HOW TO APPLY FOR SEEKING ADVANCE RULING UNDER SERVICE TAX

[Dr. Sanjiv Agarwal]

FORM NO AAR (ST)

Advance Ruling means the determination by the authority, of a question of law or fact specified in the application regarding the liability to pay Service Tax in relation to a service proposed to be provided by the applicant.

The advance ruling can be sought on any subject touching upon a questions of fact or law relating to proposed service and its taxability to Service Tax. It may relate to —

(a) Scope of service regarding taxability

(b) Classification of service into a particular category of service

(c) Valuation of a service for charging Service Tax including valuation principles.

(d) Availability of exemption or any abatement.

(e) Applicability of notifications and circulars, etc.

(f) Availability of input Service Tax credit.

(g) Determination of liability to pay service tax.

(h) Any matter relating to law in respect of above.

Section 96C prescribes the application required to be made to the authority in prescribed form and manner. The application should be made in quadruplicate and accompanied by a fee of rupees two thousand and five hundred only. The Advance Ruling Rules, 2003 prescribed Form AAR (ST) for this purpose which should be duly signed and verified

Form AAR(ST) should contain statement of relevant facts and applicant's interpretation of law or facts. A statement containing the applicants interpretation should be annexed to the form. The applicant is also required to mention his status, i.e., individual, HUF, firm, company, etc.

The application can be withdrawn within a period of 30 days from the date of the application but it is not clear whether fees paid will be refunded or not. The fees paid will perhaps not be refunded. An application, may be rejected by the prescribed authority if the question or subject matter of ruling sought in the application is such which is already pending before any assessing officer, Service Tax Tribunal and court of law or such questions already stands decided by any court or bench of Tribunal. Thus, advance ruling will not be given in respect of pending questions or already decided questions.

The authority is required to give its ruling within 90 days of the receipt of valid application. If the applicant desires in writing to be heard, the authority shall provide an opportunity of being heard to the applicant in person or through his authorized representative.

The authority is also required to forward a copy of the application to the Commissioner of Central Excise and ask him to submit the relevant record if any. On the pronouncement of the advance ruling, the records so called for should be returned to the Commissioner of Central Excise. The authority can dispose of the application filed under Section 96C by either allowing it and pronouncing the advance ruling or rejecting it. The authority shall reject the application if the question raised is one —

(i) which is already pending before any Assessing Officer, Appellate Tribunal or Court, or

(ii) which is a matter already decided by Appellate Tribunal or Court.

Before any application is rejected, following three conditions must be satisfied —

(i) Opportunity of being heard should be granted to the applicant.

(ii) Reason for rejection of application shall be recorded and given in order

(iii) Copy of order should be sent to both, Applicant and Commissioner of Central Excise.

In case the Authority decides to allow the application, it can —

(i) Seek and examine further material placed before it by the applicant or obtained by the authority.

(ii) Provide an opportunity of being heard to the applicant before pronouncing the ruling, if requested by the applicant, either personally or through authorized representative.

(iii) Pronounce its advance ruling on the question specified in the application.

(iv) Advance ruling is to be pronounced in writing.

(v) Advance ruling should be given within ninety days of the receipt of application.

(vi) Order of advance ruling should be signed by the members of the authority.

(vii)  Certified copies of the order should be sent to —

(a) Applicant, and

(b) Commissioner of Central Excise

soon after the pronouncement of the advance ruling.

How to fill Application Form

Following points may be noted for filling up the application form -

1. The application must be filled in English or Hindi in quadruplicate.

2. The application must be accompanied by an account payee demand draft of Rupees two thousand five hundred drawn in favour of Authority for Advance Rulings, payable at New Delhi. Particulars of the draft should be entered in the column pertaining to item number 13.

3. The number and year of receipt of the applications will be filled in the Office of the Authority for Advance Rulings.

4. If the space provided for answering any item in the application is found insufficient, separate sheets may be used for this purpose. Each sheet must be signed at the bottom by the applicant.

5. In reply to item number 3, the applicant must state its status, i.e., whether the applicant is an individual, Hindu Undivided Family, firm, company, association of persons or any other person.

6. In reply to item number 6, the applicant must also state the status of the business activity proposed to be undertaken, i.e., the stage to which it has progressed.

7. For item number 7, the reply must be given in the context of the provisions regarding 'residence' in India, 'non-resident', Indian Company and foreign company as per the provisions of the Income Tax Act, 1961

8. Regarding item number 8, the question(s) should be based on the activity proposed to be undertaken, hypothetical questions will not be entertained.

9. In respect of item number 9, the Applicant must state in detail the relevant facts and also disclose the nature of his activity and the likely date and purpose of the proposed activities). Relevant facts reflected in document submitted alongwith the application must be included in the statement of facts and not merely incorporated by reference.

10. For item number 10, the applicant must clearly state his interpretation of law or facts in respect of question(s) on which the advance ruling is being sought.

11.The application, the verification appended thereto, the annexure to the application and the statements and documents accompanying the Annexure I and II must be signed on each page.

Procedure for filing Application Form

(1) Every application filed before the Authority shall be in the prescribed form, that is it to say, Form AAR (CUS) of the Customs (Advance Rulings) Rules, 2002 or Form AAR (CE) of the Central Excise (Advance Rulings) Rules, 2002 or Form AAR (ST) of the Service Tax (Advance Rulings) Rules, 2003, as the case may be.

(2) The application shall be filed in quadruplicate and presented by the applicant in person or by an authorized representative to the Secretary or any other officer authorized by the Secretary in this behalf or sent by registered post or by courier service or by speed post addressed to the secretary along with a fee of two thousand five hundred Indian Rupees in the form of demand craft drawn in favour of "Authority for Advance Rulings (Customs, Central Excise and Service Tax)" payable at New Delhi.

(3) Applications for advance ruling shall be received between 10.00 a.m. and 1.00 p.m. and between 2.00 p.m. and 5.00 p.m. on any working day.

(4) Every application, its verification, annexures, statements and supporting documents shall be signed in the manner set out in the rules.

(5) The application shall be accompanied by evidence that the person who has signed the application, verification and other documents is authorized / competent to sign under the Rules.

(6) Every application, its verification, annexures, statements and supporting documents shall be on A-4 size paper and should be neatly and legibly written, types or printed leaving a left margin or 5 cms. And only on one side of a page in double line spacing.

(7) An application under sub-regulation (1) shall be deemed to have been filed on the date on which it is received in the office of the Authority.

(8) If the applicant is not based in India, he shall, inter alia, indicate in a separate annexure to the application -

(a) his postal and e-mail address abroad;

(b) the name and address including e-mail address of his representative in India, if any, authorized to act on his behalf and to receive notices or other documents sent by the Authority.

Application Form

"FORM -AAR (ST)

[Application for Advance Ruling (Service Tax)]
 (See rule 3 of the Service Tax (Advance Rulings) Rules, 2003)

BEFORE THE AUTHORITY FOR ADVANCE RULINGS
(CENTRAL EXCISE, CUSTOMS AND SERVICE TAX) NEW DELHI

(Form of application for seeking Advance Ruling

 under Section 96C of the Finance Act, 1994.) 

Application Number …… of ……… 

1.	Details of Applicant
	(i)      Full name	:
	(ii)     Complete address	:
	(iii)     Telephone number( with STD/ISD code)	:
	(iv)     Fax number (with STD/ISD code)	:
	(v)     E-mail address	:
	(vi)    Postal address ( to be  provided if different from (ii) above)
2.	Status of the Applicant(Tick whichever is applicable)
	i.                     (i)  a non-resident setting up a joint venture in India in collaboration with,- ii.                   (a) a non-resident; or (b) with a resident;	:
	iii.                  (ii)    a resident setting up a joint venture  in India in collaboration with a non-resident;	:
	iv.                 (iii)    a wholly owned subsidiary Indian company, of which the holding company is a foreign company;	:
	v.                   (iv)    a joint venture in India;	:
	(v) a resident falling within any such class or category of persons, as the Central Government may, by notification in the Official  Gazette, specify in this behalf (mention notification number).	:
3.	Basis for claim as a proposed joint venture [ref. 2(i) & (ii) above] (furnish copy of following).
	(a)    Memorandum of Understanding; or	:
	(b) Letter of Intent; or	:
	( c) Articles of Association etc.; or	:
	(d)   Any other document.	:
4.	Details of proposed joint venture
	(i)      Full name	:
	(ii)     Complete address	:
	(iii)     Telephone number( with STD/ISD code)	:
	(iv)    Fax number (with STD/ISD code)	:
	(v)     E-mail address
	(vi)    Postal address( to be filled if different from (ii)  above)	:
5.	Details of resident/non-resident party other than the applicant forming the Joint Venture
	(i)      Full name	:
	(ii)     Complete address	:
	(iii)     Telephone number( with STD/ISD code)	:
	(iv)     Fax number (with STD/ISD code)	:
	(v)     E-mail address	:
	(vi)    Postal address( to be filled if  different from (ii)  above)	:
6.	In case of a wholly owned Indian Subsidiary Company furnish the following details:-
A.	(i)     Name of Foreign holding company	:
	(ii)     Complete address	:
	(iii)     Telephone number( with STD/ISD code)	:
	(iv)     Fax number (with STD/ISD code)	:
	(v)     E-mail address	:
	(vi)    Postal address( to be provided if  different from (ii) above)	:
B.	Percentage of Foreign holding in the Indian Subsidiary Company.	:
7.	In case of a joint venture [ref. 2(iv) above]
	(i)   The persons forming the joint venture/ constitution of joint venture.	:
	(ii)   Status of constituent persons, i.e. resident/non-resident.	:
	(iii)  Existing activities if any.	:
8.	Nature of business activity/ service proposed to be undertaken.	:
9.	Present status of business activity/ service.	:
10.	Registration number of the applicant as mentioned at serial number 1 under rule 4 of the   Service Tax Rules, 1994 (if any).	:
11.	Permanent Account Number (Income Tax) of the applicant (if any).	:
12.	Question of Law or fact on which Advance Ruling required (Tick whichever is applicable and provide details against ticked  item):-
	(i)   Classification of any service as a taxable service under Chapter  V of the Finance Act, 1994;	:
	(ii)   the valuation of taxable services for charging service tax;	:
	(iii) the principles to be adopted for the purposes of determination of value of the taxable service under the   provisions of   Chapter V of the Finance Act, 1994;	:
	(iv)   applicability of notifications issued under Chapter V of the Finance Act, 1994;	:
	(v)  admissibility of credit of service tax;	:
	(vi) determination of the liability to pay service tax on a taxable service under the provisions of Chapter V of the Finance Act, 1994.	:
13.	Statement of relevant facts having a bearing on the question(s) raised	:
14.	Statement containing the applicant's interpretation of law and/or facts, as the case may be, in respect of the aforesaid question(s) (i.e. applicant's view point and submissions on issues on which the advance ruling is sought).	:
15.	Whether the question(s) raised is/are pending in the applicant's case before any officer of Service Tax/Central Excise, Appellate Tribunal or any Court of Law? If so, provide details.	:
16.	Whether a similar matter as raised in the question(s) by the applicant has already been decided by the Appellate Tribunal or any Court?	:
17.	Concerned Commissioner(s) of Service Tax / Central Excise having jurisdiction in respect of the question referred at serial number 12.	:
18.	List of documents/statement attached, (attach the list on a separate sheet, if necessary.	:
19.	Particulars of demand draft enclosed with the application	:

                                                                                                     (Applicant's signature)

VERIFICATION

I, ____________________(name in full and in block letters), son/daughter/wife of ___________________ do hereby solemnly declare that to the best of my knowledge and belief what is stated above and in the annexure(s), including the documents are correct. I am making this application in my capacity as ___________________ (designation) and that I am competent to make this application and verify it.  

2. I also declare that the question (s) on which the advance ruling is sought is/are not pending in my case before any Central Excise/Service Tax  Authority, Appellate Tribunal or any Court. 

3. Verified this………….day………..of………….200   ……………at ………

(Applicant's signature)

ANNEXURE I

Statement of the relevant facts having a bearing on the question(s) on which the advance ruling is required  

Place ………………………..  

Date …………………………

(Applicant's signature)  

ANNEXURE II

Statement containing the applicant's interpretation of law and/or facts, as the case may be, in respect of the questions(s) on which advance ruling is required  

Place ………………………..

Date …………………………

(Applicant's signature)