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Export of services

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Dear professionals ,

While reading Service tax for CA final I have come across a very strange and silly doubt

I know this may sound stupid to learned professionals but

PLESE CLARIFY

The levy of service tax derives its power from entry 97 of the union list(or entry 92-c in opinion of a few)

Chapter V of the Finance Act ,1994 enumerates the detail

Further Chapter V extends to whole of India except the state of J &K(JURISDICTION)

Thus services provided in J&K and OUT OF INDIA are not covered by the ambit of the charging section( as I was taught the place of providing service is the relevant place for deciding jurisdiction)

So, SERVISES PROVIDED OUT OF INDIA ARE NOT COVERD UNDER THE AMBIT OF THIS LEVY

Then, Why on earth have they framed “EXPORT OF SERVISES RULES” describing about which service is a service exported is understandable but if further talks about rebate and all

How can rebate be provided on serves which is not even livable to tax

Plese Help

Replies (1)

OFFICESELVA

Service

498 Points Posted on 08 March 2012

If the receipient of service is located outside india and payment is received in Convertable Foreign Currency,then it will be covered under Export of Service Rules. If the Service rteceipient is in India payment is received in INR the same will attract Service Tax.

(2) Since the broad idea is that Tax should not be exported - to compensate the exporter(for the Service Tax suffered by him while rendering export service) rebate is granted.