TaxTMI 
TaxTMI 
utilisation of Service tax credits - reg
22 Jun 2010 
2 Replies 
1291 Views Asked by
Service tax credit utilization queried: adjustment to import duty versus refund for exporters, and TDS timing on sponsorship.
Excess available service tax credits and whether they may be adjusted against import duty versus reclaimed by refund is queried; a practitioner reply notes refund is available where the taxpayer is engaged in exports. Separately, the taxpayer asks whether sponsorship payments attract Tax Deducted at Source under contract payment rules (section 194C) and whether withholding/accounting arises in the month of the event or earlier. (AI Summary)
Excess available service tax credits and whether they may be adjusted against import duty versus reclaimed by refund is queried; a practitioner reply notes refund is available where the taxpayer is engaged in exports. Separately, the taxpayer asks whether sponsorship payments attract Tax Deducted at Source under contract payment rules (section 194C) and whether withholding/accounting arises in the month of the event or earlier. (AI Summary)
We have accumulated to a large extent the portion of availed service tax credits than our on service tax liability as on 31-3-2010, This balance is so huge that it can service our IMPORT duty requirement for a year. We would like to know if this adjustment of Service tax to Import duty is possible and if so please quote the relevant rules and notifications for our benefit.