Punjab CLU & EDC Waiver: Thrust Sectors

Punjab's Industrial and Business Development Policy 2022, under Clause 12.9, exempts industrial units from two statutory levies that would otherwise apply when land is converted to industrial use. Units falling within the State's notified thrust sectors — whether MSME or large — are granted a full 100% waiver or reimbursement of Change of Land Use (CLU) charges and External Development Charges (EDC).

Both charges are assessed per acre and fall due when a project takes possession of land situated outside a developed industrial estate. For a greenfield project, these payments rank among the earliest substantial outflows a promoter must fund.

By doing away with them, the cost of establishing a unit on private land comes down considerably.

1. Verify that the project is covered by a notified Thrust Sector, then obtain eligibility approval under the Industrial and Business Development Policy 2022. 2. Submit an application for CLU permission for the project site to the competent authority. 3. Upload the CLU/EDC exemption application on the Invest Punjab Business First portal, attaching the site plan, project approval and land papers. 4. Where the charges have already been paid, lodge a reimbursement claim together with the challans. 5. Following verification, the department either issues the exemption or sanctions the refund.

The department carries out a non-competitive assessment. It first confirms that the project falls within a thrust sector, and then examines the CLU/EDC demand raised at the project site. Where these conditions are satisfied, the charges are either exempted or refunded in full.