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April 2010

Appellate Tribunal : Ruling of Authority for Advance Rulings : Not binding on Tribunal : Tribunal can decide in consonance with ruling.

By K. B. Bhujle | Advocate
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 2 Appellate
Tribunal : Ruling of Authority for Advance Rulings : Not binding on Tribunal :
Tribunal can decide in consonance with ruling.



[CIT v. P. Sekar Trust, 321 ITR
305 (Mad.)]

In this case the Tribunal had
decided an issue before it accepting the ruling of the Authority of Advance
Ruling in Advance Ruling P. No. 10 of 1996, In re (1997) 224 ITR 473 (AAR).

In the appeal filed by the
Revenue, the question raised was as to whether the Tribunal was justified in
following the decision in the Advance Ruling
Authority which does not have binding effect on the assessee’s case.

The Madras High Court held as
under :


“(i) The ruling of the
Authority for Advance Ruling is not binding on others, but there is no bar
on the Tribunal taking a view or forming an opinion in consonance with the
reasoning of the Authority for Advance Ruling de hors the binding nature.

(ii) Since the Tribunal had
not rested its decision on the ruling of the Authority for Advance Rulings,
but had taken in aid and relied on the decision of the Court, the question
of law did not arise for consideration from the order of the Tribunal.”

 



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