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Journalism of Courage
NEW DELHI, July 24: The Centre has rejected US automobile giant Ford Motor Co8217;s proposal to allow duty-free import of pre-fabricated building material for its 100 per cent export oriented unit EOU in Chennai.
The proposal, which involved import of building material worth Rs 30.6 crore, has been turned down by the Foreign Investment Promotion Board FIPB despite being approved by the department of industrial policy and promotion, the administrative ministry.
The company had sought FIPB8217;s intervention to allow duty-free imports of material following the custom department8217;s insistence on levying duty, sources said.
The company may have to shell out customs duty of over Rs 5 crore in case it decides to go ahead with the import, sources disclosed.
Sources in the finance ministry said that projects under the 100 per cent EOU scheme were allowed to import only capital goods duty-free but there was no exemption for construction materials.
The company has already got the government nod for importing capital goods worth Rs 185.4 crore.
Ford had been given permission to set up a wholly owned subsidiary to set up a project for manufacture of ignition equity under the EOU scheme.
The project is being set up by Electrical Fuel Handling India Pvt Ltd. The company has argued its case before the FIPB on the ground that the pre-fabricated building material would help it speedily implement its project.
