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Service Exports from India Scheme

Wishing to have a Service Exports from India Scheme (SEIS), let, Corpbiz assist you in obtaining the same from the DGFT of India.

    • Identify and check eligibility to get benefits under SEIS
    • Assistance in documentation and filing of applications with the concerned authority
    • Regular follow-up with the client.
    • End-to-end support.
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Overview of Service Exports from India Scheme (SEIS)

Two schemes are introduced under the Indian Foreign Trade Policy 2015-20 as a part of the Exports from India Scheme, Services Exports from India Scheme (SEIS) and Merchandise Exports from India Scheme (MEIS). Service Exports from India Scheme (SEIS) was introduced on 1st April 2015 to encourage the export of notified services from India. SEIS focuses on promoting the export of services from India by providing a duty credit scrip for eligible exports. Duty credit scrips are accorded as rewards under SEIS. These duty credit scrips and goods imported or domestically procured against them are freely transferable. The duty credit scrips are used for:

  • Payment of customs duties for the import of inputs or goods
  • Payments of excise duties on domestic procurement of input or goods, including capital goods 
  • Payment of service tax or procurement of services 
  • Payment of customs duty and fees. 

Services Applicable for Service Exports from India Scheme (SEIS)

The following services are applicable for Service Export:

  1. Professional Services

Professional Services here include the following services:

  • Legal Services 
  • Taxation Services
  • Architectural services
  • Engineering services Taxation services
  • Integrated engineering services
  • Accounting, auditing and bookkeeping services 
  • Medical and dental services
  • Services provided by nurses, midwives, physiotherapists and paramedical personnel
  • Veterinary services
  • Urban planning and landscape architectural services
  1. Research and Development Services 

The R&D services on the followings:

  • Natural Science
  • Social Sciences and humanities
  • Interdisciplinary Services
  1. Rental/Leasing Services without operators

Rental or lease services relating to the followings:

  • Ships
  • Aircraft
  • Other transport equipment
  1. Audio-visual Services

The services included here are related to the following:

  • Motion picture and video tape production and distribution services
  • Motion picture projection services
  • Radio and television services
  • Radio and television transmission services
  • Sound recording
  1. Construction and Related Engineering Services

These services are related to the following work or activities:

  • General construction work for building
  • General construction work for civil engineering
  • Installation and assembly work
  • Building completion and finishing work
  1. Educational Services

Under this heading following services are included:

  • Primary Education services 
  • Secondary education services 
  • Higher education services 
  • Adult education 
  1. Environmental Services

The environmental services are further classified into the following services:

  • Sewage services
  • Refuse disposal services 
  • Sanitation and similar services
  1. Health and Social Services

The health and social services include hospital services.

  1. Tourism and Travel Services

The followings are included under the tourism and travel services:

  • Hotels
  • Restaurants
  • Travel agencies and tour operators’ services 
  • Tourist guide services 
  1. Recreational, Cultural and Sporting Services

The following services are included under the recreational, cultural and sporting services:

  • Entertainment services, including theatre, live bands and circus services
  • News agency services
  • Libraries, archives, museums, and other cultural services
  • Sporting and other recreational services
  1. Transport & Auxiliary Services

Transport and auxiliary services include the following activities and services:

  • Passenger transportation freight transportation 
  • Maintenance and repair of road transport equipment 
  • Supporting services for road transport services 
  • Supporting services for maritime services 
  • Rental of vessels with crew
  • Rental of aircraft with crew
  • Maintenance and repair of vessels 
  • Maintenance and repair of aircraft
  • Pushing and towing services
  • Airport operations and ground handling
  • Rental of commercial vehicles with the operator 
  • Cargo handling services 
  • Storage and warehouse services
  • Freight transport agency services
  1. Other Business Services

All other services which are not covered under the above-mentioned services are included here; some of them are as follows:

  • Advertising services
  • Photographic services
  • Printing and Publishing
  • Convention services
  • Packaging services
  • Building cleaning services 
  • Services incidental to manufacturing 
  • Services incidental to mining 
  • Services incidental to energy distribution
  • Services incidental to fishing
  • Services incidental to agricultural, hunting and forestry
  • Investigation and security
  • Placement and supply services of personal 
  • Related scientific and technical consulting services 
  • Maintenance and repair of equipment except for maritime vessels
  • Technical testing and analysis services
  • Services related to management consulting 
  • Market research and public opinion polling services 

SEIS is applicable to Service Providers located in India and not Indian Service Providers. Thus, SEIS is providing rewards to all service providers to notify services, who are providing services from Indian Scheme, disregards the Constitution or profile of service provider, the rates of reward are 3% and 5% of net foreign exchange earnings. 

The rate of reward for the services stated in the above-mentioned list is provided as follows:

Services

Rate of Reward

Professional Services

5%

Research and Development Services

5%

Rental/Leasing Services without Operations

5%

Audio-visual Services

5%

Construction and Related Engineering Services

5%

Educational Services

5%

Environmental Services

5%

Health and Social Services

5%

Tourism and Travel Services

3%

Recreational, Cultural and Sporting Services

5%

Transport & Auxiliary Services

5%

Other Business Services

3%

Eligibility for Service Exports from India Scheme (SEIS)

Service Providers of notified services in India are eligible for the Service Exports from India Scheme (SEIS). The basic eligibility requirements for Service Exports from India Schemes are as follows:

  • Service providers based in India and indulged in the notified services are eligible to get rewards under SEIS. 
  • A service provider, such as a company, LLP or Partnership Firm, is eligible if it has minimum net foreign exchange earnings (free) of USD 15000 in the preceding financial year, and for a service provider, in the case of a proprietorship or an individual, the minimum net free foreign exchange earnings should be USD 10,000. 
  • According to the set guidelines of the Reserve Bank of India (RBI), if the payments are made in Indian Rupees (INR) for the earned service changes in specified services, then the payment is considered a receipt in deemed foreign exchange. 
  • To claim a reward under SEIS, the service provider must have an active Import-Export Code (IEC) at the time of rendering or performing such services for which they are claiming the reward.
  • The formula for calculating the Net foreign exchange earnings for SEIS is as follows:

Net Foreign Exchange= Gross Earnings of Foreign Exchange – total Expenses or payment or remittances of Foreign Exchange. 

A service provider is ineligible for Service Exports from India Scheme (SEIS) under the following conditions:

  • Foreign exchange remittances that are earned through the offering of services, such as donations, debt participation, loan payment, etc., other than notified services are not considered eligible for SEIS. 
  • Foreign exchange remittances associated with the Financial Service Sector:
  1. All kinds of loans are offered by self-raising foreign currency funds raised. 
  2. Foreign Equity issued by GDRs/ADRs or similar
  3. The realisation of export proceeds of clients
  4. Issuing foreign currency bond 
  5. Sale of securities proceeds and any other financial instruments 
  6. Any receivable that is not related to the service offered by financial companies
    • Foreign exchange remittances gained by regular or contract employment in foreign countries.
    • Payments received against services provided by Exchange Earners Foreign Currency, EEFC Account.
    • Equity participation, gifts, donations or any other similar foreign exchange turnovers made by Health care companies.
    • Equity participation, gifts, donations or any similar foreign exchange yield made by educational organisations
    • Activities related to good exports
    • Service providers related to the telecom sector
    • Foreign exchange earnings from services provided by airlines or shipping lines not touching any part of India
    • Addition of yield of services provided by the BTP/EHTP/STPI/SEZ/EOU units with a yield of DTA service providers
    • Export yield from services of units in operation under BTP/EHTP/STPI/SEZ/EOU schemes or services supplied to such units.

Benefits of the Service Exports from India Scheme (SEIS) 

Following are the benefits of the Service Exports from India Scheme:

  • Applicable to all Service Providers located in India and not Indian Service Providers
  • Provides reward to all service providers of notified services who are exporting services from India, despite the Constitution and service provider profile. 
  • Rewards based on net foreign exchange earned
  • Reward, i.e., duty credit scrip, is freely transferable and usable for all types of goods.
  • Debits are eligible for CENVAT credits or drawbacks.
  • Scrips are used for the payment of the customs duties for import of goods, payment of excise duties on domestic procurement of goods, payment of service tax on procurement of service and payment of customs duty and fee.

Pre-requisites for Service Exports from India Scheme (SEIS)

Following are pre-requisites for applying for the Service Exports from India Scheme (SEIS):

  • Applicant should have an active IEC at the time of rendering services
  • Applicants should have Certain minimum earnings 
  • Applicant must have Exported eligible services
  • The applicant does not fall under ineligible categories 

Documents Required for Service Exports from India Scheme (SEIS)

Documents required for the Service Exports from India Scheme (SEIS) are as follows:

  • Application Form ANF-3B
  • Copy of Foreign Inward Remittance Certificate 
  • Copy of Import-Export Code (IEC)
  • CA Certificate 
  • Registration Cum Membership Certificate, RCMC 
  • Copy of invoice 
  • DGFT DSC
  • Copy of foreign exchange earned 
  • List of directors, in case of companies
  • Board Resolution
  • Declaration 

Procedure for Service Exports from India Scheme (SEIS)

The steps must be followed at the time of applying for the Service Exports from India Scheme (SEIS) are as follows:

  • The applicant must file an application in the prescribed ANF 3B Form with all the required documents as per the latest SEIS notification.
  • If the applicant provided more than one service, it must provide the service’s category information. 
  • Application is submitted to the appropriate authority of the Directorate General of Foreign Trade (DGFT). 
  • In case the applicant has more than one office, then it files the application to the Regional Authority of DGFT at any of the places of its office’s jurisdiction. 
  • Applicant must provide Registration Cum Membership Certificate (RCMC) and in case the applicant is into the export of services and exports of goods, then the RCMC must be obtained from the Service Export Promotional Council. 
  • If the applicant is not into any of them, i.e., the applicant is not into the export of services and export of goods, then it needs to obtain RCMC from the relevant Council. 
  • Applicants must also submit the required fees with the Application Form. 
  • If the officer of DGFT marks a deficiency in the application of the applicant, then it has to amend the application. After making an amendment to the application, the applicant submits the application again. 
  • On successful submission, the DGFT authorises a SEIS Scrip to the applicant. 

Frequently Asked Questions

DGFT is short for the Directorate General of Foreign Trade (DGFT), an organisation involved in regulating and promoting foreign trade. It is responsible for the implementation of various export promotion schemes, issuance of IEC (Import-Export Code) number, issuance of various export promotion licenses and issuance of certificates under the Foreign Trade Policy of India.

Duty Credit Scrips is an incentive or reward given to eligible exporters at a notified rate. These scrips are also to make payment of different taxes and duties.

From the date of issuance, a Duty Credit Scrip is valid for 18 months.

A time period of 12 months from the end of the financial year of the claim period is given for filing an application to obtain Duty Credit Scrips.

Following are different categories in which services are delivered or exported:

Category I: cross border trade of eligible services from one country to another.

Category II: consumption of services abroad

Category III: the commercial presence of one country’s services in another territory.

Category IV: the presence of a natural person of one country to provide services in another’s territory. 

The exporter with a duty credit scrip can use it for the payment of the followings:

  • Basic customs duty 
  • Safeguard duty 
  • Transitional product-specific safeguard duty
  • Anti-dumping duty 

MEIS stands for the Merchandise Exports from India Scheme, which promotes the manufacture and export of notified goods or products. It provides a reward to exporters to offset infrastructural inefficiencies and associated costs. Such a reward is called duty credit scrip, which is freely transferable and can be used for certain kinds of payments of duties.

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