{"id":5669,"date":"2019-02-26T15:20:35","date_gmt":"2019-02-26T09:50:35","guid":{"rendered":"http:\/\/carajput.com\/blog\/?p=5669"},"modified":"2021-11-05T20:58:28","modified_gmt":"2021-11-05T15:28:28","slug":"authority-for-advance-rulings","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/authority-for-advance-rulings\/","title":{"rendered":"FAQ\u2019s on income tax advance ruling provisions"},"content":{"rendered":"<p><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/02\/Advance-rulling-authority.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-8587\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/02\/Advance-rulling-authority.jpg\" alt=\"www.carajput.com; Advance rulling authority\" width=\"966\" height=\"579\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/02\/Advance-rulling-authority.jpg 500w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2019\/02\/Advance-rulling-authority-300x180.jpg 300w\" sizes=\"(max-width: 966px) 100vw, 966px\" \/><\/a><\/p>\n<h2><span style=\"color: #ff0000;\"><strong>FAQ\u2019s ONINCOME TAX ADVANCE RULING PROVISIONS<\/strong><\/span><\/h2>\n<p><span style=\"color: #000080;\"><strong><em>Q.: What is Authority for Advance Rulings (AAR)?<\/em><\/strong><\/span><\/p>\n<ul>\n<li style=\"text-align: justify;\">The scheme of Advance Rulings has been introduced under the<a href=\"https:\/\/carajput.com\/income-tax-services.php\"> Income-tax Act, 1961<\/a>. It was reinforced by the Finance Act, 1993. Chapter XIX-B of the Income-tax Act, which deals with advance rulings, came into force with effect from 1-6-1993. Under the scheme, the power of giving advance rulings has been entrusted to an independent adjudicatory body. Accordingly, a high-level body headed by a retired judge of the Supreme Court has been set-up. This is empowered to issue rulings, which are binding both on the Income-tax Department and the applicant. The procedure prescribed is simple, inexpensive, expeditious and authoritative.<\/li>\n<li style=\"text-align: justify;\">Advance Ruling means written opinion or authoritative decision by an Authority empowered to render it with regard to the tax consequences of a transaction or proposed transaction or an assessment in regard thereto.<\/li>\n<li style=\"text-align: justify;\">The Authority for Advance Rulings has emerged as an important adjudicatory body on tax matters. Recent rulings by the AAR in Castleton Investment Limited and the MAT controversy have brought the importance of the institution in tax disputes and related matters.<\/li>\n<li style=\"text-align: justify;\">The Responsibility of the AAR is to provide the facility of ascertaining the income-tax liability of a non-resident as well as that of certain special categories of residents. If an entity or company has any doubt about the tax liability of its business, it can go to the AAR. The AAR here gives a ruling and it will become policy guide to the company as well as to the tax authorities. Hence, the companies can plan their income-tax affairs well in advance and to avoid long drawn and expensive litigation.<\/li>\n<\/ul>\n<ul style=\"text-align: justify;\">\n<li>In the case of the <a href=\"https:\/\/carajput.com\/income-tax-services.php\">Income Tax<\/a> Appellate Tribunal, a company goes to it if it has a grievance related to the tax notice it has got from the tax authorities. But in the case of AAR, such a notice is not needed to seek its ruling.<\/li>\n<\/ul>\n<p style=\"text-align: justify;\"><span style=\"color: #000080;\"><em><b>Q.: what is Constitution of AAR in India?<\/b><\/em><\/span><\/p>\n<ul>\n<li style=\"text-align: justify;\">Authority for Advance Rulings consists of a Chairman who is a retired Judge of the Supreme Court and two members of the rank of Additional Secretary to the Government of India, one each from the Indian Revenue Service and the Indian Legal Service. A non-resident or certain categories of the resident can obtain binding rulings from the Authority on the question of law or fact arising out of any transaction\/proposed transactions which are relevant for the determination of his tax liability.<\/li>\n<li style=\"text-align: justify;\">The Authority for Advance Rulings\u00a0(AAR)\u00a0pronounces rulings on the applications of the non-resident\/residents submitted in the prescribed form following prescribed procedure and such rulings are binding both on the applicant and the income-tax department.<\/li>\n<li style=\"text-align: justify;\">Thus, the applicant can avoid expensive and time-consuming litigation on any question of law or fact which might arise from normal income-tax assessment proceedings. AAR (Procedure) Rules, 1996 provide a detailed procedure for obtaining advance rulings.<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>Q.: What is advance ruling?<\/strong><\/span><\/p>\n<p>Advance ruling is basically a\u00a0written interpretation of tax laws, as made by a Advance Ruling Authority.\u00a0it&#8217;s\u00a0issued by tax authorities to corporations and individuals who request for clarification of certain tax matters. An advance ruling\u00a0is usually\u00a0requested when the taxpayer is confused\u00a0and unsure\u00a0about certain provisions. Advance tax ruling is applied for: before starting the proposed activity.\u00a0as an example, under\u00a0taxation, advance ruling\u00a0is obtainable\u00a0in international taxation.\u00a0this is often\u00a0to assist\u00a0non-residents ascertain the income-tax liability, plan their income-tax\u00a0beforehand\u00a0and avoid long drawn\u00a0and dear\u00a0legal disputes. As per GST, the advance ruling\u00a0could be a\u00a0written decision given by the tax authorities to an applicant on questions\u00a0referring to\u00a0the provision\u00a0of goods\/services.<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.: Why is advance ruling under GST necessary?<\/strong><\/span><\/p>\n<p>The objectives of any advance ruling, as provided under GST Act are as follows &#8211;<\/p>\n<ul>\n<li>Provide certainty for\u00a0liabilities\u00a0ahead\u00a0in\u00a0reference to\u00a0a future activity to be undertaken by the applicant<\/li>\n<li>Attract Foreign Direct Investment (FDI) \u2013 By clarifying taxation and showing\u00a0a transparent\u00a0picture of\u00a0the long run\u00a0liabilities\u00a0of the FDI. The clarity and clean taxation will attract non-residents who\u00a0don&#8217;t\u00a0want\u00a0to induce\u00a0involved in messy tax disputes.<\/li>\n<li>Reduce litigation\u00a0and dear\u00a0legal disputes<\/li>\n<li>Give decisions\u00a0in a very\u00a0timely, transparent\u00a0and cheap\u00a0manner<\/li>\n<\/ul>\n<p><span style=\"color: #000080;\"><strong>Q.: When can one request for GST Advance Ruling?<\/strong><\/span><\/p>\n<p>Any taxpayer can request for advance ruling when\u00a0he&#8217;s\u00a0uncertain of the provisions. Advance tax ruling shall be applicable in respect of \u2013 (a) Classification of goods or services or both, under the Act (b) Applicability of a notification which affects\u00a0the speed\u00a0of tax (c) Determination\u00a0of your time\u00a0and value of supply of goods\/services (d) Whether input\u00a0reduction\u00a0paid (or deemed to be paid)\u00a0are going to be\u00a0allowed (e) Determination of the liability to pay tax on any goods\/services (f) Whether the applicant\u00a0needs to\u00a0be registered under GST (g) Whether any particular thing done by the applicant regarding goods\/services will\u00a0end in\u00a0a supply.<\/p>\n<p><span style=\"color: #000080;\"><b>Q.: What&#8217;s is Procedure on receipt of application?<\/b><\/span><\/p>\n<p>On receipt of an application, a replica is going to be forwarded to the prescribed officer and he will furnish the mandatory relevant records.<\/p>\n<p><span style=\"color: #000080;\"><strong> Q.: What is <\/strong><strong>Process of Advance Ruling under GST?<\/strong><\/span><\/p>\n<p>An advance ruling application is required to be sent to Authority for Advance Ruling. In case any individual is unhappy with the advance ruling, the same can appeal to the Appellate Authority for Advance Ruling.<\/p>\n<ol>\n<li>Forms for application?<\/li>\n<\/ol>\n<p>Application for Advance ruling\u00a0should\u00a0be made in FORM GST ARA-01\u00a0together with\u00a0Rs. 5,000.<\/p>\n<ol start=\"2\">\n<li>Types of the Decision of the Authority?<\/li>\n<\/ol>\n<p>The Authority may make an order, thereby admitting or rejecting the application made by the aggrieved person.<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.: Will all applications be allowed?<\/strong><\/span><\/p>\n<p>The Authority\u00a0won&#8217;t\u00a0admit\u00a0the application\u00a0when- (b)\u00a0the identical\u00a0matter has already been decided in an earlier case for the applicant (c)\u00a0the identical\u00a0matter is already pending in any proceedings for the applicant Basically, Advance Ruling\u00a0won&#8217;t\u00a0be possible in any pending case or any decision already given. Applications\u00a0are going to be\u00a0rejected only after giving\u00a0a chance\u00a0of being heard. Reasons for rejection shall\u00a0tend\u00a0in writing.<\/p>\n<p><span style=\"color: #000080;\"><strong>Q.: When will the authority give their decision?<\/strong><\/span><\/p>\n<p>Advance ruling decision\u00a0are\u00a0given within 90 days from application. If the members of the Authority differ in opinion on any point,\u00a0they&#8217;ll\u00a0refer\u00a0the purpose\u00a0to the Appellate Authority. Advance Ruling will have prospective effect only.<\/p>\n<p><strong><span style=\"color: #000080;\">Q.: On whom will the advance ruling apply?<\/span> <\/strong><\/p>\n<p>The advance ruling\u00a0is going to be\u00a0binding only \u2013 (a) On the applicant (b) On the jurisdictional tax authorities in respect of the applicant. If the law, facts of\u00a0the first\u00a0advance ruling change then the advance ruling\u00a0won&#8217;t\u00a0apply.<\/p>\n<p><span style=\"color: #000080;\"><strong>You May Also Like the Following Blogs;<\/strong><\/span><\/p>\n<ul>\n<li><a href=\"https:\/\/carajput.com\/blog\/easy-and-simple-task-to-online-file-income-tax-returns\/\">File ITR online easily and simply<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/no-disallowance-if-tds-is-deposited-before-due-date-of-filing-return-amendment-to-sec-40a-ia-has-retro-effect\/\">Amendment in section-40A with retro-effect<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/how-to-e-file-return-using-evc-without-sending-signed-copy-of-itr-v-2\/\">How to e-file a return using EVC without sending a signed copy of ITR-V?<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/should-you-file-tax-return-even-without-taxable-income\/\">Should you file a tax return without Taxable Income<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/needed-to-file-income-tax-returns-for-your-bitcoin-profits-earn\/\">File ITR for your BITCOIN profit earned<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/your-income-tax-returnitr-for-fy-2017-18ay-2018-19\/\">Income Tax Return for FY-17-18<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/learn\/needed-to-file-income-tax-returns-for-your-bitcoin-profits-earn.html\">File ITR for your BITCOIN profit earned<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/popular-errors-when-filing-an-income-tax-return\/\">Popular Errors while Filing an Income Tax Return<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/blog\/section-234f-fee-penalty-for-delay-in-filing-income-tax-return\/\">Penalty for delay in ITR filing<\/a><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>FAQ\u2019s ONINCOME TAX ADVANCE RULING PROVISIONS Q.: What is Authority for Advance Rulings (AAR)? The scheme of Advance Rulings has been introduced under the Income-tax Act, 1961. It was reinforced by the Finance Act, 1993. Chapter XIX-B of the Income-tax Act, which deals with advance rulings, came into force with effect from 1-6-1993. Under the &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[7147,7146],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/5669"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=5669"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/5669\/revisions"}],"predecessor-version":[{"id":18412,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/5669\/revisions\/18412"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=5669"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=5669"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=5669"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}