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Gopika Juneja, Lovely Professional University
                                                                            Unit 6: Deductions: For Special Conditions




                    Unit 6: Deductions: For Special Conditions                                  Notes


            CONTENTS
            Objectives
            Introduction

            6.1  Key Tax Benefits for SEZs and SEZ Units
            6.2  Deduction in Respect of Profits and Gains by an Undertaking or Enterprise Engaged
                 in Development of SEZ (Section 80-IAB)

            6.3  Special Provisions in Respect of Certain Undertakings or Enterprises in Certain
                 Special Category States (Section 80-IC)
            6.4  Tax Holiday in Respect of Profits and Gains from Eligible Business of Certain
                 Undertakings in North-Eastern States (Section 80-IE)
            6.5  Application of the above Special Conditions
            6.6  Summary

            6.7  Keywords
            6.8  Review Questions
            6.9  Further Readings

          Objectives


          After studying this unit, you will be able to:
               State the meaning SEZ
               Discuss the key tax benefits to be provided to SEZs and SEZ Units
               Realise the deduction in respect of profits and gains by an undertaking or enterprise
               engaged in development of SEZ
               Trace the special provisions in respect of certain undertakings or enterprises in certain
               special category States
               Elucidate tax holiday in respect of profits and gains from eligible business of certain
               undertakings in North-Eastern States

               Test Application of the above Special Conditions
          Introduction


          A Special Economic Zone (SEZ) is a specified, delineated and duty-free geographical region that
          has different economic laws from those of the country in which it is situated. In some countries,
          such a region is even treated as a deemed foreign territory. Therefore you can say that SEZs are
          free trade zones, having completely different set of administrative and taxation laws outside the
          purview of customs authorities. Traditionally SEZs are created as open markets within an economy
          that is dominated by distortional trade, macro and exchange regulations and other regulatory
          governmental controls. SEZs are believed to create conducive environment to promote
          investment and exports. Hence, many developing countries are developing SEZs with the
          expectation that they will provide the engines of growth for their economies to achieve
          industrialization.



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