IT & ITES

IT (INFORMATION TECHONOLOGY)
IT is an acronym for information technology.
IT refers to the study of computer systems, their hardware and
software and it involves creating, managing, storing and
exchanging information using technology.
IT is about the Computer ( Hardware / Software ) and technology(
Applications and connectivity etc. ) which is mandatory to make
the computer able to work.

 As defined by Information Technology Association of

America (ITAA), “IT” is the study, design, development,
implementation, support or management of computer based
information system particularly software’s applications &
computer hardware .

 The use of IT in our daily life includes listening to music,

watching movies, playing games, doing office work, chatting
and sending messages, managing daily planner, reading
books, paying utility bills, booking ticket to travel, bank
operations, etc.

ITES (INFORMATION TECHONOLOGY ENABLED SERVICES)

ITES is an acronym for Information Technology enabled Services.
ITES refers to services that can be provided on the basis of the
knowledge of IT systems. It covers the entire gamut of operations
which is related to Information Technology. It helps to improve
the efficiency of an organisation. It is also called web-enabled
services, remote services, or Tele-working. ITES includes a large
variety of different operations that uses information technology to
upgrade the workability of an organization. These services are of
wide ranges such as back-office operations, medical
transcription, medical billing along with coding, etc. ITES can be
outsourced remotely and at present some of the biggest IT
operations around the world happens through this pathway.It is
the basis of what we popularly known as ‘remote access’. A
variety of services are performed by ITES, such as Business
Process Outsourcing (BPO), Knowledge Process Outsourcing
(KPO) and various other customer services. These are performed
over telecom networks and work remotely.
ITES is about services which help to make work easier on
INFORMATION TECHNOLOGY (HARDWARE/ SOFTWARE ).

 As defined by Information Technology Association of

America (ITAA), “ITES” is Information Technology Enable
Services. It is defined as outsourcing of processes that can
be enabled with IT and covers divers areas like Finance,
HR, Administration etc.
 As defined by the Income Tax Act

10TA. For the purposes of this rule and rule 10TB to rule 10TG,—

(e) "information technology enabled services" means the following business

process outsourcing services provided mainly with the assistance or use of
information technology, namely:—
(i) back office operations;
(ii) call centres or contact centre services;
(iii) data processing and data mining;
 (iv) insurance claim processing;
(v) legal databases;
(vi) creation and maintenance of medical transcription excluding medical
advice;
(vii) translation services;
(viii) payroll;
(ix) remote maintenance;
(x) revenue accounting;
(xi) support centres;
(xii) website services;
(xiii) data search integration and analysis;
(xiv) remote education excluding education content development; or
(xv) clinical database management services excluding clinical trials,
but does not include any research and development services whether or not in
the nature of contract research and development services;

 ITES is a apart of IT.

 Different Services Information Technology Enabled

Services or ITEA Offers:
Telecommunication services
Data processing and data entry
Documentation procedure
Medical transcription
Data warehousing
IT help desk services
Enterprise resources planning
Application development
Legal processing outsourcing
 Logistic management
Game process outsourcing
Business process outsourcing

BENEFITS OF ITES

The main benefit of using ITES is how cost-effective it is to a

company. Rather than having an in-house group to perform all
these remote tasks, it is better to outsource it directly because
this will save a lot of money. The in-house team can act as a
point of contact and coordinate the entire system, but having
them do the whole job would be very tedious. Outsourcing
these also means better and flexible and most importantly, a
faster process. Outsource partners can get work done in a very
short time, and the company would not have to sacrifice its
efficiency for speed.

DRAWBACKS OF ITES
The main drawback of ITES is the risk of data security. Since
operations are not in-house, there is always the risk that a
security breach can happen over the channels through which
the data is processed. Most corporations work with total
confidentiality and having security breaches would mean a
disaster for them. Therefore, it is important to find a partner
who will securely deliver projects without the threat of security
breaches. Also, the costs required to maintain data security
can sometimes cost the company more than what outsourcing
does.
Difference between IT and ITeS.

IT ITES
Information Technology. Information technology
enabled services.
It is the study of the design, ITES is the study of
management, development, outsourced service which has
implementation, and support of arisen due to involvement in
computer-based information various fields of IT such as
systems, typically about banking and finance, BPO,
computer hardware and call centres, etc.
application software.

Purpose

 Increases company’s
flexibility.
 Regulates the
functioning of the
industries smoothly.
 Content management.

 Fiscal Incentives in Haryana for IT/ITES

1. Stamp Duty:

IT Industry shall be eligible for 100% reimbursement of

stamp duty paid on sale / lease deeds paid on the first
 transaction for setting up units in notified IT Parks, IT
cities, Technology Parks / STPIs or any land earmarked by
the State Government for IT industry.

Units setting up in Block ‘B’, ‘C’, ‘D’ shall also be eligible for
100% reimbursement of Stamp duty.

2. Electricity Duty Exemption:

100% exemption for a period of 7 years from commercial

operations.

3. Power Subsidy:

IT/ ITeS industry shall be eligible for getting power @ INR

5.49 per unit* provided the investor signs Memorandum of
Understanding - MoU with Government of Haryana for
investments in the State.

*Subsidy is restricted up to a certain level of consumption of

per industrial unit which shall be decided separately with
approval of Hon’ble Chief Minister, Haryana.

4. Property Tax at industrial rates:

Property Tax on IT / ITeS units shall be at par with the

industrial rates and further definition of IT / ITeS industry
as specified in chapter 1 of this policy shall be applicable for
identification of IT / ITeS industry.

5. SGST Reimbursement:
 100% reimbursement (net tax) for a period of 10 years
subject to maximum of 100% of Fixed Capital Investment –
FCI for units setting up in ‘C’ & ‘D’ Blocks.

6. Mega Projects:

Mega projects shall be eligible for Special package of

incentives over and above of the standard package for IT
industry shall be considered by the empowered committee
on case to case basis.

7. Ultra Mega Projects:

Ultra Mega Projects shall be offered special package of

incentives by Haryana Enterprise Promotion Board
including such as mixed land use, allotment of land at a
price to be decided by the Government etc.

 Simplified Regulatory Regime

In its endeavor to create a conducive business climate for IT

industry, the Government of Haryana shall be implementing
some landmark reforms for regulatory simplification. These
reforms are aimed at improving the Ease of Doing Business in the
State and ensuring hassle-free experience for the investor.

1. Dedicated Single Roof

Government of Haryana has constituted Haryana Enterprise

Promotion Board (HEPB), which will provide one stop shop
clearances to companies willing to invest in the State. The
governing council of the board is headed directly by the
 Chief Minister to ensure clearances are given in a time
bound manner.

A dedicated team headed by GM, HARTRON shall work from

Haryana Enterprise Promotion Board (HEPB) to assist
investors throughout the investment lifecycle spanning from
proposal application to approval of licenses/clearances and
finally incentives disbursement in IT / ITeS sector.

2. International Desk:

Government of Haryana is keen to attract foreign

investments in the IT sector. To enable an investor friendly
experience to the foreign investors, the State government
shall be setting up International Desks for focus countries
to facilitate global investors.

3. Policy Implementation Unit (PIU):

Government shall constitute a PIU headed by the Additional

Chief Secretary (Information Technology) along with sector
experts and industry professionals for targeted
implementation of the IT & ESDM policy. PIU will work
closely with all the stakeholder departments to enable
timely notification of the interventions suggested in the
policy. Further, PIU will conduct regular dialogue with
industry to assess the evolving industry demand and assist
the department to address the demands in timely manner.

4. No CLU/Auto CLU:
 I. Government has identified 31 'No CLU' blocks and 75
'Auto CLU' blocks with an automatic dispensation of
deemed clearance for setting up of Industrial Units.
The Government shall endeavor to earmark some of
these blocks to set up IT and ITeS units.
II. 100% exemption of CLU charges to IT / ITeS units
setting up in notified land / IT Parks and further these
units will be exempted from the procedure of change of
Land.
III. 50% exemption of CLU charges to IT /ITeS units
setting up outside notified IT parks.
IV. Government notified land / IT Parks shall be pre-
cleared with all the necessary approvals

such as NOC from Pollution, Power, Land Use, Forest,

Industries etc.

5. Time bound clearance:

The Government of Haryana has made a provision for time

bound clearance for 119 services by notifying in Right to
Service Act.

6. Self-Certification:

The Government of Haryana will allow Self-certification, 3rd party

verification for Labour related clearances and approvals under 13
acts of Labour department in Haryana. Self-certification / 3rd
Party verification shall be allowed for below mentioned acts of
Labour:
 I. Factories Act, 1948 and Rules framed thereunder.
II. Minimum Wages Act, 1948 and Rules framed thereunder.
III. Payment of Wages Act, 1936 and Rules framed thereunder.
IV. Contract Labour (Regulation & Abolition) Act, 1970 and
Rules framed

thereunder.

V. Payment of Bonus Act. 1965 and Rules framed thereunder.

VI. Payment of Gratuity Act, 1972 and Rules framed
thereunder.
VII. Maternity Benefit Act, 1961 and Rules framed thereunder.
VIII. Child Labour (Prohibition & Regulation) Act, and Rules
framed thereunder.
IX. Shops & Commercial Establishments Act, 1958 and Rules
framed thereunder.
X. The Inter-State Migrant Workmen (RECS) Act, 1979 and
Rules framed thereunder.
XI. The Equal Remuneration Act, 1976 and Rules framed
thereunder.
XII. Motor Transport Workers Act, 1961 and Rules framed
thereunder.
XIII. Punjab Industrial Establishments (National & Festival
Holidays & Casual and Sick Leave) Act, 1965.

7. Online single return for various Acts pertaining to

Department of Labour

The Ministry of Labour, Govt. of India has combined forms

of 12 central labour laws, under which returns are to be
 filed, into a single format. The Government of Haryana will
expedite the process of implementing the system for filing of
online returns for labour compliance using single
application form and will make a provision to keep labour
related records in electronic form.

8. Relaxation in Inspection from various Departments for

IT/ITeS units:
I. Department of Labour: There shall be no inspection by
Labour Inspector and the Factory Inspector without
the prior approval of Head of the Department.
II. Department of Boilers: There shall be no inspection
from Boilers inspector. Self- Certification / 3rd party
inspection to be allowed
9. Exemption from Pollution NOC:

IT/ITeS units shall be exempted from the purview of NOC

and consent regime except in respect of power generation
sets of more than 10 KVA Capacity.

10. Allowing three shifts and night shifts for Women:

IT / ITES Units shall have general permission for 3 shift

operations with women allowed to be working in the night,
subject to the units taking the necessary precautions in
respect of safety and security of women employees.

k. Essential Service:
The Government will be declaring IT/ITeS Industry and non-
hazardous hardware manufacturing industry as essential service
under Haryana Essential Services Maintenance Act.

 Infrastructure Augmentation

The Government shall endeavor to create world class

infrastructure to provide an enabling ecosystem to the IT and
ITeS units.

Development of Integrated IT Townships

I. 3 integrated IT Hubs (including Integrated Townships, Walk-

to-Work Campus, etc.) shall be developed in the next 5
years. The State Government will earmark land parcel of
500 acres for the IT Townships. At-least 1 of the 3 to be
developed across KMP expressway. The Government will
provide infrastructure support including road access,
electricity, water, bandwidth and master sewerage with no
EDC charges for these IT Hubs.
II. In order to provide adequate support infrastructure in the
Townships, there shall be reservation of 25% of land in each
of the IT Townships for common social infrastructure such
as housing facilities, medical and sports facilities, schools,
recreation facilities, etc.
III. Capital Subsidy for developers: Further in order to
encourage private sector participation in infrastructure
development, the Government shall provide assistance of up
 to 50% of fixed capital investment in buildings &
infrastructure facilities, excluding the cost of land with a
ceiling of INR 2.5 Cr. for private developers of each of the IT
Townships for development of common industry specific
infra such as R&D Labs, ETPs etc. or social infra such as
housing, medical facilities, schools etc., for districts outside
Gurgaon.
IV. The developer shall be eligible for exemption from payment
of Stamp Duty/Registration Fee/Conversion Fee on
purchase of land in accordance with the Governments
prevailing policy as per the standing orders of the State
Revenue Department on the subject.
V. Earmarked space for e-commerce Warehouse: The
Government endeavors to earmark 5 Lac sq. ft. of area on
pre cleared land parcels for developing e-Commerce
warehouses in / around district Gurgaon, allowing e-
commerce companies to reduce the project gestation time
for setting up warehouses.

Development of IT / Cyber Parks for self-use:

For obtaining licence for development of IT/Cyber park for self-

use, the required minimum area shall be of 1 - 5 acres subject to
the applicability of other norms defined by Department of Town
and Country Planning for development of IT/Cyber Park:

I. The location of the site should be on a sector peripheral

road in residential or industrial sector in the Development
 Plan. In case of residential sectors the permissible area for
IT Park/ Cyber Park will not exceed 5% of the sector area.
II. The permissible ground coverage is 40% and FAR is 250.
III. In case of Cyber Parks only 4% of the area can be utilized
towards commercial uses. No

group housing is permissible.

IV. The parking requirement is one car space for every 40 sq.
mtrs area achieved.

V. Three level basement is permissible for parking and service.

No storage is to be allowed.
VI. In the area designated for IT activities, no other use is
permissible.
VII. In case of Cyber Park, the colonizer is required to complete
at least 30% of the IT area within three years of grant of
licence.

Relaxation of FSI / FAR:

d.

III. Such buildings shall be permissible on roads having

minimum width of 2000’’.
IV. Such buildings should be Eco-friendly with Five Star rating,
provision of water harvesting, energy efficient with carbon
foot print as per 5 star rating and should have certification
from Bureau of Energy Efficiency or from GRIHA (Green
Rating Integrated Habitat Assessment) of Ministry of Non
Renewable Energy Source and Energy, Government of India
 or any other recognized central / State level agency for
certification of green buildings
V. Mixed land use shall also be permissible in such buildings
VI. Land use wise parking norms shall be applicable to different
land uses proposed in the building

Sale / Registration of Independent floors in HSIIDC blocks:

Sale / Registration of Independent floors shall be allowed in case

of buildings developed for IT/ITeS units in HSIIDC blocks. Owner
of each ‘Independent Floor’ shall be entitled to get separate utility
connection such as water supply, electricity connection subject to
building

regulations/ rules of power utilities. Further, the detailed

guidelines/rules shall be prepared by the HSIIDC.

5. Uninterrupted Power Supply:

IT/ITeS units shall be exempted from the purview of

statutory power cuts. Further, for IT Parks and Townships,
dedicated industrial feeders shall be provisioned.

6. Setup a private university:

Education is considered to have a strong correlation with

social and economic development. In contemporary times
when the focus is on the 'knowledge economy' the role of
education becomes all the more important in the
development of human capital. The government, therefore,
makes policies and programmes to promote education
 among people by providing assistance and opening new
institutions for teaching the modern professional courses.

Gurgaon may have pioneered the tech boom, but it’s not the
only tech hub. Bursts of technological hubs are forming all
over the world. Therefore, the Government of Haryana
envisages to develop world class private university in
Gurgaon district to spearhead research & development, new
product design, and innovation activities in the state and
help develop & nurture talent & entrepreneurial skills thus
inspiring youth to enhance their existing skill set and to
have a global edge. This institution will be bringing
academic and industry minds together in one space which
will eventually form a “knowledge driven educational
system”. This system will help in producing the best
knowledge driven talent thus helping Gurgaon in rising as
the Technology Hub of the world.

The State Government to facilitate aggregation of land and

provide infrastructure support including road access,
electricity, water, bandwidth and master sewerage with no
EDC charges for development of world class private
university in the State.

7. Assistance in Business Development:

The Government shall promote and encourage participation

from industry in various national and international events,
exhibitions and conferences. Government would also
 undertake various promotional events and road shows at
various locations from time to time.

The Government shall conduct at least one annual focused

conference / business event to facilitate B2B interaction,
match making of Investors, attracting international
participation and promote Brand Haryana.

Human Capital Development

The progress of the IT/ITeS industry is highly dependent on the

availability of high quality manpower. While Haryana is home to
several Engineering Colleges, training institutions specializing in
IT and Computer Science courses, it is essential to create a talent
pool of individuals which lives up to the industry expectations. To
facilitate the same, Government of Haryana has taken some key
steps to support Human capital development in the State.

1. Employment Generation Subsidy:

For units setting up ‘C’ & ‘D’ blocks shall be eligible for
employment generation subsidy of INR 36,000 per year per
employee for a period 5 years for capacity building of
persons (Skilled/ semi- skilled) belonging to Haryana.

2. Skilling:

In order to provide the desired skill to the Industry as per

required standards, Haryana State Electronics Development
Corporation Limited (HARTRON) will closely work with
 various Industries and Industry Associations to analyze the
gap and assess the on ground demand of Job Role.

HARTRON will further align the detailed study with State

Skill Mission and Skill Universities in Haryana and will
design a specialized curriculum as per the requirement
ensuring that the youth is getting benefitted by acquiring
the right skill set.

Further, in line with National Skills Qualifications

Framework, the State aims to train at-least 15,000
manpower annually for the next 5 years for IT/ITeS industry
through certified courses.

Government shall encourage private sector participation in

skill development by exploring potential collaboration with
industry to deliver training on industry certified courses in
select ITI/Polytechnics.

Further, the State Government will make targeted efforts to

develop or align ITI / Polytechnic around the IT parks.

3. Faculty Training:

The State Government aims to train and certify at-least 500

trainers annually for the next 5 years for IT/ITeS industry
through certified courses. The courses at Training institute
shall be aligned to the skill gap assessment report of NSDC
and the new courses pertaining to training of trainers shall
be introduced as per the industry need.
 Further, the State Government will reimburse up to INR 1
Lacs for travel and stay of international guest faculty max.5
guests in a year per university invited by State Technical
Universities for conducting tainting sessions for faculty on
advance courses.

4. Curriculum Alignment:

The State to align curriculum of State board schools and

universities, ITIs and Polytechnics with Industry needs in
association with NASSCOM and NSDC especially on skills
where gaps have been identified by Skill gap assessment
report 2013 by NSDC. Further, all the State Technical
Universities will upgrade or add new courses in consultation
with industry.

5. Mandatory Apprenticeship:

All educational institutions offering under-graduate courses in

software engineering, electronics and computer sciences shall
implement a mandatory scheme to allow students to take up
industry aligned courses to improve their employability.

6. Skill Development Subsidy for Training providers:

Government of Haryana shall channelize the available GoI

skill development schemes and also promote skill
development mission in the State for creating IT skilled
labour pool in Haryana. In order to incentivize the training
providers and achieve the desired results of employment
generation in the State. Government of Haryana will give
 Matching Grant to training providers who have availed
incentive under any one of the GoI Scheme. 50% of the
State grant to be disbursed after 6 months of the placement
of the candidate.

7. Infrastructure Support to training providers:

I. The Government will provide space and infrastructure
in existing Government ITIs and Polytechnics to
training providers on ‘off working days and weekends’
at a nominal payment of INR 100 p.a. to run industry
focused courses for IT / ITeS sector. To avail the said
benefit the training provider to ensure 70% placement
from these focused courses.
II. A bank guarantee of an amount equivalent to the
prevailing annual rent of the ITI / polytechnic space
will be submitted by the provider.

Maharashtra Fiscal Incentives

All the fiscal incentives in Maharashtra proposed in this policy

will be provided through a provision under separate budgetary
head ( non - plan) for this purpose.

i) Stamp Duty Exemption:

IT / ITES units, including IT Hardware and Telecom Hardware

manufacturing units will be entitled to Stamp Duty exemption as
follows:

a) 100% Stamp Duty exemption for the following

transactions to new IT/ITES units and expansions of the
existing units in C, D, D+, No Industry district areas and
Naxalism affected areas of the State: hypothecation, pawn,
pledge, deposit of title deeds, conveyance, charge on
mortgage property, lease, mortgage deed and security bond
on mortgage deed.

b) 100% Stamp Duty exemption for the following

transactions to new IT/ITES units and expansions of the
existing units in public IT Parks (including IT hardware and
Telecom Exemption in hardware manufacturing units),in A
and B areas:
hypothecation, pawn, pledge, deeds, conveyance
and lease.

c) 75% Stamp Duty exemption for the following

transactions to new IT/ITES units and expansions of
the existing units in private IT parks (including IT
hardware and Telecom hardware manufacturing units), in A
and B areas: hypothecation, pawn, pledge, deeds,
conveyance, lease and public assignment lease.

d) 100% Stamp Duty exemption for the following

transactions to new IT/ITES units and expansions of the
existing units in IT parks in SEZs, IT SEZs (including IT
hardware and Telecom hardware manufacturing units), and
STPI approved registered units in IT parks of A and B areas:
hypothecation, pawn, pledge, deeds, conveyance, lease and
public assignment lease.
 e) 75 % Stamp Duty exemption to assignment leases of IT /
ITES units under section 60 and leave and licenses of IT /
ITES under section 36 A of the Bombay Stamp Act 1958 (to
be read with a, b and c above).

f) 75% Stamp Duty exemption on merger, de-merger and

reconstruction of registered IT / ITES units throughout the State.

ii) Electricity Duty : New IT / ITES units registered with the

Directorate of Industries will be exempt from payment of
Electricity Duty from the date of commencement of production /
activity for a period of 10
years for units in IT parks (including IT hardware and Telecom
hardware manufacturing units), in A and B areas and for 15

years in other areas of the State classified as per the prevailing

Package Scheme of Incentives at the time of commencement of
production / activity of the unit. The Electricity Duty would be
exempt for IT parks developed by IT companies for their own use,
ie, single unit parks for the period mentioned above except for the
support services. The new IT / ITES units in IT SEZs, new IT /
ITES units in IT parks in SEZs, and 100 % exporting IT/ITES
units under registration of STPI or other designated competent
authority shall be exempted permanently from paying Electricity
Duty.

iii) Electricity Tariff: IT/ITES units registered with the

Directorate of Industries will be supplied power at industrial
rates applicable under Maharashtra Electricity Regulatory
Commission's (MERC's) tariff orders.
iv) Power Tariff Subsidy: New IT/ITES units located in areas
other than A and B areas classified as per the Package Scheme of
Incentives and established in registered IT Park will be eligible to
get power tariff subsidy for 3 years @ Rs. 1/- per unit consumed
from the date of registration of the IT units with the Directorate of
Industries after commencement of IT/ITES activity or equal to
the investment made in IT Hardware on the date of registration of
the unit with the Directorate of Industries, whichever is lower.
The units in IT SEZs and IT parks in SEZs in these areas shall
also be

entitled for this subsidy.

v) Property Tax: Property tax shall be levied on IT / ITES units

registered with the Directorate of Industries at par with
residential rates as applicable in the relevant jurisdictions.
Government will issue necessary advisory to the local bodies to
give this benefit to the IT / ITES units

vi) Entry Tax: Registered IT / ITES units shall be exempt from

octroi / Local Body Tax (LBT) / entry tax / escort tax or other
cess or any tax levied in lieu of these for the import of capital
goods and raw material for self consumption by the unit.
Government will issue necessary advisory to the local bodies to
give this benefit to the IT / ITES units.

vii) Works Contract Tax: Works contract tax on annual

maintenance agreements of IT / ITES units shall generally be
charged at the minimum rates recommended by the relevant
Empowered Committee, at the centre, barring certain exceptions.
viii) Setting-up IT/ITES units in any zone: IT / ITES units
(except IT hardware and Telecom Hardware Manufacturing Units)
will be allowed to be set up in any zone (including residential and
no-development zones, etc.).

ix) VAT at floor rate: VAT on sale of IT products will be charged

generally at the minimum floor rate recommended by the
concerned Empowered Committee at the Centre, with some
exceptions.

x) Continuous Industry Status: The IT / ITES Industry services

clients across the globe and in different time zones. This requires
the Industry to work on 24x7x365 mode. Increasingly the work
done by IT / ITES industry is mission critical for global clients it
serves and very tight deadlines are required to be adhered to.
Considering this a continuous industry status shall be granted to
the registered IT / ITES units. The IT / ITES Industry will be
permitted to work 24x7x365 days without any close down (except
some exigencies arising wherein the State / Central Government
thinks it fit to keep the the operation in suspension).