Service Tax and R&D Cess

[Krishan Gopal]

Pls. advice on below point.

1. Whether Service Tax is payable on reimbursement of expenses charged seperately against imported Technical Services.

2. Whther R&D Cess will be paid on reimbursement of expenses against imported services. If yes, can we claim exemption of R&D cess towrds payment of service tax.

[Sanjeev Tambe]

point 1 : it is disputable. You have very good case to fight it out at higher level.

Point 2: Yes R & D cess payment can be adjusted against payment of service tax 

AI Summary

Service tax on reimbursements of imported technical services remains disputable; R&D cess payable may be adjusted against service tax. Applicability of Service Tax to reimbursements for imported technical services is disputable and may be contested; the advisor suggests a viable case to challenge liability. Separately, R&D cess is payable on such reimbursements but can be adjusted against the taxpayer's service tax liability under the available adjustment mechanism.