Domestic companies can obtain advance ruling on tax liability

Tags: News
With Rs 4 lakh crore locked in litigations, Finance Minister Arun Jaitley today proposed to allow domestic companies to obtain advance ruling with regard to their direct and indirect tax liabilities.

Till now the facility for obtaining Advance Ruling was available to non-residents and public sector undertakings.

"I propose to enable resident taxpayers to obtain an advance ruling in respect of their income tax liability above a defined threshold. I also propose to strengthen the Authority for Advance Rulings by constituting additional benches," he said in his Budget speech for 2014-15.

Similarly, in indirect taxes, the scheme of Advance Ruling has been expanded to cover resident private companies.

"This will allow these companies to seek advance ruling in respect of new activities being proposed to be undertaken by them. The scope of Settlement Commission is being enlarged to facilitate quick dispute resolution," Jaitley added.

Tax demand of more than Rs 4 lakh crore is under dispute and litigation before various Courts and Appellate authorities. "This is one of the serious concerns of all taxpayers," he said.

The scope of the Income-Tax Settlement Commission would also be enlarged so that taxpayers may approach the Commission for settlement of disputes. This would continue to be once in a lifetime opportunity for any taxpayer.

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