Service Exports from India Scheme (SEIS) - A Booster!!

Service Exports from India Scheme (SEIS)
Rewards to Service Exporters for Exports out of India

SEIS is one of the Exports from India Scheme launched by Director General of Foreign Trade (DGFT) under the Free Trade Policy 2015-20. This scheme aims to incentivize service exporters of India with the objective to encourage and maximize export of notified Services from India (The list of notified services provided at the end of this article).

Rewards under the scheme:

The rewards under the scheme are not given in the form of money but in the form of Duty Credit Scrips. Duty Credit Scrip is a scrip issued by the DGFT and can be used to pay various duties/taxes to the Central Govt. Split certificates of such Duty Credit Scrip may also be issued, at the time of application and are freely transferable.  This means the eligible service exporter can also transfer the duty scrip in return for money.

Who is eligible?

(a)   Service Providers of notified services, located in India, shall be rewarded under SEIS. Only Services rendered in two modes, i.e. Cross Border Trade (Supply of a ‘service’ from India to any other country) and Consumption abroad (Supply of a ‘service’ from India to service consumer(s) of any other country in India) shall be eligible.

(b)  Such service provider should have minimum net free foreign exchange earnings of US$15,000 in year of rendering service to be eligible for Duty Credit Scrip.

(c)   For Individual Service Providers and sole proprietorship, such minimum net free foreign exchange earnings criteria would be US$10,000 in year of rendering service.

(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)   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.

Who is not eligible?

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.

What is the entitlement under this Scheme?

Service Providers of eligible services shall be entitled to Duty Credit Scrip at notified rates on net foreign exchange earned. These rates vary from 5% to 7% on notified services.


Remittances through Credit Card and other instruments
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.

Validity Period and Revalidation of SEIS Scrip

(a)   Duty Credit Scrip issued under SEIS shall be valid for a period of 24 months from the date of issue and must be valid on the date on which actual debit of duty is made.

(b)  Revalidation of Duty Credit Scrip shall not be permitted unless validity has expired while in custody of Customs Authority / RA / Government Authority.

Ensuing is the List of Services and their Rates of reward under SEIS:

A. Professional Services
     (Rate of Reward 7%)

·       Legal
·       Accounting, auditing & book-keeping
·       Taxation
·       Architectural
·       Engineering
·       Integrated engineering
·       Urban planning & landscape architectural
·       Medical and dental
·       Veterinary
·       Services provided by midwives, nurses,
physiotherapists & paramedical personnel

B.  Research and development services
     (Rate of Reward 7%)

·       R&D on natural sciences
·       R&D on social sciences & humanities
·       Interdisciplinary services

C.  Rental/Leasing services
      without Operators
      (Rate of Reward 7%)

·       Relating to ships
·       Relating to aircraft
·       Relating other transport equipment
·       Relating other machinery & equipment

D. Audio-visual services
    (Rate of Reward 7%)

·       Motion picture & video tape production & distribution service
·       Motion picture projection service
·       Radio & television services
·       Radio & television transmission
·       Sound recording

E. Construction & Related Engineering
    (Rate of Reward 7%)

·       General Building construction work
·       General Civil engineering construction
·       Installation & assembly work
·       Building completion and finishing work

F. Educational Services
    (Rate of Reward 7%)

·       Primary & secondary education
·       Higher education
·       Adult education

G. Environmental Services
    (Rate of Reward 7%)

·       Sewage services
·       Refuse disposal services
·       Sanitation and similar services

H. Health and Social Services
     Rate of Reward – 5%

·       Hospital services

I. Tourism and Travel Services
    (5% or 7% Rate of Reward)

·       Hotel (5% Rate of Reward)
·       Restaurants (including catering) (5% Rate of Reward)
·       Travel agencies and tour operators services (7% Rate of Reward)
·       Tourist guides services (7% Rate of Reward)

J. Recreational, Cultural & Sporting
    (Rate of Reward 7%)

·       Entertainment (including theatre, live bands and circus services)
·       News agency services
·       Libraries, archives, museums and other cultural services
·       Sporting and other recreational

K. Transport & Auxiliary Services
     (Rate of Reward 7%)

·       Passenger transportation
·       Freight transportation
·       Rental of vessels with crew
·       Maintenance & repair of vessels
·       Pushing & towing services
·       Supporting for maritime transport
·       Rental of aircraft with crew
·       Maintenance & repair of aircraft
·       Airport Operations & ground handling
·       Passenger Transportation
·       Freight transportation
·       Rental of commercial vehicles with operator
·       Maintenance & repair of road transport equipment
·       Supporting services for road transport services
·       Cargo-handling services
·       Storage and warehouse services
·       Freight transport agency services

L. Other Business Services
    (5% Rate of Reward)

·       Advertising services
·       Market research & 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

For any queries on the above, feel free to write to us at info@gjmco.in

Thanks & Best regards,
Knowledge Base Team
GJM & Co.
Chartered Accountants
www.gjmco.in

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