Rebate of Service tax & excise duty on export of services — Date of realisation of value is relevant date for claim - Service Tax - 01/2010

Chief Commissioner of Central Excise, Pune Trade Facility No. 1/2010 dated 13-4-2010 1. The doubts have been raised in respect of computation of relevant date for the purpose of claiming/sanctioning rebate of Service tax paid on taxable services exported or Service tax or Central Excise duty paid on input services or inputs, as the case may be, used in providing such taxable service exported. 2. Rule 5 of Export of Services Rules, 2005, provides that Where any taxable service is exported, the Central Government may, by notification, grant rebate of Service tax paid on such taxable service or Service tax or duty paid on input services or inputs, as the case may be, used in providing such taxable service and the rebate shall be subject to such conditions or limitations, if any, and fulfillment of such procedure, as may be specified in the notification . Hence, Rule 5 of Export of Service Rules, 2005 not only empowers the Central Government to notify to grant rebate of Service tax paid on taxable service as well as Service tax or duty paid on input services or inputs, as the case may be, used in providing such taxable service but also empowers Central Government to impose appropriate conditions, limitations and specifications of procedures as may be required. Accordingly, under said Rule 5, the Central Government has issued two Notifications, viz Notification No. 11/2005-S.T., dated 19-4-2005 , for rebate of Service tax paid on services exported and Notification No. 12/2005-S.T., dated 19-4-2005 , rebate of duty paid on input/input services used in export of services, where no credit of such duties/Service tax is taken. 3. The export of services may lead to following types of rebates/refund namely, (i) Rebate of Service tax paid on services exported out of India. (ii) Rebate of duty paid inputs/input services used in services exported as per the said Rules, where no credit of duty/Service tax paid is availed under Cenvat Credit Rules, 2004 . 4. The procedure prescribed under Notifications 11/2005-S.T., dated 19-4-2005 12/2005-S.T., dated 19-4-2005 , requires the assessee to produce documentary evidence of receipt of payment against taxable service exported. The said requirement is consistent with the legal provision of paying Service tax after receipt of value of services ( Rule 6 of Service Tax Rules, 1994 ). Therefore, in terms of Section 11B read with the said condition, the date of realizing value of export services can be taken as relevant date for grant of rebate of services exported. It is, therefore, clarified that the date of realization of value of services should be taken as relevant date for claiming/sanctioning of rebate of export of services.