E-Advance Rulings Scheme, 2022
E-Advance Rulings Scheme, 2022
Advance rulings provide upfront clarity to the specified taxpayers as well as non-residents about the taxability/ non-taxability of transactions in India under the Income Tax laws. E-Advance rulings scheme, 2022 is introduced, vide notification dated 18th January 2022, by the Ministry of Finance.
The new e-advance rulings scheme enables taxpayers to apply advance rulings via e-mail. Notably, the personal hearing in the matter will also be conducted via video conferencing mode.
As the entire proceedings are to be carried out via electronic mode, the e-advance rulings scheme is more likely to benefit the applicant residing outside India. The present article briefs the entire scheme.
Applicability of e-advance ruling scheme-
E-advance ruling scheme will be applicable to-
- The application made by the applicant who is desirous of obtaining an advance ruling; or
- The application was transferred to the board for advance ruling as per section 245Q(4) of the Income Tax Act.
Manner of applying the e-advance ruling scheme-
The applicant is required to file an application for advance ruling in any of the following forms-
| Form | Particulars |
| Form No. 34C | When the applicant is a non-resident |
| Form No. 34D | When the applicant is resident and is seeking advance ruling for transaction undertaken or proposed to be undertaken with a non-resident |
| Form No. 34DA | When the applicant is resident and falls within the class or category of the person notified by the Government in the exercise of the power conferred by section 245N(b)(A)(iii) |
| Form No. 34E | When the applicant is resident and falls within the class or category of the person notified by the Government in the exercise of the power conferred by section 245N(b)(A)(iv) |
| Form No. 34EA | When the applicant is covered within section 245N(b)(A)(v) |
Such an application is to be filed by electronic mail (i.e., e-mail) to the Secretary or any authorized officer.
In case the application is found to be defective, the Sectary may send back the application for removal of the defects.
The applicant can withdraw the application within 30 days from the date of application.
Action post receipt of an application under the e-advance ruling scheme-
Once the application is received, the Board for Advance Rulings carries out the following procedure-
- Board will first intimate the applicant about the allocation or transfer;
- Based on the type of application, the Board for Advance Rulings will forward a copy of the application and a requisition to furnish the relevant record-
| Type of application | Copy forwarded to |
| When the applicant is assessed to tax in India | The Principal Commissioner or the Commissioner |
| When the applicant is not assessed to tax in India | Joint Secretary (Foreign Tax and Tax Research) |
- Based on the relevant record, the Board for Advance Rulings may either by an order allow the application or call upon the applicant to further explain the matter;
- Based on the explanation or if the explanation is not provided by the applicant, the application may be either allowed or rejected by the Board for Advance Rulings.
Other important points-
- Manner of authentication of electronic record-
| Particulars | Manner of authentication |
| Board for advance rulings, Commissioner of Income Tax or the Principal Commissioner of Income Tax | By affixing digital signature |
| An applicant or authorized representative is required to furnish an income tax return under digital signature | By affixing digital signature |
| An applicant or authorized representative in any other case | By communicating via the registered e-mail address |
- The personal hearing will be conducted via video conferencing which also includes telecommunication application software that supports videotelephony.
- Communication between the following will be exchanged by electronic mode-
- Board for Advance Rulings and the applicant;
- Board for Advance Rulings and the authorized representative of the applicant;
- Board for Advance Rulings and the Principal Commissioner of the Income Tax or the Commissioner of Income Tax;
- Communication like notice, order, or any other communication from the Board for Advance Rulings to the applicant will be sent to the registered e-mail address. Accordingly, the applicant will file the response to said notice, order, or any other communication via registered e-mail.
- The language of communication of the Board for Advance Rulings will be either English or Hindi as opted by the applicant.
- The Board for Advance Rulings will have all the powers of a civil court under the Code of Civil Procedure.
- The Secretary will have custody of all the records/ e-records of the Board for Advance Rulings.
