About SEIS

What is Service Exports from India Scheme (SEIS)

The details about Service Exports from India Scheme (SEIS) are explained here. 

Service Exports from India Scheme (SEIS)

Service Exports from India Scheme (SEIS) aims to promote export of services from India by providing duty scrip credit for eligible exports. Under the scheme, service providers, located in India, would be rewarded under the SEIS scheme, for all eligible export of services from India. In this article, we look at the Service Exports from India Scheme in detail. Service Exports from India Scheme was earlier termed as Served from India Scheme (SFIS).

SEIS Eligibility

Who is eligible for SEIS Scheme?

Service Providers of notified services, located in India, shall be rewarded under SEIS, subject to conditions as may be notified. Only Services rendered in the manner as per Para 9.51(i) and Para 9.51(ii) of the Foreign Trade Policy 2015-20 shall be eligible.

 

Such service provider should have minimum net free foreign exchange earnings of US$15,000 in the year of rendering the services to be eligible for Duty Credit Scrip. For Individual Service Providers and sole proprietorship, such minimum net free foreign exchange earnings criteria would be US$10,000 in financial year when the services have been rendered.

How do we calculate the Net Foreign Exchange (NFE) Earnings?

Net Foreign exchange earnings for the scheme are defined as under: Net Foreign Exchange = Gross Earnings of Foreign Exchange minus Total expenses / payment / remittances of Foreign Exchange by the IEC holder, relating to service sector in the Financial year.

Is having an IEC Number mandatory to avail the SEIS Incentive?

In order to claim reward under the scheme, Service provider shall have to have an active IEC at the time of rendering such services for which rewards are claimed.

Payments in Indian Rupees eligible for SEIS incentive?

Payment in Indian Rupees for service charges earned on specified services, shall be treated as receipt in deemed foreign exchange as per guidelines of Reserve Bank of India. The list of such services is indicated in Appendix 3E.

All the remittances received in Foreign Exchange are eligible for the SEIS Incentive?

Foreign exchange remittances other than those earned for rendering of notified services would not be counted for entitlement. Thus, other sources of foreign exchange earnings such as equity or debt participation, donations, receipts of repayment of loans etc. and any other inflow of foreign exchange, unrelated to rendering of service, would be ineligible.

Following shall not be taken into account for calculation of entitlement under the scheme

Foreign Exchange remittances

Related to Financial Services Sector

Raising of all types of foreign currency Loans

Export proceeds realization of clients

Issuance of Foreign Equity through ADRs / GDRs or other similar instruments

Issuance of foreign currency Bonds

Sale of securities and other financial instruments

Other receivables not connected with services rendered by financial institutions

Earned through contract/regular employment abroad (e.g. labor remittances

Payments for services received from EEFC Account

Foreign exchange turnover by Healthcare Institutions like equity participation, donations etc.

Foreign exchange turnover by Educational Institutions like equity participation, donations etc.

Export turnover relating to services of units operating under SEZ / EOU / EHTP / STPI / BTP Schemes or supplies of services made to such units

Clubbing of turnover of services rendered by SEZ / EOU /EHTP / STPI / BTP units with turnover of DTA Service Providers

Exports of Goods

Foreign Exchange earnings for services provided by Airlines, Shipping lines service providers plying from any foreign country X to any foreign country Y routes not touching India at all

Service providers in Telecom Sector

What is the effective date of the SEIS Scheme?

The rewards under SEIS shall be admissible for export of services rendered on or after 01.04.2015, i.e. the date of notification of the Foreign Trade Policy 2015-20

How can the Scrips issued under SEIS Scheme be utilized?

Duty Credit Scrips shall be granted as rewards under Service Exports from India Scheme (SEIS). The Duty Credit Scrips and goods imported against them shall be freely transferable. The Duty Credit Scrips can be used for:

Payment of Basic Customs Duty and Additional Customs Duty specified under sections 3 (1), 3(3) and 3(5) of the Customs Tariff Act, 1975 for import of inputs or goods, including capital goods, as per DoR Notification, except items listed in Appendix 3A.

All the Foreign Exchange Expenses need to be considered for calculating the NFE?

If the IEC holder is a manufacturer of goods as well as service provider, then the foreign exchange earnings and Total expenses / payment / remittances shall be taken into account for service sector only

How can we apply for the SEIS Benefits?

An Online Application needs to be filed on the DGFT Server and the relevant fields of information need to be entered in the SEIS ECOM Module.

Are the forms for filing the SEIS Application available online?

Yes all the relevant forms which are ANF3B and Annexure to ANF3B are available online. You may also refer the link http://dgft.gov.in/links/appendices-and-anf-ftp2015-2020 on the DGFT Server to view the Forms applicable for SEIS Application.

How do we identify the jurisdiction for filing our SEIS Claim?

You may kindly refer Para 3.06 of the Handbook of Procedures 2015-2020 to know your applicable jurisdiction.

How much time does the department take to process the SEIS Claims?

As per para 9.10 of the Handbook of Procedures 2015-20, the Schemes under Chapter 3 should be disposed of in 3 Working Days. However, in case there are any deficiencies / discrepancies in the file then the process may take longer.

Can we today process our SEIS Claims for previous financial years?

Kindly refer Para 9.02 which clarifies whether that SEIS Application for previous years can be filed, subject to certain limitations and late cut applicability.

Can we file the SEIS Application on a monthly / quarterly / half-yearly / annual basis?

The SEIS Application can be filed on an Annual Basis only, which means for each FY only One Application can be filed.

How do we file our SEIS application, if we render multiple services?

The ANF 3B form seeks “Service Category information” from the Exporter. Therefore the Exporter needs to classify the eligible services as per Appendix 3D and claim the incentive accordingly.

I have billed my clients and rendered the Services, however the foreign exchange earnings have not been received?

The SEIS incentives will be issued only on the amount which has been realized against the Services Rendered.

Is SEPC RCMC compulsory?

If you are a service provider and want to avail SEIS incentives, then SEPC RCMC is compulsory. If you are manufacturer and a service provider, then RCMC from the relevant export promotion council needs to be availed, which is connected to your main line of business. As per Public Notice No. 26/2015-2020 dated 01.08.2018 issued by Directorate General of Foreign Trade, Department of Commerce to add an “Others” category in list of 14 service sectors of SEPC

What is validity period of Duty Credit Scrips?

Duty Credit Scrips issued on or after 01.01.2016 under chapter-3 shall be valid for a period of 24 months from the date of issue and must be valid on the date on which actual debit of duty is made. (Public Notice No. 33/2015-2020 dated 23.10.2017)

Service Export from India Scheme (SEIS) Rate of Reward

The following services and rates of rewards were applicable for services export made between 1-4-2015 to 31.03.2019:

  • Professional Services – 5% Rate of Reward
  • Legal services
  • Accounting, auditing and bookkeeping services
  • Taxation services
  • Architectural services
  • Engineering services
  • Integrated engineering services
  • Urban planning and landscape architectural services
  • Medical and dental services
  • Veterinary services
  • Services provided by midwives, nurses, physiotherapists and paramedical personnel
  • Research and Development Services – 5% Rate of Reward
  • R&D services on natural sciences
  • R&D services on social sciences and humanities
  • Interdisciplinary R&D services
  • Rental/Leasing Services without Operators – 5% Rate of Reward
  • Relating to ships
  • Relating to aircraft
  • Relating to other transport equipment
  • Relating to other machinery and equipment
  • Audiovisual Services – 5% Rate of Reward
  • Motion picture and video tape production and distribution service
  • Motion picture projection service
  • Radio and television services
  • Radio and television transmission services
  • Sound recording
  • Construction and Related Engineering Services – 5% Rate of Reward
  • General construction work for building
  • General construction work for civil engineering
  • Installation and assembly work
  • Building completion and finishing work
  • Educational Services – 5% Rate of Reward
  • Primary education services
  • Secondary education services
  • Higher education services
  • Adult education
  • Environmental Services – 5% Rate of Reward
  • Sewage services
  • Refuse disposal services
  • Sanitation and similar services
  • Health and Social Services – 5% Rate of Reward
  • Hospital services
  • Tourism and Travel Services – 3% or 5% Rate of Reward
  • Hotel (3% Rate of Reward)
  • Restaurants (3% Rate of Reward)
  • Travel agencies and tour operators services (5% Rate of Reward)
  • Tourist guides services (5% Rate of Reward)
  • Recreational, Cultural and Sporting Services – 5% Rate of Reward
  • Entertainment services (including theatre, live bands and circus services)
  • News agency services
  • Libraries, archives, museums and other cultural services
  • Sporting and other recreational services
  • Transport & Auxiliary Services – 5% Rate of Reward
  • Passenger transportation
  • Freight transportation
  • Rental of vessels with crew
  • Maintenance and repair of vessels
  • Pushing and towing services
  • Supporting services for maritime transport
  • Rental of aircraft with crew
  • Maintenance and repair of aircraft
  • Airport Operations and ground handling
  • Rental of commercial vehicles with operator
  • Maintenance and repair of road transport equipment
  • Supporting services for road transport services
  • Cargo-handling services
  • Storage and warehouse services
  • Freight transport agency services
  • Other Business Services – 3% Rate of Reward
  • Advertising services
  • Market research and public opinion polling services
  • Management consulting service
  • Services related to management consulting
  • Technical testing and analysis services
  • Services incidental to agricultural, hunting and forestry
  • Services incidental to fishing
  • Services incidental to mining
  • Services incidental to manufacturing
  • Services incidental to energy distribution
  • Placement and supply services of personnel
  • Investigation and security
  • Related scientific and technical consulting services
  • Maintenance and repair of equipment (not including maritime vessels, aircraft or other transport equipment)
  • Building- cleaning services
  • Photographic services
  • Packaging services
  • Printing, publishing
  • Convention services.

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About SEIS

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