New Delhi, May 23 (KNN) The Directorate General of Foreign Trade (DGFT) has clarified that the actual Service Providers and not Ports are eligible for SFIS/SEIS benefit in respect of their share of earnings made by performing the notified services under SFIS/SEIS Scheme.

The notification said that the aggregator of services (Ports) shall be entitled for benefits under SFIS/SEIS for services exclusively rendered by them and for which the foreign exchange earnings (or INR payments as allowed under the scheme) are received and retained by them on this account.”

“The Ports cannot claim benefits to the extent of free foreign exchange earnings (or INR payments as allowed under the scheme) simply routed through them as receipt of service charges with regard to services rendered by other actual service providers”, it added.

Further, DGFT said that it should be ensured that there is no double claim by the aggregator (Port) and the actual service providers.

The move comes after DGFT has received references from exporters providing port related services seeking clarification whether the actual service providers rendering the eligible services should be entitled for the SFIS/SEIS benefits or the aggregator of services (Ports).

The issue has been examined in this Directorate in the light of the applicable FTP Provisions and through inter-ministerial consultations as well as opinion received from Ministry of Law and Justice.

In FTP 2015-20,  Served from India Scheme (SFIS) has been replaced with Service Exports from India Scheme (SEIS). SEIS shall apply to `Service Providers’ located in India’ instead of `Indian Service Providers’. 

Thus SEIS provides for rewards to all Service providers of notified services, who are providing services from India, regardless of the constitution or profile of the service provider. 

The rate of reward under SEIS would be based on net foreign exchange earned. The reward issued as duty credit scrip, would no longer be with actual user condition and will no longer be restricted to usage for specified types of goods but be freely transferable and usable for all types of goods and service tax debits on procurement of services/goods. Debits would be eligible for CENVAT credit or drawback.