Setting aside revenue department's advice, government allows stake sale in SEZs

NEW DELHI: In a big relief for SEZ developers, the government has decided to allow them to sell stake in their projects, setting aside revenue department’s argument that it would amount to transfer of land that is not permitted.

Three proposals for dilution and transfer of promoter’s equity deferred earlier, following objections by the revenue department, were cleared this week by the board of approval for SEZs, a government official has said.

The BoA has representatives from commerce, finance, agriculture and other key ministries.

"The BoA decided to go with the legal department’s views on the issue and permit stake sale. All three pending proposals were cleared," a commerce department official told ET.

The BoA clearance has come for DLF Ackruti Info Park’s request for sale of shares to a foreign investor, an amalgamation proposal by Sterling and Aachvis Softech’s request for change/transfer of equity.

"We are happy with the decision as it has not only led to clearance of pending proposals, but has opened the door for future stake sale by developers at a time when SEZs are facing a cash crunch," said a developer who did not want to be named as the minutes of the BoA meeting are not yet in the public domain.