Section 98 of GST – Procedure on receipt of application

Understanding the procedure followed upon the receipt of an application for advance ruling is essential for taxpayers seeking clarity under the GST regime. Section 98 of the CGST Act outlines the detailed steps undertaken by the Authority for Advance Ruling (AAR) once an application is filed. This blog breaks down the process in a simple and comprehensive manner, helping businesses and professionals navigate the GST framework effectively.

What Happens After an Application for Advance Ruling Is Received?

Upon receiving an application, the Authority for Advance Ruling initiates the process by forwarding a copy of the application to the concerned officer. If required, the Authority may also request the relevant records from the officer to evaluate the application more thoroughly. These records are to be returned to the officer promptly after examination.

Can the Authority Reject an Application for Advance Ruling?

Yes, the Authority can reject an application. However, before making this decision, the Authority thoroughly examines the application, the accompanying documents, and the records submitted. A hearing is conducted where both the applicant or their authorized representative and the concerned officer or their representative are given the opportunity to present their views.

The Authority may reject the application if the question raised has already been decided or is pending in any proceedings under the CGST Act involving the applicant. However, no application can be rejected without first giving the applicant an opportunity to be heard. Additionally, if the application is rejected, the Authority must clearly state the reasons for the rejection in the order.

What Happens Once the Application Is Admitted?

If the application is admitted, the Authority proceeds to examine any additional material submitted by the applicant or collected independently. Both the applicant and the concerned officer are given further opportunities to be heard. After considering all relevant inputs, the Authority pronounces its advance ruling on the questions raised in the application.

What If the Members of the Authority Disagree on a Question?

In situations where the members of the Authority differ on any question posed in the application, they must record the points of difference and refer the matter to the Appellate Authority for Advance Ruling (AAAR). The AAAR will then hear the case and provide a decision on the matter in question.

Within What Timeframe Must the Authority Pronounce Its Ruling?

The Authority is required to pronounce its advance ruling in writing within 90 days from the date the application is received. This ensures that applicants receive timely clarity on their GST-related queries, aiding in better compliance and tax planning.

Who Receives the Copy of the Advance Ruling?

Once the ruling is pronounced, a certified copy of the advance ruling, signed by the members of the Authority, is sent to the applicant, the concerned officer, and the jurisdictional officer. This formal communication ensures all stakeholders are informed and the ruling can be acted upon accordingly.

Why Is Section 98 Important for Taxpayers?

Section 98 plays a critical role in providing procedural clarity in the advance ruling mechanism under GST. It ensures transparency, due process, and a platform for both taxpayers and tax authorities to be heard. By following this structured process, the law upholds the principles of natural justice and helps taxpayers obtain definitive legal clarity on complex GST matters.

Conclusion

Section 98 of the CGST Act lays down a transparent and fair procedure for handling applications for advance rulings. It emphasizes due process, timely decision-making, and the importance of giving both the applicant and the tax authorities a fair opportunity to be heard. For businesses seeking certainty in their GST obligations, understanding and leveraging this process can be immensely beneficial.

If you’re considering filing for an advance ruling or need help interpreting GST provisions, consulting a qualified CA is highly recommended.