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April 5, 2021

AAR allows applicant to voluntarily and unconditionally withdraw its application.

by CA Jessica Nagaonkar in GST

AAR allows applicant to voluntarily and unconditionally withdraw its application.

“Advance ruling” under GST means a decision provided by the Authority or the Appellate Authority to an applicant on matters or on questions specified in section 97(2) or section 100(1) of the CGST Act, 2017, in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.

The matters/questions specified for which advance ruling can be sought are:

  • Classification of any goods or services or both
  • Applicability of a notification issued under the provisions of CGST Act
  • Determination of time and value of supply of goods or services or both
  • Admissibility of input tax credit of tax paid or deemed to have been paid
  • Determination of the liability to pay tax on any goods or services or both
  • Whether applicant is required to be registered
  • 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.

The applicant desirous of obtaining advance ruling should make application to AAR in a prescribed form and manner. The format of the form and the detailed procedure for making application have been prescribed in the Advance Ruling Rules. Upon receipt of an application, the AAR shall send a copy of application to the officer in whose jurisdiction the applicant falls and call for all relevant records. The AAR may then examine the application along with the records and may also hear the applicant. Thereafter he will pass an order either admitting or rejecting the application.

Application for advance ruling will not be admitted in cases where the question raised in the application is already pending or decided in any proceedings in the case of an applicant under any of the provisions of this Act. The question which arises is whether can the applicant withdraw its application of advance ruling? We can refer to the case of M/s. Lfonds India Pvt. Ltd. (GST AAR Maharashtra) to find an answer to this question.

M/s Lfonds India Pvt Ltd., the applicant, sought an advance ruling in respect of the question that whether they could input tax credit of GST charged by the Vendors on expenses specifically incurred by them on behalf of Principal, the claim for which was denied /disallowed by the Insurance Company

Preliminary hearing in the matter was fixed on 28.01.2020. The applicant has sought time to submit documents to substantiate, that they are under taking an ongoing Contract and case was adjourned on 25.02.2020. The applicant has submitted a letter dated 24.02.2020 and requested that they may be allowed to voluntarily withdraw their subject application filed on 24.02.2020.

The request of the applicant to withdraw the application voluntarily and unconditionally was allowed, without going into the merits or detailed facts of the case.

AAR Maharashtra had also allowed another applicant to withdraw his advance ruling application. The application was filed by M/s. Shekhar Bhagwan Gore, the applicant, seeking an advance ruling in respect of the following questions:

  • How much GST Rate applicable to Aryan Contractor Pvt Ltd (subcontractor), 12% or 18%?
  • Which Tariff Head applicable to Aryan Contractor Pvt Ltd (subcontractor)?

The applicant has submitted a letter dated 30.12.2020 and requested that they may be allowed to voluntarily withdraw their subject application filed on 30.12.2020.

The request of the applicant to withdraw the application voluntarily and unconditionally was also allowed, without going into the merits or detailed facts of the case.

An advance ruling helps the applicant in planning his activities which are liable for payment of GST, well in advance and also brings certainty in determining the tax liability.

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