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Phoenix Spaces, in Telangana, has however sought an extension of letters of approval
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BIJOY GHOSH
Tata Steel and Infosys are amongst 4 developers who have sought partial cancellation of their special economic zones (SEZs) stating that there are no units in the proposed area for de-notification and tax benefits have not been availed.
The 4 proposals for partial de-notification, including ones from ELCOT Ltd. and Sipcot Ltd. for their multi-product SEZs in Tamil Nadu, have all got the approval of development commissioners and are scheduled to be taken up for consideration of the Board of Approval for EOUs and SEZs in its meeting on May 9, per the agenda for the meeting.
With the government considering SEZ amendments, some developers are optimistic about the future and have sought extensions for their letters of approval hoping for more demand soon, the agenda highlighted.
Demand for DTA land
Tata Steel SEZ has applied for partial de-notification of 282.7351 hectares out of 588.6514 hectares of its multi product SEZ at Gopalpur, Ganjam, Odisha. The reason for de-notification given by the developer is that the SEZ land, much of which has been laying vacant since inception, is very much in demand as DTA (domestic tariff area) land.
“There are no units in the proposed area for partial de-notification. After the proposed partial de-notification, the SEZ land area will be reduced to 305.9163 hectares. SEZ land remains contiguous and shall meet the minimum land requirement prescribed for the multi-product SEZ, which is 50 hectares,” according to the site inspection report cited in the agenda.
Move to hybrid model
Infosys Ltd. IT SEZ has requested for partial de-notification of 20.234 hectares out of 52.643 hectares of its IT/ITES SEZ in Indore, Madhya Pradesh. It said various challenges, including unprecedented pandemic situation and lockdowns, resulted in uncertainty regarding phase 2 and phase 3 development and completion.
“Further, the said situation also led to hybrid operating model as a norm for IT industry and consequently we are contemplating optimisation of allotted land to us to create a conducive IT eco-system for other prospective companies. Hence, we have surrendered the portion of unutilised land,” the company stated.
However, some SEZs have also sought an extension of letters of approval for their proposed projects so that the validity remains despite some delays. Phoenix Spaces, an IT/ITES SEZ in Telangana which has sought an extension, stated that due to the present market condition of reduced demand for office spaces and sunset on income tax benefits to the new units, there are no takers for IT/ITES SEZ space.
“Yet, they are confident that with the proposed new SEZ amendments, the demand for SEZs will expand in future and they will be able to lease out the space and make the SEZ operational,” the agenda noted.
Published on May 5, 2025
This article first appeared on The Hindu Business Line
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