New Delhi: Infrastructure major Larsen & Toubro has surrendered an IT/ITeS special economic zone proposed at Coimbatore, citing economic slowdown as the reason.
The Board of Approval (BoA), headed by Commerce Secretary Rahul Khullar, has approved the developer's request on its meeting on January 24.
The developer had requested for de-notification of the proposed tax-free zone, citing lack of economic viability in the changed economic scenario, as the reasons for the same.
"After deliberations, the Board decided to approve the request of Larsen & Toubro Ltd for de-notification of the sector specific SEZ for IT/ITES at Coimbatore notified over an area of 11.03 hectares, subject to DC’s certificate that the developer has refunded all the tax/duty benefits availed under SEZ Act/Rules," the minutes of the BoA meeting said.
The Board has also allowed Videocon group to pull out from its SEZ project at Jalpaiguri in West Bengal. The Videocon firm had approached the board to withdraw its project at Jalpaiguri due to "latest business outlook" in the northern region of West Bengal. It had been granted a formal approval in May 2009.
Further, the BoA has approved four developers, including Tata Consultancy Services and Cochin Port Trust, to set up new zones.
The green signals to TCS and a few other promoters have been given at a time when SEZs have lost sheen as a vehicle of investment in the wake of imposition of Minimum Alternate Tax (MAT) on the SEZ developers and units in the zones. Slowdown in the realty market has also added to the uncertainty among the developers.
Eleven developers, including that of Parsvnath SEZ Ltd got extension of time for execution of their projects.
Out of 381 notified zones in the country, only 148 have become operational. The maximum number of them are in sectors such as IT/ITES, engineering, electronics, hardware and textiles.
Commerce Ministry has floated a discussion paper to revamp its SEZ policy.