1 What is meant by advance ruling?

Advance ruling means the determination, by the Authority, of a question of law or fact specified in the application regarding the liability to pay service tax in relation to service proposed to be provided, by the applicant. Activity means service to be provided. (See Section 96A of the Finance Act, 1994)

2 What is the scheme of advance rulings?

Authority for Advance Rulings for Excise and Customs is meant to provide binding ruling on important issues so that intending investors will have a clear-cut indication of their duty/tax liability in advance.

Since advance rulings are not appealable under the Finance Act, 1994, it assures the applicant of the finality of the tax liability and hence freedom from spending time, energy and money in legal battles which mostly become long-drawn.

3.  Who can apply for an advance ruling?

i. A non-resident setting up a joint venture in India in collaboration with a nonresident or a resident; or

ii. A resident setting up a joint venture in India in collaboration with a non- resident; or

iii. A wholly owned subsidiary Indian company, of which the holding company is a foreign company, which proposes to undertake any business activity in India;

iv. A joint venture in India,

(Ref.: Section 96A of the Service Tax, Provisions under Finance Act, 1994).

v. A resident falling within any such class or category of persons, as the Central Government may, by notification in the official Gazette, specify in this behalf, and which or who, as the case may be, makes application for advance ruling under subsection (1) of section 28H of the Customs Act or Section 23C of Central Excise Act or Section 96C of Service Tax provisions of Finance Act, 1994.

v. A resident as an applicant who proposes to import any goods from the Republic of Singapore under Comprehensive Economic Co-operation Agreement (CECA). –Refer Notification No.69/2005 dated 29.07.2005

4 On which questions can an advance ruling be sought?

Advance rulings, concerning service tax matters, can be sought in respect of –

i. Classification of any service as a taxable service under Chapter V of the Finance Act, 1994;

ii. Principles to be adopted for the purposes of determination of value of taxable service under the said Act;

iii. Determination of the liability to pay service tax on a taxable service under the said Act;

iv. Valuation of taxable services for charging Service Tax; and

v. Applicability of notifications issued under said Act. (Ref.: Section 96C(2) of Finance Act,1994).

5 Where is the Authority located and who can be contacted for information/ guidance?

Office of the Authority for Advance Rulings (Central Excise, Customs & Service Tax), 4th Floor (Room No. 445 to 465, 467 & 469), Hotel Samrat, Kautilya Marg, Chanakyapuri, New Delhi – 110 021, Phone 91-11-26876402/26876406, Fax No. 91-11-26876410, Email :[email protected],

Further information, including those relating to the procedure for filing application, fees and formats of annexure, is available on Website: www.cbec.gov.in/cae/aar.htm

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September 2021