Refund of Unavailed Cenvat under rule 5 and Electronic Refund of Service Tax on Outward Services

[Ashok Chopra]

Respected Forum,

I am 100% EOU and availing refund on Unutilized Cenvat under Rule, 5 and i am also availing Electronic Refund of Service Tax  in my Shipping Bill and is being credited in my bank account.

 As per recent amendment in Rule 5 that unit who is availing rebate of Service Tax is not entitle for Unutilized Cenvat under Rule, 5.

Pls guide me:-

1.  Whether this clause is applicable on me and i am not entitled for Unutilized Cenvat under Rule, 5?

2. I am interested in Unutilized Cenvat, should i immediately stop taking Service Tax Rebate?

3. What should i do with the Service Tax Rebate, which has already been credited in my bank account, but still i have not utilized that rebate?

With regards

Ashok Chopra

[Mahir S]

Are you sure the above query is related to a 100 percent EOU Unit..

[Ashok Chopra]

yes sir

AI Summary

Unutilized Cenvat entitlement may be restricted where a service tax rebate is availed; eligibility and treatment questions arise. A 100% Export Oriented Unit claims refund of unutilized Cenvat under Rule 5 while also receiving electronic refund of service tax on outward services; an amendment appears to bar entitlement to unutilized Cenvat where a unit avails a service tax rebate. The operative issues are whether the amendment applies to the EOU, whether the unit must stop taking the service tax rebate to seek unutilized Cenvat, and how to treat service tax rebate amounts already credited but unused.