Investment Promotion Scheme (IPS): Scheme For Reimbursement Of Stamp Duty

Description
The scheme “Scheme For Reimbursement Of Stamp Duty” is a sub scheme under the “Investment Promotion Scheme IPS ”. It was launched on 3rd July, 2015 for a period of five years by the Dept. of Industries, U.T. Administration Of Dadra & Nagar Haveli And Daman & Diu. Now it has been extended further from 20th May, 2022 and shall be operative till 19th May, 2027. Objective of the "Investment Promotion Scheme IPS ”: The scheme envisages to provide incentives and assistance to the MSME Sector in order to nurture them and protect them from market vagaries thereby making them vibrant and successful, therefore making the U.T. a Special Hub for the MSME sector; maximize Women participation in the business sector, reduce unemployment among the local residents and incentivize the industries to employ resident laborers etc. Objective of the "Scheme For Reimbursement Of Stamp Duty" Sub-scheme: Under this scheme, New Units as well as the units undertaking Expansion/ Diversification will be reimbursed payment of Stamp duty during the operative period of the Scheme for acquiring land.

Exclusions
• An Industrial unit that has availed similar incentive, shall not be eligible for the incentive under this Scheme.

Benefits
• **For MSME sector:** 50% reimbursement. - **For units other than MSMEs:** 25% reimbursement. - **For Thrust Sectors:** 100% reimbursement. - **For Industrial units located in the Industrial Parks:** 50% reimbursement.
• **Note:** Reimbursement of Stamp duty will be made only after purchase of total required land and development of at least 25% of the infrastructure as required by the institutions developing the Industrial parks.

Eligibility Criteria
1. Should be a New Manufacturing/ Service units or Existing Manufacturing/ Service units which undertakes Expansion/ Diversification in MSME sector.
2. The unit should have commenced the commercial production between 20.05.2022 to 19.05.2027.
3. Unit should be located in the U.T. of Dadra and Nagar Haveli & Daman and Diu.

Required Documents
• Corporate Identification Number (CIN) Document.
• Taxpayer Identification Number (TIN) Document.
• Permanent Account Number (PAN) Document.*
• Goods and Services Tax Number (GST) Document.
• Other Registrations Document.
• Copy of Udyam Registration /Industrial Entrepreneur Memorandum, as applicable.
• Copy of Partnership Deed and Firm Registration Certificate in case of partnership concern or Memorandum & Articles of Association and Date of Incorporation Certificate in case of Public/Private Limited companies.
• Copy of land purchase deed duly signed by the applicant (If the Enterprise is functioning in its own land).
• Copy of registered lease agreement for a minimum period of 5 years from the date of commencement of commercial production (If the Enterprise is functioning in a leased land/ building).
• Copy of sanction order from Electricity Department for power supply with copy of the latest bill.
• Authorization letter.
• Copy of Consent to Operate / Renewal from PCC, DNH & DD (as applicable for Notification No. PCC/DMN/13(PART VI)/2020-21/448 DATED 25/01/2021).
• Copy of Factory licensee.
• Undertaking.
• Land Purchase Agreements.
• Receipts Of Stamp Duty Payment.

Frequently Asked Questions
Q: What is the Stamp Duty Reimbursement Scheme?
A: The Stamp Duty Reimbursement Scheme provides financial relief by reimbursing a portion or all of the stamp duty paid by eligible industrial units and industrial park developers, depending on their classification and development stage.

Q: What is the reimbursement rate for the MSME sector?
A: MSMEs are eligible for a 50% reimbursement of the stamp duty they pay.

Q: What is the reimbursement rate for units other than MSMEs?
A: Units that are not classified as MSMEs can receive a 25% reimbursement of the stamp duty they pay.

Q: What is the reimbursement rate for industrial complexes dedicated to Thrust sectors?
A: Industrial complexes that are solely dedicated to industrial units identified as Thrust sectors under this scheme can receive a 100% reimbursement of the stamp duty.

Q: When is the reimbursement of stamp duty provided?
A: Reimbursement is made only after the total required land has been purchased and at least 25% of the necessary infrastructure, as stipulated by the institutions developing the industrial parks, has been developed.

Q: Are industrial units within industrial parks eligible for stamp duty reimbursement?
A: Yes, industrial units located within the industrial parks are eligible for a 50% reimbursement of the stamp duty paid on the purchase of a plot within the park.

Q: What additional documentation is required for the reimbursement application?
A: Required documents typically include land purchase agreements, receipts of stamp duty payment, and evidence showing the development of at least 25% of the required infrastructure for industrial parks.

Q: How does this scheme benefit industrial units?
A: The scheme reduces the financial burden of stamp duty, encouraging the establishment and expansion of industrial units, and supporting the development of industrial parks, thereby fostering economic growth and job creation.

Q: What types of enterprises are eligible for this Scheme?
A: This Scheme is applicable to both new enterprises and existing or new units that are undertaking expansion or diversification projects completed during the operative period of the Scheme.

Q: Can an enterprise that has received similar incentives from other schemes apply for this Scheme?
A: No, an industrial undertaking that has availed similar incentives under any other scheme of the U.T Administration is not eligible for incentives under this Scheme.

Q: What happens if an enterprise fails to continue production for five years?
A: If an enterprise fails to continue production for five years, the amount of capital investment subsidy disbursed will be recovered as arrears of land revenue.

Q: Does the Scheme apply to only new projects or can existing projects also qualify?
A: The Scheme applies to both new projects and existing projects that are undergoing expansion or diversification during the operative period of the Scheme.

Q: What is meant by the 'operative period of the Scheme'?
A: The operative period of the Scheme refers to the specific timeframe during which the Scheme is active and applicable.

Q: What kind of projects qualify for the Scheme?
A: Projects that qualify include new enterprises starting their production, as well as existing enterprises that are expanding or diversifying their production capabilities.

Q: Is there any monitoring mechanism to ensure that enterprises comply with the five-year production requirement?
A: Yes, enterprises will be monitored to ensure compliance with the requirement to remain in production for five years. Failure to comply will result in recovery of the subsidy as arrears of land revenue.

Q: Are there any penalties for providing false information to avail of the Scheme?
A: Yes, providing false information to avail of the Scheme can lead to disqualification from receiving the incentive, recovery of disbursed subsidies, and possible legal action.

Q: What happens to the benefit of the incentive if a newly setup enterprise is sold or transferred to a new owner within the first five years of its establishment?
A: If a newly setup enterprise is sold or otherwise transferred to a new owner during the period of five years, the benefit of the incentive shall be available to such transferee or the new owner, only for the unexpired portion.

Q: What is the definition of Expansion/ Diversification?
A: Expansion/Diversification means where an existing / New Enterprise increases its investment by at least 50% (out of which at least 60% of investment is made in plant and machinery for which expansion is carried out) of its existing Gross Fixed capital investment on the date of initiating expansion and compared with the date of commencing production during the operative period of the scheme. Only one Expansion / Diversification will be eligible for assistance during the operative period of the Scheme.

Q: What measures are in place to prevent misuse of the subsidy scheme?
A: Strict guidelines, documentation requirements, and verification procedures are in place to ensure that subsidies are availed by eligible enterprises for genuine purposes only.

Q: What is the operative period of the scheme?
A: The operative period of scheme is from 20.05.2022 till 5 years that is 19.05.2027.

Q: If an enterprise is established in 2023 and becomes eligible for the scheme what would be the time period in which benefits are applicable?
A: The enterprise can avail benefit commencing from date of production till 5 years even if that period falls beyond operative period.

Q: How can an eligible unit apply to get the benefits of the scheme?
A: The eligible unit can apply by visiting single window portal website which is "swp.dddgov.in", and once page pops-up the user have to go to departments tab and select district industries tab under which the user have to click on apply for investment promotion scheme: 2022 to 2027.

Q: What is meant by Gross Fixed Capital Investment (GFCI)?
A: In case of Manufacturing Sector, Gross Fixed Capital Investment means the investment made in building, plant and machinery, utilities, tools and equipment, and other assets (excluding Land) required for manufacturing the end product. In case of Service Sector, the Gross Fixed Capital Investment means the investment made in plant and machinery, utilities, tools and equipment, and other assets (excluding land and building) required for the services provided.