Pradeep Jain - Chartered Accountant

Query

(PARVEEN KHURANA) Posted On: 19 Jul, 2013

Sir, we have to pay commission to Indian agents against export sale.On this commission we have to pay service tax.Sir,please clarify that can we claim refund of service tax on commission paid under notification no. 41/2012 of Service Tax dt 29.06.2012.Because in this notification services are not specified. Also clarify that refund will be granted on commission paid on sale executed after 29.06.2012 or any sale executed before 29.06.2012 but refund of commission on that sale filed after 29.06.2012 is also liable for refund. Thanks CA Parveen Khurana

As per the notification no 41/2012 except the services mentioned in the amended definition of input service exemptions by way of refund can be availed by a exporter of goods in relation to the service tax paid on the taxable services used for the export of goods. Input service means: The amended definition of input service excludes the following services from the ambit of input service for the purpose of admissibility of credit: (A) Services specified in the following sub-clauses of clause 105 of Section 65 of Finance Act, 1994 (p)- Services provided by architect (zn)- Services provided by port (zzl)- Services provided by other port, (zzm)- Service provided airport (zzq)- Commercial or industrial construction services, (zzzh)- Construction of complex service and (zzzza)- works contract service In so far as they are used for- (a) Construction of a building or a civil structure or a part thereof; or (b) Laying of foundation or making of structures for support of capital goods, except for the provision of one or more of the specified services; or (B) The following Services specified in sub-clauses of clause (105) of section 65 of the Finance Act, (d)- General insurance service, (o)- Rent-a-cab service, (zo)-authorised service station and (zzzzj)- Supply of tangible goods in so far as they relate to a motor vehicle except when used for the provision of taxable services for which the credit on motor vehicle is available as capital goods; It specifically excludes services (C) such as those provided in relation to outdoor catering, beauty treatment, health services, cosmetic and plastic surgery, membership of a club, health and fitness centre, life insurance, health insurance and travel benefits extended to employees on vacation such as Leave or Home Travel Concession, when such services are used primarily for personal use or consumption of any employee. This amendment will come into force from 1.04.2011 Prior to this notification, notification no.52/2011 was effective and this notification exempted some specified services which were mentioned in the notification itself. On close analyses of list, it can be concluded that commission on sale is not specifically mentioned in the notification thus it will not be allowed prior to 29.06.2013.

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