TMI Blog2013 (8) TMI 487X X X X Extracts X X X X X X X X Extracts X X X X ..... r created under the proviso to section 245R (2) clearly operates. Therefore, these applications are not admitted for adjudication and stand rejected - Decided against the Assessee. - AAR No. 1138, 1140-1144, 1150 of 2011 - - - Dated:- 7-8-2013 - Dr. Arijit Pasayat and Mr. TBC Rozara , JJ. For the Appellant: Mr. Deepak Chopra, Advocate, Mr. Harpreet Singh Ajmani, Advocate and Ms. Shruti Sinha, Advocate For the Respondent: Mr. R.S. Rawal and Mr. Bhupinderjit Kumar ORDER (By Justice Dr. Arijit Pasayat, Chairman) Since common questions of law are involved in all these applications, reference to the factual aspects is limited only to the factual scenario of the issues involved, which are also similar. 2. The applicant company in each case filed application for advance ruling in terms of Section 245Q (1) of the Income-tax Act, 1961 (in short the Act). In response to the notice issued in each case the respondent Revenue has filed its objection (in the nature of preliminary objection) taking the stand that in view of the bar provided in section 245R(2) of the Act, the application needs to be rejected in each case. It has been specifically pointed out with reference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upervisory Activities in the absence of any specific supervisory fee under the Offshore supply contract? 3. Reference has been made to two decisions of this Authority in the case of Wave Field Inseis ASA (AAR No. 951 of 2010), wherein it was observed as under: In our order in AAR No.1009 of 2010 (SEPCO III Electric Power Corporation), we had taken the view that if the applicant before this Authority had already filed a return of income involving the amount arising out of the identical transaction on which a question for our ruling is raised by filing an application under section 245Q(1) of the Income-tax Act, the application before the Authority for Advance Rulings will be barred by the clause (i) of the proviso to section 245R(2) of the Act and the application will have to be rejected. It was further observed in the cited ruling as under :- One of the situations or circumstances, is when the question raised before it, has arisen before the Income-tax Authority. The question referred to in the proviso to section 245R(2) of the Act, is the question before the Authority for Advance Rulings. When a return is filed, so many aspects arise out of that return. The question of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... South Korea which is applicable to the applicant in each case. It is further pointed out that there is divergence of opinion in various rulings of this Authority and judgment of the Delhi High Court and therefore at the most the views expressed can be said to have prospective effect. In essence it is submitted that the provisions of Section 245R (2) have to be read down as discriminatory and invalid. The purpose and intent for setting up of the Authority has also been highlighted. It is also pointed out though initially the Authority was empowered to deal with applications of non-resident only, later on residents of a particular category were brought within the ambit of Section 245N(a). Some decisions dealing with the concept of equality under Article 14 of the Constitution have been highlighted. 5. By way of reply the Revenue has submitted that the plea of discrimination in any provision is an issue which this Authority cannot decide. Even otherwise, it is submitted that there is rationale for treating the two categories of applicants differently and the reasons have been highlighted by explanatory notes to the Finance Act by which the amendments were introduced at various points ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation,- (i) is already pending before any income-tax authority or Appellate Tribunal {except in the case of resident applicant falling sub-clause (iii) of clause(b) of section 245N} or any court; (ii) involves determination of fair market value of any property; is already pending before any income-tax authority or Appellate Tribunal {except in the case of resident applicant falling sub-clause (iii) of clause(b) of section 245N} or any court; (iii) relates to a transaction or issue which is designed prima facie for the avoidance of income-tax {except in the case of resident applicant falling in sub-clause (iii) of clause (b) of section 245N{or in the case of an applicant falling in sub-clause (b) of section 245N} Provided further that no application shall be rejected under this sub-section unless an opportunity has been given to the applicant of being heard: Provided also that where the application is rejected, reasons for such rejection shall be given in the order. It would be appropriate to deal with the issue as to whether the question raised can be said to be already pending. Where a return has been filed by the applicant for advance ruling and notice under se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the application for advance ruling is in issue in the return filed, be it on the question of taxability/non-taxability of any income, rate at which it is to be taxed, whether any expenditure/exemption is allowable or not and relatable to inclusion or exclusion of any income/expenditure. Mere filing of return before filing of the application under section 245Q(1) of the Income-tax Act, 1961 does not necessarily mean the question raised in the application is already pending before the Income-tax Authority. In these instant cases notices under section 143(2) were already issued before filing of the application before the AAR. The transaction on those where rulings of the AAR were sought, were admittedly shown in the return of income-tax filed before the date of application. Section 143(2) reads as under : Where a return has been furnished under section 139, or in response to a notice under sub-section (1) of section 142, the Assessing Officer shall (i) where he has reason to believe that any claim of loss, exemption, deduction, allowance or relief made in the return is inadmissible, serve on the assessee a notice specifying particulars of such claim of loss, exemption, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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