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Services Exports from India Scheme (SEIS)

ASC offers assistance with the SEIS (Service Exports from India Scheme) introduced in the new five-year Foreign Trade Policy (FTP) 2015-2020. SEIS entails the benefits to be provided to service exporters of the country and aims to offset the infrastructural inefficiencies and associated costs involved. The scheme has been applicable from the date of notification i.e. 01.04.2015.

The key component ofour solutions for this scheme is the evaluation and categorization of services provided by the client company. Classification of these services and determination of the correct category of service plays an important role and needs to be presented accurately to DGFT authorities. We also prepare a comprehensive application file to be filed with DGFT to claim the benefits awarded under the scheme.

Some of the eligibility criteria
SEIS came with its own eligibility criteria which have been listed under the new FTP 2015-20. Some of theeligibility criteria has been listed below:

1. Only service providers falling under the categories under para 9.51(i) and para 9.51(ii) of FTP 2015-20 willbe eligible for the benefit.

Para 9.51(i): Cross border trade: Supply of a 'service' from India to any other country
Para 9.51(ii): Consumption abroad: Supply of a 'service' from India to any other country

2. Minimum net free foreign exchange earnings* in preceding financial year for:

Individual and sole proprietorship service providers: $10000

Others: $15000

3. Benefit will be provided only for the services provided and not for the goods
4. Service provider should have an active IEC at the time of providing services for which benefit is to beclaimed
5. Only the services as notified under the scheme of SEIS shall be eligible for the benefitto consumer(s) of any other country than India

* Net free foreign exchange earnings = Gross Earnings of foreign exchange minus total expenses / payment / remittances of foreign exchange

Ineligible categories under SEIS

1. Service providers providing services under para 9.51 (iii) and Para 9.51 (iv) of foreign trade policy2015-2020are not eligible for reward under the scheme:

Para 9.51(iii): Commercial Presence: Supply of a 'service' from India through commercial presence

Para 9.51(iv): Presence of natural persons: Supply of a 'service' from India through the presence of natural persons

2. Following shall not be taken into account for calculation of entitlement under the scheme:
a) Foreign exchange remittances
I. Related to financial services sector
i. Raising of all types of foreign currency loans
ii. Export proceeds realization of clients
    iii. Issuance of foreign equity through ADRs / GDRs or other similar instruments
    iv. Issuance of foreign currency bonds
    v. Sale of securities and other financial instruments
vi. Other receivables not connected with services rendered by financial institutions; and
II. Earned through contract/regular employment abroad (e.g. labour remittances)
b) Payments for services received from EEFC account
c) Foreign exchange turnover by healthcare institutions like equity participation, donations etc.
d) Foreign exchange turnover by educational Institutions like equity participation, donations etc.
e) Export turnover relating to services of units operating under EOU / EHTP / STPI / BTP schemes
or supplies of services made to such units
f) Clubbing of turnover of services rendered by SEZ / EOU /EHTP / STPI / BTP units with turnover
of DTA service providers
g) 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
h) Service providers in telecom sector
presence in any other country
presence of natural persons in any other country 

Entitlement and utilization under SEIS
Service Providers of eligible services shall be entitled to Duty Credit Scrip at notified rates on net foreignexchange earned. Scrips can be utilized for payment of
• Custom duties for import of inputs or goods except the notified items;
• Excise duties on procurement of input and capital goods;
• Service tax on procurement of services;
• Custom duty in case of default in fulfillment of Export Obligation for authorization under Advance
• Authorization/EPCGetc, composition fee and application fee under FTP; and
• Payment of value shortfall in Export Obligation.

The scheme has given relaxation to the actual user condition and the Duty Credit Scrips and goods
imported / domestically procured against them shall be freely transferable.

Service and Rate of Reward

The present rates of reward are 3% and 5%. The list of services and the rates of rewards would be
reviewed after 30.9.2015.

S.No.

Sector

Admissible Rate

A

Professional services 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.

5%

B

Research and development services R&D services on natural sciences, R&D services on social sciences and humanities, Interdisciplinary R&D services

5%

C

Rental/Leasing services without operators Relating to ships, Relating to aircraft, Relating to other transport equipment, Relating to other machinery and equipment

5%

D

Other business services 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), Buildingcleaning services, Photographic services, Packaging services, Printing, publishing and Convention services

3%

2

COMMUNICATION SERVICES
Audiovisual services Motion picture and video tape production and distribution service, Motion picture projection service, Radio and television services, Radio and television transmission services, Sound recording

5%

3

CONSTRUCTION AND RELATED ENGINEERING SERVICES
General Construction work for building, General Construction work for Civil Engineering, Installation and assembly work, Building completion and finishing work

5%

4

EDUCATIONAL SERVICES (Please refer Note 1) Primary education services, Secondary education services, Higher education services, Adult education

5%

5

ENVIRONMENTAL SERVICES Sewage services, Refuse disposal services, Sanitation and similar services

5%

6

HEALTH-RELATED AND SOCIAL SERVICES Hospital services

5%

7

TOURISM AND TRAVEL-RELATED SERVICES

 

A

Hotels and Restaurants (including catering)

 

 

a. Hotel

3%

 

b. Restaurants (including catering)

3%

B

Travel agencies and tour operators services

5%

C

Tourist guides services

5%

8

RECREATIONAL, CULTURAL AND SPORTING SERVICES (other than audiovisual 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

5%

9

TRANSPORT SERVICES (Please refer Note 2)

5%

A

Maritime Transport Services Passenger transportation*, Freight transportation*, Rental of vessels with crew *, Maintenance and repair of vessels, Pushing and towing services, Supporting services for maritime transport

5%

B

Air transport services Rental of aircraft with crew, Maintenance and repair of aircraft, Airport Operations and ground handling

5%

C

Road Transport Services Passenger transportation, Freight transportation, Rental of Commercial vehicles with operator, Maintenance and repair of road transport equipment, Supporting services for road transport services

5%

D

Services Auxiliary To All Modes Of Transport. Cargo-handling services, Storage and warehouse services, Freight transport agency services

5%

Note: (1) Under education services, SEIS shall not be available on Capitation fee.
         (2) *Operations from India by Indian Flag Carriers only is allowed under Maritime transport services