Purchase by SEZ from its Parent/ Sister concern

[vishnumurthi holla]

Dear Sir,

We are having a SEZ unit manufacturing Automotive Components made out of rubber and allied products.

We have also running a DTA unit dealing the similar commodity.

My query is, If SEZ Unit Purchases Some of Semi finished commodities from its DTA unit, Can it be treated as Export for DTA Unit. and Whether such commodities run through further Manufacturing process at SEZ and subsequently exported from India. Can this transaction technically permitted under SEZ rules? Please share valuable inputs- Pro's and Con's.

[YAGAY and SUN]

Dear Vishnumurthi,

Your DTA Unit would have to take care of following provisions while supplying goods to unit at SEZ, viz:-

1. Rule 8, 9 and 10 of the Central Excise Valuation (Determination of Price of Excisable goods) Rules, 2000.
2. Rule 30 of the SEZ Rules.

Regards,

Team YAGAY and SUN

(Management and Indirect Tax Consultants)

AI Summary

Supply from DTA to SEZ units requires compliance with excise valuation rules and SEZ rule requirements for permissibility.
Supply of semi finished goods from a DTA parent/sister unit to an SEZ unit is subject to the Central Excise Valuation Rules (Rules 8-10) for price determination and to Rule 30 of the SEZ Rules; compliance with these provisions is necessary for the transaction to be treated as permissible under the SEZ regulatory framework.