TaxTMI 
TaxTMI 
We have paid export commission to foreign agents. As per rules we have deposited Service Tax as liability in case of foreign payment regarding service tax is on the person getting services. Now we are have paid commission for the same for the month of March06. Till date we have not taken credit of the same. Now Cenvat Credit Rules of Excise has changed and wide Notification No 81 dated 13/7/06 they have specied that if any unit is exporting under Duty Draw Back, he can not take Cenvat Credit of input services. Can we take the credit of Commission paid to foreign agents now.
Credit of service tax on commission paid to foreign agent
02 Mar 2007 
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Cenvat credit on export commission may be availed within one year but prohibited if duty drawback covers the service tax.
Entitlement to Cenvat credit on commission paid to foreign agents exists where service tax was paid by the service recipient, but the credit must be availed within one year of entitlement. Notification No.81/13-7-06 limits Cenvat credit for exporters who claim duty drawback; exporters must confirm that drawback does not compensate the service tax portion before taking Cenvat credit, because the same tax benefit cannot be claimed twice. (AI Summary)
Entitlement to Cenvat credit on commission paid to foreign agents exists where service tax was paid by the service recipient, but the credit must be availed within one year of entitlement. Notification No.81/13-7-06 limits Cenvat credit for exporters who claim duty drawback; exporters must confirm that drawback does not compensate the service tax portion before taking Cenvat credit, because the same tax benefit cannot be claimed twice. (AI Summary)