Section 384: procedure on receipt of application

Step 1: records called for

On receipt of an application, the Board for Advance Rulings forwards a copy to the Principal Commissioner or Commissioner and calls upon that officer to furnish the relevant records, which must be returned at the earliest opportunity.

Step 2: application allowed or rejected

After examining the application and the records called for, the Board for Advance Rulings may allow or reject the application by an order.

The application must be rejected if the question raised:

• Is already pending before any income-tax authority or Appellate Tribunal - except in the case of a resident applicant falling under Section 380(b)(iii) - or any court;
• Involves determination of the fair market value of any property;
• Relates to a transaction or issue designed prima facie for the avoidance of income-tax - except for a resident applicant under Section 380(b)(iii) or an applicant under Section 380(b)(iv).

Hearing and reasons required before rejection

An application cannot be rejected under sub-section (2) unless the applicant has been given an opportunity of being heard, and the order records the reasons for rejection.

A copy of every order made under sub-section (2) - whether allowing or rejecting the application - is sent to the applicant and to the Principal Commissioner or Commissioner.

Pronouncing the ruling

Where an application is allowed, the Board for Advance Rulings examines any further material placed before it by the applicant or obtained by it, and pronounces its advance ruling in writing on the question specified in the application, within six months of the receipt of the application.

On a request from the applicant, the Board must provide an opportunity of being heard - in person or through a duly authorised representative - before pronouncing the ruling.

A copy of the advance ruling, duly signed by the Members and certified in the prescribed manner, is sent to the applicant and to the Principal Commissioner or Commissioner as soon as may be after pronouncement.

"Authorised representative" here carries the meaning assigned to it in Section 515(3)(a), as if the applicant were an assessee.

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