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. Service Exports from India Scheme was earlier termed as Served from India Scheme (SFIS).
The incentives under the SEIS Scheme are provided to all types of service providers who are located in India irrespective of the nature of organisation of the service provider. The rate of reward under SEIS which is 3% to 5% would be computed on the net foreign exchange earned.
These incentives are not given in the form of money but are given in the form of duty-free credit scrip. The duty credit scrips issued under SEIS Scheme can be used for payment of various taxes levied on goods and services. These scrips are also freely transferable and can also be easily sold to some other assessee.
SEIS Scheme Eligibility
Service Providers of notified services, located in India are eligible for the Service Exports from India Scheme.
Services Eligible: Only Services rendered in Mode I: Cross Border Trade i.e. Supply of a service from India to any other country and Mode II: Consumption abroad i.e. Supply of a service from India to service consumers of any other country.
Services not Eligible: Supply of a Service through Mode 3: Commercial Presence i.e. Supply of a service from India through Commercial Presence in any other Country and Mode 4: Presence of Natural persons in any other country – not eligible for reward under this scheme.
To be eligible, a service provider (Company / LLP / Partnership Firm) should have a minimum net free foreign exchange earnings of USD15000 in the preceding financial year to be eligible for duty credit scrips.
For proprietorships or individual service providers, minimum net foreign exchange earnings of USD10, 000 in the preceding financial year is required to be eligible for the scheme. Also, in order to claim reward under the SEIS scheme, the service provider shall have to have an active Import Export Code (IE Code) at the time of rendering such services for which rewards are claimed.
Net foreign exchange earnings for the SEIS scheme is calculated as:
Net Foreign Exchange = Gross Earnings of Foreign Exchange – Total Expenses or payment or remittances of Foreign Exchange.
To claim the incentives, the service provider is required to have an active IEC Code at the time of rendering such services.
In case the IEC holder is a manufacturer of goods as well as service provider, then the foreign exchange earnings and Total Expenses/ payment/ remittances to be taken into account for the service provider only
Duty Credit Scrip
Service providers of eligible services shall be entitled to duty credit scrip at notified rates on the net foreign exchange earned. Duty credit scrips can be used for the payment of custom duties, excise duties, service tax on procurement of services, custom duty in case of default in fulfillments of export obligation under Advance Authorization/EPCG, etc., Further, the SEIS scheme has given relaxation to the actual user condition and duty credit scrips and goods imported using duty credit scrips are freely transferable. Duty credit scrip would be valid for a period of 18 months from the date of issue.
Service Export from India Scheme (SEIS) Rate of Reward
The following services and rates of rewards
• 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
Foreign Exchange or Remittance Ineligible under SEIS Scheme
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.
How to apply for 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. All the relevant forms which are ANF3B and Annexure to ANF3B are available online.
PROCEDURE FOR FILING OF APPLICATION FOR CLAIMING INCENTIVES UNDER SEIS
1. An application for grant of duty credit scrip for eligible services shall be filed online for a financial year on an annual basis in ANF – 3B using Digital Signature.
2. The last date for filing an application for claiming incentives for Service Exporters under this Scheme is 12 months from the end of relevant financial year.
3. The applicant shall have the option to choose Jurisdictional Regional Officer on the basis of the Corporate Office/ Registered Office/ Head Office/ Branch Office address endorsed on IEC for submitting application/ applications.
4. This option for the determination of the officer shall be exercised at the beginning of the financial year.
5. Once this option is exercised, no change would be allowed for claims relating to that year
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.
Registration with Service export Promotion Council
Whether you are a manufacturer or a services provider, RCMC (Registration Cum Membership Certificate) from the relevant export promotion council is compulsory in 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. Now all the services are covered by SEPC along with 14 service sectors explicitly mentioned earlier. Therefore, if you are a services provider and want to avail SEIS incentives, then SEPC RCMC is compulsory.
OTHER RELEVANT POINTS FOR INCENTIVES UNDER SEIS SCHEME
Validity: These scrips are valid for a period of 18 months from the date of issue and must be valid on the date on which such actual debit of duty is made.
Revalidation: Revalidation of such duty credit scrip is not permitted unless validity has expired while in the custody of Customs Authority/ RA. Splitting of Scrips: These scrips can be split if requested subject to a minimum of Rs. 5 Lakh each and multiples thereof may also be issued, at the time of application. After issuance the split certificates would be permitted with the same port of registration as appearing on the original scrips in respect of EDI enabled ports. The facility of splits not allowed after issue of scrip in case of export through non-EDI Ports.
Attestation: Some of the annexures attached to ANF -3B, ANF – 3C, ANF – 3D are required to be signed by a Chartered Accountant/ Company Secretary/ Cost Accountant.
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