Manual No. 3
Procedure
followed in the decision making process, including channels of supervision
and accountability
Procedure
to be followed in pronouncing the advance rulings stands notified vide
Authority for Advance
Rulings (Central Excise,
Customs & Service Tax) Regulations, 2005.* The said
procedure has into effect from 26.01.2005.
Detailed procedure in
this regard is laid down vide Regulations 4,9,15 to 20, 23, 26 and 27. Same are
reproduced below:
Regulation 4.
Powers of the Authority. -
(1) The Authority shall have the power to hear and determine all applications
and petitions.
(2) The Authority may, if any difficulty
arises in giving effect to its order/advance ruling, either suo motu or on a
petition made by the applicant or the Commissioner within a period of three
months of noticing the difficulty, by appropriate order remove such difficulty,
and pass such other order as it considers just and necessary in the
circumstances of the case.
(3) The Authority may reopen the
hearing of any case, before pronouncement of its order/advance ruling, for
sufficient reasons,
(4)
The Authority may, in an appropriate case, direct -
(i) examination of any
records and submission of report;
(ii) conduct of any technical, scientific or market enquiry of any goods or
services and submission of report and may also call for reports from experts and
order such further investigation as may be necessary for effectual disposal of
the application.
(5)
The Authority shall have all the powers of a civil court in regard to the
following matters, namely:-
(i)
discovery and inspection ;
(ii) enforcing the attendance of any person
and examining him on oath;
(iii) issuing
commissions; and
(iv) compelling production of books of
account and other records.
*Notification No. 1/2005-AAR
dated 7th January, 2005.
Regulation 9.
Procedure on receipt of an
application. -
(1) The officer receiving the applications hall put his initials and the stamp
of the Authority thereon together with the date and time of receipt thereof and
shall also acknowledge its receipt and he shall also enter the particulars of
the application in the register of daily filing, maintained for that purpose.
(2) The application shall be scrutinized by the officer
authorized by the Secretary for that purpose for any deficiency/defect and any
deficiency/defect noticed in the application or annexures thereof shall be
communicated to the applicant
as far as possible within
ten working days from the date of receipt of application.
(3) The applicant shall be required to rectify the
deficiency/defect within the time granted by the Secretary and such application
shall deemed to have been received on the date when it is re-submitted after
removal of such deficiency/defect, for the purposes of sub-section (6) of
section 28I of the Customs Act or sub-section (6) of section 23D of the Central
Excise Act or sub-section (6) of section 96D of the Service Tax Provisions, as
the case may be.
(4) Date of receipt of an application free from any defect or
deficiency in the secretariat of the Authority shall be deemed to be the date of
the application for the purposes of sub-section (4) of section 28H of the
Customs Act or of sub-section (4) of section 23C of the Central Excise Act or of
sub-section (4) of section 96C of the Service Tax Provisions.
(5) When an application is free from any defect/deficiency, an
endorsement "examined and registered" shall be made thereon and a serial number
allotted thereto.
(6) In case the defect/deficiency is not removed/made good within
the time granted under sub-regulation (3), the application shall be placed
before the Authority for appropriate orders.
(7) On allotment of serial number to an application under
sub-regulation (5), a copy of the application shall be forwarded to the
concerned Commissioner of Customs/Central Excise for furnishing relevant records
with comments if any, within two weeks of the receipt of the application.
(8) On receipt of the relevant records/comments from the
concerned Commissioner under sub-regulation (7) or after expiry of two weeks or
such further period as may be allowed by the Authority, the application shall be
placed before the Authority for passing orders in terms of sub-section (2) of
section 28I of the Customs Act or sub-section (2) of section 23D of the Central
Excise Act or sub-section (2) of section 96D of the Service Tax Provisions, as
the case may be.
(9) In a case where the Authority considers that prima facie
the application is liable for rejection, a notice shall be issued to the
applicant indicating the reasons therefore together with the comments, if any,
of concerned Commissioner, giving an opportunity to the applicant of being heard
in person or through an authorized representative and a copy of the notice shall
be endorsed to the concerned Commissioner.
(10) On the date fixed for hearing or such other date to which
the case is adjourned, the Authority may pass an order either allowing or
rejecting the application under sub-section (2) of section 28I of the Customs
Act or sub-section (2) of section 23D of the Central Excise Act or sub-section
(2) of section 96D of the Service Tax Provisions, as the case may be and a copy
of the order passed by the Authority shall be sent to the applicant and the
concerned Commissioner.
(11) Where an
application is allowed, the comments of the concerned Commissioner and further
material, if any, shall accompany a copy of the order sent to the applicant
drawing his attention to the statutory provisions that he has a right to be
heard, if he so desires, before pronouncement of advance ruling and the response
of the applicant should reach the Authority within two weeks of receipt of the
copy of the order.
(12) Hearing of
the application shall normally be held between
11.00 a.m.
and 5.00 p.m. on a working day in the court - room of the Authority or an
alternative place fixed by the Authority.
(13) In the
absence of request for personal hearing from the applicant, advance ruling shall
be pronounced after hearing the concerned Commissioner or his authorized
representative, if present, on the date of hearing and on the basis of records
available with the Authority.
(14) Where the
Authority reserves the application for consideration, the advance ruling shall
be pronounced in the open court under intimation to the applicant and the
concerned Commissioner and a copy of the advance ruling shall be served upon the
parties to the application and the concerned Commissioner.
Regulation 15.
Hearing of application.-(1)
On the day fixed, or any other day to which the case is adjourned, the Authority
shall hear the applicant or his authorized representative in cases where it is
proposed to reject the application or where the applicant seeks an opportunity
of being heard and the Authority may also hear the Commissioner or his
authorized representative, if it considers it necessary, before pronouncing its
advance ruling.
(2) In an appropriate case, the
Authority may call upon any person to depose or to supply such material, as it
may consider necessary to arrive at a decision.
(3) The Authority may, in
an appropriate case where an important question of law arises, issue notice to a
Law Officer of the Central Government including the Attorney General and
Solicitor General to assist the Authority in the matter.
(4) It will also be open to
the Authority to appoint an advocate as amicus curie to assist the Authority in
an application.
(5) The Authority may, on
such conditions as the circumstances of the case require, adjourn the hearing of
the application.
Regulation 16.
Hearing of application ex
parte.-
Where on the day fixed for hearing or any other day to which the case is
adjourned, the applicant or the Commissioner does not appear in person or
through an authorized representative when the application is called for hearing,
the Authority may dispose of the application ex parte on merits:
Provided
that where an application has been disposed of under this regulation and the
applicant or the Commissioner, as the case may be, applies within seven days of
receipt of a copy of the order/advance ruling and the Authority is satisfied
that there was sufficient cause for his non-appearance when the application was
called for hearing, the Authority may, after allowing the opposite party a
reasonable opportunity of being heard, make an order setting aside the ex
parte order and restore the application for fresh hearing.
Regulation 17.
Withdrawal of application.-
The applicant
may withdraw his application within thirty days from the date of such
application and thereafter only with the leave of the Authority.
Regulation 18.
Modification of the order/advance
ruling.- The
Authority may suo motu or on a representation made to it by the
applicant or the Commissioner or otherwise, but before an advance ruling
pronounced by the Authority has been given effect to, on coming to know that
there is a change in law or facts on the basis of which the advance ruling was
pronounced, it may by order modify such ruling in such respects as it considers
appropriate, after allowing the applicant and the Commissioner a reasonable
opportunity of being heard.
Regulation 19.
Rectification of mistakes.(1)
The Authority may, with a view to rectifying any mistake apparent from
the record, may amend any advance ruling pronounced by it before such ruling has
been given effect to.
(2) Such amendment may be
made suo motu or when the mistake is brought to the notice of the
Authority by the applicant or the Commissioner, but only after allowing the
applicant and the Commissioner a reasonable opportunity of being heard.
Regulation 20.
Amendment of the Record.-
If at any stage of the proceedings it is brought to the notice of the Authority
that there is any factual or material error in the records, the Authority may
permit amendment of the records after hearing the applicant and the
Commissioner.
Regulation
23.
Declaration of advance ruling to be void in certain circumstances.-
(1) Where it is brought to the notice of the Authority on a representation made
by the Commissioner or otherwise that an advance ruling pronounced by it has
been obtained by the applicant by fraud or misrepresentation of facts, the
matter shall be examined by the Authority and any such representation shall be
supported by an affidavit duly attested and accompanied with attested copies of
documents relied upon.
(2) If the Authority after
examining the representation is prima facie of the view that the advance
ruling appears to have been obtained by the applicant by fraud or
misrepresentation of facts, the applicant shall be given a notice to explain as
to why the ruling should not be declared void ab initio under sub-section
(1) of section 28K of the Customs Act or sub-section (1) of section 23F of the
Central Excise Act or sub-section (1) of section 96F of the Service Tax
Provisions, as the case may be.
(3) Such notice to the
applicant shall be in writing -
(a) informing him of the
grounds on which it is proposed to declare the advance ruling as void ab
initio;
(b) enclosing copies of the
documents, if any, sought to be relied upon;
(c) giving an opportunity
of making a representation in writing within such reasonable time as may be
specified in the notice against the grounds for declaring the advance ruling
void ab initio; and
(d) giving a reasonable
opportunity of being heard in person or through an authorized representative in
the matter.
(4) A copy of the notice
with enclosures shall also be forwarded to the Commissioner for comments, if
any, and a reasonable opportunity shall also be allowed to the Commissioner or
his authorized representative of being heard before passing any order.
(5) Where the Authority
finds that the advance ruling was obtained by the applicant by fraud or
misrepresentation of facts, the same shall be declared void ab initio.
Regulation 26.
Authentication and communication
of orders/advance rulings.-
(1) Every order/advance ruling of the Authority shall be duly
signed by the Chairperson and the members of the Authority pronouncing the
order/advance ruling and bear the official seal of the Authority.
(2)
A certified copy of order/advance ruling of the Authority shall be
communicated to the applicant and the Commissioner under the signature of the
Secretary or another officer of the Authority authorized by the Secretary in
this behalf and bear the official seal of the Authority.
Regulation 27.
Proceedings of Authority-
(1) When one or both
of the Members of the Authority other than the Chairperson is unable to
discharge his functions owing to absence, illness or any other cause or in the
event of occurrence of any vacancy or vacancies in the office of the Members,
the Chairperson alone or the Chairperson and the remaining Member may function
as the Authority.
(2) Subject to the provisions of
sub-regulation (3), in case there is difference of opinion among the Members
hearing an application, the opinion of the majority of Members shall prevail and
order/advance ruling of the Authority shall be expressed in terms of the view of
the majority but any Member dissenting from the majority view may record his
reasons separately.
(3)
Where the Chairperson and one other member hear a case under
sub-regulation (1) and are divided in their opinion, the opinion of the
Chairperson shall prevail.
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