High Court accepts challenge to reduction of SEIS benefit for FY 2019-20

by | Nov 29, 2021 | Outlook

We apprised you that the Central Government vide Notification No. 29/2015-20 dated September 23, 2021 (‘Notification’) has amended Foreign Trade Policy, 2015-20 (‘FTP’) and capped Service Exports from India Scheme (‘SEIS’) benefit to Rs. 5 crore per Importer Exporter Code (‘IEC’) for 2019-20 (‘relevant period’). The Notification further reduced list of eligible categories of services and SEIS rates. We also highlighted that the amendment is amendable to challenge before the Constitutional Courts.

Recently, this amendment has been challenged before the Gujarat High Court in the case of Gujarat Port Association v. UOI, SCA 16773 of 2021. The Court accepted this challenge and issued notice to the Central Government. The matter will be listed in due course for further hearing.

NITYA Comments: It is notable that last date for filing of SEIS application for relevant period is December 31, 2021. All exporters are advised to file claim as per Notification before this date. As final outcome of this case is expected to take some time, exporters may consider approaching the High Court to keep their claim for full benefit (where services are made ineligible) or differential benefit (where quantum of benefit has been reduced) alive.

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