the Government, the Implementing Agency shall ascertain if the Unit is located in conforming zone, and no zoning certificate will be required from the applicant unit.

(ii) Registration in respect of Firm / Company / Trust / Society / Co-operative Society. However, in respect of Partnership Firm only evidence of execution of a Partnership Deed and filing of a requisite application with payment of necessary registration fees with the Registrar of Firms will be necessary.

(iii) Provisional SSI registration/ Letter of Intent or Registration for IT units from Directorate of Industries or SICOM / Letter of Intent from the Government of India and / or permission from the State Government for setting up / shifting of the Unit, if such permission is required to be obtained, or registration from the Khadi and Village Industries Board (KVIB), if the Unit is covered by KVIB programme.

(iv) A photocopy of the Industrial Entrepreneur's Memorandum (IEM) along with a photocopy of its acknowledgement in the case of a LSI Unit not covered under the licensing provisions of the Industries (Development & Regulation) Act, 1951.

II. Final Effective Steps shall mean and include:-

(i) Conversion of Letter of Intent to an Industrial License wherever applicable.

(ii) Foreign Exchange Regulation Act (FERA) / Foreign Exchange Management Act (FEMA) / Monopolies and Restrictive Trade Practices Act (MRTP) clearance, Capital Goods clearance / Import Licence, Foreign Investment Promotion Board (FIPB) / Reserve Bank of India's permission for foreign equity with or without repatriation, wherever necessary.

(iii) Other clearances, if any required from the Central / State Government and / or other authorities concerned for implementing the project.

(iv) Tying up of the means of finance for the project to the satisfaction of concerned Implementing Agency.

Explanation-

Based on the documentary evidence laid by the Eligible Unit, the Implementing Agency shall determine the date on which the Initial and Final Effective Steps are completed, subject to such directions as the Government may issue from time to time.

3.4 Existing Unit-

An Existing Unit shall mean and include-

(i) A Unit which has been set up and is in production on or any time prior to 31st March, 2001, for any period whatsoever, or

(ii) A Unit which has been granted an EC or availed of any incentives under any of the Earlier Schemes, or

(iii) A Unit which has filed a valid application for grant of an EC under the 1993 Scheme with any of the Implementing Agencies on or before the 31st March, 2001.

3.5 Finished Product-

Finished product shall mean and include the item/s of manufacture by the Eligible Unit as considered under the project scheme approved by the concerned term lending agency and / or by the Implementing Agency, together with by-product /scrap which may be get generated as incidental to and during the main production activity.

3.6 Fixed Assets-

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The term Fixed Assets shall mean and include:-

(i) Land / area in effective possession for a minimum further period of 15 years, and as required for the project.

(ii) Building, i.e. any built-up area used for the Eligible Unit including administrative building, residential quarters, industrial housing and accommodation for all such facilities as are required for the manufacturing processes.

(iii) Plant and Machinery, i.e. Tools and equipment including handling and haulage equipment or tools as are necessarily required and exclusively used for sustaining the working of the Eligible Unit.

(iv) The cost of development of the location of the Eligible Unit, such as fencing, construction of roads and other infrastructure facilities which the Eligible Unit has to incur under the project.

(v) Installation charges and pre-operative expenses capitalized.

(vi) Technical know-how including cost of drawings and know-how fees. Such expenses would also include all pre-operative expenses including expenses on preparation of feasibility report (incurred either before or after incorporation / registration of the Company or other entity) capitalized, and accepted as such by the concerned financial institution / bank, or considered by FIPB/RBI as eligible for being counted towards the minimum foreign equity / project investment to be brought into the country.

(vii) The amount paid as non-refundable interest-free deposit to the Maharashtra State Electricity Board (MSEB) for supply of power to the Eligible Unit, or to the Maharashtra Industrial Development Corporation (MIDC) for development of infrastructure for the Eligible Unit, or to any other Government agency for similar purpose.

3.7 Gross Fixed Capital Investment-

(I) Gross Fixed Capital Investment shall mean and include, in the case of:

    (i) New Fixed Assets- The value of new Fixed Assets acquired at site and duly paid for.

Explanation-

(a) Only new Fixed Assets as per the project scheme accepted by the Implementing Agency based on the project assessment done by the concerned term lending agency, or by the Implementing Agency in case of a self-financed project, which are acquired by an Eligible Unit within the relevant period indicated in Annexure III from the date of completion of Final Effective Steps shall be considered for incentives.

(b) Any acquisition of new Fixed Assets outside the project scheme accepted by the Implementing Agency can be considered for the incentives below, provided such acquisition is not less than 25% of the Gross Fixed Capital Investment at the end of the previous financial year. A Separate Eligibility Certificate will be issued for availing of such benefits with eligibility period as admissible to a new unit in the relevant area and for the relevant category of unit as per the Scheme. However, for the purpose of such benefits, the entitlement will be limited only to 75% of the Special Capital Incentive (para 5.1) and of the Octroi Refund (para 5.3) admissible to a New Unit in the relevant area and for the relevant category of unit as per the Scheme. The above entitlement of SCI would, however, be applicable only if the investment of the Unit remains within the ceiling prescribed for SSI status even after acquisition of additional fixed assets. A unit cannot claim benefits for acquisition of new Fixed Assets under this clause more than twice.

Example: For example, the Existing Unit starts acquiring new fixed assets acceptable to Implementing Agency at any time from 1st April, 2001 to 31st March, 2002, which are not a part of the earlier project accepted by the Implementing Agency considered for incentives under the earlier Scheme. The Existing Unit has gross fixed capital investment (not depreciated value) of Rs. 100/- as on 31st March, 2001. The Existing Unit will be entitled to additional for admissible incentives only if investment in the proposed new fixed assets is more than Rs.25/- (i.e. more than 25%). The eligible investment for admissibility of various incentives will be worked out at the rate of 75% of the actual investment incurred in new fixed assets thus acquired by the Existing Unit.

(c) Acquisition of imported second hand fixed assets - The value for which these are acquired or the value thereof as certified by an approved valuer, whichever is less, subject to the condition that the assets shall have residual performing life of a minimum 10 years as clarified by such valuer.

(ii) Shifting of fixed assets

The depreciated value of Fixed Assets on the date of shifting on the basis of the method of depreciation adopted by the Unit during the immediate preceding 3 years or during such shorter period during which the Unit has been in existence, together with the actual expenditure incurred on dismantling, transportation, insurance and re-erection which is allowed to be and is capitalised under the Indian Income Tax Act.

Provided that:

(a) The Unit is eligible and the Fixed Assets shifted form a part of the project for which the eligibility is considered.

(b) The Fixed Assets shifted have a residual performing life of over ten years from the date of shifting as certified by an approved valuer.

(c) The shifting of the existing Fixed Assets is from any place outside the State of Maharashtra.

(II) Fixed Assets acquired by an Eligible Unit and forming part of the Gross Fixed Capital Investment cannot be disposed of / sold / shifted / written off except with the prior written permission of the Implementing Agency. Such permission shall be applied for by the Eligible Unit at least one month prior to the contemplated disposal / sale / shifting within State / written off of the Fixed Assets. The Implementing Agency may ordinarily grant such permission if it is satisfied that the overall production capacity of the Eligible Unit will not thereby suffer and that the Eligible Unit has definite plans/proposals for replacement of the Fixed Assets being disposed of / sold / written off either by similar Fixed Assets or by Fixed Assets with better output / higher production capacity with or without change in the finished product/s. However, shifting of assets will be permitted only if the contemplated shifting is to a place in an equivalent or lesser-developed area of the State (e.g. from 'C' to 'C' or 'D' area, but not from 'C' to 'B' area as per the area classification at Annexure - I.)

(III) Subject to the provisions of paras (I) and (II) above, the Gross Fixed Capital Investment at the end of each year will be computed as Gross Fixed Capital Investment at the beginning of the year, plus additions as per the approved project scheme made, if any, to the Gross Fixed Capital Investment during the year, less the original value of any Fixed Assets of the Eligible Unit shifted disposed of / sold / written off, if any, during the year.

(IV) If the admissible Gross Fixed Capital Investment as endorsed in the EC is reduced as a result of any shift / disposal / sale / write off / replacement of the Fixed Assets, the ceiling as endorsed in the EC shall be reduced proportionately and if the incentives availed by the Eligible Unit exceed the ceiling revised as a result of shifting / disposal / sale / write off / replacement, the benefits availed in excess of such revised ceiling shall stand recoverable/refundable forthwith with interest at the rate of 15% from the date of such excess availment till the date of actual payment.

(V) Any increase in the Gross Fixed Capital Investment as a result of replacement of any of the Fixed Assets earlier considered under the EC shall not entitle the Eligible Unit to have the ceiling for incentives pro-rata revised upward except under para 3.7 (I) (i) (b) above.

3.8 New Unit-

A New Unit shall mean a Unit which is set up for the first time by an entity in the Private Sector / Co-operative Sector / State Public Sector / Joint Sector in any Taluka where there is no Existing Unit set up by the said entity provided that the Unit satisfies the following conditions:-

(a) It is not an Existing Unit.

(b) At least one of the Final Effective Steps is completed on or after 1st April, 2001 for setting up the Unit.

(c) It is not formed as a result of re-establishment, mere change of ownership, change in the constitution, reconstruction or revival of an Existing Unit.

Explanation-
The incentives available to a New Unit under the 2001 Scheme shall, however, be available to units which get established as result of purchase of assets of Existing / Defunct / Closed / Sick Units subject to and to the extent mentioned in Annexure II to this Resolution.

3.9 Period of Eligibility-

The period of eligibility applicable to an Eligible Unit will be as per paras 5.2, 5.3 and 5.4 and shall be computed from the date of commercial production as contained in the EC and depending on the nature and location of the Eligible Unit, during which the incentives will be available to the Eligible Unit subject to fulfillment of the conditions of the 2001 Scheme.

Example: For example, an Eligible New SSI Unit located in D area has obtained EC and its date of commencement of commercial production is 1st January, 2002. The Eligible Unit will be entitled to Special Capital Incentives at the rate of 30% of its eligible investment subject to a ceiling of Rs. 20 lakhs. The Unit will also be entitled to octroi refund in the form of grant restricted to 100% of the admissible fixed assets for a period of 7 years, and exemption from payment of electricity duty for a period of 15 years. In addition, if the Unit is textile unit in SSI Sector, it would be entitled to interest subsidy for a period of 5 years subject to a ceiling of Rs.20 lakhs.

3.10 Procedural Rules-

'Procedural Rules' shall mean and include the rules as laid down under Government Resolution, Industries, Energy and Labour Department, No.IDL-7079/95227/(2540)/IND-8, dated the 11th August, 1980 as amended from time to time. In case of any conflict, the provisions of this Govt. resolution shall prevail.

3.11 Sick Unit-

A 'Sick Unit' shall mean and include an SSI Unit so considered and certified by the Directorate of Industries, or LSI Unit so considered by the Board for Industrial and Financial Reconstruction (BIFR).

3.12 Year-

'Year' shall mean the financial year, i.e. 1st April to 31st March.

4. GENERAL PROVISIONS:

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4.1 Application for Eligibility-

(1) An application for eligibility under the 2001 Scheme shall be filed by an Eligible Unit only after it has taken all the Initial Effective Steps but not later than the 31st March, 2006. It shall be supported by documentary evidence in regard to completion of the Effective Steps.

(2) For claiming eligibility under the 2001 Scheme, an Eligible Unit shall also complete all the Final Effective Steps on or before the 31st March, 2007.

(3) If an Eligible Unit has filed an application with the Implementing Agency on or before the 31st March, 2001 after completion of the Initial Effective Steps, or has filed an application on or before 31st March, 2000 in accordance with the Govt. resolution No. IDL-1020/(5)/IND-8, dated 23rd March, 2000 for incentives under the 1993 Scheme, but has failed to complete all the Final Effective Steps within the period prescribed in the 1993 Scheme, the application of the Unit shall be automatically considered under the 2001 Scheme. However, the incentives applicable to such an Eligible Unit shall be at the scales under the 1993 Scheme or the 2001 Scheme, whichever is lower.

(4) An application for eligibility shall be submitted to the Implementing Agency at least three months prior to the expected date of commencement of commercial production. If there is any delay, the period and entitlement will be curtailed proportionately. An Eligible Unit shall comply with the requirements preceding the issue of the EC to ensure obtaining the EC within six months from the date of commencement of commercial production as laid down in the Procedural Rules.

4.2 Claim for Incentive-

No right or claim for any incentives under the 2001 Scheme shall be deemed to have been conferred by the 2001 Scheme merely because the applicant Unit has fulfilled the conditions of the 2001 Scheme. The incentives under the 2001 Scheme cannot be claimed unless an EC has been issued under the 2001 Scheme by the Implementing agency and the Eligible Unit has complied with the stipulations/conditions of the EC. The Implementing Agency shall issue EC to the Eligible Unit within two months of the unit complying with the stipulations of the 2001 Scheme.

4.3 Priority for Disbursement-

The disbursement of the incentives by the Implementing Agency shall be in accordance with the chronological order of approved claims. Priority shall, however, be given to Sick Units and 100% Export Oriented Units.

Explanation-

The release of incentives to an Eligible Unit, which has turned sick during the eligibility period, shall be considered on priority only if and when a scheme for rehabilitation has been approved and implemented under the BIFR provisions or with the approval and to the satisfaction of the Directorate of Industries, respectively for LSI and SSI Units.

5.0 INCENTIVES:

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5.1 Special Capital Incentives (SCI) for SSI Units-
(1) A New SSI Unit, or other New Unit specified at para 1.1 whose investment is within the ceiling prescribed for      SSI, set up on or after the 1st April, 2001 will be entitled to Special Capital Incentive at the rates indicated      below: -
AREA (Group) Quantum as % of Fixed Capital Investment Ceiling (Rs. lakhs)
C 20 10
D 30 20
D+ 35 25
No Industry District 40 35
(2) The SCI will become due for disbursement to the Eligible Unit in equal annual instalments over five years from the date of effect of the EC.

Example: An Eligible Unit located in D area is granted EC with effect from 1st January, 2002. If its eligible fixed capital investment is Rs. 100/-, the amount of SCI will be Rs. 20/-. The Eligible Unit will be entitled for disbursement of SCI of Rs. 4/- on 1st January, 2003 and every year upto 1st January, 2007. If Govt. releases funds for disbursement of SCI in October, 2005, the Eligible Unit will be disbursed Rs. 12/- from the allocated funds, in accordance with the chronological order of the claim/s approved for the Eligible Unit.

(3) The Special Capital Incentive will be admissible as a grant. The Unit will be entitled to draw the incentive after completion of all Initial and Final Effective steps and the same will be computed on the basis of the Fixed Capital Investment actually made by the Eligible Unit.

5.2 Interest subsidy to new textiles, hosiery and knitwear industrial units under SSI sector (in addition to SCI):

(1) New textile, readymade garments, hosiery and knitwear Units in the SSI Sector set up on or after 1st April, 2001 will be entitled to subsidy on the interest actually paid by the Unit to the financial institutions / banks on the term loan/s for creating fixed capital assets which are held to be eligible by the Implementing Agency as per the project scheme approved by the financial institutions / banks.

(2) The amount of interest subsidy will be equal to the amount of interest payable by the unit at the rate of 5% per annum, out of the interest actually paid by the unit. The interest subsidy will not be applicable on the interest paid on defaulted instalments.

(3) The units will have to prefer annual claims for interest subsidy to the Implementing Agency within three months from the end of the financial year, along with the statement of the financial institutions/ banks showing the outstanding term loan, actual interest paid and the amount of interest subsidy, duly certifying that the subsidy is not claimed on the interest on the defaulted amount paid by the unit.

(4) The maximum period of eligibility, and the ceiling limit of interest subsidy applicable during the period of eligibility, are as follows:
Taluka/Area classification Monetary ceiling
(Rs. in lakhs)
Ceiling (Rs. lakhs)
C 10 4
D 20 5
D+ 25 6
No Industry District 35 7

5.3 Refund of Octroi / Entry Tax in lieu of Octroi-

(1) An Eligible Unit, after it goes into commercial production, will be entitled to refund of Octroi Duty / Entry Tax (in lieu of Octroi), account-based cess or other levy charged instead of or in lieu of octroi payable and paid to the local authority on import of all the items required by the Eligible Unit. This incentive will be admissible in the form of a grant restricted to 100% of the admissible Fixed Capital Investment of the Eligible Unit for a period of 5/7/9/12 years respectively in the B/C/D/D+ areas. In respect of No Industry District areas, however, the period will be 15 years.

(2) The period of eligibility for refund of the Octroi / Entry Tax (in lieu of Octroi), account-based cess or other levy charged instead of or in lieu of octroi shall be from the date of commencement of commercial production. However, in respect of 100% EOU or an Agro-industry Unit, the period shall commence from the date of first import.

(3) The Incentive will also be available to new Electronic Industrial Units holding IEM / LOI / SSI registration that will be located in MMR (excluding Greater Mumbai, Mira-Bhayander and Thane Municipal Corporation areas) and PMR for 5 Years.

5.4 Exemption of Electricity Duty-

An Eligible New Unit in C, D, and D+ areas and No-Industry District(s) will be exempted from payment of Electricity Duty for a period of 15 years. In other parts of the State, 100% Export Oriented Units (EOUs), Information Technology (IT) and Bio-Technology (BT) units, and industries setting up in Special Economic Zones (SEZs) and in Electronic Hardware Technology Parks will be exempted from payment of Electricity Duty for a period of 10 years. Necessary Notification under the provisions of the Electricity Duty Act 1958 will be issued separately by Energy Department.

6. MONITORING AND REVIEW:

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6.1 Monitoring and Review of the Fixed Capital Investment and Production activities of the Eligible Unit-

With a view to monitoring the production activities of and the establishment of Fixed Assets by the Eligible Unit in relation to the incentives available under the 2001 Scheme, and ensuring that the two year during the period of eligibility and also thereafter during the operative period of the agreement entered into by the Eligible Unit, the following procedure is laid down.

(i) The Eligible Unit shall submit a report duly signed by its authorized representative covering information and details regarding production and sales, indicating the period of stoppage of production and/or closure of the Unit, if any, with reasons therefor, addition to the Fixed Capital Investment, disposal of Fixed Assets, and changes in the constitution of the Eligible Unit.

(ii) The Eligible Unit shall also submit to the Implementing Agency, within a period of 9 months from the close of every year, a certified true copy of the audited annual statement of accounts and Balance Sheet for the said year.

(iii) The Implementing Agency shall be entitled to call for any information and details for a shorter period even prior to the close of the year. The implementing Agency shall independently examine the position from time to time in order to ensure that the incentives drawn/availed of are within the ceilings specified under the 2001 Scheme or under the relevant earlier Scheme, as the case may be.

6.2 Failure on the part of an Eligible Unit to submit any of the above information / documents within the specified time shall tantamount to breach of the provisions of the 2001 Scheme entailing suitable action as provided under the Procedural Rules, including action to cancel the EC, or premature recall of and immediate recovery of the incentives drawn / availed.

6.3 The Implementing Agencies shall, as far as possible, ensure that the Eligible Unit and MSEB or other relevant agency for supply of power, and the Electrical Inspector are kept informed of the continuance or discontinuance of the EC during the tenure in accordance with the Procedural Rules.

6.4 If and when the Eligible Unit reaches the relevant ceilings prescribed in the EC in the matter of drawal of the refund of octroi prior to expiry of the EC period, or contravenes any of the conditions thereunder, the Implementing Agencies shall take prompt action to cancel the EC.

By order and in the name of the Governor of Maharashtra,

(M.D. SARWANKAR)

Deputy Secretary to Government

Copy to:
Development Commissioner (Industries), Mumbai-400 032 (500 copies),
Managing Director, SICOM Ltd., Mumbai-400 021 (5,000 copies),
Managing Director, Maharashtra State Financial Corporation, Mumbai-400 001 (500 copies)
All General Managers, District Industries Centres (250 copies each)
Managing Director, Development Corporation of Konkan Ltd., Mumbai.
Managing Director, Marathwada Development Corporation Ltd., Aurangabad.
Managing Director, Development Corporation of Vidarbha Ltd., Nagpur.
Managing Director, Western Maharashtra Development Corporation Ltd., Pune.
Managing Director, Maharashtra Small-Scale Industries Development Corporation Ltd., Mumbai.
Chief Executive Officer, Maharashtra Industrial Development Corporation, Mumbai (25 copies)
All Divisional Commissioners (10 copies each)
All Collectors and Deputy Industries Commissioners (10 copies each)
All Joint Directors of Industries (50 copies each)
Commissioner of Sales Tax, Mumbai (1,200 copies)
The Finance Department, (PSU-I)
All other Departments at Mantralaya.
All Desk Officers in Industries, Energy and Labour Department.
The Industries, Energy and Labour Department (IND-8, Select file).
The Accountant General, Maharashtra - I, Mumbai.
The Accountant General, Maharashtra - II, Nagpur.
The Pay and Accounts Officer, Mumbai.
The Resident and Audit Officer, Mumbai.

Copy for information to:
Secretary to Chief Minister, Mantralaya, Mumbai.
Secretary to Deputy Chief Minister, Mantralaya, Mumbai.
Private Secretary to Minister (Industries)
Private Secretary to Minister of State for Industries, Mumbai.
Personal Assistant to Chief Secretary.
Personal Assistant to Principal Secretary (Finance).
Personal Assistant to Principal Secretary (Planning).

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ANNEXURE I
CLASSIFICATION OF TALUKAS
1. KONKAN DIVISION

 
District Group A Group B Group C Group D Group D+
Greater Mumbai Greater
Mumbai
         
Thane Bhivandi
Kalyan
Thane
Ulhasnagar
Vasai
Dahanu
Palghar
Murbad
Shahapur
   Jawhar
Mokhada
Talasari
Wada
Raigad Alibag @
Karjat @
Khalapur @
Panvel @
Pen@
Uran
Alibag$
Khalapur $
Panvel $
Pen $
Roha $
Sudhagad
Karjat $
Mahad
Mangaon
Mhasala
Murud
Shrivardhan
   Poladpur
Ratnagiri       Ratnagiri Chiplun
Dapoli
Guhagar
Khed
Lanja
Mandangad
Rajapur
Sangameshwar
Sindhudurg        Deogad
Kankavli
Kudal
Malvan
Valbhavwadi
Vengurla
Sawantwadi
        @ : Within BMR
         $ : Outside B

2. PUNE DIVISION

 
District Group A Group B Group C Group D Group D+
Pune Haveli *
Khed *
Maval *
Mulshi *
Pune City
Bhor
Haveli **
Maval **
Mulshi **
Shirur
Baramati
Daund
Indapur
Junnar
Khed **
Purandhar
Velhe
  Ambegaon
Solapur       Malshiras
Solapur (N)
excluding Chincholi
Industrial Area
Akkalkot
Barshi
Mohol
Pandharpur
Chincholi
Industrial Area
in Mohol and
Solapur (N)
talukas
Solapur (S)
Karmala
Madha
Mangalwedhe
Sangola
Satara      Karad
Koregaon
Phaltan
Satara
Wai
Khandala
Mahabaleshwar
Man
Patan
Jaoli
Khatav
Sangli       Khanapur
Miraj
Entire District
excluding
Khanapur,
Miraj and
Shirala talukas
Shirala
Kolhapur      Karveer
Shirol
Bavada
Chandvad
Hatkanangale
Kagal
Panhala
Radhanagari
Shahuwadi
Ajra
Bhudargad
Gadhinglaj
   * : within PMR,
** : outside PMR

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3. NASIK DIVISION

 
District Group A Group B Group C Group D Group D+
Nasik    Malegaon
Nasik
Baglan
Niphad
Sinnar
Yeola
Nandgaon
Igatpuri
Chandwad
Dindori
Kalwan
Peth
Surgana
Ahmednagar    Ahmednagar
Kopergaon
Sangamner
Srirampur
Akola
Rahuri
Karjat
Pathardi
Sheogaon
Srigonda
Jamkhed
Newase
Parner
Dhule          Dhule
Sakri
Shahada
Shirpur
Sindkhed
Talode
Akkalkuva
Akarani
Nandurbar
Nawapur
Jalgaon         Amalner
Bhadgaon
Erandol
Jalgaon
Jamner
Pachora
Parola
Raver
Yawal
Bhusawal
Chalisgaon
Chopada
Edalabad

 

4. AURANGABAD DIVISION

 
District Group A Group B Group C Group D Group D+
Aurangabad       Aurangabad
Municipal
Corporation (AMC) Area
Aurangabad
taluka
excluding
Walunj
Industrial
Area
Walunj
Industrial Area.
Talukas
other than
Aurangabad
Paithan
Soegaon,
Vaijapur and
AMC Area
Paithan
Soegaon
Vaijapur
Jalna          Jalna Ambad
Badnapur
Bhokardan
Ghangsavangi
Jafferbad
Mantha
Partur
Beed          Talukas
other than Ashti,
Kaij and Patoda
Ashti
Kaij
Patoda
Osmanabad          Talukas
other than Omerga
and
Tuljapur
Omerga
Tuljapur
Parbhani          Talukas
other than
Jintur and
Selu
Jintur
Selu
Latur         Talukas
other than
Ahmedpur, Ausa and
Udgir
Ahmedpur,
Ausa,
Udgir
Nanded          Talukas
other than
Bhokar,
Deglur, Hadgaon, Kinwat and Mukhed

 

Bhokar
Deglur,
Hadgaon,
Kinwat,
Mukhed

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5. AMARAVATI DIVISION

 
District Group A Group B Group C Group D Group D+
Amravati       Amravati
Municipal Corporation (AMC) Area
Amravati taluka excluding AMC Area, Chandur Railway, Talukas other than Achalpur, Chandur
Bazar and Chikaldara
Achalpur, Chandur
Bazar, Chikhaldara
Akola          Talukas
other than Murtizapur
and Washim
Murtizapur, Washim
Buldhana          Talukas other than Chikhali and Shegaon Chikhali Shegaon
Yavatmal          Talukas
other than Darwah,
Pusad and
Wani
Darwah,
Pusad,
Wani

6. NAGPUR DIVISION

 
District Group A Group B Group C Group D Group D+
Nagpur       Nagpur
Muncipal Corporation (NMC) Area
Talukas
other than Katol,
Savner,
Umred and NMC Area
Katol,
Savner,
Umred
Bhandara          Talukas
other than Devadi
and Tiroda
Devadi
Tiroda
Wardha          Talukas
other than Devali
Devali
Chandrapur          Talukas
other than
Mul, Rajura
and Warora
Mul
Rajura
Warora
Gadchiroli             Entire District
 

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ANNEXURE II
NATURE OF INCENTIVES AND CONDITIONS FOR GIVING THOSE INCENTIVES FOR
TYPICAL CASES REFERRED TO IN PARA 3.8

 
   Types of case Conditions for incentives under the 1993 Scheme
(I) No incentive availed of   
   1. Only land and building of an Existing Unit which is set up in Group B/C/D/D+ area and which has not availed any incentives under any of the Schemes is transferred and the Transferee sets up a new project for manufacture of any product at the location of the Existing unit, after adding thereto, additional fixed assets and starts production as a New Unit, or
2. in the above situation, land, building and plant and machinery are transferred and the Transferee acquires additional fixed assets and starts production of either the same product or an altogether new product.
The incentives upto the corresponding ceilings shall be related and restricted only to the additional Fixed Capital Investment by the Unit (i.e. the investment in the fixed assets of the Existing Unit shall be excluded).
(II) Incentive availed partly and the unit transferred   
   3. A New Unit eligible under the 2001 Scheme has availed incentive for a part of the period of EC. The Transferee will be considered eligible as a New Unit provided the incentives availed by the Transferor are repaid fully in accordance with the 2001 Scheme / Procedural Rules without interest.
(III) Period of incentives of the Existing Unit expired but operative period of the agreement not expired   
  4. An Existing Unit which has already availed incentive under any of the Earlier Schemes is closed after expiry of the period of eligibility but during the operative period of agreement entered into for the purpose of availing the incentives or during the currency of the loan availed as incentive, it is transferred and the transferee sets up a new project at the said location for manufacture of same and/or any new product. (i) The Transferee will be considered eligible as a New Unit provided the incentives availed by the Transferor are repaid. Where the existing unit is closed within 7 years from commencement of production, the Transferor shall be liable to repay the incentives with interest thereon
(ii) The incentives upto the corresponding ceiling shall be related and restricted only to the additional Fixed Capital Investment by the Eligible Unit (i.e. the investment in the fixed assets of the existing unit shall be excluded).
(IV) Assets of New Units eligible under 2001 Scheme transferred before availing of incentives   
  5. A New Unit eligible under the 2001 Scheme before availing any of the incentives is transferred. Eligible as a New Unit
(V) Takeover and transfer by Financial Institutions   
  6. An Existing Unit which has availed incentives under any of the Earlier Schemes or the 2001 Scheme is closed during the currency of the EC or operative period of the agreement and the concerned Financial Institution/s take over the assets of the unit and transfer the same in realization of their dues and the Transferee after adding further fixed assets starts production as a New Unit. (i) Incentives up to the corresponding ceilings shall be related and restricted only tot he additional Fixed Capital Investment by the Eligible Unit (i.e. investment in the fixed assets of the Existing Unit shall be excluded).
(ii) Such additional fixed capital investment shall not be less than twice the gross fixed capital investment of the Transferor unit as may have been considered earlier for incentives.
 

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ANNEXURE III

 
  Description Period of making investment
  Vidharbha &  Marathwada Rest of Maharashtra
SSI Units 2 years 2 years
Other than SSI but investment upto Rs.300 crores 3 years 3 years
Investment more than Rs.300 crores but upto Rs.400 crores 4 years --
Investment more than Rs.400 crores but upto Rs.500 crores 5 years --
Investment more than Rs.500 crores but upto Rs.750 crores 7 years from the date of last of the final effective steps or date of commencement of commercial production whichever is later 5 years from the date of last of the final effective steps for date of commencement of commercial production whichever is later
Investment more than Rs.750 crores As above As above
Investment of Rs.300 crores or more than but less than Rs.450 crores -- 4 years
Investment more than Rs.450 crores but upto Rs.600 crores -- 5 years
Investment more than Rs.600 crores but upto Rs.750 crores -- 5 years
Investment more than Rs.750 crores 5 years from the date of last of the final effective steps or date of commencement of commercial period whichever is later 5 years from the date of last of the final effective steps or date of commencement of commercial period whichever is later
 

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For Latest Development on the Subjects related to Industries,
visit official website of Maharashtra Government at:
http://www.maharashtra.gov.in

Or
 Contact

Secretary, Industries,
 Government. Of Maharashtra
Mantralaya, Mumbai 400 032.Maharashtra State, India.
Email: umc@giasbm01.vsnl.net.in

For Further Details Contact:

Development Commissioner (Industries) Maharashtra
Directorate of Industries, New Administrative Bldg.,
2nd Floor, Opp. Mantralaya,
Mumbai 400 032, Maharashtra Government, India.
Phone: 91-22-2028616 Fax: 91-22-2026826
Email: dihq@mah.nic.in     scind@giasbm01.vsnl.net.in