RULE 6A (1) – The provision of any service provided or agreed to be provided shall be treated as export of service when

  • the provider of service is located in the taxable territory
  • the recipient of service is located outside India
  • the service is not a service specified in the section 66D of the Act
  • the place of provision of the service is outside India
  • the payment for such service has been received by the provider of service in convertible foreign exchange; and
  • the provider of service and recipient of service are not merely establishment of a distinct person in accordance with item (b) of Explanation 3 of clause (44) of section 65B of the Act.

Rule 3 of Place of Provision of Service Rules 2012 which is reproduced herein under,defines that the place of provision is recipient of service and only in cases where the location of service receiver is not available in the ordinary course of business; the place of provision of service shall be the location of the provider of service.

Rebate/Refund of Service Tax:

Service tax paid on export of services or input services used for such export services shall be refunded according to the conditions and limitations specified in the Notification No.39/2012-Service Tax dated 20th June, 2012.

Conditions and Limitations:

  • Service should be Export of Service as per the rule 6A of Service Tax Rules, 1994.
  • Duty on the inputs must have been paid for which the rebate is claimed.
  • Service tax and cess must have been paid for the input services, for which the rebate is claimed, to the service provider.
  • If the service receiver himself is responsible for paying service tax as per reverse charge mechanism, then he should have paid the service tax to the government.
  • The total amount of duty, service tax and cess admissible should not be less than Rs.1000/-
  • No CENVAT credit has been availed on input services, for which rebate is claimed.

Procedures to Claim Rebate:

  • The service provider of export service should file a declaration with the jurisdictional Assistant or Deputy Commissioner of Central Excise before the date of export of service.
  • The declaration should contain the details of the service to be exported, description, quantity, value, rate of duty and the amount of duty payable on inputs to be used for providing the service to be exported and the amount of service tax and cess payable on input services to be used for providing the service to be exported.
  • The commissioner shall verify the correctness of the declaration and if satisfied he will accept the declaration.
  • The exporter can obtain the inputs from a registered factory or registered dealer, accompanied by invoices issued under the Central Excise Rules, 2006 for the purpose of CENVAT Credit Rules, 2004.
  • The exporter can receive the input services along with invoice issued under the provisions of Service Tax Rules, 1994.
  • After the export of service, the exporter shall file for claim of rebate with the commissioner.
  • The application for the claim should be accompanied by the invoices issued for inputs and input services.
  • Submit the documentary evidence of receipt of payment against the service exported.
  • Submit a declaration that the service is exported as per the rule 6A.
  • After receiving the claim application, the commissioner after verification, if satisfied, shall sanction rebate in whole or in part.

Exemption of Services for Exporter of Goods:

  • The taxable services mentioned below as received and used by an exporter for export of goods, are exempted from service tax as per the Notification No.31/2012-Service Tax dated 20th June 2012. The exporter needs not to pay any service tax on these services:
  • Services provided by Goods Transport Agency (GTA) by way of transport of the goods, meant for export, in a goods carriage-
  • from any freight container station or inland container depot to the port or airport from where the goods are exported
  • or directly from their place of removal to an inland container depot, freight container station, port or airport from where the goods are exported
  • For this exemption, the exporter should produce the consignment note issued in his name, by the GTA.