Cenvat credit of service tax on export sale

[Guest]

A LTD Manufacturing co. exported some products and paid freight ( air / sea ) and also paid other charges alongwith service tax. Can the co is eligible for CENVAT credit of service tax on export sale activity ? is answer will chage if the same is for import activity ? Manoj

AI Summary

CENVAT Credit Eligibility Confirmed for Export Freight Charges Under Rule 5 of Cenvat Credit Rules, 2004. A manufacturing company inquired about the eligibility for CENVAT credit on service tax paid for export activities, specifically concerning freight charges. Responses indicated that under Rule 5 of the Cenvat Credit Rules, 2004, CENVAT credit is allowable for exports without duty payment. For imports, credit is available if the goods are used in manufacturing. There is some controversy about service tax paid beyond the place of removal, but courts have generally favored a liberal interpretation to allow such credits. The consensus is that service tax on export-related services and incoming services from outside India is eligible for credit.