Input of service tax

[Guest]

We have paid commission to overseas agent for booking export orders at dubai[service done at dubai], as per departmental direction we have paid the service tax. Can we take input credit on Service Tax paid on Commission to overseas agents, if so, can we claim refund after availing credit, becoz, we dont have any similar excisable goods to adjust the cenvat credit. Plese guide me.

[Ravi Chopra]

It appears that you have paid service tax in the capacity of receipient of services (reverse charge) on Import of Services. These services are eligible for various benefits. You can avail canvat credit on such services as input services and claim refund of such services under rule 5. But this aspect is subject to overall dicision with relation to cenvat credit and excise duty. You can also claim refund under notification no. 41/2007 - sr. no. 15

AI Summary

Input credit on service tax may be available for reverse-charge commissions and refundable where non-adjustable under cenvat rules. Payment of service tax under the reverse charge on overseas agent commission is an input service eligible for cenvat credit, subject to the overall cenvat rules and requirement of an excisable output to utilize the credit; where adjustment is not possible, recovery may be sought through the applicable refund mechanism or notification-based refund route, contingent on compliance with cenvat conditions.