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Incentives for Banking Sectors Under Foreign Trade Policy
by
CA Hans Raj Chugh *
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The readers of this forum will remember that last year we have published a similar article to create awareness among top bankers for claiming the benefits of "Served from India Scheme". The article was well received and helped bank staff to understand the scheme in much better way. Now the Banks which has could not claimed the benefits of this scheme may avail the benefits of 10% of net foreign exchange earned during the period 1.04.2010 to 31.12.2010 with 10% late cut up to 31.03.2014 under annual frequency period. Banks will not be eligible for benefit of this scheme after 31.03.2014. The bank staff dealing with the subject must brief their seniors about this scheme so that Bank is able to take benefit. Brief on scheme are given hereunder for your reference. About the Scheme Objective of the scheme to accelerate the growth of Export of Services from India so as to create a powerful and unique ‘Served from India’ brand instantly recognized and respected world over. Ads by Google
Eligibility Under this scheme Service Providers (including Banking sector) of services listed in Appendix 10 of HBP v1 (list attached as annexure-1) would be eligible and who have free foreign Exchange earning of at least Rs.10 lakhs in the preceding financial year will be eligible for duty credit scrip.
Entitlement Eligible service providers will be entitled to 10% of Net free foreign exchange earned during period 01.04.2010 to 31.12.2010.
Eligible remittances. Free Foreign Exchange earned through international credit cards and through any instrument as permitted by RBI for rendering of services shall also be taken into account for computation of duty credit scrip.
Imports allowed Duty credit scrip may be used for import of capital goods including spares, office equipment and professional equipment, office furniture etc; that are otherwise freely importable and or restricted.
Procurement from domestic sources Duty credit shall be permitted to be utilized for payment of Excise duty in terms of DOR notification issued in this behalf for procurement from domestic sources, in respect of items permitted for imports under SFIS duty credit scrip.
Last date for filling of Application The last date for filling of application will be 31st March 2014 for net foreign exchange earned during the period 01.04.2010 to 31.12.2010 with applicable late cut i.e. 10% of entitlement. Annexure-1 Banking and other Financial Services (excluding insurance): a. Acceptance of deposits and other repayable funds from the public b. Lending of all types, including consumer credit, mortgage credit, factoring and financing of commercial transaction c. Financial leasing d. All payment and money transmission services e. Guarantees and commitments F. Trading for own account or for account of consumer, whether on an exchange, in an over-the-counter market or otherwise, the following: - Money market instruments (cheques, bills, certificates of deposits, etc.) - derivative products including, but not limited to, futures and options - exchange rate and interest rate instruments, including products such as swaps, forward rate agreements, etc. transferable securities - Other negotiable instruments and financial assets, including bullion g. Participation in issue of all kinds of securities, including under writing and placement as agent (whether publicly or privately) and provision of service related to such issues h. Money binding i. Asset management, such as cash or portfolio management, all forms of collective investment management, pension fund management, custodial depository and trust services j. Settlement and clearing services for financial assets, including securities, derivative products and other negotiable instruments k. Advisory and other auxiliary financial services on all the activities listed in article 1B of MTN.TNC/W/50, including credit reference and analysis, investment and portfolio research and advise, on acquisitions and own corporate restructuring and strategy l. Provision and transfer of financial information and financial data processing and related software by providers of other financial services.
* The Author of the Article CA Hans Raj Chugh can be reached through email : hansrajchugh@hotmail.com (or Mob No.09811207924 ) for further clarifications (AllBankingSolutions.com will like to put on record its special thanks to the author for creating awareness among bankers)
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