Grants Provisioned under Uttarakhand Tourism Policy, 2023

What are the grants provisioned under the Uttarakhand Tourism Policy 2023?

Grants Provisioned under Uttarakhand Tourism Policy, 2023 is the incentive package of the Department of Tourism, Government of Uttarakhand, notified by Government Order No. TS-1-UTDB/21/2022-VI-1-Tourism Dept. I/112351/2023 dated 5 April 2023. The policy remains operational until 31 March 2030.

According to the Operational Guidelines issued by the Uttarakhand Tourism Development Board (UTDB), the package is not a single grant but a set of linked incentives: a capital investment subsidy, additional incentives layered on top of it, turnover-linked incentives for units that do not take the capital subsidy, 100% reimbursement of stamp duty and electricity duty, and a per-passenger incentive for heli-transport. UTDB is the implementation and administration agency; the money is released by UTDB's finance wing.

This is an investment incentive package, not a personal welfare scheme. The applicant is always a tourism unit, a company, LLP, partnership or other legal entity, and there is no individual citizen benefit to apply for.

Who is eligible for grants under the Tourism Policy 2023?

A tourism unit can apply if:

• It is a legitimate legal entity or investor setting up, expanding or diversifying a tourism unit in Uttarakhand.
• Its activity appears in the list of Eligible Tourism Units with the matching NIC code in Section 3 of the Operational Guidelines.
• It meets the minimum investment in Eligible Capital Assets for its category, for example Rs 5 crore for a hotel, motel, heritage hotel, spa or wellness resort, MICE or convention centre and amusement park; Rs 2.5 crore for ecolodges and perennial camps, museums and commercial art galleries, and non-fuel wayside facilities; Rs 10 crore for ropeways and funiculars; Rs 1 crore for parking lots in Category A areas and Rs 0.5 crore in Category B and C areas.
• It meets the minimum infrastructure or amenity condition, for example a minimum of 10 rooms or 5,000 sq ft of built-up area for a hotel, at least 10 individually let-out tents for a perennial camp, or a minimum capacity of 250 people for a MICE centre.
• It obtains in-principle approval under the Uttarakhand Enterprise Single Window Facilitation and Clearance Act, 2012 after the policy was notified.
• It owns land in Uttarakhand or acquires it by purchase or lease within the state for the project.

A unit cannot apply, or is not eligible, if:

• It is already drawing an identical benefit under another central or state government scheme.
• Its commercial operation date falls outside the policy period of 5 April 2023 to 31 March 2030, in the case of the electricity duty and stamp duty reimbursements.
• It applied for CAF approval before the policy was notified. Applicants who applied for but did not receive in-principle approval under the Uttarakhand Tourism Policy 2018 may, however, register a fresh application under this policy.
• It is an individual seeking a personal grant. Individuals cannot apply for a personal benefit here; only a registered tourism unit can.
• Its expansion or diversification component on its own fails the minimum investment and infrastructure test.

How much subsidy does the policy provide?

Capital subsidy — hospitality projects

The maximum admissible capital subsidy is released in 10 equal annual instalments of 10% from the commercial operation date, or as 75% of the Net-SGST paid by the unit in the preceding 12 months plus applicable additional incentives, whichever is lower.

Capital subsidy, tourism products and services

Up to 100% of Eligible Capital Assets, subject to the caps in the Policy, released in 5 equal annual instalments of 20%, again capped by the 75% of Net-SGST test.

Additional incentives, calculated as a share of the maximum capital subsidy and subject to the overall capping:

Turnover-linked incentives are for operational units that are not drawing the capital subsidy: 1% of eligible turnover for high-value premium hospitality, 1% for foreign tourist attraction, and 1% for organising MICE, art, social and cultural events, fairs and festivals. In each case only room rent excluding taxes counts; food and beverage, laundry and other value-added revenue is excluded.

Heli-transport incentive is Rs 500 per leg per person for helicopter transport from the Sahastradhara, Jolly Grant and Pantnagar helipads to the nearest accommodation or helipad.

Electricity duty is reimbursed at 100% for new eligible units achieving their commercial operation date within the policy period. Stamp duty is reimbursed at 100%, paid in five equal instalments.

What counts as Eligible Capital Assets?

Eligible Capital Assets include site-level infrastructure such as fencing and internal roads, structures and buildings, indigenous and imported plant, machinery and equipment, material handling equipment, mechanical, electrical and plumbing installations, fixtures, furniture and fittings, utilities including waste treatment facilities, transformers, generators and captive power plants, together with installation charges.

Eligible Capital Assets exclude land, intangible assets such as intellectual property and goodwill, pre-construction expenses and consultant cost, capitalised interest, and working capital. Leased assets are valued at net present value on the date of the lease deed or MoU, discounted at 10%, and the lease must run at least 10 years for a building and at least half the residual life for other fixed assets.

How to apply for grants under the Uttarakhand Tourism Policy 2023

1. Register on the single window portal at investuttarakhand.uk.gov.in and file the Common Application Form for registration cum in-principle approval, before the commercial operation date of the new, expanded or diversified development.
2. Select the applicable NIC code, state the envisaged investment, tick Tourism Policy 2023 as the incentive you are seeking, indicate which specific subsidies you intend to claim, and upload the required documents. A Unique Project Number is issued online and by SMS or email.
3. Wait for scrutiny. For MSME projects up to Rs 50 crore the General Manager, District Industries Centre checks completeness and circulates the file to line departments including the District Tourism Development Officer, then convenes the District Level supported Committee. For projects above Rs 50 crore the Nodal Officer of the Directorate of Industries does the same and convenes the State Level supported Committee.
4. Receive in-principle approval from the DLEC or SLEC as applicable. Only after this can any incentive be claimed.
5. Obtain pre-construction clearances, land use change, fire safety, environmental clearance, electricity connection, water supply and building plan approval, and construct the project.
6. Obtain post-construction approvals including the Occupancy Certificate from the Tourism Department, development authority clearances and travel trade registration, and begin commercial operations.
7. File the incentive claim online using the approved CAF ID, within 150 days of the close of the financial year, attaching the documents listed in Section 6 of the Operational Guidelines. File the stamp duty claim together with the first capital subsidy claim.
8. Cooperate with the joint inspection. The District Level Committee for Tourism, chaired by the Chief Development Officer, verifies the Occupancy Certificate, travel trade registration and ongoing operations, and files a Joint Inspection Report.
9. Await approval and payment. The Nodal Officer of UTDB scrutinises the report, the Integrated Tourism Committee chaired by the CEO of UTDB recommends it, and the State Level supported Committee grants final approval. UTDB's finance wing disburses the money.

What are the timelines?

Why claims are rejected or withdrawn

• No in-principle approval before the commercial operation date.
• Minimum investment or minimum infrastructure not met for the declared NIC code, a common problem for units just short of 10 rooms or 5,000 sq ft.
• Stamp duty claimed separately instead of with the first capital subsidy claim. The guidelines say such claims shall not be considered.
• Claim filed after 150 days from the close of the financial year.
• The same benefit already taken under another central or state scheme.
• Missing Occupancy Certificate or travel trade registration at the time of physical verification.
• Land or consultancy cost counted in Eligible Capital Assets, which inflates the claim and gets it reduced on scrutiny.

Where irregularity or misrepresentation is found, UTDB issues a show cause notice, allows the unit 15 days to reply, and requires refund within 30 days. All wrongly claimed benefits carry penal interest of 18%. Where UTDB rectifies its own computation error, the excess is recovered with simple interest at 15%.

How to appeal or get help

• Appeal to the State Level supported Committee against any order or decision of the Integrated Tourism Committee, filed within 30 days of the decision being communicated. The SLEC's decision is final and binding.
• Invest Uttarakhand helpline: +91-7618544555, 10:00 AM to 5:00 PM IST, and the email mpr@doiuk.org.
• Tourism Investment Facilitation Centre (TIFC) headed by a UTDB Nodal Officer, which coordinates between the single window portal and the applicant for sanctions, licences, NOCs and approvals.
• District Tourism Development Officer, the member secretary of the District Level Committee for Tourism, for inspection and verification questions.

UTDB reserves the right to add, modify or delete any part of the guidelines in public interest, and to issue clarifications where a provision is ambiguous. Check the current version of the Policy and Operational Guidelines on investuttarakhand.uk.gov.in before you commit capital.