*The Department of Industries may be contacted for more accurate information as well as for Registration.

Letter of Intent (LOI) / Registration of IT Unit:

The State Government has announced and is considering various Fiscal and nonfiscal incentives to give an impetus to IT sector in the State, so as to consolidate the State's leading position. The concessions and incentives will be applicable to IT Units registered as Small Scale Industry (SSI) /Small Scale Service/Business Enterprises (SSSBE) /Maharashtra Small Industries (MSI)/Maharashtra Small Scale Service/Business Enterprises (MSSSBE) or holding Industrial Entrepreneurs Memorandum (IEM) on the strength of separate Letter of Intent (LOI) /Registration granted by the designated agencies mentioned below in para 3. The procedure for grant of such LOI /Registration has been finalised under the aegis of the High Powered Committee on Information Technology.

2. CLASSIFICATION OF IT UNITS:
The Information Technology (IT) units are classified into three groups depending upon their activities, namely (a) IT Hardware unit, (b) IT Software unit, (c) IT Service (IT enabled service) unit. In some cases the benefits flowing under IT policy to each of these categories are different.

2.1 IT HARDWARE UNIT:
IT hardware would basically comprise the items indicated in the list of 'Primary Products' and ' Priority Intermediate Products'' mentioned in the Report of Panel of the National IT Task force on Development. Manufacture and Export of IT Hardware. A list indicating the items to be recognized as IT hardware products is enclosed (Annexure - A and Al). Categorization as IT Hardware unit also requires that the unit's annual turnover of IT Hardware should exceed 75% of its total annual turnover in value terms.

2.2 IT SOFTWARE UNITS:
IT software includes a wide range of products and it is not possible to draw up a comprehensive list in view of its nature and continuing developments in this sector. It has, therefore, been decided that the software units, whether in small scale or large scale sector, which are certified as such by the following competent agencies would be considered for registration as IT Software units. Categorization as an IT Software unit also requires that the unit's annual turnover of IT Software should exceed 75% of its total annual turnover in value terms.

2.3 IT SERVICE UNIT:
IT services, including IT enabled services, cover a wide and expanding spectrum. A definitive list cannot, therefore, be drawn up for this sector. Hence, an illustrative list is enclosed at Annexure B. Categorization as an FT Service unit also requires that the unit's annual turnover of IT Services should exceed 75% of its total annual turnover in value terms.


3. REGISTRATION AUTHORITY

As in the case of other Industrial/Service units, the IT units will also be registered as per the normal procedure followed for IEM and SSI/MSI/SSSBE/MSSSBE. However, the Registering Authorities designated for recognizing the IT units for the purpose of incentives offered by the State Govt. would also issue a separate Letter of Intent or Registration to IT Hardware / IT Software / IT Service units. -The following agencies are designated as Registering Authorities for the purpose of issue of Letter of Intent and Registration to different categories of IT units.

4. LETTER OF INTENT (LOI):
Proposed units / existing units now proposing to produce IT products will be granted Letter of intent by the registering authority. The Letter of Intent will be valid for a period of three years.

4.1 LETTER OF INTENT FOR IT HARDWARE UNIT:
The proposed IT Hardware units shall apply for Provisional SSI/MSI Registration in the usual SSI/MSI registration form or, if already holding Provisional SSI / MSI registration, furnish a copy of such registration, along with the following documents:

1. Application in the prescribed form for LOI (Annexure-I)
2. Affidavit (Annexure II -A)
3. Locational clearance from DI/MIDC/Local Authority, as the case may be
4. Form regarding employment of local persons (ELP-II Form): The units holding lEMs shall apply to Industries Department for grant of LOI in the prescribed form (Annexure I) along with affidavit as at Annexure - II-B and copy of IEM and ELP-ll form. In case of SSI / MSI units, the Registration Authority will issue provisional SSI/MSI registration to the unit as per normal procedure where necessary, and simultaneously issue Letter of intent in the format at Annexure III. Industries Departmentl also issue LOI in the format enclosed at Annexure-lll.

4.2 LETTER OF INTENT FOR IT SOFTWARE UNITS:
The proposed IT Software units shall apply for provisional SSI/MSI Registration in the regular registration form or, if already holding Provisional SSI / MSI registration, furnish a copy of such registration, along with the following documents.

1. Application in the prescribed form for LOI (Annexure-IV)
2. Affidavit (Annexure V-A)
3. Certificate from the designated agency (Annexure IX)
4. Locational clearance from DI/MIDC/Local Authority, as the case may be
5. Form regarding employment of local persons (ELP-II Form)
The units holding IEMs shall apply to Industries Department for grant of LOI in the prescribed form (Annexure-IV) along with affidavit as at Annexure V-B and copy of IEM and the certificate issued by the designated agency. In case of SSI/MSI units, the Registration Authority will issue provisional SSI registration as per normal procedure and simultaneously issue LOI in the format at Annexure III. Industries Department will also issue LOI in the format enclosed at Annexure -III.

4.3 LETTER OF INTENT FOR IT SERVICE / IT ENABLED SERVICE UNIT:
The proposed IT service units and IT enabled service units shall apply for provisional SSSBE/MSSSBE registration or in the regular registration form or, if already holding such Provisional registration, furnish a copy along with following documents
1. Application in the prescribed form for LOI (Annexure-IV)
2. Affidavit (Annexure VI-A)
3. Locational clearance from DI/MIDC/Local Authority, as the case may be
4. Form regarding employment of local persons (ELP - II form)

The units holding IEMs shall apply to Industries Department for grant of LOI in the prescribed form (Annexure-IV) along with affidavit as at Annexure VII-B and copy of ITEM. The small scale - registering authority will issue provisional SSSBE/MSSSBE registration to the unit as per normal procedure and simultaneously issue LOI in the format at Annexure III. Industries Department will also issue LOI in the format at Annexure -III.

5. REVALIDATION OF LOI:
The LOI will be valid for a period of three years from the date of issue. The unit may apply to the Registration Authority for revalidation of the LOI for a further period of three years indicating the effective steps taken for sorting the activities, and why such activities could not be started so far. In the case of proposed IT Software unit, the application should also be accompanied by a revalidated certificate from the designated agency. (Annexure-IX).

6. REGISTRATION:
As mentioned in para 4, a Letter of Intent will be granted to proposed unit. After a unit commences its activities, it would apply for Registration as IT Hardware / Software / Service unit, as the case may be.

6.1 REGISTRATION AS IT HARDWARE UNIT:
Provisionally SSI/MSI registered units holding LOIs as IT Hardware units and which have gone into IT Hardware production shall apply for permanent SSI Registration in the regular permanent SSI Registration form or if already holding permanent SSI registration, furnish a copy of such registration along with the following documents.

1. Application for Registration as IT Hardware unit in the prescribed form (Annexure-I)
2. Affidavit (Annexure VII-A)
3. Locational clearance /NOC from Directorate of Industries/ MIDC etc. as the case may be.
4. C.A's certificate regarding turnover of IT hardware products exceeding 75% of total turnover (Annexure XI)
5. Form regarding employment of local persons (ELP-I Form)
6. IT Hardware Unit Letter of intent (if obtained)
The units holding lEMs and which have gone into IT Hardware production shall apply to Industries Department for grant of Registration as IT Hardware unit in the prescribed form (Annexure-I) along with affidavit as at Annexure-VII-B and copy of IBM, HLP-I form IT LOI and C.A.'s certificate. The format in which IT Hardware Registration is to be granted to such units is enclosed at Annexure VIII. In respect of small-scale units, Permanent SSI/MSI Registration will be granted simultaneously in the usual manner.

6.2 REGISTRATION AS IT SOFTWARE UNIT:
Provisionally SSI registered units holding LOI a5 IT Software Unit which have gone into production shall apply for permanent SSI Registration in the regular permanent SSI Registration form or, if already holding permanent SSI registration, furnish a copy of such registration along with the following documents:

1. Application for Registration as IT Software unit in the prescribed form (Annexure-lV)
2. Affidavit (AnnexureVI-A)
3. CA's certificate regarding turnover of IT Software products exceeding 75 % of total turnover (Annexure XI)
4. Certificate from the designated agency (Annexure-X)
5. Locational clearance /NOC from Directorate of industries / MIDC /
Local authority as the case may be
6. IT Software Unit Letter of intent (if obtained) 7. Form regarding employment of local persons (ELP-l Form)
The units holding lEMs shall apply to Industries Department, for IT Software-Registration in the prescribed form (Annexure-lV) along with affidavit (Annexure-VII-B), copy of IEM, and other documents listed above. The Registering Authority will issue Registration as IT Software unit as at Annexure -VIII.

6.3 REGISTRATION AS IT SERVICE UNIT:
Provisionally SSSBE/MSSSBE registered units holding LOI as IT Service units which have started their IT Service activities shall apply for Permanent SSSBE/MSSSBE Registration in the regular form or, if already holding Permanent small-scale registration, furnish a copy of such registration along with the following documents:

1. Application for Registration as IT Service unit in the prescribed form (Annexure-IV)
2. Affidavit (Annexure VII-A)
3. CA's certificate regarding turnover of IT Services exceeding 75% of total turnover (Annexure XI)
4. Locational clearance /NOC from Directorate of Industries / MIDC / Local authority as the case may be
5. IT Service Unit Letter of intent (if obtained)
6. Form regarding employment of local persons (ELP-l Form)
The units holding IEMs shall apply to Industries Department Ltd for grant of registration as IT Service unit in the prescribed form (Annexure-lV) along with affidavit at Annexure-VII-B, copy of IEM and other document listed above. The Registering Authority will issue Registration as IT Service UNIT in the format at Annexure VIII.

6.4 IT REGISTRATION TO EXISTING IT UNIT:

6.4.1 Units already producing IT products or engaged in IT Service activities may apply for IT Registration alongwith the documents mentioned at paras
6.1 if IT Hardware unit
6.2 if IT Software unit
6.3 if Service unit as the case may be
6.4.2 Existing unit producing non-IT produces but which propose co produce IT products, may apply as per para 4.1, 4.2 and 4.3 as the case may be with a copy of permanent SSI/SSSBE/MSSSBE registration certificate or IBM as may be relevant.

6.5 RENEWAL OF IT REGISTRATION
IT Registration will be valid for a period of three years from the date of issue. Application for revalidation may be made for a further period of three years. Such application should be accompanied by revalidated certificate from the designated agency in the case of IT Software units.

7 ISSUE OF CERTIFICATE BY DESIGNATED AGENCY:
As mentioned at para 2.2, proposed and existing software units have to obtain a certificate from the designated agencies before applying for IT Software LOI / Registration. The designated agencies will issue a Certificate, after examining the project report submitted by the entrepreneur and taking into consideration the background and technical qualifications of the promoters and proposed personnel where relevant. If required, the agencies may call the representative / entrepreneur for discussion / interview. Separate certificates have been prescribed for proposed (Annexure DO) and existing (Annexure X) units. Applications may be made on plain paper.
Such Certificate will be issued by the following designated agencies

SR. NO NAME OF DESIGNATED AGENCY AUTHORISED ISSUING OFFICER AREA
1 Software Technology Park of India(STPI) Director, STPI, Vashi, Navi Mumbai For units in Mumbai and Navi Mumbai
Asst. Director (Tech), STPI, Pune For units in the State excluding Mumbai and Navi Mumbai
2 National Center for Software Technology (NCST) Director, NCST, Mumbai State of Maharashtra
Associate Director, NCST, Mumbai State of Maharashtra
3 Santacruz Electronics & Export Processing Zone (SEEPZ) Development Commissioner, SEEPZ SEEPZ units / 100% EOUs located in Maharashtra
Joint Development Commissioner, SEEPZ
4. Electronic and Computer Software Promotion Council (ESC) Chairman State of Maharashtra
Executive Director
Chief Coordinator
5. National Association of Software and Service Companies (NASSCOM) President State of Maharashtra
General Manager
Details (addresses, telephone numbers, etc.) of the designated agencies are enclosed at Annexure XII.
The Certificate issued by the designated agencies will be valid for a period of three years in the first instance.
The designated agencies will forward a copy of Certificates issued by them to the Development Commissioner (Industries), Government of Maharashtra for information.

8. CHARTERED ACCOUNTANT'S CERTIFICATE:
There is a fine line of demarcation between electronic and IT hardware industry since the process of manufacturing and the input raw materials are often the same. This also applies to the software manufacturing units. Such industries usually have a variable product mix.
It has therefore been decided to recognise only chose units as IT units which produce IT Hardware/Software/Services, respectively, to the extent of more than 75% of their total turnover. The existing units will have to produce C.A. certificate to that effect indicating the total turnover of the last three years and its breakup between IT and non-lT produces. The average turnover of the three years will be considered for this purpose. The format of the C.A. certificate is at Annexure - XI

ANNEXURE - A
PRIMARY PRODUCTS
Sr. No. H. S. No Description of Products
1. 85.23 11) Magnetic tape of a width not exceeding 4 m.m.12) Magnetic tapes of a width exceeding 4 m.m. but not exceeding 6.5 m.m.13) Magnetic tapes of a width exceeding 6.5 m.m.20) Magnetic discs. 90) Other
2. 85.31 Electrical capacitor..., Fixed, variable or adjustable (Pre-Set)10) Fixed capacitors designed for use on 50/60 HZ Circuits and having a reactive power h. capacity of not less than 0.5 k. var (Power capacitors) 21 Tantalum fixed capacitors. 22 Alluminium electrolytic fixed capacitors. 23 Ceramic dielectric, single laxer fixed capacitors. 24 Ceramic dielectric, multilayer fixed capacitors. 25 Dielectric fixed capacitors of paper or plastic. 29 Other fixed capacitors. 30 Variable or adjustable (Pro-Set) capacitors. 90 Other.
3. 85.33 Electrical resisters (Including rheostats and potentiometers) other than heating resistors10 Fixed carbon resisters, composition or film types. 21) Other fixed resisters for a power handling capacity not exceeding 20 w.29) Other fixed resistor capacity of 20 w or more.31) Wire wound variable resistors including rheostats and potentiometers for a power handling not exceeding 20 w.39) Wire wound variable resistors including rheostats and potentiometers for a power handling exceeding 20 w or more.40) Other variable resistors, including rheostats and potentiometers.90 parts.
4. 85.36 50) Electronic AC switches consisting of optically coupled input and output circuits (A.C. Switches)50) Electronic switches including temperature electronic switches consisting of and a logic chip (Chip on Chip technology) For a voltage not exceeding 1000 volts.50) Electromechanical snap action switches for a current not exceeding 11 amps. 69) Plugs & Sockets for co-axial cables and printed circuits.90) Connection and contact elements for Wires and Cables.
5) 85.41 Diodes, transistors and similar semiconductor devices, photo sensitive semi-conductor, including photo voltaic cells whether or not assembled in modules or made-up into pa light emitting diodes, mounted piezo electric crystals.10) Diodes, other than photosensitive or light emitting diodes.22) Transistors other than photosensitive transistors with dissipation rule of less than 1 w.29) Transistors other than photosensitive transistors with dissipation rate of 1 w or more.30) Thyristors, diacs and triacs other than photosensitive device40) Photosensitive semiconductor devices, including photo voltaic cells whether or not as modules or made up into panels, light emitting diodes.50 Other semi conductor devices. 60 Pountged piezo-electric crystals90 Parts

6. 85.12 Electronic integrated circuits and microassemblies12) Cards incorporating an electronic integrated circuit ("Smart" Cards)13) Metal oxide semi conductors (Mos Technology)14) Circuits obtained by bipolar technology.19) Other monolithic integrated circuit, including circuits obtained by a combination and MOS technologies (Bionos technology)31) Other monolithic integrated circuits. 40) Hybrid integrated circuits. 50) Electronic Micro assemblies 90 Parts.
7. 85.44 41) Other electric conductors for a voltage not exceeding 80 v, fitted with conductors for telecommunication.49) Other electric conductors for a voltage not exceeding 80 v, not fitted with conductors for telecommunication.50) Other electric conductors for a voltage exceeding 80 v but not exceeding 1000 v, fitted with connectors of a kind used for telecommunication. 70) Optical fibre cables.

ANNEXURE - A-l
PRIORITY INTERMEDIATE PRODUCTS (Initial List)
1. Input - Output Units including
All computer peripherals: HSN 8471.60
2. Computer Keyboard: HSN 8471.60.19.10
3. ComputerMonitors:HSN8471.60.l9.20
HSN 8471.90.07
4. Populated PCBs
All categories) : HSN 8473.10
HSN 8473.30
HSN 8473.40
HSN 8504.90
HSN 8517.90
HSN 8529.90
HSN 8538.90
HSN 8543.90
5. Smart Cards & Assessories: HSN 8542.12
6. UPS for Data Processing HSN 8504.40
Equipment: HSN 8543.89
HSN 8471.05
7. Set-top-box with communication Function and accessories: HSN 8517.80
8. Internet-box with user interface
and network interlace: HSN 8517.80 ,
9. Modems & ISDN Terminals: HSN 8517.50
10. Routers & Terminal Servers: HSN 8517.50
11. VSAT Terminals: HSN 8525.20
12. Radio Communication
Equipment: HSN 8525.20

ANNEXURE - B
THE LIST OF ACTIVITIES REGISTERABLE AS IT SERVICES AND IT
ENABLED SERVICES
1. Computer training institutes/centers.
2. Data Processing.
3. Data Entry Operation services.
4. Computer Aided Designing / CAD.
5. Web Designing services.
6. E-mail, data fax and Internet fax services.
7. Cyber parlors.
8. Remote access cyber services.
9. V-SAT / Internet Protocol Advantage services.
10. Desk Top Publishing.
11. Web Service Providers.
12. ISDN service providers.
13. Infonet services.
14. Cyber Libraries.
15. Computer System AMC holders.
16. Remote Diagnostic &L Repairs services.
17. Technical Service providers viz. System Integration, out sourcing,
etc.
18. E-marketing / e-commerce services.
19. Internet Consultancy Services.
20. Computerised special effect studios.
21. Videographing &. Conversion Center.
22. Video Conferencing Centre (Parlours)
23. Digitisation of archives
24. Digital photo studio
25. Computerised Screen Printing Units.
26. Smart Cards Set-up
27. Multi media development units.
The list is illustrative and not exhaustive.


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