Service Tax Exemption on FMS Duty Credit
Scrip under Sec 66B of Finance Act 1994
[Service
Tax Notification No. 06 dated 18th April 2013]
In exercise of the powers conferred by sub-section (1)
of section 93 of the Finance Act, 1994 (32 of 1994)(hereinafter
referred to as the said Act), the Central Government, on being satisfied that
it is necessary in the public interest so to do, hereby exempts the taxable
services provided or agreed to be provided against a scrip by a person located
in the taxable territory from the whole of the service tax leviable
thereon under section 66B of the said Act.
2. Application.
– This notification shall be applicable to the Focus Market Scheme duty credit
scrip issued to an exporter by the Regional Authority in accordance with
paragraph 3.14 of the Foreign Trade Policy.
3. The
exemption shall be subject to the following conditions, namely:-
(a) that the scrip is issued against exports to the countries
notified by the Government of India in Appendix 37C of the Handbook of
Procedures, Volume I:
Provided that the following
categories of exports (specified in paragraph 3.17.2 and 3.14.3 of the Foreign
Trade Policy) shall not be counted for calculation of export performance or for
computation of entitlement under the Focus Market Scheme, namely:-
(i) the Export Oriented Units or Electronic Hardware Technology
Parks or Biotechnology Parks which are availing direct tax benefits or
exemption;
(ii) the export of imported goods covered under Para 2.35 of the
Foreign Trade Policy;
(iii) the exports through transhipment, meaning thereby that
exports originating in third country but transhipped through India;
(iv) the deemed exports;
(v) the exports made by Special Economic Zone units or Special
Economic Zone products exported through Domestic Tariff Area units;
(vi) the items, which are restricted or prohibited for export
under Schedule-2 of Export Policy in ITC (HS);
(vii) supplies made to Special Economic Zone units;
(viii) the service exports;
(ix) diamonds and other precious, semi
precious stones;
(x) Gold,
silver, platinum and other precious metals in any form, including plain and
studded jewellery;
(xi) Ores and
Concentrates, of all types and in all forms;
(xii) Cereals, of
all types;
(xiii) the Sugar, of all types and in all forms;
(xiv) Crude or
Petroleum oil and Crude or Petroleum based products covered under ITC HS codes
2709 to 2715, of all types and in all forms; and
(xv) the export of milk and milk products covered under ITC HS
Codes 0401 to 0406, 19011001, 19011010, 2105 and 3501;
(b) that the scrip is registered with the Customs Authority at
the port of registration (hereinafter referred to as the said Customs
Authority);
(c) that the
holder of the scrip, to whom taxable services are provided or agreed to be
provided shall be located in the taxable territory;
(d) that the
holder of the scrip who may either be the person to whom the scrip was
originally issued or a transferee-holder, presents the scrip to the said
Customs Authority along with a letter and an invoice or challan
or bill, as the case may be, issued under rule 4A of the Service Tax Rules,
1994 by the service provider indicating details of his jurisdictional Central
Excise Officer (hereinafter referred to as the said Officer) and the
description, value of the taxable service provided or agreed to be provided and
service tax leviable thereon;
(e) that the
said Customs Authority, taking into account the debits already made under
notification number 93/2009-Customs, dated the 11th September, 2009,
notification No.30/2012-Central Excise, dated the 9th July, 2012 and this
exemption, shall debit the service tax leviable, but
for this exemption in or on the reverse of the scrip and also mention the
necessary details thereon, updates its own records and sends written advice of
these actions to the said Officer;
(f) that the date of debit of service tax leviable,
in the scrip, by the said Customs Authority shall be taken as the date of
payment of service tax;
(g) that in case
the service tax leviable as per the point of taxation
determined in terms of the Point of Taxation Rules, 2011 is prior to date of
debit or that the rate of tax determined in terms of rule 4 of the Point of
Taxation of Rules, 2011, is in excess of the rate of service tax mentioned in
the invoice, bill or challan, as the case may be, the
holder of the scrip shall pay such interest or short-paid service tax along
with interest, as the case may be;
(h) that the
holder of the scrip presents the scrip debited by the said Customs Authority
within thirty days to the said Officer, along with an undertaking addressed to
the said Officer, that in case of any service tax short debited in the scrip,
shall pay such service tax along with applicable interest;
(i) that based
on the said written advice and undertaking, the said Officer shall verify and
validate, on the reverse of the scrip, the details of the service tax leviable, which were debited by the said Customs Authority,
and keep a record of payment of such service tax and interest, if any;
(j) that the
service provider retains a copy of the scrip, debited by the said Customs
Authority and verified by the said Officer and duly attested by the holder of
the scrip, in support of the provision of taxable services under this
notification; and
(k) that the
said holder of the scrip, to whom the taxable services were provided or agreed
to be provided shall be entitled to avail the drawback or CENVAT credit of the
service tax leviable under section 66B of the said
Act, against the service tax debited in the scrip and validated by the said
Officer.
4. Any amount
due to the Central Government under this notification shall be recoverable
under the provisions of the said Act and the rules made there under.
Explanation - For the purposes of this
notification,-
(A) “Foreign
Trade Policy” means the Foreign Trade Policy, 2009-14, published by the
Government of India in the Ministry of Commerce and Industry, vide notification
No.01 (RE 2012)/2009-2014, dated the 5th June, 2012, as amended from time to
time.
(B) “Handbook of
Procedures Volume 1” means the Handbook of Procedures Volume 1, 2009-14,
published by the Government of India in the Ministry of Commerce and Industry, vide Public Notice No.01 (RE 2012)/2009-2014,
dated the 5th June, 2012, as amended from time to time.
(C) “Point of
taxation” shall have the same meaning assigned to it in clause (e) of rule 2 of
the Point of Taxation Rules, 2011.
(D) “Regional
Authority” means the authority competent to grant a duty
credit scrip under the Foreign Trade (Development and Regulation) Act, 1992 (22
of 1992).
(E) “Scrip”
means Focus Market Scheme duty credit scrip issued to an exporter by the
Regional Authority in accordance with paragraph 3.14 of the Foreign Trade
Policy;
[F.No.354/55/2013-TRU]