THE AUTHORITY FOR ADVANCE RULINGS
(PROCEDURE) RULES, 1996
(Notification
No. GSR 426(E), dated 17-9-1996)[1]
In exercise of the
powers conferred by section 245V of the Income-tax Act, 1961 (43 of 1961),
the Authority for Advance Rulings hereby makes the following rules, namely:—
1.
Short title and commencement:-
(1) These rules
may be called the Authority for Advance Rulings (Procedure) Rules, 1996.
(2) They shall come into force with
immediate effect.
In these rules, unless the context otherwise requires,—
(a) "Act" means the Income-tax Act, 1961 (43 of 1961);
(b) "Advance Ruling" means an advance ruling as defined in
sub-clause (a) of section 245N of the Act;
(c) "Applicant" means an applicant as defined in sub-clause
(b) of section 245N of the Act;
(d) "Application" means an application under sub-section (1)
of section 245Q of the Act but shall include, where the context permits, all
applications, petitions and representations of the nature referred to in rule
5;
(e) "Authorised Representative",—
(i) in relation to an applicant shall have the meaning assigned to it
in sub-section (2) of section 288 of the Act as if the applicant were an
assesses;
(ii) in relation to the Commissioner, means a person authorised by the
Commissioner in writing to appear, plead and act for the Commissioner in any
proceedings before the Authority;
(f) "Authority" means the Authority for Advance Rulings
constituted under section 245-O of the Act;
(g) "Case" means any proceedings under Chapter XIX-B of the
Act in respect of an applicant;
(h) "Chairman"
means the Chairman of Authority;
(I) " Commissioner" means,—
(1) The Commissioner as defined in
sub-clause (16) of section 2 of the Act in respect of an applicant assessed
under the Income-tax Act,
(2) The Commissioner designated by
the Central Board of Direct Taxes in this behalf in respect of an applicant not
hitherto assessed;
(j) "Member"
means a member of the Authority and includes the Chairman;
(k) "Order"
includes any order, direction or ruling of the Authority;
(l) "Rule"
means a rule of the "Authority for Advance Rulings (Procedure) Rules,
1996";
(m) "Secretary"
means a Commissioner of Income-tax designated as the Secretary of the Authority
and includes an Additional Commissioner of Income-tax and Deputy Commissioner
of Income-tax appointed to assist the Secretary in his functions where the
context so requires;
(n) "Section"
means a section of the Act;
(o) Words
and expressions used and not defined herein but defined in the Act, shall have
the meanings respectively assigned to them in the Act.
3.
Language of the Authority:-
(1) The language of the Authority
shall ordinarily be English:
Provided that the
Authority may, at the request of the parties, permit the use of Hindi in the
proceedings before it to the extent it may consider appropriate and practical.
(2) Where any document is in a
language other than English or Hindi, an English translation thereof should
also be filed along therewith.
(3) The ruling of, and other orders
passed by the Authority may, at the discretion of the Authority, be in Hindi or
English.
4. Sittings of the
Authority:-
The Authority shall hold its sittings at its headquarters at
The Authority shall hear and determine the application made under
sub-section (1) of section 245Q of the Act and such other applications,
petitions and representations of an interlocutory, incidental or ancillary
nature as may be necessary for a complete and effective disposal of the
application, as the Chairman may by general or special order direct.
6. Power to remove
difficulty:-
If any difficulty arises in giving effect to any order of
the Authority, the Authority may, on its own motion or on an application made
by the applicant or the Commissioner, remove the difficulty insofar as it is
not inconsistent with the provisions of the Act.
7. Powers and functions of
the Secretary:-
(1) The Secretary
shall have the custody of the records of the Authority and shall exercise such
other functions as are assigned to him under these rules or by the Chairman by
separate order.
(2) The official seal of the
Authority shall be kept in custody of the Secretary.
(3) The Secretary shall also have
the following powers and duties namely:—
(I) To receive all applications filed before
the Authority;
(ii) To scrutinize the applications to find out
whether they are in conformity with the Act, the rules and the procedure;
(iii) to point out defects in such application to
the parties and require them to remove the defects by affording them a
reasonable opportunity to do so and, where, within the time granted, the
defects are not removed, to obtain necessary orders of the Authority;
(iv) to fix the date of hearing for the
applications in consultation with the Chairman and direct the issue of notices
there for;
(v) to issue the service of notices or other
processes and to ensure that the parties are properly served;
(vi) to requisition records from the custody of
any person including a Commissioner or any other authority;
(vii) to allow inspection of records of the
Authority;
(viii) to direct any formal amendment of the
records of the Authority;
(ix) to grant certified copies of the orders of
the Authority to the parties;
(x) to grant certified copies of documents
filed in the proceedings to the parties in accordance with the rules; and
(xi) to bring on record legal representatives,
in case of death or retirement of any party to the proceedings and to make such
appropriate amendments in the cause title as may become necessary in the other
situations referred to in rule 15.
8. Signing of notices
etcetera:-
(1) Any requisition, direction, letter,
authorization, or written notice to be issued by the Authority shall be signed
by the Secretary or by an officer authorised by him.
(2) Nothing in
sub-rule (1) shall apply to any requisition or direction which the Authority may,
in the course of the hearing, issue to an applicant or a Commissioner or an
authorised representative.
9. Mode of service of
notices:-
Every notice or other document required to be served on
or delivered to any person may, be sent by hand through process server, or by
registered post or by FAX to that person or his authorised representative at
the address or FAX number furnished by him for service or at the place where
the person or his authorised representative ordinarily resides or carries on
business or personally works for gain.
10. Procedure for filing
applications:-
(1) An application
shall be made in Form 34C of the Income-tax Rules, 1962 in quadruplicate and
presented by the applicant in person or by an authorised representative to the
Secretary or any other officer notified in writing by the Secretary or sent by
registered post addressed to the Secretary along with a fee of two thousand
five hundred Indian Rupees in the form of a Demand Draft drawn in favour of
"Authority for Advance Rulings" payable at New Delhi.
(2) The application, its
verification and the annexures, statements and documents accompanying it, shall
be signed in the manner set out in sub-rule (2) of rule 44E of the Income-tax
Rules, 1962:
Provided that where a person signing the application and other documents
claims to have been duly authorised in that behalf under the rules, the
application shall be accompanied by a power of attorney, authorizing him to
append his signature and an affidavit setting out the unavoidable reason which
entitles him to sign it.
(3) An application sent by
registered post under sub-rule (1) shall be deemed to have been made on the
date on which it is received in the office of the Authority.
(4) If the applicant is not hitherto
assessed in
(a) His head office in any other country,
(b) The place where his office and residence is
located or is likely to be located in
(c) The name and address of his representative in
(5) The Secretary
may send the application back to the applicant if it is defective in any
mannerfor removing the defects within such time as he may allow. Such
application shall be deemed to have been made on the date when it is
represented after correction.
11. Submission of
additional facts before the Authority:-
(1) The Authority
may at its discretion permit or require the applicant to submit such additional
facts as may be necessary to enable it to pronounce its advance ruling.
(2) Where
in the course of the proceedings before the Authority, a fact is alleged which
cannot be borne out by or is contrary to the record, it shall be stated clearly
and concisely and supported by a duly shorn affidavit.
12. Questions contained in
the application:-
The applicant shall not, except by leave of the Authority, urge or be heard
in support of any additional question not set-forth in the application, but in
deciding the application of the Authority shall at its descretion consider all
aspects of the questions set-forth as may be necessary to pronounce a ruling on
the substance of the questions posed for its consideration.
13. Date and place of
hearing to be notified:-
(1) Where
an application under section 245Q is received from an applicant not hither to
assessed and there is no Commissioner designated in respect thereof under rule
2(i)(2), a copy of the application and enclosures thereto shallbe
forwarded to the Board calling upon it to specify or designate; within a period
of two weeks, the commissioner for the purposes of the application, failing
which the application may be decided without hearing the Commissioner.
(2) On
receipt of an application under section 245Q in respect of which there is a
Commissioner as defined in rule.2(i)(1) or a Commissioner has been
designated by the Board under rule. 2(i)(2) or under sub-rule (1) of
this rule, the Authority shall notify the applicant and the Commissioner of the
date and place of hearing of the application and forward a copy of the
application to the Commissioner calling upon him to furnish the relevant
records of the case along with his comments, if any, on the contents of the
application and nominate his authorized representative if he desires to be heard.
14. Authorization to be
filed:-
An authorized representative appearing for the applicant at the hearing
shall file, before the commencement of the hearing, a document authorizing him
to appear for the applicant and if he is a relative of the applicant, the
document shall state the nature of his relationship with the applicant, or if
he is a person regularly employed by the applicant the capacity in which he is
at the time employed.
15. Continuation of
proceedings after the death, etc. of the applicant:-
Where the applicant dies or is wound up or dissolved or disrupted or
amalgamated or succeeded to by any other person or otherwise comes to an end,
the application shall not abate and may be permitted by the Authority, where it
considers that the circumstances justify it, to be continued by the executor,
administrator or other legal representative of the applicant or by the
liquidator, receiver or assignee, as the case may be, on an application made in
this behalf.
(1) On the day fixed,
or any other day to which the hearing may be adjourned, the Authority shall
hear the applicant or his authorized representative in cases where it is
proposed to reject the application of the applicant seeks/has sought an
opportunity of being heard. The Authority may also hear the Commissioner or his
authorized representative as well if it considers it necessary before
pronouncing its advance ruling.
(2) In appropriate
cases the Authority may call upon any person to supply such material as it may
consider necessary to assist the Authority in arriving at a decision.
(3) The Authority
may, on such conditions as the circumstances of the case may be required,
adjourn the hearing of the application.
17. Hearing of application
ex-part:-
Where on the date fixed for hearing or any other day to which the hearing
may be adjourned, the applicant or the Commissioner does not appear in person
or through an authorised representative when called on for hearing, the
Authority may dispose of the application ex-parte on merits:
Provided, that where an application has been disposed of as above and the
applicant or the Commissioner, as the case may be, applies within 15 days of
receipt of the order and satisfies the Authority that there was sufficient
cause for his non-appearance when the application was called upon for hearing,
the Authority may, after allowing the opposite party a reasonable opportunity
of being heard, make an order setting aside the ex-parte order and
restore the application for fresh hearing.
18.
Modification of the Order:-
Where the Authority finds so mouth or on a
representation made to it by the applicant or the Commissioner or otherwise,
but before the ruling pronounced by the Authority has been given effect to by
the Assessing Officer, that there is a change in law or facts on the basis of
which the ruling was pronounced, it may by order modify such ruling in such
respects as it considers appropriate, after allowing the applicant and the
Commissioner a reasonable opportunity of being heard.
19. Rectification of
mistakes:-
(1) The
Authority may, with a view to rectifying any mistake apparent from the record,
amend any order passed by it before the ruling pronounced by the Authority has
been given effect to by the Assessing Officer.
(2) Such
amendment may be made so mouth or when the mistake is brought to its
notice by the applicant or the commissioner, but only after allowing the
applicant and the Commissioner reasonable opportunity of being heard.
If at any stage of the proceedings before the Authority it appears that
there is any factual or material error in the records the same shall be amended
after hearing the applicant and the Commissioner.
21. Fees for supply of
additional certified copies:-
(1) The
Secretary may order grant of additional certified copies of documents or orders
to the applicant or the Commissioner on a written request made by either of
them.
(2) Copying
fees for supply of additional certified copies to the applicant shall be
charged at rupees three per page and such fees shall be paid in advance in
cash.
22. Inspection of records
and fees thereof:-
(1) The applicant
or the Commissioner or an authorised representative may be allowed to inspect
the records of the case on making an application in writing to the Secretary
provided that only those documents shall be allowed to be inspected which have
been relied upon in the proceedings before the Authority.
(2) The inspection
shall be allowed only in the presence of an offer of the Authority and the applicant
may be permitted to make notes of inspection but not to take copies of any
document.
(3) Fees for inspecting records of
the Authority shall be charged from the applicant as follows:-
(a) Rupees one hundred for the first hour or
part thereof, and
(b) Rupees fifty for every additional hour or
part thereof.
(4) Fees for inspection shall be
paid in advance in cash.
23. Declaration of advance
rulings to be void in certain circumstances:-
(1) Where
a representation is made under section 245T of the Act to the Authority by the
Commissioner or otherwise that an advance ruling pronounced by it under
sub-section (6) of section 245R has been obtained by the applicant by fraud or
misrepresentation of facts, such representation shall be made in quadruplicate
and shall be accompanied by a statement of facts incorporating the fraud or
misrepresentation as also particulars of the evidence to substantiate the claim
of fraud or misrepresentation of facts.
(2) On
receipt of such representation a notice shall be issued to the applicant along
with a copy of the representation for rebuttal and a reasonable opportunity
shall be allowed to the applicant and the Commissioner for being heard before
passing an order under section 245T.
24. Proceedings not open
to the public:-
Proceedings before the Authority shall not be open to the public and no
person, other than the applicant, the Commissioner or their authorised
representatives shall, without the permission of the Authority, remain present
during such proceedings.
Such of the orders of the Authority, as the Chairman deems fit for
publication in any authoritative report or the press, may be released for such
publication on such terms and conditions as the Chairman may specify.
26.
Authentication and communication of Orders:-
(1) Every order of
the Authority under Chapter XIX-B shall be duly signed by the members and bear
the official seal of the Authority.
(2) One
certified copy of such order of the Authority shall be communicated to the
applicant and the Commissioner under the signature of the Secretary or any
other officer of the Authority authorised by him in this behalf and bear the
official seal of the Authority.
27. Proceedings of the
Authority:-
(1) When one or
both of the members of the Authority other than the Chairman is unable to
discharge his functions owing to absence, illness or any other cause or in the
event of occurrence of any vacancy or vacancies in the office of the members
and the case cannot be adjourned for any reason, the Chairman alone or the
Chairman and the remaining member may function as the Authority.
(2) Subject to the
provisions of sub-rule (3), in case there is difference of opinion among the
members hearing an application the opinion of the majority of members shall
prevail and orders of the Authority shall be expressed in terms of the views of
the majority but any member dissenting from the majority view may record his
reasons separately.
(3) Where the Chairman and one other
member hear a case under sub-rule (1) and are divided in their opinion, the
opinion of the Chairman shall prevail.
28. Procedure in case of
other application:-
The provisions contained in these rules for the hearing
and disposal of application under section 245Q(1) shall apply, mutatis
mutandis, to the hearing and disposal of all other applications, petitions
and representations before the Authority.
(1) An authorised
representative shall appear before the Authority in dress prescribed for the
members of his profession by the competent professional body, if any.
(2) All other
persons appearing before the Authority shall be properly dressed.