Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise
Provision: Inserted by the Finance Act, 2021 w.e.f. 1 April 2021. Empowers the Central Government to constitute one or more Boards for Advance Rulings to give advance rulings on or after a notified date; each Board consists of two members, each an officer not below the rank of Chief Commissioner, nominated by the CBDT.
Notifications: Boards for Advance Ruling at Delhi and Mumbai constituted by Notification S.O. 3561(E) dated 1 September 2021; the e-Advance Rulings Scheme, 2022 notified by Notification No. 07/2022 dated 18 January 2022 (faceless, e-mail-based, dynamic-jurisdiction procedure under s.245R(9)/(10)).
Finance Act, 2026: No amendment to section 245-OB.
Status: New and as yet untested on its merits. Candour rule applied. The substantive jurisprudence of the erstwhile Authority on “advance ruling”, admission bars and binding effect carries over to the Board; the institutional change brings appeal to the High Court (s.245W) in place of writ to challenge a judicial Authority.
A. SECTION COMMENTARY
1. The institutional shift
Section 245-OB replaces the high-powered, judicially-staffed Authority for Advance Rulings with departmental Boards for Advance Rulings — each comprising two officers not below Chief-Commissioner rank. The change responds to the chronic problem of vacancies that had stalled the Authority (rulings were to issue within six months under s.245R(6) but in practice took years). The trade-off is candidly structural: speed and administrative capacity are gained, but the forum is no longer a Tribunal of judicial composition; the assessee’s safeguard is re-located to a statutory appeal to the High Court under s.245W.
2. Faceless architecture
Read with s.245R(9) and (10), s.245-OB underpins a faceless scheme. The e-Advance Rulings Scheme, 2022 (Notification No. 07/2022 dated 18 January 2022) eliminates the physical interface between Board and applicant to the extent technologically feasible, provides for hearing through video-conferencing, and operates on dynamic jurisdiction. Boards were first constituted at Delhi and Mumbai (Notification S.O. 3561(E) dated 1 September 2021).
3. Continuity of substantive law
Although the institution is new, the substantive law it administers is not. The definitions in s.245N, the admission bars in the proviso to s.245R(2), the binding effect in s.245S and the void-for-fraud power in s.245T all apply mutatis mutandis to the Board (the Chapter’s several “Board for Advance Rulings” substitution clauses give effect to this). Accordingly, the pre-2021 body of Authority rulings remains the working jurisprudence before the Board, subject to the appellate gloss the High Courts will supply under s.245W.
4. Candour
There is no merits decision yet construing s.245-OB. The recent Supreme Court decision in Tiger Global (2026 INSC 60), though arising from a ruling of the erstwhile Authority, illustrates the avoidance enquiry that the Board too must conduct and is noted here and under s.245R. No case law is invented to fill the gap.
B. STATUTORY POSITION (verbatim text)
The text of section 245-OB, as it stands in the Act (Finance Act, 2025 base text), is set out below.
245-OB. (1) The Central Government shall constitute one or more Boards for Advance Rulings, as may be necessary, for giving advance rulings under this Chapter on or after such date as the Central Government may, by notification in the Official Gazette, appoint.
(2) The Board for Advance Rulings shall consist of two members, each being an officer not below the rank of Chief Commissioner, as may be nominated by the Board.
Editorial note: section 245-OB was inserted by the Finance Act, 2021 w.e.f. 1 April 2021. Its operation is given effect through Notification S.O. 3561(E) dated 1 September 2021 and the e-Advance Rulings Scheme, 2022.
C. AUTHORITIES
Candour rule: section 245-OB is new (Finance Act, 2021) and has no merits jurisprudence of its own. The continuity of substantive law is shown by the carried-over Authority rulings collected under ss.245N, 245R and 245S; the recent avoidance authority is noted below as cognate.
Cluster 1 — Continuity and the avoidance enquiry before the Board
Authority for Advance Rulings (Income Tax) v. Tiger Global International II Holdings, 2026 INSC 60 (SC, 15 January 2026)
Held: Confirmed the forum’s power under s.245R(2)(iii) to look through form to substance and decline a ruling on an arrangement prima facie designed to avoid tax (full note under s.245R).
Relevance: Though arising from the erstwhile Authority, it states the enquiry the Board for Advance Rulings must equally undertake — the substantive law is continuous across the institutional change.
Columbia Sportswear Company v. DIT (2012) 346 ITR 161 (SC)
Held: Advance rulings are binding inter partes yet reviewable by the constitutional courts.
Relevance: Post-2021, the review of a Board ruling is channelled through the statutory High-Court appeal in s.245W; Columbia Sportswear remains the conceptual anchor for reviewability.
Compiled for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text is reproduced from the Income-tax Act, 1961 (text as printed in the local Act, base text amended up to the Finance Act, 2025), with the publisher's footnote apparatus and amendment-marker brackets removed; no statutory word is altered. Chapter XIX-B (Advance Rulings, ss.245N–245W) was inserted by the Finance Act, 1993; the Authority for Advance Rulings was replaced, for fresh income-tax applications, by the Board for Advance Rulings (s.245-OB, Finance Act, 2021), with a statutory appeal to the High Court (s.245W) and the e-Advance Rulings Scheme, 2022. The Finance Act, 2026 makes NO amendment to any section of Chapter XIX-B. Rulings of the Authority for Advance Rulings are cited as the natural body of jurisprudence on this Chapter; Supreme Court and High Court decisions are flagged as such; there is virtually no Income-tax Appellate Tribunal authority on Chapter XIX-B (advance-ruling disputes travel to the High Court/Supreme Court, not the Tribunal), which is stated candidly rather than padded. Where a section has not been judicially construed, that is stated and the nearest governing authority is given. Citations are stated as reported and have been web-verified; the reader should consult the official report before filing. This material is for professional reference and is not legal advice.
CHAPTER XIX-B — ADVANCE RULINGS
Section 245-OB — Board for Advance Rulings
Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise
Provision: Inserted by the Finance Act, 2021 w.e.f. 1 April 2021. Empowers the Central Government to constitute one or more Boards for Advance Rulings to give advance rulings on or after a notified date; each Board consists of two members, each an officer not below the rank of Chief Commissioner, nominated by the CBDT.
Notifications: Boards for Advance Ruling at Delhi and Mumbai constituted by Notification S.O. 3561(E) dated 1 September 2021; the e-Advance Rulings Scheme, 2022 notified by Notification No. 07/2022 dated 18 January 2022 (faceless, e-mail-based, dynamic-jurisdiction procedure under s.245R(9)/(10)).
Finance Act, 2026: No amendment to section 245-OB.
Status: New and as yet untested on its merits. Candour rule applied. The substantive jurisprudence of the erstwhile Authority on “advance ruling”, admission bars and binding effect carries over to the Board; the institutional change brings appeal to the High Court (s.245W) in place of writ to challenge a judicial Authority.
A. SECTION COMMENTARY
1. The institutional shift
Section 245-OB replaces the high-powered, judicially-staffed Authority for Advance Rulings with departmental Boards for Advance Rulings — each comprising two officers not below Chief-Commissioner rank. The change responds to the chronic problem of vacancies that had stalled the Authority (rulings were to issue within six months under s.245R(6) but in practice took years). The trade-off is candidly structural: speed and administrative capacity are gained, but the forum is no longer a Tribunal of judicial composition; the assessee’s safeguard is re-located to a statutory appeal to the High Court under s.245W.
2. Faceless architecture
Read with s.245R(9) and (10), s.245-OB underpins a faceless scheme. The e-Advance Rulings Scheme, 2022 (Notification No. 07/2022 dated 18 January 2022) eliminates the physical interface between Board and applicant to the extent technologically feasible, provides for hearing through video-conferencing, and operates on dynamic jurisdiction. Boards were first constituted at Delhi and Mumbai (Notification S.O. 3561(E) dated 1 September 2021).
3. Continuity of substantive law
Although the institution is new, the substantive law it administers is not. The definitions in s.245N, the admission bars in the proviso to s.245R(2), the binding effect in s.245S and the void-for-fraud power in s.245T all apply mutatis mutandis to the Board (the Chapter’s several “Board for Advance Rulings” substitution clauses give effect to this). Accordingly, the pre-2021 body of Authority rulings remains the working jurisprudence before the Board, subject to the appellate gloss the High Courts will supply under s.245W.
4. Candour
There is no merits decision yet construing s.245-OB. The recent Supreme Court decision in Tiger Global (2026 INSC 60), though arising from a ruling of the erstwhile Authority, illustrates the avoidance enquiry that the Board too must conduct and is noted here and under s.245R. No case law is invented to fill the gap.
B. STATUTORY POSITION (verbatim text)
The text of section 245-OB, as it stands in the Act (Finance Act, 2025 base text), is set out below.
245-OB. (1) The Central Government shall constitute one or more Boards for Advance Rulings, as may be necessary, for giving advance rulings under this Chapter on or after such date as the Central Government may, by notification in the Official Gazette, appoint.
(2) The Board for Advance Rulings shall consist of two members, each being an officer not below the rank of Chief Commissioner, as may be nominated by the Board.
Editorial note: section 245-OB was inserted by the Finance Act, 2021 w.e.f. 1 April 2021. Its operation is given effect through Notification S.O. 3561(E) dated 1 September 2021 and the e-Advance Rulings Scheme, 2022.
C. AUTHORITIES
Candour rule: section 245-OB is new (Finance Act, 2021) and has no merits jurisprudence of its own. The continuity of substantive law is shown by the carried-over Authority rulings collected under ss.245N, 245R and 245S; the recent avoidance authority is noted below as cognate.
Cluster 1 — Continuity and the avoidance enquiry before the Board
Authority for Advance Rulings (Income Tax) v. Tiger Global International II Holdings, 2026 INSC 60 (SC, 15 January 2026)
Held: Confirmed the forum’s power under s.245R(2)(iii) to look through form to substance and decline a ruling on an arrangement prima facie designed to avoid tax (full note under s.245R).
Relevance: Though arising from the erstwhile Authority, it states the enquiry the Board for Advance Rulings must equally undertake — the substantive law is continuous across the institutional change.
Columbia Sportswear Company v. DIT (2012) 346 ITR 161 (SC)
Held: Advance rulings are binding inter partes yet reviewable by the constitutional courts.
Relevance: Post-2021, the review of a Board ruling is channelled through the statutory High-Court appeal in s.245W; Columbia Sportswear remains the conceptual anchor for reviewability.
Compiled for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text is reproduced from the Income-tax Act, 1961 (text as printed in the local Act, base text amended up to the Finance Act, 2025), with the publisher's footnote apparatus and amendment-marker brackets removed; no statutory word is altered. Chapter XIX-B (Advance Rulings, ss.245N–245W) was inserted by the Finance Act, 1993; the Authority for Advance Rulings was replaced, for fresh income-tax applications, by the Board for Advance Rulings (s.245-OB, Finance Act, 2021), with a statutory appeal to the High Court (s.245W) and the e-Advance Rulings Scheme, 2022. The Finance Act, 2026 makes NO amendment to any section of Chapter XIX-B. Rulings of the Authority for Advance Rulings are cited as the natural body of jurisprudence on this Chapter; Supreme Court and High Court decisions are flagged as such; there is virtually no Income-tax Appellate Tribunal authority on Chapter XIX-B (advance-ruling disputes travel to the High Court/Supreme Court, not the Tribunal), which is stated candidly rather than padded. Where a section has not been judicially construed, that is stated and the nearest governing authority is given. Citations are stated as reported and have been web-verified; the reader should consult the official report before filing. This material is for professional reference and is not legal advice.