Rajasthan High Court Rejects AAR’s GST Order, Upholds Advance Ruling Application

Recently, the Rajasthan High Court in Jaipur has overturned the order of the Authority for Advance Rulings (AAR) by ruling that the advance ruling application cannot be dismissed solely on the grounds that the applicant is not the supplier. This decision was made by Justice Avneesh Jhingan and Justice Ashutosh Kumar.

Background of the Case

The applicant, a taxpayer involved in electricity transmission, had sought clarification on whether transportation services were exempt under certain provisions of the Goods and Services Tax Act. The AAR had deemed the application not maintainable as the applicant was not the supplier.

Legal Analysis

Under the CGST Act, an advance ruling can be sought by any person registered or looking to register under the Act. There are no restrictions that the application must be made only by the supplier. The Court emphasized that the advance ruling can be requested by the supplier or a proposed supplier, which includes the applicant in this case.

Key Takeaways

According to the provisions of the CGST Act, Section 95 defines ‘advance ruling’ as a judgment on matters related to the supply of goods or services. The procedure for filing an advance ruling application is outlined in Section 97 and 98 of the Act.

Conclusion

The Rajasthan High Court’s decision to reject the AAR’s order and remand the case back for a fresh ruling highlights the importance of ensuring that all stakeholders have the right to seek clarity on GST matters.

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