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Authority for Advance Ruling (Excise & Customs)

AUTHORITY FOR ADVANCE RULINGS (EXCISE & CUSTOMS)

  1. The Government of India vide Finance Acts, 1998 and 1999 proposed the setting up of an Authority for advance rulings for Excise and Customs in view of the need for foreign investors to be assured in advance of their likely indirect tax liability, by providing binding rulings on important issues. Authority for Advance Rulings (Customs & Central Excise) was constituted vide Notification No.16/2002-Ad, IC dated 7th May, 2002.
  2. The Authority consists of a retired judge of the Supreme Court functioning as the Chairperson and two Members an officer of the Indian Customs & Central Excise Service qualified to be a Member of the CBEC and the other an Officer of the Indian Legal Service who is or is qualified to be, an Additional Secretary to the Government of India.
  3. Application for advance ruling can be filed by
    1.  
      1. a non-resident setting up a joint venture in India in collaboration with a non-resident or a resident; or
      2. a resident setting up a joint venture in India in collaboration with a non-resident or
      3. a wholly owned subsidiary Indian company, of which the holding company is a foreign company
    2. who or which, as the case may be, proposed to undertake any business activity in India
      1. a joint venture in India; or
      2. 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, and which or who, as the case may be, makes application for advance ruling; Central Govt. vide notification No. 69/2005-Cus (N.T.) dated 29th July, 2005 has notified importers importing from Singapore under CECA.
  4. Question on which advance rulings can be sought are :
    1. Classification of goods under the Customs Tariff Act, 1975. Central Excise Tariff Act, 1985, and any service as a taxable service under Chapter V of the Finance Act, 1994 (Service Tax)
    2. Principles to be adopted for the purposes of determination of value of goods under the Customs Act, 1962, the Central Excise Act, 1944 and of taxable services under Chapter V of the Finance Act, 1994.
    3. Valuation of taxable services for charging Service Tax
    4. Applicability of notifications issued under the Customs Act, 1962, Customs Tariff Act, 1975, Central ExciseAct,1944 and Central Excise Tariff Act, 1985 having a bearing on the rate of duty and any duty chargeable under any other law for the time being in force in the same manner as duty of customs or excise and also of notifications issued under Chapter V of Finance Act 1994, as the case may be.
    5. Admissibility of credit of excise duty paid or deemed to have been paid on the goods used in or in relation to the manufacture of excisable goods.
    6.  Admissibility of credit of Service Tax.
    7. Determination of liability to pay Excise Duty
    8. Determination of liability to pay Service Tax
    9. Determination of origin of goods in terms of the Rules notified under the Customs Tariff Act, 1975 and matters relating thereto.
  5. An advance ruling is statutorily required to be pronounced within 90 days of the receipt of application. An applicant has been given the liberty to withdraw his application within thirty days from the date of the application. The advance ruling pronounced by the Authority shall be binding only on the applicant who had sought it, in respect of any question as aforesaid and also on the Commissioner of Customs or Central Excise or Service Tax, as the case may be and the authorities subordinate to him, in respect of the applicant.
  6. For filing an application under Customs, Central Excise & Service Tax laws, forms have been prescribed under Customs (Advance Rulings) Rules, 2002, Central Excise (Advance Rulings) Rule, 2002 and Service Tax (Advance Rulings) Rules, 2003. Detailed procedure has been laid down by the Authority for Advance Rulings (Customs, Central Excise and Service Tax) Procedure Regulations, 2005. (also known as AARUL (CEST) regulations) for regulating its own procedure in all matters arising out of the exercise of the powers under the respective Acts.