AAR ruling is binding on a taxpayer and the Tax Authority in relation to transaction in respect of which the AAR ruling was sought: Bombay HC

Recently Bombay high court in the case of The Prudential Assurance Company Ltd. (Taxpayer) [AIT-2010-170-HC] on the binding nature of a ruling pronounced by the Authority for Advance Rulings (AAR), reiterated the relevant provisions of the Indian Tax Laws (ITL) and held that an AAR ruling is binding on a taxpayer and the Tax Authority, in relation to the transaction in respect of which the AAR ruling was sought. The AAR ruling continues to apply unless there is a change in law or facts on the basis of which the AAR ruling was earlier pronounced. A subsequent AAR ruling in respect of a differen...