In re Tamilnadu Medical Council (GST AAAR Tamil Nadu)
The GST Appellate Authority for Advance Rulings (AAAR), Tamil Nadu, addressed an appeal filed by the Tamilnadu Medical Council regarding its liability to pay tax on the collection of various fees. The AAAR upheld the dismissal of the original application by the Authority for Advance Ruling (AAR) based on Section 98(2) of the CGST Act, 2017. The provision explicitly prohibits admitting an application for advance ruling if the same issue is already under scrutiny or adjudication in any ongoing proceedings under the Act. An investigation by the Directorate General of GST Intelligence (DGGI) was already in progress, leading to the rejection of the application.
Section 98(2) broadly defines “proceedings” to encompass scrutiny, inquiries, investigations, cancellations, audits, and more. The AAAR emphasized that this wide interpretation reflects the holistic nature of GST laws compared to other taxation statutes. The Council’s reliance on judicial precedents, including the Supreme Court rulings in Radha Krishan Industries v. State of Himachal Pradesh and Liberty Union Mills v. Union of India, was deemed irrelevant since the issues in those cases revolved around provisional attachment and procedural safeguards, not the specific ambit of advance ruling exclusions under GST law.
The AAAR further clarified that terms like “proceedings” and “inquiry” have been consistently used in various contexts within GST laws, as illustrated in multiple sections such as 6(2)(b), 66, and 70. The judgments cited by the appellant, including M/s. G.K. Trading Company (Allahabad High Court), were also distinguished, as they dealt with different interpretations of proceedings under the CGST Act. The AAAR stressed that the GST statute introduced a unique framework, necessitating a case-specific approach to interpret its provisions.
The Authority referred to two High Court judgments directly relevant to the issue but ultimately determined that they did not alter the statutory bar under Section 98(2). The AAAR’s decision highlights the necessity for applicants to carefully evaluate the pendency of proceedings before seeking advance rulings to avoid rejection on procedural grounds. This ruling reaffirms the scope and application of Section 98(2) and its impact on taxpayers seeking clarity under GST law.
Read AAR order: GST Advance ruling application dismissed due to pending DGGI investigations
FULL TEXT OF THE ORDER OF APPELLATE AUTHORITY FOR ADVANCE RULING, TAMILNADU
