Special Economic Zones (Fourth Amendment) Rules, 2022

The Ministry of Commerce & Industry has recently amended the Special Economic Zones Rules, 2006, which have been published in the Gazette of India on October 3, 2022. Rule 29A details the procedure for import or export or procurement from or supply to Domestic TariffArea, of aircraft by a unit in International Financial Services Centre’. This has been done to streamline and make the process of procurement of aircrafts by the International Financial Services Centre (“IFSC”) Units easier and done in accordance with Section 55 of the Special Economic Zones Act, 2005 (“Act”) by the central government.

Rule 29A: An Overview

1. When importing an aircraft, a unit based in the IFSC which has been authorised by it must follow the steps outlined below:
   • Bill of entry in quintuplicate for home consumption includes a description, a specially stamped endorsement reading "International Financial Services Centre Cargo," an invoice, and a packing list. The authorised officer is responsible for registering the bill of entry, assigning a running annual serial number, and assessing its value based on the transaction. The specified officer is not required to countersign the bill of entry.
   • When submitting the bill of entry, the lessor must provide the port of discharge or customs landing station as the specific customs airport, port, or landing station where the IFSCunit anticipates receiving the aircraft for the first time.
   • The assessed bill of entry must be delivered to the customs officer at the port of entry via email and it shall be regarded as authorization for the transfer of goods to the location specified by the IFSCunit.
   • After receiving the assessed bill of entry, the customs officer at the customs airport must check the aircraft's markings and numbers and send the inspection report, which includes the location of the aircraft's storage or parking,to the Special Economic Zone customs authorised officer via email.
   • Receipt of the report from the customs officer at the customs airport and the authorized officer's verification of the details from the assessed bill of entry at the Gujarat International Finance Tec-City Special Economic Zone (SEZ) shall be considered to be the arrival of the goods and the conclusion of the customs process for out of charge of the goods.
2. Additionally, in case of procurement of aircraft from Domestic Tariff Area, the following procedure needs to be followed:
   • Only lessors who are authorised as units in the IFSCcan purchase or lease aircrafts.
   • For the procurement, all tax invoices, filings for domestic tariff area procurement, and other papers under the Goods and Services Tax Act, 2019, the act or the rules need to be submitted to SEZ Customs. Documents include port of receipt or landing station as the respective customs airport or port or landing station where aircraft is expected to be received first time.
   • Within twenty-four hours of filing the relevant documentation, the authorized officer must inform the appropriate customs officer of the concerned customs airport regarding the examination and inspection of the aircraft's marks and numbers.
   • Customs officials at the respective customs airport shall carry out an examination or inspection of marks and numbers of such aircraft and forward the examination or inspection report to the authorized officer.
   • When the authorised officer receives the report from the customs officer at the customs airport and confirms the information on the document filed in accordance with clause (b), it is assumed that the goods have arrived at the centre unit and the customs process for out of charge of the goods has been completed.
   • It is the responsibility of the lessor to ensure that the aircraft imported by the IFSC unit is under the custody of such person approved under Section 45 of the Customs Act, for the respective customs airport or landing station.
3. Further, in case of supply of aircraft on lease or outright basis, the IFSCunit needs to follow the below procedure:
   • Aircraft may be supplied into the domestic tariff area on a lease or owned basis by lessors authorised as the International Financial Services Centre Unit situated in SEZ.
   • All bill of entry for domestic tariff area sale and other such documents are needed to be submitted through SEZ online system by the IFSCunit with the customs.
   • For examination and inspection of marks and numbers of the aircraft, the authorised officer shall communicate to the appropriate customs officer of the customs airport or port or landing station concerned within 24 hours of filing of respective documents.
   • The marks and numbers of such aircrafts shall be examined or inspected by customs officials at the relevant customs airport, port, or landing station, who shall also forward the examination or inspection report. Receipt of the examination or inspection report from customs and verification of the details from the assessed bill of entry is deemed to be the completion of the customs procedure for out of charge of the goods into domestic tariff area.
   • After out-of-charge has been completed, the authorised officer shall intimate the customs officials at the respective customs airport or port or landing station to allow the physical removal of the aircraft into India. The same shall be intimated to authorized officer concerned.
4. In case of export of aircraft on a lease or outright basis, the following procedure needs to be followed by the IFSC unit based in the SEZ:
   • Lessors approved as the IFSCunit located in SEZ may export the aircraft on lease or outright basis.
   • All shipping bills and other such documents shall be required to be submitted by the IFSCunit with customs.
   • The documentation mentioned in subsection (b) must designate the IFSCunit's storage facility or landing station as the port of shipment, which must be the specific customs airport, port, or landing station.
   • Within twenty-four hours of the filing the relevant documentation, the authorised officer must inform the appropriate customs officer about the examination and inspection of the aircraft's marks and numbers. The customs officers shall carry out an examination or inspection of marks and numbers of such an aircraft and forward the examination or inspection report to theauthorised officer.
   • The receipt of the examination or inspection report and verification of the details from the submitted shipping bill by the authorised officer at the SEZ and completion of the customs procedure for the let export order of the goods will be deemed to be the completion of procedure for export of aircraft by the IFSCunit. Post the grant of let export order, the authorised officer is required to intimate the customs officials for removal of aircraft from India physically.