Appeal to Appellate Authority for Advance Ruling Under GST

Last Update Date : October 04, 2018

Under GST law, a mechanism has been provided for appealing against the advance ruling issued by Authority for Advance Ruling (AAR). If a person or concerned GST officer is unhappy with the decision of AAR, they can knock the doors of Appellate Authority for Advance Ruling (AAAR) for appealing against such a decision.

Applicant and Application for Appeal to Appellate Authority

  • An applicant in this case is a person or officer who is not happy with the advance ruling issued by the Authority for Advance Ruling.
  • If the applicant is a person other than GST officer then he can apply by filling the application form GST ARA-02 along with a fee of Rs 10,000.
  • If the applicant is a GST officer then he needs to fill the application form GST ARA-03. He is not required to pay any fees.

Applicable Time Limit

An applicant gets a time period of 30 days to appeal against advance ruling issued by AAR. If required, this time period can further be extended by another 30 days.

[ Read: Appeal to First Appellate Authority under GST ]

Decision of the Appellate Authority for Advance Ruling

  • The AAAR can choose to either agree or change the advance ruling issued by AAR.
  • It has to give its decision on the appeal within 90 days from the date of application.
  • The Appellate Authority can issue an advance ruling only if all the members agree on all the points of the matter.
  • Once the advance ruling is issued, a copy of it signed by the members is sent to the applicant, the jurisdictional Central GST/State GST officer or the jurisdictional officer and the Appellate Authority.

Procedure of Advance Ruling by Appellate Auhtority

Rectification of Advance Ruling issued by Appellate Authority

If the Appellate Authority for Advance Ruling makes a mistake in the advance ruling, it can rectify its mistake. However, to facilitate this, the mistake must be noticed by the jurisdictional Central GST/State GST officer or the prescribed officer or the applicant or the AAAR itself within six months from the date of issue of advance ruling.

If the rectification of error leads to an increase in the tax liability or reduction in input tax credit then the taxpayer will get a notice and an opportunity to be heard before the result is imposed upon him.

Procedure for Rectification of Advance Ruling

Applicability of Advance Ruling

The advance ruling will be applicable only on the applicant which can be a taxpayer or jurisdictional officer related to 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.

Advance ruling will no longer be applicable if the laws, rules or facts of the original advance ruling change.

[ Read: Advance Ruling under GST ]

The Powers of AAR and AAAR

The Code of Civil Procedure gives all the powers of a civil court to the Authority for Advance Ruling and the Appellate Authority for Advance Ruling to facilitate:

  1. Discovery and inspection;
  2. Enforcing the attendance of a person and questioning him on oath;
  3. Investigations and enforcing production of books and other records,

Both the authorities are deemed to be a civil court for the purposes of section 195 of the Code of Criminal Procedure, 1973. Any proceeding before the authority shall be deemed to be judicial proceeding under section 193 and 228 and for the purpose of section 196, of the Indian Penal Code, 1860.

Note: Every proceeding before the AAR or the AAAR will be a deemed judicial proceeding.

 

Procedure of the Authority and the Appellate Authority

Both the authorities, i.e. AAR and AAAR can regulate their own procedures on all the matters emerging from the use of their powers.

 

Powers of Appellate Auhtority for Advance Ruling

Most Frequently Asked Questions

Can the Advance Ruling become void?

Yes, it can also become void. If it is found out that the applicant has obtained the advance ruling through fraud or suppressing material facts then AAAR can make the ruling void ab initio. In such a case, all the GST provisions will be applicable on the applicant normally (but excluding the period when advance ruling was given and up to the period when the order declaring it to be void is issued) without the provisions of advance ruling since it becomes void.

Advance ruling shall be binding till the period when the law, facts or circumstances supporting the original advance ruling have not changed.

However, before the advance ruling is declared void, the applicant is given a notice and an opportunity to be heard.

 

What happens if the Applicant is not happy with the Ruling of the Appellate Authority for Advance Ruling?

The GST Act does not mention any procedure or steps to be taken for appeal against the decision of AAAR. However, taxpayers can expect it to be similar to the procedure followed in the previous indirect tax regime. So, if a similar procedure is to be followed then the applicant can appeal against the ruling of AAAR through a special dispensation to Division Bench of the High Court.

Conclusion

The mechanism for appealing against advance ruling to a higher authority ensures that disputes and litigations related to it are mitigated. It aims at ensuring that the taxpayers can meet their obligations under GST with certainty.

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