Advance Ruling Mechanism in GST
Advance Rulings – GST Ready Reckoner
GST
Chapter Thirty Seven
\nAdvance Ruling Mechanism in GST
\nIntroduction
\nAn advance ruling helps the applicant in planning his activities, which are liable for payment of GST, well in advance. It also brings certainty in determining the tax liability, as the ruling given by the Authority for Advance Ruling is binding on the applicant as well as Government authorities. Further, it helps in avoiding long drawn and expensive litigation at a later date. Seeking an advance ruling is inexpensive and the procedure is simple and expeditious. It thus provides certainty and transparency to a taxpayer with respect to an issue which may potentially cause a dispute with the tax administration. A legally constituted body called Authority for Advance Ruling (AAR) can give a binding ruling to an applicant who is a registered person or is desirous of obtaining registration. The advance ruling given by the Authority can be app<\/p>\n
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\ni. provide certainty in tax liability in advance, in relation to an activity proposed to be undertaken by the applicant;
\nii. attract Foreign Direct Investment (FDI);
\niii. reduce litigation;
\niv. pronounce ruling expeditiously in transparent and inexpensive manner;
\nWhat are the matters\/questions specified in Section 97(2) & Section 100(1) of the CGST Act, 2017
\n(a) classification of any goods or services or both;
\n(b) applicability of a notification issued under the provisions of CGST Act;
\n(c) determination of time and value of supply of goods or services or both;
\n(d) admissibility of input tax credit of tax paid or deemed to have been paid;
\n(e) determination of the liability to pay tax on any goods or services or both;
\n(f) whether applicant is required to be registered;
\n(g) whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both, within the meaning<\/p>\n
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\nTo whom the Advance Ruling is applicable
\nAn advance ruling pronounced by AAR or AAAR shall be binding only on the applicant who has sought the advance ruling and on the concerned officer or the jurisdictional officer in respect of the applicant. This clearly means that an advance ruling is not applicable to similarly placed other taxable persons in the State. It is only limited to the person who has applied for an advance ruling.
\nFees for filing an application before AAR and AAAR
\n * Fee deposited by the Applicant or applicant
\n * In case of AAR fee of ₹ 10000\/- (Five thousand each under CGST and SGST Act) has to be deposited along with every application GST ARA-01 to A<\/p>\n
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\nProcedure for obtaining Advance Ruling
\n * The applicant desirous of obtaining advance ruling should make application to AAR in a prescribed form and manner.
\n * The format of the form and the detailed procedure for making application have been prescribed in Rule 104 of the CGST Rules, 2017.
\n * An application for obtaining an advance ruling under section 97(1) shall be made on the common portal in FORM GST ARA-01 and shall be accompanied by a fee of five thousand rupees, to be deposited in the manner specified in section 49 (Section 49 deals with procedure of payment of tax\/interest\/penalty and the mechanism to make payment through Electronic Cash and Credit Ledgers).
\n * The application, the verification contained therein and all th<\/p>\n
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\n * Before giving the ruling, AAR must hear the applicant or his authorized representative as well as the jurisdictional officers of CGST\/SGST.
\n * If there is difference of opinion between the two members of AAR, they shall refer the point or points on which they differ to the AAAR for hearing the issue. If the members of AAAR are also unable to come to a common conclusion in regard to the point(s) referred to them by AAR, then it shall be deemed that no advance ruling can be given in respect of the question on which difference persists at the level of AAAR.
\nAppeals against order of AAR
\nIf the applicant is aggrieved with the finding of the AAR, he can file an appeal with AAAR. The form and manner of filing appeal with AAAR is given in Rule 106 of the CGST Rules, 2017. An appeal against the advance ruling shall be made by an <\/p>\n
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\n(b) in the case of an applicant, in the manner specified in rule 26 (DSC\/e-signature).
\nAny appeal must be filed within thirty days from the date on which the advance ruling is communicated to the concerned officer, the jurisdictional officer and applicant.
\nThe Appellate Authority must pass an order after hearing the parties to the appeal within a period of ninety days of the filing of an appeal. If members of AAAR differ on any point referred to in appeal, it shall be deemed that no advance ruling is issued in respect of the question under appeal.
\nManual Filing of applications before AAR & AAAR
\nAs per rules 104 and 106 of the CGST Rules, 2017 the application for obtaining an advance ruling and filing an appeal against an advance ruling shall be made by the applicant on the common portal. However, due to the unavailability of the requisite forms on the common p<\/p>\n
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\nForm and Manner of Application to the Authority for Advance Ruling
\nAn application for obtaining an advance ruling under sub-section (1) of section 97 of the CGST Act and the rules made thereunder, shall be made in quadruplicate, in FORM GST ARA-01. The application shall clearly state the question on which the advance ruling is sought. The application shall be accompanied by a fee of five thousand rupees which is to be deposited online by the applicant, in the manner specified under section 49 of the CGST Act. It is reiterated that though the application shall be filed manually till the advance ruling module is made available on the common portal, the fee is required to be deposited online in terms of section 49 of the CGST Act.
\nIn order to make the payment of fee for filing an application for Advance Ruling on the common portal, the applicant has to fill his details using “Generate User ID for Advance Ruling” under “User Services”. After entering the email id and mobile numb<\/p>\n
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\n(c) in the case of a company, by the Chief Executive Officer or the authorized signatory thereof;
\n(d) in the case of a Government or any Governmental agency or local authority, by an officer authorised in this behalf;
\n(e) in the case of a firm, by any partner thereof, not being a minor or the authorized signatory thereof;
\n(f) in the case of any other association, by any member of the association or persons or the authorised signatory thereof;
\n(g) in the case of a trust, by the trustee or any trustee or the authorised signatory thereof; or
\n(h) in the case of any other person, by some person competent to act on his behalf, or by a person authorised in accordance with the provisions of section 48 of the CGST Act.
\nForm and Manner of Appeal to the Appellate Authority for Advance Ruling
\nAn appeal against the advance ruling issued u<\/p>\n
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\nThe appeal, the verification contained therein and all the relevant documents accompanying such appeal shall be signed-
\na) in the case of the concerned officer or jurisdictional officer, by an officer authorised in writing by such officer; and
\nb) in the case of an applicant, in the manner specified above
\nThe application for advance ruling or the appeal before the Appellate Authority shall be filed in the jurisdictional office of the respective State Authority for Advance Ruling or the State Appellate Authority for Advance Ruling respectively.
\nIf the space provided for answering any item in the Forms is found to be insufficient, separate sheets may be used. Further, the application, the verification appended thereto, the Annexures to the application and the statements and documents accompanying the Annexures must be self-attested.
\nThe contact details of all the AARs for<\/p>\n
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