Freight Subsidy Scheme, 2013

 
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F. No. 11(5)/2009-DBA-II/NER.--The Government of India has approved the following scheme for grant of freight subsidy to eligible industrial units located in selected States/UTs/districts on transportation of raw materials and finished goods to and from certain selected areas with a view to promoting growth of industries there:-

1. Short title and commencement-

(1) This Scheme may be called the Freight Subsidy Scheme, 2013.

(2) It comes into effect on the date of its publication in the Official Gazette.

2. Coverage-

Unless otherwise specified, the Scheme will cover all industrial units in the selected areas (A), (B), (C) and (D).

3. Definitions-

In this Scheme, unless the context otherwise requires,

(a) 'Designated Rail-Head' in relation to a selected area means the nearest designated rail-head mentioned against such selected area in Annexure-I of this notification.

(b) 'Diversification' means production of new article(s) by an industrial unit. The sale value of diversified articles should not be less than twenty five per cent of the turnover, during the previous financial year computed at the full registered capacity of the unit.

(c) 'Existing Industrial Unit' means an industrial unit where manufacturing activity has commenced before the date of publication of the Scheme in the Official Gazette.

(d) 'Finished Goods' means the goods actually produced by an industrial unit and for which it is registered.

(e) 'Industrial Unit' means an industrial unit where a manufacturing activity is carried on.

(f) 'Manufacturing Activity' means "An activity which brings about a change in non-living physical object or article or thing (i) resulting in transformation of the object or article or thing into' a new and distinct object or article or thing having a different name, character and use; or (ii) bringing into existence of a new and distinct object, article or thing with a different chemical composition or integral structure."

(g) 'New Industrial Unit' means an industrial unit where manufacturing activity has commenced on or after the date of publication of the Scheme in the Official Gazette.

(h) 'Nodal Agency' means the respective agencies designated, under para 12 of this notification, for disbursement of subsidy under the scheme to the eligible industrial units.

(i) 'Raw Materials' means any raw materials actually required and used by an industrial unit in manufacturing of the finished goods for which it is registered.

(j) 'Registered Capacity' means "capacity for which the unit has been registered with the Central/State Government as reflected in Industrial License/Industrial Entrepreneur's Memorandum Part-B/Entrepreneur's Memorandum Part-II".

(k) 'Scheme' means the Freight Subsidy Scheme, 2013.

(l) 'Selected Area (A)' means the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura.

(m) 'Selected Area (B)' means the States of Sikkim and Jammu and Kashmir.

(n) 'Selected Area (C)' means the Union Territories of Andaman & Nicobar Islands and Lakshadweep.

(o) 'Selected Areas (D)' means the State of Himachal Pradesh, Darjeeling district of West Bengal and the State of Uttarakhand (excluding district of Haridwar).

(p) 'Substantial Expansion' means an increase of at least 25% of the registered capacity of the industrial unit through additional capital investment. However, if such increase is due to merger/amalgamation of two or more industrial units, it will not be considered as substantial expansion for the purpose of subsidy under the scheme.

4. Sunset clause-

The scheme will automatically terminate after five years from the date of its publication in the Official Gazette.

5. Ineligible industries/goods/movements (Negative List)-

(1) The industrial units/items listed in Annexure-II of this notification will not be eligible for subsidy under the Scheme.

(2) Unless otherwise specified, subsidy under the scheme will not be applicable to Industrial Unit for movement of raw materials and finished goods within the State/Union Territory in which they are located.

6. Applicability-

Unless otherwise specified,

(1) This scheme is applicable to all eligible industrial units, both in the public and the private sectors irrespective of their size, located in the selected areas and which commence commercial production within the period of validity of the scheme.

(2) Subsidy Under the Scheme will be admissible to eligible industrial units for a period of five years from the date of commencement of commercial production.

(3) Eligible industrial units in Micro, Small & Medium Enterprises (MSME) Sector, which undergo substantial expansion during the period of validity of the scheme, will be provided subsidy under the scheme for an additional period of five years from the date of commencement of commercial production consequent to substantial expansion, over and above the subsidy already drawn.

(4) Existing eligible industrial units located in the selected areas are also eligible for subsidy under the scheme in respect of the additional transport costs of raw materials and finished goods arising as a result of substantial expansion or diversification effected by them after the commencement of the Scheme. Subsidy in such cases will be restricted to the transport costs of the additional raw materials required and additional finished goods produced as a result of the substantial expansion or diversification.

7. Quantum of Subsidy-

(1) Unless otherwise specified, the quantum of subsidy to the industrial units located in Selected Area (A) would be computed as follows:

(a) 90% of the transport cost for movement of raw materials by rail from nearest designated rail-head i.e. Siliguri/New Jalpaiguri to the railway station nearest to the location of the industrial unit and thereafter the cost of movement by road to the location of industrial unit will be reimbursed. Similarly, while calculating the transport costs of finished goods the cost of movement by road from the location of industrial unit to the nearest railway station and thereafter the cost of movement by rail to Siliguri/New Jalpaiguri will be reimbursed. For materials moving entirely by road or any other mode of transport, reimbursement of the transport cost will be limited to the amount which the industrial unit might have paid, had the raw material moved from Siliguri/New Jalpaiguri by rail upto the railway station nearest to the location of the industrial unit and thereafter by road. Similarly in the case of movement of finished goods moving entirely by road or any other mode(s) of transport in such selected area, reimbursement of the transport costs will be limited to the amount which the industrial unit might have paid had the finished goods moved from the location of the industrial units to the nearest railway station by road and thereafter by rail to Siliguri/New Jalpaiguri. In case of transportation of raw material/finished goods by Inland Water Transport, an industrial unit will be eligible for subsidy equivalent to 90% of the transport cost for transportation by Inland Waterways Transport (IWT) from Dhubri to any other location on the Brahmaputra river right upto Sadiya along the National Waterway-2 and thereafter by road to the industrial unit and vice-versa, in respect of raw materials which are brought into and finished goods which are taken out of such selected area. However in such cases, subsidy will be subject to a ceiling of 90% of the amount which the industrial unit might have paid had the transportation been undertaken from Siliguri/New Jalpaiguri (designated Rail head) by rail up to railway station nearest to the location of the industrial unit and thereafter by road and vice-versa.

(b) Reimbursement of 90% of the transport costs for movement of raw materials from one State to another within such selected area. The actual cost of transportation or, the cost of movement by road from where raw material is being procured to the railway station nearest to it and thereafter by rail from that railway station to the Railway Station nearest to the industrial unit and subsequently by road to the location of the industrial unit, whichever is less, will be taken into account.

(c) Reimbursement of 50% of the transport costs for movement of finished goods from one State to another within such selected area. The actual cost of transportation or, the cost of movement from the location of the industrial unit to the nearest Railway Station by road and thereafter by rail to the railway station nearest to the location where the finished goods is to be received and subsequently by road from that railway station to the location where finished goods has been received, whichever is less, will be taken into account.

(d) Reimbursement of 90% of transport costs for movement of steel as raw material from Guwahati Stockyard of Steel Authority of India Limited (SAIL) upto the location of the industrial units.

(e) Reimbursement of 75% of the air freight on movement of electronic components/products partly by air and partly by rail/road. The subsidy would be admissible @75% on the air freight from Calcutta upto the airport nearest to the location of the industrial unit and thereafter @ of 90% for movement by rail/road upto the location of the industrial unit and vice-versa.

(2) Unless otherwise specified, the quantum of subsidy admissible to an industrial unit located in Selected Area (B) would be as under:

(a) 90% of...

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