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TaxTMI 
TaxTMI 
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2017 (6) TMI 1415
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....e. 3. The Policy Interpretation Committee (in short 'PIC') and DGFT have held that SFIS is not applicable to the petitioner company as he is subsidy of foreign company. According to PIC / DGFT, the SIF is not applicable to subsidiaries of foreign companies as granting benefits available under the SFIS does not further objective of the SFIS, which is to create a powerful and a unique 'served from India' brand. 4. According to the petitioner, the SFIS is applicable to "All India Service Providers" who fulfilled the specified criteria; no distinction can be drawn on the basis of nationality of their constituent shareholders. As per para 5.2 of the writ petition, the petitioners are a wholly owned subsidiary of Cummins Inc., USA, and part of the Cummins Group of Companies in India, having complementary businesses that includes design and manufacture of engines, generators, components and other related technologies, and rendering of various engineering and non-engineering services. 5. The petitioners inter alia exports auto components, engineering and non-engineering services, and earn foreign exchange for the country, through its units in Pune. 6. In exercise of powers conf....
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....terpretation and will not deviate from the same. It is for this reason that we expected the Central Government to act in terms of our directions. We have clarified by our earlier order that not only it will deal with the interpretation placed by the Policy Interpretation Committee but outcome of the directions issued by us does not mean any particular decision or interpretation of the policy be taken and be made. The Central Government was free to decide the matter independently. 32. While it is true that the Secretary should have been aware that there was an order passed by this Court with great expectation and hope. That expectation and hope is that Government Department and members of the Executive will be fully conscious of their role. Framing a Policy may be the prerogative of those elected by a specific process, however interpretation of all policies rests with the Executive. The members of the bureaucracy are therefore answerable to the people of India. They cannot evolve parameters to interpret the policies contrary to public interest. When in employment and interpreting a policy, Rules or regulations, they ought to be aware that any decision by a Court of law has ....
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.... Volume-II or classification of any item for import/export policy in the ITC (HS) and Policy Interpretation Committee (PIC) may be constituted to aid and advice DGFT. We are not required to decide the ambit and scope of this power which are essentially to aid and advice the Directorate General of Foreign Trade. We are are not concerned in this case as to whether any further appellate power was available to be exercised and to decide a challenge to the Interpretation placed on the policy of Policy Interpretation Committee. (PIC). In other words, we are not required to go into and interpret so also consider the ambit and scope of the appellate powers conferred by Section 15 of the Foreign Trade Act, 1992. Therefore, we do not make any further reference to these provisions. The expression "Free Exports" is to be found in paragraph 2.29 of the FTP which also need not detain us. That there is awareness of the "Exemption/Remission of Service Tax DTA". That is available for all goods and services which are exported from units in DTA and units in EOU/EHTP/STP/BTP exemption/remission of service tax levied and related to exports, shall be allowed as per prescribed procedure....
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....lement goods (imported/procured) shall be non-transferable (except within group company and managed hotels) and be subjected to actual User condition. However, these goods can be alienated on completion of 3 years from the date of import/procurement). 36. A perusal of these paras would denote that object of SFIS is to accelerate growth in export of services so as to create a powerful and unique 'Served From India brand,' instantly recognized and respected worldwide.' We are in agreement with Mr. Jetley learned Counsel that the object which is sought to be achieved would be only by encouraging those entities and conferring benefits and giving incentives to such companies who create an Indian brand. This is therefore, apparent. By referring to the identity of share holders and the nation they belong, the policy makers are not trivializing the issue. That reference is to highlight the object of accelerating growth in export of services so as to create a powerful and unique 'Served from India' brand instantly recognized and respected world over. One must appreciate the object properly and completely. The role that Indian Suppliers are expected to p....
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.... would alone be eligible and such eligible service providers will be entitled to Duty Credit Scrip equivalent to 10% of free foreign exchange earned during current financial year from 1 st January 2011 and for services rendered prior to 1st January, 2011, Appendix 10 of HBP Volume 1 would be applicable. SFIS benefit will be allowed on the Net Foreign Exchange earned is what is stated to be in paragraph 3.12.4 and by reference to that alone it will not be proper to hold that the object and purpose sought to be achieved is of augmenting foreign exchange reserves. That surely is not the intent while giving reward/incentive and making a scheme in that behalf to be implemented by the Directorate General of Foreign Trade. It is framed under the Foreign Trade Policy. That scheme entitles a person earning free foreign exchange to the extent indicated therein to avail of the benefits therein. Anybody who earns free foreign exchange of at least Rs. Ten lakhs is not entitled as claimed. That will be contrary to the object and purpose of making the scheme. That as rightly urged by Mr. Jetley is to accelerate growth in export of services so as to create a powerful and unique 'Serve....
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.... as having being paid for in free foreign exchange by RBI. 37. A bare reading of the same would indicate that persons providing a service from India to any other country, from India to service consumer of any other country in India, supply of a service from India through commercial or physical presence in territory of any other country, supply of a service in India relating to exports paid in free foreign exchange or in Indian rupees as having being paid for in free foreign exchange by RBI are all referred to. It is to promote a unique 'Served from India brand instantly recognized and respected world over that the definition has been worded accordingly. If the main object and purpose sought to be achieved, on which emphasis is placed is noted, then, only as a corollary or analogy to the main object and to accelerate growth of exports from India, that nationality of the share holders comprising of the Petitioner company has been referred to. That is not held to be determinative for availing benefits of 'Served from India Scheme.' Rather the definition and reading thereof would indicate how it is worded so as to achieve the object. Para 3.6. and 3.6.1. a....
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....er by Educational Institutions like equity participation, donations, etc (However remittances received on account of the course fees and consultancy provided by the institution shall be eligible); (e) Export turn over relating to services of units operating under SEZ/EOU/EHTP/STPL/BTP schemes or supplies of services made to such units; (f) Clubbing of turnover of services rendered by SEZ/EOQ/EHTP/STPL/BTP units with turnover of DTA service Providers; and (g) Exports of Goods (h) Foreign Exchange earnings for services provided by Shipping Lines Service providers from plying from any country X to any country Y routes not touching India at all. 'Served from India Scheme' is a policy and that is set out in Chapter 3 of Foreign Trade Policy. The application for grant of Duty Credit Scrip has to be made to whom, with what details and the forms which are required to be filled in for evaluation of duty credit Scrip entitlement. Non-entitling remittances and services for SFIS scheme are set out in paragraph 3.6.1. That is how the criteria is evolved and provided for. We are of the opinion that once the object and purpose of the Foreign Tr....