Exports

Dear Taney,

Credit taken means Credit taken in your books and available for being utilized against payment of your Excise duty / Service tax liability.

However, while filing for refund of the Cenvat credit, the assessee shall reverse such Cenvat credit to negate the possibility of unjust enrichment. Meaning, the assessee should not be able to take double benefits of the same amount i.e., one by way of utilization of Cenvat credit to pay the duty / taxes and the other, by way of refund.

For. E.g., an assessee who is providing legal consultancy services to Indian and overseas customers. He may not be liable to pay Service tax on its foreign services provided. But, he has also received input services from various Indian service providers used for providing the export services. Thus, such an assessee may file the refund application only when he has reversed the Cenvat credit, else he will be in a position to claim double benefits of the same credit.