Export service invoice raised but not paid within 1 year

Friends

We exported services without payong output serviec tax in May 2011 in accordance with Rule 4 and Rule 3(1) of Export of Services Rules 2005 and raised export invoice on foreign client. Now the export proceeds have not come into India in convertible foreign exchange within 1 year from date of export ie May 2012.

Under such scenario are we liable to pay output serviec tax now as per Rule 7 of Point of Taxation Rules 2011 read with Rule 3(2) of Export of Services Rules, 2005.

Please enlighten.

Regards,

Replies (2)

Any service, which is taxable under clause (105) of section 65 of the Act, may be exported without payment of service tax. You can cancled the invoice also if you not received the payment.

Yes you are liable for service tax and export benefit on the invoice is not avalible as per the service tax circulars.

What Arun is stating is a work around way is not actually as per rules laid down

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