The centre has given more reasons for the industry in Himachal Pradesh and Uttarakhand to smile, by stating that a change of ownership of an industrial unit would not imperil the benefits of the area-based tax exemptions.
In a new circular sent to the Industries Association of Uttarakhand (IAU) here, the Central Board of Excise and Customs has ruled that a change of ownership of an industrial unit enjoying these benefits “will not jeopardise the admissibility of exemption for the remaining part of the 10 year period.” This, it said, is the subject to the condition that the new owner exercises the option in writing to avail the benefits of the exemptions before effecting the first clearance.
“In the two states, change of ownership is a big issue. The new decision has given the industry much needed relief,” said IAU president Pankaj Gupta, who had taken up the matter at various levels in the central government.
A slew of tax benefits, including cent percent excise exemption, is available with the cut-off date of March 31, 2010, for a period of 10 years.
The CBEC, in another decision, said the exemption would continue to remain available in the case of an eligible unit physically shifting to a new location within the area specified under the notification. However, such units should be examined on case-to-case basis subject to the condition that they are not shifted out of the states notified for the purpose, the board added.
In the context of expansion of a unit by acquiring an adjacent plot of land and installing new plant and machinery on such land, the unit will also continue to get benefit of the tax incentives.
Besides top companies like Ranbaxy, Hero Motocorp, Bajaj Auto and Tata Motors, the two states have also become hubs of SMEs. In Uttarakhand alone, the industrial investments have reached over Rs 32,000 crore with the industrial growth hovering around 26 per cent.
