Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise
Provision: Empowers the Authority to regulate its own procedure in all matters arising out of the exercise of its powers, subject to the Chapter. A proviso switches the section off on and from a notified date (part of the Board transition). The AAR (Procedure) Rules, 1996 are framed under this power.
Status: No direct merits ruling on s.245V as such. Candour rule applied; the procedural rules made under it (modification — Rule 18; rectification — Rule 19; ex parte disposal — Rule 17) have been construed, and those authorities are supplied.
A. SECTION COMMENTARY
1. Master of its own procedure
Section 245V is the source of the Authority’s procedural autonomy. Subject to the Chapter, it may regulate its own procedure, and it has done so through the Authority for Advance Rulings (Procedure) Rules, 1996. These Rules provide, among other things, for the form of application, hearing and disposal of interlocutory and intervention applications (Rule 5/Rule 28), ex parte disposal on merits (Rule 17), modification of a ruling on a change of law or facts (Rule 18) and rectification of a mistake apparent from the record (Rule 19).
2. Modification and rectification — the limits
The procedural power is not a power of review. Rectification under Rule 19 corrects a mistake apparent from the record; it does not permit the applicant to reframe or add questions not originally formulated (CTCI Overseas), nor does it empower the Authority to review its ruling on the strength of additional facts (General Electric Pension Trust). Because rectification presupposes a ruling, no rectification lies where no ruling was pronounced (Mahindra-BT Investment). Drawing on Columbia Sportswear, which equates the Authority with a Tribunal, the principles governing s.254(2) rectification by the Appellate Tribunal apply by analogy.
3. Ex parte disposal and natural justice
The procedural autonomy is bounded by natural justice. Rule 17 permits ex parte dismissal only on merits and only for genuine non-appearance; an order cannot stand where the hearing notice never reached the applicant (Onmobile Global). The forum’s mastery of its own procedure under s.245V does not license a denial of a fair hearing.
4. Candour
No decision construes s.245V in terms; the authorities below construe the Rules made under it and are the nearest governing law.
B. STATUTORY POSITION (verbatim text)
The text of section 245V, as it stands in the Act (Finance Act, 2025 base text), is set out below.
245V. The Authority shall, subject to the provisions of this Chapter, have power to regulate its own procedure in all matters arising out of the exercise of its powers under this Act:
Provided that nothing contained in this section shall apply on or after such date as the Central Government may, by notification in the Official Gazette, appoint.
Editorial note: the AAR (Procedure) Rules, 1996 are framed under s.245V; the proviso switches the section off from a notified date as part of the Board transition.
C. AUTHORITIES
Candour rule: no merits authority construes s.245V itself. The authorities below construe the procedural Rules (modification/rectification/ex parte) made under the section’s power.
Cluster 1 — Rectification/modification: scope and limits
CTCI Overseas Corporation Ltd, In re (2013) 261 CTR 344 (AAR)
Held: A rectification application does not permit the applicant to reframe or add new questions not originally formulated or adjudicated.
Relevance: Limits Rule 19 rectification under the s.245V procedural power.
General Electric Pension Trust, In re (2007) 289 ITR 335 (AAR)
Held: A rectification application does not empower the Authority to review its ruling on the basis of additional facts.
Relevance: Confirms rectification is not review.
Mahindra-BT Investment Co (Mauritius) Ltd v. DIT (2013) 359 ITR 485 (Bombay HC)
Held: Rectification presupposes that a ruling has been rendered; where no ruling is pronounced, no rectification application lies.
Relevance: Defines the precondition for invoking the rectification power under the Rules.
Cluster 2 — Ex parte disposal and natural justice
Onmobile Global Ltd v. Chairman, Authority for Advance Ruling (2015) 279 CTR 518 (Karnataka HC)
Held: Rule 17 allows ex parte dismissal only on merits for non-appearance; an application could not be rejected where the hearing notice never came to the applicant’s knowledge.
Relevance: Natural-justice limit on the procedural autonomy conferred by s.245V.
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 245V — Procedure of Authority
Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise
Provision: Empowers the Authority to regulate its own procedure in all matters arising out of the exercise of its powers, subject to the Chapter. A proviso switches the section off on and from a notified date (part of the Board transition). The AAR (Procedure) Rules, 1996 are framed under this power.
Finance Act, 2026: No amendment to section 245V.
Status: No direct merits ruling on s.245V as such. Candour rule applied; the procedural rules made under it (modification — Rule 18; rectification — Rule 19; ex parte disposal — Rule 17) have been construed, and those authorities are supplied.
A. SECTION COMMENTARY
1. Master of its own procedure
Section 245V is the source of the Authority’s procedural autonomy. Subject to the Chapter, it may regulate its own procedure, and it has done so through the Authority for Advance Rulings (Procedure) Rules, 1996. These Rules provide, among other things, for the form of application, hearing and disposal of interlocutory and intervention applications (Rule 5/Rule 28), ex parte disposal on merits (Rule 17), modification of a ruling on a change of law or facts (Rule 18) and rectification of a mistake apparent from the record (Rule 19).
2. Modification and rectification — the limits
The procedural power is not a power of review. Rectification under Rule 19 corrects a mistake apparent from the record; it does not permit the applicant to reframe or add questions not originally formulated (CTCI Overseas), nor does it empower the Authority to review its ruling on the strength of additional facts (General Electric Pension Trust). Because rectification presupposes a ruling, no rectification lies where no ruling was pronounced (Mahindra-BT Investment). Drawing on Columbia Sportswear, which equates the Authority with a Tribunal, the principles governing s.254(2) rectification by the Appellate Tribunal apply by analogy.
3. Ex parte disposal and natural justice
The procedural autonomy is bounded by natural justice. Rule 17 permits ex parte dismissal only on merits and only for genuine non-appearance; an order cannot stand where the hearing notice never reached the applicant (Onmobile Global). The forum’s mastery of its own procedure under s.245V does not license a denial of a fair hearing.
4. Candour
No decision construes s.245V in terms; the authorities below construe the Rules made under it and are the nearest governing law.
B. STATUTORY POSITION (verbatim text)
The text of section 245V, as it stands in the Act (Finance Act, 2025 base text), is set out below.
245V. The Authority shall, subject to the provisions of this Chapter, have power to regulate its own procedure in all matters arising out of the exercise of its powers under this Act:
Provided that nothing contained in this section shall apply on or after such date as the Central Government may, by notification in the Official Gazette, appoint.
Editorial note: the AAR (Procedure) Rules, 1996 are framed under s.245V; the proviso switches the section off from a notified date as part of the Board transition.
C. AUTHORITIES
Candour rule: no merits authority construes s.245V itself. The authorities below construe the procedural Rules (modification/rectification/ex parte) made under the section’s power.
Cluster 1 — Rectification/modification: scope and limits
CTCI Overseas Corporation Ltd, In re (2013) 261 CTR 344 (AAR)
Held: A rectification application does not permit the applicant to reframe or add new questions not originally formulated or adjudicated.
Relevance: Limits Rule 19 rectification under the s.245V procedural power.
General Electric Pension Trust, In re (2007) 289 ITR 335 (AAR)
Held: A rectification application does not empower the Authority to review its ruling on the basis of additional facts.
Relevance: Confirms rectification is not review.
Mahindra-BT Investment Co (Mauritius) Ltd v. DIT (2013) 359 ITR 485 (Bombay HC)
Held: Rectification presupposes that a ruling has been rendered; where no ruling is pronounced, no rectification application lies.
Relevance: Defines the precondition for invoking the rectification power under the Rules.
Cluster 2 — Ex parte disposal and natural justice
Onmobile Global Ltd v. Chairman, Authority for Advance Ruling (2015) 279 CTR 518 (Karnataka HC)
Held: Rule 17 allows ex parte dismissal only on merits for non-appearance; an application could not be rejected where the hearing notice never came to the applicant’s knowledge.
Relevance: Natural-justice limit on the procedural autonomy conferred by s.245V.
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.