Applicability of advance ruling [Section 103] - GST Ready Reckoner - GST

Applicability of advance ruling Applicability of advance ruing pronounced by the Authority or Appellate Authority[ section 103(1) ] The advance ruling pronounced by the Authority or the Appellate Authority under this chapter shall be binding only on Who sought the advance ruling on specified matter under section 97(2) , on the concerned officer or the jurisdictional officer in respect of the applicant. the National Appellate Authority [ in case of distinct person] [ section 103(1A) ] Where the advance ruling pronounced on specified matter under section 97(2), conflicting Advance Rulings are given by the Appellate Authorities of two or more States or Union territories or both ; under section 101(1) or (3) may appeal to National Appellate Authority and advance ruling pronounced by the national advance ruling authority shall be binding only on the applicants (being distinct persons) who had sought the ruling under section 101B(1) and all registered persons having the same Permanent Account Number issued under the Income-tax Act, 1961 the concerned officers and the jurisdictional officers in respect of the applicants referred to in clause (a) and the registered persons having the same Permanent Account Number issued under the Income-tax Act, 1961. Following matter specified under section 97(2) (a) classification of any goods or services or both; (b) applicability of a notification issued under the provisions of this Act; (c) determination of time and value of supply of goods or services or both; (d) admissibility of input tax credit of tax paid or deemed to have been paid; (e) determination of the liability to pay tax on any goods or services or both; (f) whether applicant is required to be registered; (g) whether any particular thing done by the applicant with respect to any goods or services or both amounts to or results in a supply of goods or services or both, within the meaning of that term. Thus only Applicant/appellant shall bide by advance ruling Therefore, an applicant/appellant has no option but to abide by the advance ruling that he had applied for, except of approaching a higher court through a writ petition. Applicant/appellant not liable in case of change in law or circumstances As per section 103(2) 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. Although an advance ruling may not be binding on persons other than the applicant or the appellant, it does throw light on the manner in which the law is being understood and interpreted. Other taxpayers could draw inferences from the advance rulings. As Per Section 103 (1)(A) Would not be binding on other distinct person of applicant That is to say, the advance ruling obtained by an applicant would not be applicable to other distinct persons of such applicant. As such, it may be advisable to make the application for advance ruling by a distinct person, other than the distinct person who is desirous of undertaking such activity as the person making the application shall be bound by the advance ruling and not the other distinct person. Note : The above provision which seeks to bind only the applicant to the advance ruling could be misused by which applications for advance rulings are filed through a proxy carrying on business with the same/similar business model or issues.