FOSTER WHEELER FRANCE SA 92 QUAI. DE BARCY 75597, PARIS, CEDEX 12, FRANCE Vs. MR. RAJIB HOTA, DIT(IT), CHENNAI

JUDGEMENT

(1.) IN our order in AAR No. 1009 of 2010 (SEPCO III Electric Power Corporation), we had taken the view that if the applicant before this Authority had already filed a return of income involving the amount arising out of the identical transaction on which a question for our ruling is raised by filing an application under section 245Q(1) of the Income -tax Act, the application before the Authority for Advance Rulings will be barred by the clause (i) of the proviso to section 245R(2) of the Act and the application will have to be rejected. On an application made by the applicant therein before this Authority to review or reconsider the correctness of that view, after considering the relevant aspects pointed out, this Authority again reiterated its view. The correctness of this view so taken is again sought to be canvassed in this Application and the other Applications heard along with it containing similar fact situation.

(2.) THE applicant before us filed its return of income under section 139(1) of the Act on 31.3.2010. The transaction based on which Rulings on various questions are sought, was entered into on 31.10.2007. The application for Advance Ruling before this Authority was filed on 6.7.2010 raising certain questions as contemplated by the relevant provisions of the Act and the Rules framed.

(3.) THE view taken in SEPCO III order was that the applicant having filed a return of income, the question regarding the chargeability of the amount paid or recovered under a particular transaction during the Assessment Year, would arise for consideration and decision before the Assessing Officer and consequently, an application, for a ruling on the payment under that transaction, would be barred for the reason that the question raised in the application before this Authority was already pending before an Income -tax Authority within the meaning of clause(i) of the proviso to section 245R(2) of the Act. The proviso, as we see it, divests this Authority of jurisdiction in cases where its jurisdiction could be invoked by a qualified applicant, in three situations. The first is when the question on which a ruling is sought, is already pending before any Income -tax Authority or Appellate Tribunal or any court. The second is when the question involves determination of fair market value of any property. The third is where the question relates to a transaction or issue which is designed prima -facie for the avoidance of income -tax. When any one of those conditions is satisfied, obviously, this Authority has to decline jurisdiction and has to reject the application. Of course, as an authority constituted under a statute, this Authority may have a jurisdiction to decline a ruling even when one of these clauses in the proviso is not attracted or one of them is not strictly satisfied.[See the Ruling in Microsoft (AAR/781/2008)]