In the evolving landscape of indirect taxation under the Goods and Services Tax (GST) regime, the Authority for Advance Rulings (AAR) plays a crucial role in offering clarity to taxpayers on complex legal questions. However, procedural discipline is as vital as substantive claims. A recent ruling by the Kerala AAR in [2025] 176 taxmann.com 378, dated 16th April 2025, underscores this point. The application for an advance ruling was dismissed solely due to the assessee’s failure to participate in the proceedings. The case stands as a stark reminder that non-compliance with procedural norms can defeat the very purpose of seeking legal clarity.
🧩 Background of the Case
An applicant approached the Kerala Authority for Advance Rulings (AAR) seeking clarification under the GST regime. Though the application was duly admitted and listed for hearing, the applicant failed to appear or submit any written arguments.
Multiple opportunities were provided for participation and hearing, but the assessee remained absent throughout. As a result, the AAR was left without any factual support or clarification to deliberate upon the questions raised.
⚖️ Key Legal Issue
Can an advance ruling application be adjudicated in the absence of the applicant, and what is the consequence of such non-participation?
🧑⚖️ Observations by the AAR
- The AAR emphasized that an advance ruling is a quasi-judicial process and the applicant’s active involvement is essential.
- In the absence of submissions, oral or written, the authority could not determine the legal position or facts relevant to the case.
- The authority noted that natural justice principles demand proper participation by both parties.
🧾 Final Ruling
The application was dismissed as infructuous due to non-prosecution. The AAR clarified that it could not pass an ex parte ruling without sufficient material on record, especially when the applicant voluntarily failed to participate despite opportunities.
📌 Key Takeaways for Taxpayers
- Proactive participation is mandatory in proceedings before authorities such as the AAR.
- An advance ruling application is not a mere formality—non-attendance can lead to dismissal without decision on merits.
- This decision reiterates the importance of procedural compliance in quasi-judicial proceedings.
📚 Relevant Legal Provisions
- Section 97 of the CGST Act, 2017 – Power to seek advance rulings.
- Principles of Natural Justice – Right to be heard and duty to appear.
- Rule 107A of CGST Rules – Procedure before the AAR.
Case Details:
Citation: [2025] 176 taxmann.com 378 (AAR – Kerala)
Ruling Date: 16-Apr-2025
Reported on: 22-Jul-2025
Authority: Authority for Advance Rulings (AAR), Kerala