Central Government De-notifies Portion of Andhra Pradesh SEZ for Industrial Use

The Ministry of Commerce and Industry, Department of Commerce, issued Notification S.O. 843(E) on February 22, 2024, which formally de-notified a specific area within an existing Special Economic Zone (SEZ) in Andhra Pradesh. This notification, published in the Gazette of India as an extraordinary issue on February 23, 2024, came into force upon its publication. The action followed a proposal from M/s. CCL Products (India) Ltd, the developer of a sector-specific SEZ dedicated to Agro-based Food Processing, located in Kuvvakolli Village, Varadaiahpalem (Mandal), Chittoor District. The company sought to de-notify 1.514 hectares from its previously notified SEZ area. The Central Government's decision was made after receiving approval from the State Government of Andhra Pradesh, conveyed through letters dated July 14, 2022, and May 30, 2023, and a recommendation from the Development Commissioner, Visakhapatnam Special Economic Zone. The de-notification reduces the total area of the SEZ from 13.774 hectares to 12.260 hectares, with the specific survey numbers of the de-notified land detailed in the notification.

The legislative intent behind such de-notifications is to provide flexibility within the Special Economic Zones framework, allowing for adjustments to the designated SEZ area when circumstances or developer requirements change, provided statutory conditions are met. The Special Economic Zones Act, 2005 (28 of 2005), and the Special Economic Zones Rules, 2006, establish the legal framework for the establishment, operation, and modification of SEZs. This particular notification addresses a situation where a developer, M/s. CCL Products (India) Ltd, sought to alter the scope of its SEZ. The earlier legal position allowed for the notification of SEZs, but also provided mechanisms for their de-notification or modification. The present action highlights the statutory provisions that enable the Central Government to respond to such proposals, ensuring that land use within and around SEZs remains dynamic and aligned with industrial development goals. The notification explicitly stated that the de-notified area of 1.514 hectares "will be used in future for industrial purpose only," indicating a policy rationale to facilitate broader industrial development even for land previously earmarked for SEZ-specific activities. The Central Government, having satisfied itself that the requirements under sub-section (8) of section 3 of the Special Economic Zones Act, 2005, and other related requirements were fulfilled, proceeded with the de-notification. The legislation provided: “NOW, THEREFORE, in exercise of the powers conferred by first proviso to sub-section (1) of section 4 of the Special Economic Zones Act, 2005 and in pursuance of rule 8 of the Special Economic Zones Rules, 2006, the Central Government hereby de-notifies an area of 1.514 hectares, thereby making resultant area as 12.260 hectares.” This action underscores the government's role in overseeing the optimal utilization of land for economic activities, balancing the specific benefits of SEZs with broader industrial development needs.

Keywords: Special Economic Zone, SEZ, De-notification, Ministry of Commerce and Industry, Andhra Pradesh, Industrial Development, CCL Products, Agro-based Food Processing, Chittoor District Geo Tags: India, Andhra Pradesh District: Chittoor