Maytas Ventures SEZ Pvt Ltd has approached the Board of Approval (BoA) under the commerce ministry to scrap its notified Special Economic Zone at Ranga Reddy district in Andhra Pradesh. In addition, five more developers have also applied for surrendering their tax-free industrial zones, citing the ongoing economic slowdown.
Maytas Ventures Pvt Ltd is part of the tainted Maytas Group, which has six approved zones, out of which three are notified.
The applications will be considered by the BoA, headed by commerce secretary Rahul Khullar, on 11 August.
The infotech zone was notified in June 13, 2007 by the commerce ministry, a status which allowed the developer to enjoy tax and duty benefits under the SEZ Act of 2005. In its application, Maytas Ventures has said that it has not taken any customs, excise or sales tax exemption, but availed service tax exemption worth Rs 31, 46,550. While denotifying a zone, the developer has to pay the government back the tax and other duty benefits that it availed while developing the zone. Maytas Ventures has requested the board to waive the refund of service tax benefits, as the company is under ?poor financial condition?.
The BoA has so far approved scrapping of five notified zones, of which four were to be developed by DLF, while one was to be developed by Mumbai based K Raheja Universal.
Maharashtra based Sanvo resorts have also applied for denotification of their Panvel based information technology SEZ. Sanvo has not undertaken any development activity in the zone and hence has not availed tax or duty benefits.
Moreover, Shiram Properties and infrastructure Pvt Ltd has asked for scrapping a part of their 23 hectare notified Infotech zone at Kancheepuram , Tamil Nadu. All these zones have stated reasons ranging from unavailability of prospective customers, high debt servicing cost and strict lending conditions for scrapping of the zones.
Developers of two formally approved zones ? SEZs with land that are yet to be notified ? and one zone with in principal approval ? given to SEZs that are yet to complete land acquisition- have also applied for de-recognition. These include a handicraft SEZ proposed to be developed by Gujarat Growth Centre Development Corporation Ltd in Kutch and an infotech SEZ of T. Holdings Electronics Pvt in Mysore, Karnataka.
Significantly, many developers have decided not to abandon their SEZ projects. As many as 25 SEZs have asked for more time to make the SEZs functional, as the current conditions are not conducive for developing the zones.
The Board of Approval will also consider five new SEZ proposals, including one from Cochin International Airport Ltd for a 100 hectare airport based zone in Ernakulam.