Reliance Industries today said it has returned nearly 1,384 acres of land in Gurgaon that was acquired for its SEZ, saying that the withdrawal of the concessions offered to special economic zones has made such projects unviable.
"Reliance Haryana SEZ Limited (RHSL) on Friday returned 1,383.68 acres of land in Gurgaon acquired from HSIIDC for setting up SEZs due to revision of strategic priorities," the company said in a statement here.
RHSL is a joint venture between Reliance Ventures Ltd (RVL), RIL's wholly-owned subsidiary, and Government of Haryana through HSIIDC.
The JV was established for development of SEZs/Model Economic Township (MET) project and other infrastructure facilities in Haryana. HSIIDC has also exited the JV and the project, it said.
The Model Economic Township project will continue to be developed in the Industrial Model Township framework on the directly-purchased land. The development work has been started over 290 acres as an Industrial Colony. Companies such as Panasonic and Denso have established their manufacturing units in the MET Project, the statement said.
RIL had on December 12, 2005 entered into an MoU with HSIIDC (a Government of Haryana-owned company) for development of a large multi-product SEZ.
RHSL was formed on June 9, 2006. The SEZ project was located in Gurgaon and Jhajjar districts of Haryana.
In 2007, HSIIDC transferred 1,383 acres to RHSL for development of the SEZ. On July 14, 2010, Haryana government approved the development of SEZ over the land transferred by HSIIDC in Gurgaon and development of Model Economic Township (Industrial Model Township Framework) on the directly purchased land.
"But, in March 2011, the Government of India withdrew the fiscal concessions of exemption of MAT and DDT for the SEZs. Consequently, in January 2012, RHSL offered to return the 1383 acres as SEZs became unviable with the withdrawal of fiscal incentives," the statement said.
On February 7, 2014, the Haryana Cabinet approved the return of the land to HSIIDC at a price much lower than the price at which it was transferred to them. It also approved the exit of HSIIDC from the project.
"On the directly-purchased land RHSL has developed 290 acres as an Industrial Colony where some multi-national corporations commenced production in 2012. The company has sought another license for an additional 415 acres," the statement added.