L.B. Singhal
Director General

Sub : i) Postponement of implementation of SEZ Rules and Regulations till 1-3-2004
        ii) Trading Activities for EOUs, for trading EOUs which were in existence prior to  31-3-2002

1. Ministry of Finance has issued Notification Nos 116, 117, 118 and 119-Cus(NT) all dated 31-12-2003 and Notification No. 85/2003-CX(NT) dated 31-12-2003 through which the effective date for implementation of SEZ rules & regulations have been postponed from 1-1-2004 to 1-3-2004.

2.   Department of Revenue has issued notification No. 01/2004-Cus dated 2-1-2004 regarding trading activities in the EOU in respect of trading EOUs which were in existence prior to 31-3-2002. At present trading activities in the EOU is not allowed. Trading activities in the EOUs have been discontinued from 31-3-2002. However, prior to this, trading activities in the EOUs were allowed. After discontinuance of trading activities under the EOU Scheme, the existing trading EOUs had been representing that they should be permitted to continue their trading activities as LOP/LOI had been issued prior to discontinuance of the Scheme.

Department of Revenue has issued Notification No. 01/2004-Cus dated 2-1-2004 wherein this request has been accepted. This notification permits import of goods for the purpose of trading by the trading units which were in existence prior to 31-3-2002 and having valid Letter of Permission to continue under the Export Oriented Undertaking Scheme. However this import is subject to the following condition:-

“The unit engaged in trading shall not be allowed to,-

(i) sell any goods so imported in the domestic tariff area or remove samples in the domestic tariff area;

(ii) export goods through merchant exporter or through any other exporters;

(iii) transfer the goods to other export oriented undertaking or unit in Electronic Hardware Technology Park (EHTP) or Software Technology Park (STP) or Special Economic Zone;

(iv)  remove the goods outside the bonded premises for the purpose of jobwork;”