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GOVERNMENT
OF WEST BENGAL
DEPARTMENT
OF INFORMATION TECHNOLOGY
4,
CAMAC STREET, 7TH FLOOR,
KOLKATA-700016
NOTIFICATION
No.59-DS/IT-85/2003(Pt.1)
Dated, Kolkata, the 2nd Feb. 2005
WHEREAS
the State Government had considered it
necessary and expedient to draw up a
comprehensive Incentive Scheme for IT Industry
and IT enabled services on the basis of WEST
BENGAL INCENTIVE SCHEME, 2001:
And
whereas the Governor was pleased to introduce
the WEST BENGAL IT INCENTIVE SCHEME 2001.
And
whereas the said scheme was notified
on November 13, 2001.
And
whereas the said scheme was supposed to have
come into effect from 1st day of
November, 2001. And whereas the said scheme
could not be made operational owing to certain
procedural anomalies in this scheme.
Now
therefore, by making suitable amendments in the
scheme of 2001, the Governor is pleased to
introduce the WEST BENGAL IT INCENTIVE
SCHEME, 2004, which follows hereunder:
1. Short Title:
This
scheme may be called The West Bengal IT
Incentive Scheme, 2004 (hereinafter referred to
as the IT Incentive Scheme, 2004) for IT/IT
Enabled Services Projects of large
and small-scale units (hereinafter
referred to as IT Units) to be set up in the
State.
2.
Commencement and Duration:
Unless
specifically mentioned against the respective
items of incentives sanctioned under the IT
Incentive Scheme 2004, it shall come into effect
on and from the 1st day of September 2004 in the
whole of West Bengal and shall remain valid for
a period of five years ending on the 31st August
2009.
However, units, which have been set up on
or after 1st January, 2000 may be
granted incentives under this scheme as a
special case subject to the condition that if
these units have drawn any incentives under the
earlier scheme (West Bengal Industrial
Scheme,2000) then such incentives may be
adjusted against the incentives which may be
admissible under the new scheme.
3. Definitions:
In the IT
Incentive Scheme, 2004, unless the context otherwise requires,
i.
IT Industry includes IT & ITeS; IT
software Industry means IT software, IT services
and IT enabled services, where no factory
operation is involved.
ª
ii.
"ITeS" means Information Technology
Enabled services
iii. "State Government"
means the Government of West Bengal and
"Central Government" means the
Government of India;
iv.
"W.B.I.D.C" means the West Bengal
Industry Development Corporation Limited;
v.
"State Financial Institutions" means
the W.B.I.D.C and the W.B.F.C.;
vi. "Authorised Agent" means W.B.I.D.C., as agent specially
authorized by the State Government for operation
of IT Incentive Scheme, 2004.
vii. "Unit" means any IT project in large and small scale
sector, having registration under Software
Technology Park Scheme of the Central
Government;
viii A Large or Small Unit means a unit as defined as such by the
Government of India from time to time.
ix. "New Unit" means an IT unit in the large/small scale sector
which is established and commissioned by the
entrepreneur in West Bengal for the first time
on or after the 1st September, 2004 and is
registered with the Directorate of Industries.
x. "Existing IT Unit" means an unit in the large/ small scale
sector, which exists in West Bengal and was
functioning before it started commercial
production in its expanded portion on or after
the 1st September, 2004;
xi. "Approved Project" means the IT project of a unit and for
which registration certificate and eligibility
certificate have been issued under the IT
Incentive Scheme 2004; Such Project should be
covered by appropriate approval under the STPI.
xii. "Approved Location" means the location of the approved
project registered with the concerned authority
of the Central Government/the State Government;
xiii. "Approved Industrial Complex" means any industrial complex
set up in the public or private sector in the
State approved by the State or Central
Government;
xiv. "Eligible IT Unit" means an IT Unit in the large/small
sector having registration certificate issued by
the Director of Industries and eligibility
certificate by the WBIDC.
xv. "Expansion of Existing Unit" means expansion for the same
item(s) of production/expansion of services
within existing approved capacity or for
expansion for enlarged approved capacity or for
manufacture of a new item with an approved
capacity;
xvi. In case of expansion of an existing IT unit, the fixed capital
investment made or to be made on approved
project shall increase the total value of the
fixed capital investment of the unit by not less
than 25% of the net value of fixed asset of
land, building and plant and machinery including
computer hardware and computer software as on
1st September, 2004 or Rs 50 lakh, whichever is
less.
xvii. "Expanded Portion" means the portion expanded with
additional capacity on or after the 1st
September 2004 with approval of the State
Government .
xviii.
The
"fixed capital investment" shall be
calculated as follows:
a) Land: actual price or premium paid for the land free hold or
lease hold as deemed necessary for the approved
project at the approved location by the
authorized agent.
b) Building: the actual expenditure incurred for construction of
the office building, factory sheds etc as
necessary for the approved project at the
location but not residential quarters.
c) Plant & Machinery: fixed capital investment in plant &
machinery shall be calculated as below: The cost
of plant, and machinery as erected at the
approved location, including the cost of
productive equipment such as jigs, dies, moulds,
computer hardware, computer software etc and
items pertaining to pollution abatement measures
but excluding the cost of any second hand plant
and machinery, computer hardware, computer
software etc as also plant and machinery
purchased and installed under hire purchase
agreement. In the case of plant and machinery
taken on lease, the leasing fees/charge shall be
taken into account, provided that on the expiry
of the leasing contract, the said plant and
machinery, computer hardware, computer software
become the property of the IT unit.
d) Advances: Advances paid to suppliers of plant and machinery for
the approved project of the eligible IT unit on
or after 1st September 2004 may be taken into
account in calculating the total fixed capital
investment. However the special cases mentioned
in clause 2 shall be applicable.
4.
Applicability of the IT
Incentive Scheme,
2004:
The IT Incentive
Scheme, 2004 shall generally be
applicable to all large and small-scale project
units to be set up and also to expansion
projects of existing unit on or after 1st
September 2004. However, units, which have been
set up on or after 1st January 2000
may be granted incentives under this scheme as a
special case subject to the condition that if
these units have drawn any incentives under any
earlier state scheme, then such incentives may
be adjusted against the incentives which may be
admissible under the new scheme.
The units may be in the private sector,
co-operative sector, joint sector as also
companies/undertakings owned or managed by the
State Government.
5.
Eligibility Criteria for IT Incentives under the
2004 Scheme:
5.1
Any IT project to which this scheme applies
shall be eligible for securing an Eligibility
Certificate provided;
a) the project is
covered by a detailed feasibility report /
project report prepared for the purpose
b) the project has
been approved and sanctioned by the Central
Financial Institutions or the Commercial Banks
or the State Financial Institutions, as the case
may be. In the case of projects with arrangement
of finance from own resources, issue of
Eligibility Certificate shall be considered
provided the WBIDC is satisfied about the
arrangement of such finance.
6.
Classification of development areas and backward
areas:
6.1
For the purpose of determination of types and
quantum of incentive available under the Scheme
for the approved projects, according to their
location, the State shall be classified in the
following groups:
Group
A - Kolkata Municipal Corporation
Group
B - Howrah, Hooghly, North 24 Parganas, South 24
Parganas (excluding the area under jurisdiction
of the Kolkata Municipal Corporation), Burdwan,
Nadia and Purba Medinipur districts.
Group
C - Murshidabad, Birbhum, Purulia, Bankura,
Malda, Coochbehar, Uttar Dinajpur, Dakhin
Dinajpur, Jalpaiguri and Darjeeling and Paschim
Medinipur districts.
7.
State Capital Investment Subsidy:
7.1
An eligible IT unit located in a group 'A &
B' area and set up in the State on or after 1st
September 2004, will be entitled to State
Capital Investment Subsidy @ 7.5% of the Fixed
Capital Investment subject to a limit of Rs.
150.00 lakh payable in 5 equal yearly
installments.
7.2
An eligible IT unit located in Group C area and
set up in the State on or after the 1st
September 2004, will be entitled to State
Capital Investment Subsidy @ 10% of the Fixed
Capital Investment subject to a limit of Rs.
250.00 lakh payable in 5 equal yearly
installments.
8.
Interest Subsidy:
8.1
An eligible new IT unit for its approved project
will be entitled to Interest Subsidy on the
annual interest liability on the Term Loan
borrowed from a Commercial Bank/Financial
Institution for implementation of the approved
project, at the rates given below -
Group
A & B 25% of the annual liability on the
Term Loan borrowed for an approved project
subject to a ceiling of Rs. 100.00 lakh
per year for 5 years.
Group
C 25% of annual interest liability on the Term
Loan borrowed for an approved project subject to
a ceiling of Rs. 100.00 lakh
per year for 7 years.
In case of mega
units, there shall be an
option of either receiving interest
subsidy or industrial promotion assistance to be
adjusted against sales tax liabilities.
9.
The Interest Subsidy will be payable
annually subject to submission of a
statement/certificate by the lending
Banks/Financial Institution certifying that the
IT unit has paid the due interest to the
institutions on the due dates.
10.
Waiver of Electricity Duty: An eligible IT
unit or ITeS unit for its approved project will
be entitled to waiver of electricity duty on the
electricity consumed for its
production/operation activity for a period of 5
years from the date of commercial
production/operation.
11.
Employment Generation Subsidy:
11.1
An eligible IT unit in the large and medium
scale sectors, employees of which are
recruited through employment exchange or
otherwise, will be entitled to reimbursement to
the extent of 50% of the expenditure incurred by
it for paying its contribution towards Employees
State Insurance (ESI) and Employees Provident
Fund (EPF) depending on the location of the unit
as follows:
i. Group 'A & B'
area: 5 years;
ii. Group 'C' area: 7
years .
11.2
An eligible IT unit in the small scale sector
will be entitled to reimbursement to the extent
of 75% of the expenditure incurred by it for
paying its contribution towards Employees State
Insurance (ESI) and Employees Provident Fund (EPF)
depending on the location of the unit as
follows:
i. Group 'A & B'
area: 5 years;
ii. Group 'C' area: 7
years
11.3
The reimbursement of the expenditure prescribed
at the sub para 12.1 and 12.2 above will be
payable annually based on minimum statutory
limit subject to the condition that the IT unit
has paid its contribution towards ESI & EPF
on due dates.
12.
Refund of Stamp Duty & Registration Fees:
12.1
An eligible IT unit (excluding IT enabled
Services) irrespective of its location will be
entitled to refund of 100% of stamp duty and
registration fee required for the purpose of
registration of documents within the State
relating to purchase/acquisition of land and
building for setting up of the approved project.
12.2
Notwithstanding anything contained anywhere in
the Scheme the incentive prescribed at para 12.1
above shall be admissible from 1st
September 2004.
12.3
For IT enabled Services, requirement of land
will be assessed at the rate of 0.3 acre for
every 100 jobs created. If a unit acquires land
in excess of this limit no concession in respect
of stamp duty and registration fees for excess
land shall be allowed.
12.4
Industrial Complex and Centres set up with
infrastructural facilities will be entitled to
remission of 50% of Stamp Duty and Registration
Fee for the first sale in relation to such
Complex & Centres. This will be admissible
from the date of issue of the Notification by
the Finance Department.
Infrastructure facilities must include
the following items:
(i) Road; (ii) Water Supply; (iii) Power;
(iv) Drainage Facilities; (v) Any other relevant
items.
13.
Subsidy for quality improvement in the Small
Scale Sector: An eligible IT unit in the
Small Scale Sector shall be reimbursed 50% of
the expenditure up to a maximum of Rs. 5.00 lakh
for obtaining ISI Certification / ISO 9000 for
approved Institutions/ Research Laboratories.
14.
Incentives for approved expansion project of an
existing unit: An existing IT unit for its
approved expansion project will be entitled to
all the incentives mentioned above in this
Scheme subject to fulfillment of the conditions
prescribed for the respective item for a new
unit.
14.1
IT industries on their relocation to approved
industrial complex maybe considered by the State
Government for Capital
Investment Subsidy. The quantum of subsidy will
be 7.5% of fresh investment in plant and
machinery, computer hardware, computer software
subject to maximum of Rs. 150.00 lakh in case of
A and B category areas and 10% of fresh
investment in plant and machinery, computer
hardware, computer software in case of C
category areas depending on merit of each case
to be paid in 5 equal annual installments.
15.
Mega Projects: Notwithstanding anything
contained any where in the Scheme, the State
Government may consider granting special package
of incentives under this Scheme to a Mega
Project on case by case basis, based on pioneer
nature of projects, locational aspects, state of
the art technology, scope of further related
investment etc.
16.
Power to amend and/or relax/or repeal:
Notwithstanding anything contained in any of the
provisions of the IT Incentive Scheme 2004, the
State Government may act anytime –
i.
make any amendment to this Scheme or
repeal it, but the commitments already made for
an approved project shall not be affected by any
such amendments or repeal:
ii.
make any relaxation in applying the
provision of this Scheme but such relaxation
shall be made on the merit of the approved
project in each case, as the State Government
may consider necessary and appropriate;
iii.
may issue instructions and guidelines to
facilitate implementation, to remove anomalies
and to clarify interpretations of the provisions
of this Scheme.
Operational Procedures of West Bengal
IT Incentive Scheme 2004
An IT Unit claiming to be eligible for
incentives available under West Bengal IT
Incentive Scheme, 2004 shall submit an
application to the Director of Industries, West
Bengal at New Secretariat. Bldg., 9th
Floor, 1, K.S. Roy Road, Kolkata – 700 001 for
registration of the unit in the Form No-1
annexed hereto. Any application submitted for
registration of any project under the said
Scheme shall be treated to be validly submitted
within the period of operation of the scheme.
1.1
On receipt of application for registration of
any project, the Director of Industries shall
make as expeditiously as possible, scrutiny of /
enquiry into the particulars furnished by the
applicant unit and on being satisfied that the
application in terms of the provision of the
said scheme is in order, shall register the
applicant unit with a number and issue a
certificate for such registration to the
applicant unit with a copy to West Bengal
Industrial Development Corporation Ltd.,
together with the copy of the application, for
issue of eligibility by the WBIDC Ltd. If,
however, any application is found not to be
eligible for Registration under the IT Incentive
Scheme 2004, the Director of Industries will
issue a letter of rejection to the applicant
unit.
1.2
The Director of Industries shall maintain a
separate register for each district mentioning
the group to which district belongs and also
enter theere all relevant details in respect of
the project necessary to carry out the purpose
of the said scheme.
2.
After receipt of the application from the
Director of Industries, West Bengal, together
with the copy of the Registration Certificate
issued by him, WBIDC Ltd. will scrutinise the
particulars necessary for issue of the
eligibility certificate by them and also make
such further enquiry as may be deemed necessary
in respect thereto. If on such scrutiny/enquiry
the corporation is satisfied that such unit is
eligible for one or more than one incentive
available under the terms of the scheme, an
Eligibility Certificate shall be forthwith
issued by the said corporation to such applicant
unit. A copy of the Eligibility Certificate
shall also be endorsed to the Director of
Industries for information and record in that
office.
3.
The Director of Industries, the WBIDC Ltd. may
cause a joint inspection if they consider so
necessary anywhere in any case under the IT
Incentive Scheme 2004. The Directorate of
Industries, the WBIDC Ltd. will keep each other
informed of the decision taken by either of them
in respect of any case under this Scheme.
4.
An IT Unit, after receipt of the ‘Eligibility
Certificate’ from WBIDC
Ltd. may apply for the incentives to
which it may be entitled, under West Bengal IT
Incentive Scheme, 2004 in the manner as
prescribed below:
4.1
State Capital Investment Subsidy:
An eligible IT unit shall submit an
application to the Managing Director, WBIDC Ltd.
in the Form No – II as appended hereto for the
purpose. The Corporation, if on scrutiny of the
documents is satisfied, will work out the
admissibility of the Capital Investment Subsidy
and will as early as possible inform the
applicant of the quantum of admissibility of
such subsidy and the mode of disbursement
thereof, by the Corporation.
4.2
Interest Subsidy:
An eligible IT unit may apply to the
Managing Director, WBIDC Ltd. for Interest
Subsidy on the interest liability on account of
the loan secured by the unit from Bank(s) /
Financial Institution(s) in the Form No. III.
Immediately on receipt of the application the
Corporation will correspond with the concerned
Bank(s) / Financial Institution(s) and obtain a
certificate in the format at Annexure-A to Form
No. III regarding payment of interest against
the loan secured for implementation of the
approved project and the Corporation, if
satisfied about the payment of interest to the
Bank(s) / Financial Institution(s) according to
the norms of the scheme, will sanction interest
subsidy in favour of the applicant unit to be
credited to its account maintained in the
concerned Bank(s) / Financial Institution(s)
under an intimation to the unit.
4.3
Waiver of Electricity Duty:
An eligible IT unit may apply to the
Directorate of Electricity for waiver for
electricity duty in Form No. - IV annexed hereto
with a copy to the Director of Industries, West
Bengal. The Director of Industries after receipt
of copy of application from the IT unit will
cause an enquiry and ascertain the actual date
of commencement of commercial production to the
IT unit and communicate the date of commencement
of commercial production of the project, for
which the benefit is claimed, to the Directorate
of Electricity, following the required norms,
with a copy to the applicant unit.
4.4
Employment Generation Subsidy:
An eligible IT unit may apply to the
WBIDC Ltd. in the Form No - V annexed hereto,
for reimbursement of admissible subsidy on
account of expenditure incurred for contribution
towards Employees States Insurance and / or
Employees Provident Fund with a certificate
issued by the respective authorities regarding
contribution made by them in the manner as per
Annexure-A to Form No - V. The Corporation on
scrutiny of papers will sanction and disburse
the subsidy as admissible to the unit.
4.5
Refund of Stamp Duty and Registration Fee:
An eligible IT unit may apply to the
MD,WBIDC for refund of Stamp Duty and
Registration Fee as may be admissible according
to provision of the scheme in the Form No - VI
annexed hereto.
5
Capital Investment Subsidy to IT Units:
IT Industries on their relocation to
approved industrial complex, if such relocation
is accompanied with modernisation, may be
considered by the State Government to Capital
Investment Subsidy. The quantum of subsidy will
be 7.5% of fresh Investment in plant and
machinery, computer hardware, computer software,
subject to maximum of Rs. 150.00 lakh in case of
A and B category of areas and 10% of fresh
investment in plant and machinery, computer
hardware, computer software, in case of C
category areas. The payment of subsidy shall be
staggered over a period of 5 years.
5.1.The
Director of industries will verify the
application with the books of accounts of his
office and if on verification the unit is found
to be eligible for Capital Investment Subsidy,
in terms of the provision of the scheme, he will
record his recommendations in the Format at
Annexure - A to Form No - VII and forward the
same to the Managing Director, WBIDC Ltd. for
sanction and disbursement of the admissible
Capital Investment Subsidy to the applicant
unit. A report regarding such sanction and
disbursement when made will be sent by the WBIDC
Ltd. to the Directorate of Industries for their
information and record.
This
issues with the concurrence of the Finance
Department vide their U.O No.
S-162,
date; 22.12.2004
By
order of the Governor
SD/-
Dr.
G.D. Gautama
Principal
Secretary to the
Government
of West Bengal
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