The new five year Foreign Trade Policy (FTP) 2015-2020 introduces reward scheme

Service Exports from India Scheme (SEIS) to the Exporter which come into force
from the date of notification i.e. 1.04.2015. The rewards under SEIS shall be
admissible for services rendered on or after the date of notification of this Policy.

The main objective of SEIS is to encourage export of notified services from India and
rewards to exporters to compensate infrastructural inefficiencies and associated costs
involved.

The FTP 2015-2020 has extended this reward scheme to units located in SEZs to
accelerate the export from SEZ.

In order to lay emphasis on export of services, the Served from India Scheme (SFIS)
is replaced by Service Exports from India Scheme (SEIS) .The intention is to provide
benefits to all service providers located in India, instead of Indian Service Providers.
Earlier, under SFIS the benefit was not available for foreign brand of the Indian
companies.

Eligibility Criteria under SEIS

A. Service Providers of notified services, located in India shall be rewarded under the
scheme subject to the rendering of the services in the following mode as specified by
Para 9.51(i) and Para 9.51(ii) of the FTP 2015-2020:

a) Cross border trade: Supply of a service from India to any other country.

b) Consumption abroad: Supply of a service from India to service consumer(s) of any

other country in India.

B. Such Service Provider should have minimum net free foreign exchange earnings in
preceding financial years for:

Providers and sole proprietorship: US$10,000

Others: US$15,000

C. 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.

D. 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.
E. Payment earned in India Rupees on specified services shall be deemed foreign
earnings as per the guidelines of Reserve Bank of India.

F. 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.

The following list of service providers are eligible for Serve from India
Scheme:

BUSINESS SERVICES ------ Admissible Rate 5%

1. Professional services
1. Legal services
2. Accounting, auditing and bookkeeping services
3. Taxation services
4. Architectural services
5. Engineering services
6. Integrated engineering services
7. Urban planning and landscape architectural services
8. Medical and dental services
9. Veterinary services
10. Services provided by midwives, nurses, physiotherapists and
paramedical personnel
2. Research and development services ---- Admissible Rate 5%
1. R&D services on natural sciences
2. R&D services on social sciences and humanities
3. Interdisciplinary R&D services
3. Rental/Leasing services without operators ---- Admissible Rate 5%
1. Relating to ships
2. Relating to aircraft
3. Relating to other transport equipment
4. Relating to other machinery and equipment
4. Other business services ---- Admissible Rate 3%
1. Advertising services
2. Market research and public opinion polling services
3. Management consulting service
4. Services related to management consulting
5. Technical testing and analysis services
6. Services incidental to agricultural, hunting and forestry
7. Services incidental to fishing
8. Services incidental to mining
9. Services incidental to manufacturing
10. Services incidental to energy distribution
11. Placement and supply services of personnel
12. Investigation and security
13. Related scientific and technical consulting services
14. Maintenance and repair of equipment (not including maritime
vessels, aircraft or other transport equipment)
15. Building- cleaning services
16. Photographic services
17. Packaging services
 18. Printing, publishing
19. Convention services
COMMUNICATION SERVICES ----- Admissible Rate 5%
1. Audiovisual services
2. Motion picture and video tape production and distribution service
3. Motion picture projection service
4. Radio and television services
5. Radio and television transmission services
6. Sound recording
CONSTRUCTION AND RELATED ENGINEERING SERVICES Admissible
Rate 5%
1. General Construction work for building
2. General Construction work for Civil Engineering
3. Installation and assembly work
4. Building completion and finishing work
EDUCATIONAL SERVICES ----- Admissible Rate 5%
1. Primary education services
2. Secondary education services
3. Higher education services
4. Adult education
ENVIRONMENTAL SERVICES ---- Admissible Rate 5 %
1. Sewage services
2. Refuse disposal services
3. Sanitation and similar services
HEALTH-RELATED AND SOCIAL SERVICES Admissible Rate 5%
1. Hospital services
TOURISM AND TRAVEL-RELATED SERVICES - Admissible Rate 3% to 5%
1. Hotels and Restaurants (including catering)
2. Travel agencies and tour operators services
3. Tourist guides services
RECREATIONAL, CULTURAL AND SPORTING SERVICES --- Admissible
Rate 3%
1. Entertainment services (including theatre, live bands and circus
services)
2. News agency services
3. Libraries, archives, museums and other cultural services
4. Sporting and other recreational services
TRANSPORT SERVICES - Admissible Rate 5%
o Maritime Transport Services
1. Passenger transportation
2. Freight transportation
3. Rental of vessels with crew
4. Maintenance and repair of vessels
5. Pushing and towing services
6. Supporting services for maritime transport
o Air transport services
1. Rental of aircraft with crew
2. Maintenance and repair of aircraft
o Road Transport Services
1. Passenger transportation
 2. Freight transportation
3. Rental of Commercial vehicles with operator
4. Maintenance and repair of road transport equipment
5. Supporting services for road transport services
o Services Auxiliary To All Modes Of Transport
Cargo-handling services
Storage and warehouse services

Freight transport agency services

Ineligible categories under SEIS

A. The following mode specified by Para 9.51 (iii) and Para 9.52 (iv) of FTP2015-2020
is not eligible for reward under the scheme:

a) Commercial Presence: Supply of a service from India through commercial

presence in any other country.

b) Presence of natural persons: Supply of a service from India through the presence
of natural persons in any other country.

B. 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.

C. 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) Exports of goods.

h) 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.

i) Service providers in telecom Sector.

Entitlement and utilization under SEIS

Service Providers of eligible services shall be entitled to Duty Credit Scrip at notified
rates on net foreign exchange earned. Scrips can be utilized for the 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 fulfilment of Export Obligation for authorization

under Advance Authorization/EPCG etc., 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.

Remittances through Credit Card and other instruments for MEIS and SEIS

Free Foreign Exchange earned through international credit cards and other
instruments, as permitted by RBI shall also be taken into account for computation of
value of exports.

Service and Rate of Reward

The present rates of reward are 3% and 5%.

Time Limit for filing application for Duty Credit Scrips

An application for obtaining Duty Credit Scrip shall be filed within a period of 12 months
from the end of relevant financial year of claim period. Such application is filed online
for a financial year on annual basis in form ANF 3B using digital signature.

Validity Period of Duty Credit Scrips

Duty Credit Scrip shall be valid for a period of 18 months from the date of issue.

APPLICATION FORMAT AND GUIDELINES FOR APPLIYING SFIS / SEIS

For Served from India Scheme applications

GUIDELINES FOR APPLICANTS

1. Two copies of the application must be submitted unless otherwise mentioned.
2. Each individual page of the application has to be signed by the applicant.
3. a. Part 1 & Part 4 has to be filled in by all applicants. In case of applications
submitted electronically, no hard copies of Part 1 may be submitted. However
in cases where applications are submitted otherwise, hard copy of Part 1 has
to be submitted.
b. Only relevant portions of Part 2 & Part 3 need to be filled in.
4. Application must be accompanied by documents as per details given below:
VII. For Served from India Scheme applications

1. Bank Receipt (in duplicate)/Demand Draft/EFT details evidencing payment

of application fee in terms of Appendix 21B.
2. Chartered Accountant/Cost and Works Accountant certificate in the format
given in Appendix 26.
3. Self certified copy of Service Tax Registration (in cases where Service
provider is registered with Service tax authorities).
 PART 1
Note: Please state Not Applicable wherever the information/data is not
applicable to you.
1. IEC Details
i. IEC Number
ii. Date of Issue
iii. Issuing Authority

2. Applicant Firm Details

i. Name
ii. Address
(Registered Office in case of Companies and
Head Office in case of Others)
iii. Address of all Branches/Divisions/Units/Factories
located in India & abroad (attach extra sheet if required)
iv. Telephone
v. Email address (for correspondence with DGFT)

3. Details of Proprietor/Partners/Directors/Karta/Trustee
of the applicant firm (attach extra sheet if required)
i. Name
ii. Father's Name
iii. Residential Address
iv. Telephone

4. Nature of Concern (please tick)

( )
i. Government Undertaking
ii. Public Limited Company
iii. Private Limited Company
iv. Proprietorship
v. Partnership
vi. Others

5. Type of Exporter (please tick)

()
i. Merchant Exporter
ii. Manufacturer Exporter
iii. Service Provider
iv. Others (please specify)
v. Merchant cum Manufacturer

6. Industrial Registration Details

i. SSI/IEM/LOI or IL Registration Number
ii. Date of Issue
iii. Issuing Authority
iv. Products for which registered

7. Service Tax Registration Details (in case of Service providers)

i. Service Tax Registration Number
ii. Issuing Authoity
iii. Services for which registered

8. RCMC Details
i. RCMC Number
ii. Date of Issue
iii. Issuing Authority
iv. Valid upto
v. Products for which registered

9. Status House Details

i. One/Two/Three/Four/Five Star
ii. Certificate Number
iii. Date of Issue
iv. Issuing Authority
v. Valid Upto

10. PAN Details

i. PAN Number
iii. Issuing Authority

11. Excise Details

i. Excise Registration Number
ii. Issuing Authority

12. VAT Details

i. VAT Registration Number
ii. Issuing Authority

13. Turnover Details for the preceding three licensing years

Annual Domestic
Annual Export Turnover (Rs
FY Turnover (Rs
Lakhs)
Lakhs)
 PART 2
1. IEC Number

2. Applicant Details
i. Name
ii. Address

3. Application for (please tick the category for which the application is being
made) :
( )
I. Importer Exporter Code Number (IEC)
II. Import Licence for Restricted Items
IIA. Import Certificate under Indo - US Memorandum
III. Export Licence for Restricted Items
IIIA. Export Licence for SCOMET Items
IV. Star Export House Certification
V. Advance Licence
VA. Gem Replenishment Licence
VB. Diamond Imprest Licence
VC. DEPB Licence
VI. EPCG Licence
VII. Served from India
VIII. Vishesh Krishi Upaj Yojana(VKUY)
IX. Target Plus
X. Claiming Duty Drawback on All Industry
Rates/Fixation of Drawback Rates/Refund of Terminal
Excise Duty
 4. Application Submission Details (in case of electronically submitted
applications)
i. ECOM Reference Number
ii. Date of Submission on Server
iii. Submitted to which Licensing Authority
iv. File Number
v. Date of Issue

5. Application Fee Details

Amount (Rs)
Demand Draft/Bank Receipt/Electronic Fund Transfer No
Date of Issue
Name of the Bank on which drawn
Bank Branch on which drawn
Note;
1. Only one category of application may be made in the Form.
2. In case of application for issue of IEC number, information at Serial No 1
may be left blank.

SUB SECTION VII

( For Served from India scheme)
1.
i. Serial No of Appendix 10 under which classified
ii. Whether registered with Service tax authorities
Yes/No

2. Category of Service Provider (please tick)

()
i. Hotels
ii. Stand-alone Restaurants
iii. Healthcare
 iv. Education
v. Individual
vi. Others

3. Details of free foreign exchange earned

Services rendered in free foreign exchange Duty Free Credit Entitlement
(in equivalent Indian Rs) (in Rs)
2017 + 2015-16
(1) (2) (3) = 0.1 * (2)
However in case of Hotels (3)
=0.05* (2)
and in case of Restaurants (3)=
0.2* (2)

+ - to be filled in cases where the applicant claims eligibility under the scheme on the
current year basis
4. Port of Registration (for purpose of Imports):
5. Number of Split Certificates required (in multiples of Rs 5 lakhs each):

PART 4
DECLARATION/UNDERTAKING

1. I/We hereby declare that the particulars and the statements made in this
application are true and correct to the best of my/our knowledge and belief and
nothing has been concealed or held there from.
2. I/We fully understand that any information furnished in the application if found
incorrect or false will render me/us liable for any penal action or other
consequences as may be prescribed in law or otherwise warranted.
3. I/We undertake to abide by the provisions of the Foreign Trade (Development
and Regulation) Act, 1992, the Rules and Orders framed there under, the
 Foreign Trade Policy, the Handbook of Procedures and the ITC(HS)
Classification of Export & Import Items.
4.
a. I/We hereby certify that the firm/company for whom the application has been
made has not been penalized under the Customs Act, Excise Act, Foreign
Trade (Development & Regulation) Act 1992 and FERA/FEMA.
b. I/We hereby certify that none of the Proprietor/ Partner(s)/
Director(s)/Karta/Trustee of the firm/company, as the case may be, is/are a
Proprietor/Partner(s)/Director(s)/Karta/Trustee in any other firm/Company
which has come to the adverse notice of DGFT.
c. I/We hereby certify that the Proprietor/Partner(s)/Director(s)/Karta/Trustee, as
the case may be, of the firm/company is/are not associated as
Proprietor/Partner(s)/Director(s)/Karta/Trustee in any other firm/company
which is in the caution list of RBI.
d. I/We hereby certify that neither the Registered Office/Head Office of the
firm/company nor any of its Branch Office(s)/Unit(s)/Division(s) has been
declared a defaulter and has otherwise been made ineligible for undertaking
import/export under any of the provisions of the Policy.
5. I/We hereby declare that I/We have not obtained nor applied for such benefits
(including issuance of an Importer Exporter Code Number) in the name of our
Registered/Head Office or any of our Branch(s)/Unit(s)/Division(s) to any other
Licensing Authority.
6. I/We solemnly declare that I/We have applied for / obtained a RCMC to the
Export Promotion Council which pertains to our main line of business. In case
we have applied to any other council, the application has been made within the
purview of the provisions of Para 3.12 and Para 3.12.1 of the Handbook of
Procedures (Vol 1).
14. (applicable in case of Served from India Scheme only)
a. I/We hereby certify that only such foreign exchange remittances as are earned
on account of the services rendered and received in freely convertible currency
have been taken into consideration while arriving at the computation of the duty
credit entitlement under the Scheme and other sources of foreign exchange
earnings such as equity or debt participation, donations, repayment of loans
and any other inflow of foreign exchange unrelated to the service rendered has
 not been considered while arriving at the computation of the duty credit
entitlement under the Scheme.
b. I/We hereby declare that no export proceeds are outstanding beyond the
prescribed period as laid down by RBI or such extended period for which RBI
permission has been obtained.
c. I/We hereby undertake that in case of non realisation of export proceeds or
lesser realisation of export proceeds in free foreign exchange, I/We shall pay
in cash, an amount equivalent to the duty free credit entitlement already
obtained on the non-realised basis or lesser realised value of export proceeds
together with 15% interest reckoned from the date of imports till the date of
deposit.
d. I/We (applicable in case of hotels and stand alone restaurants including 1 star
and above hotels and heritage hotels) hereby undertake to pass on the benefit
of the duty credit entitlement to the consumers and undertake to submit a
statement of utilization of duty credit entitlement in the prescribed format to the
licensing authority in this behalf.
e. I/We hereby undertake to submit to the Licensing Authority (with a copy to the
jurisdictional Excise Authorities), a statement of imports made under the
Scheme within one month of the completion of imports or the expiry of the
validity of the duty credit entitlement certificate, whichever is earlier.
f. I/We hereby undertake that the imports to be made under this duty free credit
entitlement certificate shall be related to my/our main line of business and I/We
further undertake that such imported goods shall not be
sold/transferred/disposed off or utilised in a manner in contravention to the
provisions of the Policy and Handbook.
18. I hereby certify that I am authorised to verify and sign this declaration as per
Paragraph 9.9 of the Policy.

Signature of the Applicant Place

Name Date
Designation
Official Address
Telephone
Residential AddressEmail Address
After GST Goods and Service Tax

After 1st July 2017, the benefits under all the said schemes shall be restricted only to
Basic Customs Duty, Safe-guard Duty, and Transitional Product Specific Safeguard Duty
And Anti-dumping Duty in respect of goods leviable to IGST.

For items specified in the Fourth Schedule to the Central Ex-cise Act, 1944 (specified
petroleum products, tobacco etc.) exemption from Additional Duty leviable under
Sections 3(1), 3(3) and 3(5) of the Customs Tariff Act, 1975 shall be available.

Can duty credit scrips such as Merchandise Ex-ports from India Scheme (MEIS) and
Service Exports from India Scheme (SEIS) be used for payment of GST?

Answer:

No. MEIS and SEIS scrip can be used only for payment of Basic Customs Duty or
additional duties of Customs on items not covered under GST for imports under
GST regime.

The Centre has modified existing export incentive schemes removing most
exemptions provided on input taxes to align them with the Goods & Services
Tax (GST) regime which has rolled in from July 1.

Exporters importing inputs including machinery under popular schemes such as

Advance Authorisation (AA) and Export Promotion Capital Goods Scheme without
paying import duties (customs duty, countervailing duty and special additional duty)
up to a given limit will now have to pay GST on it and later apply for refund.

Under the GST regime, no exemption from payment of Integrated GST (IGST) and
compensation cess would be available for imports under Advance Authorisation.
Importers would need to pay IGST and take input tax credit as applicable under
GST, a trade notification issued by the Directorate General of Foreign Trade
(DGFT) modifying provisions under the Foreign Trade Policy (2015-20) on Friday
night stated.

However, imports under Advance Authorisation would continue to be exempted from

payment of basic customs duty, additional customs duty and education cess.
Exemptions will also be provided wherever penal duties such as anti-dumping,
safeguard and transition product specific safeguard duty are applicable.

The notification added that under the EPCG scheme (Chapter 5 of the FTP), too,
importers of capital goods would need to pay IGST and take input tax credit.

Benefits under the Merchandise Export from India Scheme (MEIS) and the
Services Export from India Scheme (SEIS), which provides exporters with duty
free scrips based on the value of their exports, have also been curtailed. The
scrips cannot be used for payment of IGST and GST compensation cess in
imports, and CGST, SGST, IGST and GST compensation cess for domestic
procurement, the notification stated.
Imports by Export Oriented Units (EOUs), which were allowed duty free imports of
goods for their authorised operations, will now get exemption on only the customs
duty. Such goods would attract integrated tax and compensation cess. The taxes so
paid on imports will be neutralised by ITC (input tax credit), the notification said.

CBEC vide Notifications No. 16-22/2015-CUS,Dated: April 1, 2015&24&25 -

CUS,Dated: April 8, 2015has exempted the goods specified therein imported against
a duty credit scrip/post export EPCG duty scrip /valid authorisation issued etc. under
the Foreign Trade Policy 2015-20 from duties specified therein. The various conditions
for availing said exemptions have also been specified.

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
(DEPARTMENT OF REVENUE)

Notification No. 25/2015 Customs

Dated- 8th April, 2015

G.S.R. 270 (E).- In exercise of the powers conferred by sub-section (1) of section 25
of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it
is necessary in the public interest so to do, hereby exempts goods when imported into
India against a Service Exports from India Scheme duty credit scrip issued by the
Regional Authority under paragraph 3.10 read with paragraph 3.08 of the Foreign
Trade Policy (hereinafter referred to as the said scrip) from,-

(a) the whole of the duty of customs leviable thereon under the First Schedule to the
Customs Tariff Act, 1975 (51 of 1975) (hereinafter referred to as said Customs Tariff
Act); and

(b) the whole of the additional duty leviable thereon under section 3 of the said
Customs Tariff Act.

2. The exemption shall be subject to following conditions, namely :-

(1) that the duty credit in the said scrip is issued to a service provider located in India
against export of notified services listed in Appendix 3D of Appendices and Aayat
Niryat Forms of Foreign Trade Policy 2015-2020;

(2) that the imports and exports are undertaken through the seaports, airports or
through the inland container depots or through the land customs stations as mentioned
in the Table 2 annexed to the Notification No. 16/2015- Customs dated 01.04.2015
or a Special Economic Zone notified under section 4 of the Special Economic Zones
Act, 2005 (28 of 2005):

Provided that the Commissioner of Customs may within the jurisdiction, by special
order, or by a Public Notice, and subject to such conditions as may be specified by
him, permit import and export through any other sea-port, airport, inland container
depot or through any land customs station;
(3) that the said scrip is registered with the Customs Authority at the port of
registration specified on the said scrip;

(4) that the said scrip is produced before the proper officer of customs at the time
of clearance for debit of the duties leviable on the goods and the proper officer of
customs, taking into account the debits already made under this exemption and debits
made under the notification Nos. 21/2015 Central Excise, dated the 8th April,
2015 and Notification No. 11/2015-Service Tax, dated the 8th April, 2015, shall
debit the duties leviable on the goods, but for this exemption;

(5) that the said scrip and goods imported against it shall be freely transferable ;

(6) that where the importer does not claim exemption from the additional duty of
customs leviable under section 3 of the said Customs Tariff Act, he shall be deemed
not to have availed the exemption from the said duty for the purpose of calculation of
the said additional duty of customs;

(7) that the importer shall be entitled to avail drawback of the duty of customs
leviable under the First Schedule to the said Customs Tariff Act against the amount
debited in the said scrip;

(8) that the importer shall be entitled to avail drawback or CENVAT credit of
additional duty leviable under section 3 of the said Customs Tariff Act against the
amount debited in the said scrip.

(9) that the benefit under this notification shall not be available to the items listed
in Appendix 3A of Appendices and Aayat Niryat Forms of Foreign Trade Policy 2015-
2020.

Explanation.- In this notification-

(I) Capital goods has the same meaning as assigned to it in paragraph 9.08 of the
Foreign Trade Policy;

(II) Foreign Trade Policy means the Foreign Trade Policy 2015-2020, published by
the Government of India in the Ministry of Commerce and Industry notification
number 01/2015-2020, dated the 1st April 2015 as amended from time to time;

(III) Goods means any inputs or goods including capital goods;

(IV) Regional Authority means the Director General of Foreign Trade appointed
under section 6 of the Foreign Trade (Development and Regulation) Act, 1992 (22 of
1992) or an officer authorised by him to grant an authorisation including a duty credit
scrip under the said Act.

[F.No.605/55/2014-DBK]

(Sanjay Kumar)

Under Secretary to the Government of India