Advance Ruling | Section 100 to 106 | CGST ACT 2017 | Part II

Simplified GST Series –Section 100-106/CGST ACT 2017 /PART-2

In part II of the Article author explains provisions  of  Section 100- Appeal to Appellate Authority, Section 101 -Orders of Appellate Authority, Section 102- Rectification of advance ruling, Section 103– Applicability of advance ruling, Section 104– Advance Ruling to be void in certain circumstances, Section 105-Powers of Authority and Appellate Authority and Section 106- Procedure of Authority, Appellate Authority and National Appellate Authority.

Also Read- Advance Ruling | Section 95 to 99 | CGST ACT 2017 | Part I

Section 100- Appeal to Appellate Authority-

(1) The concerned officer, the jurisdictional officer or an applicant aggrieved by any advance ruling pronounced under sub-section (4) of section 98, may appeal to the Appellate Authority.

(2) Every appeal under this section shall be filed within a period of thirty days from the date on which the ruling sought to be appealed against is communicated to the concerned officer, the jurisdictional officer or the applicant:

Provided that the Appellate Authority may, if it is satisfied that the appellant was prevented by a sufficient cause from presenting the appeal within the said period of thirty days, allow it to be presented within a further period not exceeding thirty days.

(3) Every appeal under this section shall be in such form, accompanied by such fee and verified in such manner as may be prescribed.

Analysis- An appeal can be filed by the concerned officer or jurisdictional officer or the applicant, who is aggrieved by the ruling.

• The appeal should be filed within 30 days from the date of receipt of the ruling. The appeal shall be filed by the aggrieved applicant in FORM GST ARA-02 along with a fee of Rs. 10,000/- to be paid under the CGST Act and the respective SGST Act.
• An appeal preferred by the concerned officer or the Jurisdictional officer shall be in the prescribed FORM GST ARA-03 without any fee and shall to be signed by an officer authorized in writing by such officer.

Section 101 -Orders of Appellate Authority-

(1) The Appellate Authority may, after giving the parties to the appeal an opportunity of being heard, pass such order as it thinks fit, confirming or modifying the ruling appealed against or referred to.

(2) The order referred to in sub-section (1) shall be passed within a period of ninety days from the date of filing of the appeal under section 100 or a reference under subsection (5) of section 98.

(3) Where the members of the Appellate Authority differ on any point or points referred to in appeal or reference, it shall be deemed that no advance ruling can be issued inrespect of the question under the appeal or reference

(4) A copy of the advance ruling pronounced by the Appellate Authority duly signed by the Members and certified in such manner as may be prescribed shall be sent to the applicant, the concerned officer/the jurisdictional officer and to the Authority after such pronouncement.

Analysis-

• The appellate authority must afford a reasonable opportunity of being heard to the parties before passing the order in which it may choose to either-

(a) Confirm the Advance Ruling passed by the AAR;

(b) Modify the Advance Ruling appealed against; or

(c) Pass such orders as it may deem fit

• The order should be passed within 90 days from the date of filing appeal or date ofreference by the AAR.

• If there is a difference of opinion between members of the AAAR on the question covered under the appeal, then it would be considered that no advance ruling can be issued in respect of that matter on which no consensus was reached by the members.

Section 102- Rectification of advance ruling

The Authority or the Appellate Authority may amend any order passed by it under section 98 or section 101, so as to rectify any error apparent on the face of the record, if such error is noticed by the Authority or the Appellate Authority on its own accord, or is brought to its notice by the concerned officer, the jurisdictional officer, the applicant or the appellant within a period of six months from the date of the order.

Provided that no rectification which has the effect of enhancing the tax liability or reducing the amount of admissible input tax credit shall be made unless the applicant or the appellant has been given an opportunity of being heard.

Analysis- The rectification may be made by the AAR or Appellate Authority within six months from the date of the order, and shall not result in a substantial amendment to the order being rectified.

• The rectification shall not arise on account of any interpretational issues or change in views and opinions of the members of the AAR and Appellate Authority.
• Any rectification resulting in an increase in the tax liability or reduction of admissible input tax credit shall be carried out only after giving the applicant/appellant an opportunity of being heard.

• The AAR or Appellate authority may amend the order to rectify any mistake apparent from records, if such mistake:

(a) Is noticed by it on its own accord, or

(b) Is brought to its notice by the concerned or the jurisdictional officer or the applicant/appellant.

Section 103– Applicability of advance ruling

(1) The advance ruling pronounced by the Authority or, the Appellate Authority under this chapter shall be binding only –

(a) on the applicant who had sought it in respect of any matter referred to in subsection (2) of section 97 for advance ruling;

(b) on the concerned officer or jurisdictional officer in respect of the applicant.

(2) The advance ruling referred to in sub-section (1) shall be binding unless the law, facts or circumstances supporting the original advance ruling have changed.

Analysis- The advance ruling pronounced by the Authority under this chapter shall be binding only on the applicant and on the jurisdictional officer in respect of the applicant.

• It is important to note the advance ruling is GSTIN specific and not PAN based. That is to say, the advance ruling obtained by an applicant would not be applicable to other distinct persons of such applicant.

Therefore, an applicant/appellant does not have an option but to abide by the advance ruling that he had applied for, except approaching a higher court through a writ petition.

• The advance ruling shall be binding on the said person/authority unless there is a change in law or facts or circumstances, on the basis of which the advance ruling has been pronounced. When any change occurs in such laws, facts or circumstances, the advance ruling shall no longer remain binding on such person.

Section 104– Advance Ruling to be void in certain circumstances-

(1) Where the Authority or the Appellate Authority finds that advance ruling pronounced by it under sub-section (4) of section 98 or under sub-section (1) of section 101 has been obtained by the applicant or the appellant by fraud or suppression of material facts or misrepresentation of facts, it may, by order, declare such ruling to be void ab initio and thereupon all the provisions of the Act or the Rules made there under shall apply to the applicant or the appellant as if such advance ruling had never been made:

Provided that no order shall be passed under this sub-section unless an opportunity of being heard has been given to the applicant or the appellant.

Explanation. – The period beginning with the date of such advance ruling and ending with the date of order under this sub-section shall be excluded while computing the period specified in sub-sections (2) and (10) of section 73 or sub-sections (2) and (10) of section 74.

(2) A copy of the order made under sub-section (1) shall be sent to the applicant, the concerned office and the jurisdictional officer.

Analysis- Where the Authorities (AAR or Appellate Authority, as the case may be) subsequently discover that an advance ruling has been obtained by the applicant or appellant fraudulently or by way of suppression of material facts or misrepresentation of facts, the Authorities are empowered to declare such a ruling to be void ab initio.

• The above would result in all the provisions of the Act becoming applicable to the applicant as if such advance ruling had never been made.

• However, no such order can be passed by the AAR or Appellate Authority without giving the applicant/appellant an opportunity of being heard.

• The period beginning with the date of advance ruling and ending with the date of order declaring the advance ruling to be void ab initio shall be excluded in computing the period for issuance of Show-cause notice and adjudication order under sub-section(2) and (10) of both Sections 73 and 74.

Section 105-Powers of Authority and Appellate Authority

(1) The Authority or the Appellate Authority or the National Appellate Authority shall, for the purpose of exercising its powers regarding—

(a) discovery and inspection;

(b) enforcing the attendance of any person and examining him on oath;

(c) issuing commissions and compelling production of books of account and other records, have all the powers of a civil court under the Code of Civil Procedure, 1908.

(2) The Authority or the Appellate Authority or the National Appellate Authority shall be deemed to be a civil court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973, and every proceeding before the Authority or the Appellate Authority shall be deemed to be judicial proceedings within the meaning of sections 193 and 228, and for the purpose of section 196 of the Indian Penal Code.

Analysis- The Authorities have all the powers of a civil court under the Code of Civil Procedure, 1908 for the purpose of discovery and inspection, enforcing the attendance of any person and examining him on oath, issuing commissions and compelling production of books of account and other records.

• The Authorities are deemed to be a civil court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973.

• Every proceeding before the Authorities shall be deemed to be a judicial proceeding within the meaning of sections 193, 196 and 228 of the Indian Penal Code, 1860.

Section 106- Procedure of Authority, Appellate Authority and National Appellate Authority

The Authority or the Appellate Authority or the National Appellate Authority shall, subject tothe provisions of this Chapter, have power to regulate its own procedure.

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