Service Tax Refund

[Guest]

Dear Sir,

CBEC vide Customs notification no. 92/2012 –cus (NT)  dated 4^th Oct., 2012 read with AIR drawback schedule thereof has given following break up of drawback rate of 1% on export of SBM falling under Chapter 2304 :

AIR DRAWBACK SCHEDULE W.E.F. 10.10.2012 

Tariff Item no.	Description of goods	Unit	A		B
			Drawback when Cenvat facility has not been availed		Drawback when Cenvat facility has been availed
			Drawback Rate	Drawback cap per unit in Rs.	Drawback Rate	Drawback cap per unit in Rs.
(1)	(2)	(3)	(4)	(5)	(6)	(7)
2304	Oil-cake and other solid residues whether or not ground or in the form of pellets, resulting from the extraction of soyabean oil		1%		0.3%

Further para 6 of the said notification provides as under:

(6)          The figures shown under the drawback rate and drawback cap appearing below the column “Drawback when Cenvat facility has not been availed” refer to the total drawback (customs,  central   excise   and   service   tax  component   put   together)    allowable   and  those appearing under the column “Drawback when Cenvat facility has been availed” refer to  the drawback allowable  under the customs  component. The difference between the two columns refers to the central excise and service tax component of drawback. If the rate indicated is the same in both the columns, it shall mean that the same pertains to only customs component and is available irrespective of whether the exporter has availed of Cenvat or not.  

From the above schedule & Para 6 it is clear that now drawback consists of:

0.7%   towards Central Excise and service tax component

0.3%   towards Customs component.

My query is  when service tax component  include in 0.7%  whether refund of service tax paid on the taxable services which are received by an exporter of goods and used for export of goods is available or not.

AI Summary

Exporters Must Choose: No Simultaneous Service Tax Refund and Drawback Claim on Exports Per Customs Notification. An individual inquired about the eligibility for a service tax refund on taxable services received and used for exporting goods, given the breakdown of the drawback rate on exports under a specific customs notification. The notification outlines a 1% drawback rate for exports, with 0.7% allocated to central excise and service tax, and 0.3% to customs. The response clarified that both schemes-drawback and service tax refund-cannot be simultaneously adopted, implying that exporters must choose between the two benefits.