Advance Ruling under GST



Advance Ruling under GST

Like in income tax act, any person can obtain advance ruling in GST on the issues where interpretation of law is required.

Meaning of advance ruling:

  • It is a written interpretation of tax laws
  • It is required to applied before starting the proposed activity.
  • It is issued by tax authorities to corporations and individuals who request for clarification of certain tax matters.

Benefits of Advance Ruling:

  • Reduce litigation and costly legal disputes
  • Give decisions in a timely, transparent and inexpensive manner
  • It Provide certainty for tax liability in advance in relation to a future activity to be undertaken by the applicant
  • The clarity and clean taxation will attract non-residents who do not want to get involved in messy tax disputes

 Cases where Advance Ruling can be applied:

  • Determination of the liability to pay tax on any goods/services
  • Whether the applicant needs to be registered under GST
  • Availability  of input tax credit paid (or deemed to be paid)
  • Classification of any goods and/or services under the Act
  • Applicability of a notification which affects the rate of tax
  • Determination of time and value of supply of goods/services
  • Whether any act done by the applicant regarding goods/services will result in a supply


Procedure for applying advance ruling:

1.Applicant needs to be applied in form GST ARA-01 with sum of Rs.5000/-

2.After application it is forwarded to prescribed officer (advance ruling authority)

3.After receipt of application, Authority can either admit or reject the application

4.If concern person is not satisfied with decision of the authority then he can appeal to appellate Authority.

Time limit for giving Decision on the issue:

Within 90 days from application authority need to give the decision.If the members of the Authority differ in opinion on any point, they will refer the point to the Appellate Authority.


Binding of decision :

The advance ruling will be binding only –
(a) On the applicant
(b) On the jurisdictional tax authorities in respect of the applicant.

If the law, facts of the original advance ruling change then the advance ruling will not apply.


  1. Advance Ruling will have prospective effect only.
  2. Authority will NOT admit the application if same matter has already been decided in an earlier case for the applicant or the same matter is already pending in any proceedings for the applicant