SEZ Developer/Co developer Exit 'infrastructure' - Need Clarification

[Abhijeet Mane]

We are a co developer in Puthuvypeen SEZ (Kochi) and exploring de notification. Dept. of Commerce (File No. F 2/15/2005 SEZ(Vol III)(Pt.), 10 Apr 2024) has clarified that Rule 49 depreciation applies to Developers at exit.

Need expert views on:

1. Does Rule 49 depreciation apply only to 'capital goods' or also to 'infrastructure' (civil/common assets), since 'capital goods' is defined separately in Rule 2(e) of SEZ Rules?
2. If infrastructure is not eligible, is the standard practice to repay full duty/GST benefits actually availed (no depreciation), supported by CE certification? (As seen in Rule 11B clarifications.)
3. Any real cases of developer/co developer denotification and the methodology accepted by authorities for duty repayment?

AI Summary

Rule 49 depreciation scope questioned for SEZ developer exits; infrastructure classification alters duty/GST repayment obligations. Whether Rule 49 depreciation applies to SEZ developers/co-developers at exit for infrastructure (civil/common assets) as distinct from items defined as capital goods is decisive for duty/GST repayment. If infrastructure is excluded from Rule 49, authorities typically require repayment of the full duty/GST benefit availed without depreciation, supported by central excise/customs certification and guided by methodologies referenced in Rule 11B clarifications; practical precedents and accepted calculation methods are sought.