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Section 97 of GST – Application for advance ruling
(1) An applicant desirous of obtaining an advance ruling under this Chapter may make an application in such form and manner and accompanied by such fee as may be prescribed, stating the question on which the advance ruling is sought.
(2) The question on which the advance ruling is sought under this Act shall be in respect of,
- (a) classification of any goods or services or both;
- (b) applicability of a notification issued under provisions of this Act;
- (c) determination of time and value of supply of goods or services or both;
- (d) admissibility of input tax credit of tax paid or deemed to have been paid;
- (e) determination of the liability to pay tax on any goods or services or both;
- (f) whether applicant is required to be registered;
- (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 of that term.
Analysis of this section
This section specifies the matters in respect of which an advance ruling can be sought and prescribes the form and manner in which an application for advance ruling may be filed.
(i) An applicant who seeks an advance ruling should make an application online in the prescribed FORM GST ARA-01 together with a fee of Rs. 5000/-stating the question on which such a ruling is sought. Similarly, an applicant who seeks to file an appeal before the Appellate Authority for Advance Ruling shall apply online in FORM GST ARA-02 together with a fee of Rs. 10000/-.
(ii) The said fee of Rs. 5000/- or Rs. 10000/-as the case may be, shall be paid by the applicant under the CGST Act and the respective State GST Act utilising the amount in the Electronic Cash Ledger in the manner specified in section 49.
(iii) The application and all the relevant documents accompanying such application should be digitally signed through Digital Signature Certificate (DSC) or e-signature as specified in Rule 26.
(iv) It is advised that the questions or issues in respect of which an advance ruling is sought be simple, direct and specific. The facts brought out in the application should be germane and pertinent to the issue at hand. Facts which do not necessarily concern the issue at hand should not require mention in the application as this might attract unnecessary attention to the business carried out by the assessee. Although an AAR cannot extend its scope by ruling on matters or issues not sought, it is still advisable that an applicant exercise restraint and caution while placing facts in the application.
(v) As regards an appeal against an advance ruling by the AAR filed by the concerned officer or the jurisdictional officer, the application shall be filed online in Form GST ARA-03 without any payment of fee.
(vi) The question raised is limited to the following:
- (a) Classification of any goods or services or both;
- (b) Applicability of notification issued under the GST law.
- (c) Determining the time and value of supply of goods or services or both;
- (d) Input credit admissibility of tax paid or deemed to be paid;
- (e) Determination of liability to pay tax on any goods or services or both;
- (f) Requirement for registration by an applicant;
- (g) Whether any particular thing done by the applicant amounts to or results in supply of goods or services or both.
Thus, it is apparent from this section that the Authority will not admit questions or matters which fall outside the purview of the issues stated above.
(vii) It is interesting to observe that matters relating to determination of place of supply are beyond the scope of matters to be decided by the Authority. This emanates from the fact that the ruling given by the AAR and AAAR will be applicable only within the jurisdiction of the concerned state or union territory and not beyond.
(viii) Also, no advance ruling can be sought on matters such as those relating to
- (a) Transitional credits specified in Chapter XX of the CGST Act, 2017
- (b) E-way bill requirements
- (c) Anti-Profiteering issues
- (d) Restraining officers from initiating an action/proceeding under the Act
(ix) Manual filing of an Application for Advance Ruling: Although Rules 104 and 106 specify filing of an application on the common portal, Rule 107A was introduced to allow manual filing of the same. Accordingly Circular No. 25/25/2017-GST dated 21.12.2017 was issued detailing the procedures for manual filing of an application for advance ruling till such time the advance ruling module is made available on the common portal. An application for advance ruling, or appeal thereon to be filed by the applicant, the concerned officer or the jurisdictional officer shall be filed in quadruplicate. It is to be noted that though the application shall be filed manually, the fee is required to be deposited online in terms of section 49 of the CGST Act. The Applicant is required to download and take a print of the challan and file the application duly signed by the authorised person with the Authority for Advance Ruling. One may refer to the above circular for detailed procedures to be followed for manual filing of an application for advance ruling or an appeal to the Appellate Authority for Advance Ruling.
Note: The circular allowing manual filing of applications for advance ruling shall be effective in a State only until such time an online module is made available on the common portal.
The questions on which AAR can be sought are quite comprehensive as compared to the erstwhile indirect tax regime.
Under the erstwhile laws, the applicant may withdraw the application within 30 days from the date of application. However, there is no such withdrawal provision under present GST laws.
Q1. Who can make an application to the AAR?
Ans. An applicant desirous of obtaining an advance ruling (whether registered or not) can make an application to AAR.
Q2. Can a question relating to classification of services or goods be referred to AAR?
Ans. Yes, a question on classification of services or goods can be referred to AAR.
Q3. Can the issue relating to admissibility of input credit be raised in an application for advance ruling?
Ans. Yes, an issue in relation to admissibility of input tax credit of tax paid or which is deemed to have been paid can be raised in an application for advance ruling.
Q4. Can the issue relating to notification having a bearing on tax rate, be raised before the AAR?
Ans. Yes, an issue relating to applicability of any notification issued under act can be raised before the AAR
Q5. Can the application made to the authority be withdrawn at any time?
Ans. It appears that there is no such provision under GST law.
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