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2012 (2) TMI 253 - AAR - Income TaxMaintainability of application before Advance Rulings Return of Income filed u/s 139(1) on 31.03.2010 - transaction based on which Rulings on various questions are sought, was entered into on 31.10.2007 application filed on 06.07.2010 Held that - Date of filing of the return is the relevant date to consider the applicability of the proviso to section 245R(2), and that the filing of the return of income generates questions including the ones raised before this Authority, the jurisdiction to give a ruling in the present application has to be held to be barred. We, therefore, reject the application as being barred by clause (i) of the proviso to section 245R(2). See SEPCO III Electric Power Corporation (2011 - TMI - 207237 - Authority For Advance Rulings).
Issues:
1. Interpretation of the proviso to section 245R(2) of the Income-tax Act regarding the jurisdiction of the Authority for Advance Rulings. 2. Determining the relevant date for considering the applicability of the proviso. 3. Impact of filing a return of income on the jurisdiction of the Authority for Advance Rulings. Detailed Analysis: Issue 1: The judgment discusses the interpretation of the proviso to section 245R(2) of the Income-tax Act, which restricts the jurisdiction of the Authority for Advance Rulings in certain circumstances. The proviso bars the Authority from entertaining applications where the question raised is already pending before an Income-tax Authority, Tribunal, or Court. The judgment emphasizes that the Authority must decline jurisdiction if the question is already under consideration by another tax authority or involves specific scenarios outlined in the proviso. The purpose of the proviso is to prevent duplication of proceedings and ensure timely resolution of tax disputes. Issue 2: The judgment delves into determining the relevant date for assessing the applicability of the proviso to section 245R(2) of the Act. It establishes that the crucial date for determining jurisdiction is the date of filing the return of income by the applicant, not the date of hearing or any subsequent procedural steps. By fixing the point at the filing of the return, the judgment aims to provide certainty and consistency in determining the existence of jurisdiction for the Authority for Advance Rulings. This approach prevents ambiguity and ensures a uniform standard for all applicants. Issue 3: The impact of filing a return of income on the jurisdiction of the Authority for Advance Rulings is a key aspect addressed in the judgment. It clarifies that filing a return initiates various questions related to income computation, exemptions, and tax liabilities. The judgment asserts that by filing a return, an assessee invites adjudication on all aspects arising from that return. Therefore, if the question raised before the Authority arises from the return filed, the jurisdiction of the Authority is considered to be barred under the proviso to section 245R(2) of the Act. The judgment highlights the importance of timely application to the Authority to avoid conflicts with pending assessments by Income-tax Authorities. In conclusion, the judgment in the case before the Authority for Advance Rulings emphasizes strict adherence to the proviso to section 245R(2) of the Income-tax Act to maintain clarity and consistency in jurisdictional matters. It underscores the significance of the date of filing the return of income as a crucial factor in determining the Authority's jurisdiction and upholding the purpose of Advance Rulings in expediting dispute resolution and promoting foreign investment.
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