According to notification no.11/2005-St dated 19.4.2005, service provider can take rebate for service tax and education cess paid on taxable services exported and according to Notification no. 12/2005-St dated 19.04.2005, service provider can take rebate of excise duty and service tax paid on inputs used in providing exported services.
Assuming that all the conditions mentioned under export of service rules are met. Value of Exported Services in INR 1000.00
Option I - Notification No. 11/2005
A company bills Rs. 1103 to overseas entity. The bill amount invoves Rs. 1000 for services and Rs. 103 for service tax and cess. It has availed cenvat of Rs. 20 and paid balance of Rs. 83 to the credit of service tax department.
The company can file claim of Rs. 83 paid with service tax department.
Option II - Notification No. 12/2005
A company bills Rs. 1000 to overseas entity without charging service tax thereon.
The company can file claim of Rs. 20 for service tax on inputs, with service tax department.
Query:
The option to either avail notification no 11/2005 or 12/2005 is on assessee. Is it good to go with option I in the above case as service reciever can avail the cash benefit of Rs. 63.
Please advice.
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