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CA Final · Direct Tax Laws & International Taxation · Advance Rulings

Tej Pharma Ltd, a resident company, is told that a Board for Advance Rulings is being set up to give advance rulings under the Income-tax Act, 2025. Which statement correctly describes the composition of such a Board?

A Board for Advance Rulings has two members, each an officer not below the rank of Chief Commissioner, nominated by the Board. The Act does not provide for a judge as chair or a single-member Board, and the minimum rank is higher than Commissioner.

  1. AIt consists of two members, each an officer not below the rank of Chief Commissioner, nominated by the BoardCorrect
  2. BIt consists of three members, including a High Court judge as chairperson
  3. CIt consists of one member, an officer of the rank of Principal Commissioner
  4. DIt consists of two members, each an officer not below the rank of Commissioner of Income-tax (Appeals)

Explanation

Section 381(2) provides that the Board for Advance Rulings consists of two members, each being an officer not below the rank of Chief Commissioner, as nominated by the Board. The three-member option and the judge-chaired option do not match the text. The Commissioner (Appeals) rank is lower than the required rank.

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