WHAT IS SEIS?
In New Foreign Trade Policy 2015-2020, with effect from 01.04.2015 Service Exports from India Scheme to promote exports from India. This Scheme not only replaces the old scheme announced in trade circular policy 2009-2014 under SFIS (Served from India Scheme), but also rationalize the various kind of restriction imposed on end use of scrips. Unlike earlier scheme, this scheme also includes exports from SEZ.
OBJECTIVE OF SEIS?
Under this scheme, exporters are rewarded with tradeable custom duty scrips credit for all notified service exports rendered on or after 01.04.2015.
WHY SEIS?
As we all know, India is a trade deficit country i.e. our imports are greater than exports, this deficit leads to the artificial demand of dollars in India. Advantages of boost to Exports are as follows:
Boost to SMEs and MSMEs
Creation of Jobs
Stable & strong currency
Overall Economic and Infrastructure growth
SALIENT FEATURES OF SEIS?
- Incentives are provided to all the service exports notified under circular dated 1.04.2014 on or after.
- Rate of rewards under SEIS are based on Net foreign exchange earned.
- Duty scrips are transferable and usable for all types of GST debits on procurement of Services/goods.
- Debits are eligible for CENVAT credit or Drawback.
- Certain export services are not eligible under SEIS.
Scrips can be traded for:
- Customs Duties for import of goods, except items mentioned in Appendix 3A.
- Payment of excise duties on domestic procurement of inputs or goods, including capital goods.
- Payment of service tax on procurement of services.
VALIDITY OF SEIS SCHEME: -
As per trade policy circular dated 2015, claim period for receiving these scripts would be valid for 5 years, i.e. exports done during 2015-2020 would be eligible for claiming this incentive from government of India.
ELIGIBILITY CRITERIA FOR CLAIMING SEIS:-
All service exports under approved/recognised list of activity by government of India are entitle to claim the SEIS benefit.
An Exporter should have an active Import Export code issued by DGFT for the period of claims.
For an exporter in India to be eligible for SEIS scheme scrips apart from companies having IEC code, the following foreign exchange criteria should be met.
| S.No | Incorporation Type | Minimum Foreign Exchange In FY |
|---|---|---|
| 1 | Partnership Firm/LLP/Company | USD 15000 |
| 2 | Proprietorship Firm | USD 10000 |
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.
CLAIM AMOUNT/INCENTIVE AMOUNT:-
Total Claims percentage can vary somewhere between 3-5% of export value, depending upon the list of activities approved by government of India.
VALIDITY AND RE-VALIDATION: -
- a. Duty Credit Scrips will be valid for a period of 18 Months from the date of issue and must be valid on the date on which actual custom duty is paid.
- b. Revalidation of Duty scrip is not permitted unless it is expired in customs custody/RA.
DOCUMENTS REQUIRED FOR SEIS SCHEME :-
An Application with Annexure attached to ANF-3B, ANF-3C and ANF-3D should be submitted by CA/CS using digital signatures. These docs are uploaded in e form or are submitted to respective RA in physical form for processing of claims.