GST AAR rejects advance ruling as not maintainable under Sections 97(2) and 98(2) of CGST Act

The AAR (Gujarat) declined to admit the applicant's advance ruling application under Section 98(2) of the CGST Act. The Authority held that since the applicant was already registered under GST, the query did not concern "requirement of registration" but rather the permissibility of multiple registrations at the same premises, which does not fall within any of the specified questions under Section 97(2). The AAR further observed that any ruling would bind only the applicant, not its clients, rendering the request misconceived. Reliance placed on prior Kerala AAR rulings was rejected, noting those authorities had not examined admissibility on the same parameters. The application was rejected as not maintainable.

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1. ISSUES PRESENTED AND CONSIDERED

1.1 Whether an advance ruling application is maintainable where the question relates to eligibility of GST registration for multiple unrelated businesses (clients) at the applicant's premises as "Principal Place of Business".

1.2 Whether the question raised falls within the permissible scope of matters on which advance ruling can be sought under Section 97(2) of the CGST Act, 2017.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Maintainability of application when the question pertains to clients' GST registration at applicant's premises

Legal framework

2.1 The Court considered Section 95(a) of the CGST Act, which defines "advance ruling" as a decision provided by the Authority to an applicant on matters or questions specified in Section 97(2) or Section 100(1), in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant.

2.2 Section 103 of the CGST Act provides that an advance ruling is binding only on the applicant and the concerned officer/jurisdictional officer in respect of the applicant.

2.3 Section 98(2) empowers the Authority not to admit an application where the questions raised do not fall within the scope of Section 97(2).

Interpretation and reasoning

2.4 The Court found that the question posed was whether GST registration can be granted to multiple unrelated businesses (clients) using distinct, identifiable and demarcated seats/time slots at the applicant's address as their "Principal Place of Business".

2.5 The Court held that the question directly concerns the registration status and entitlement of the applicant's clients, and not the supply of goods or services being undertaken or proposed to be undertaken by the applicant within the meaning of Section 95(a).

2.6 Since an advance ruling is intended to operate only in relation to the applicant's own supplies, the query seeking determination of whether the clients can be granted registration falls outside the statutory definition of "advance ruling".

2.7 The Court also noted that, in terms of Section 103, any ruling would be binding only on the applicant and not on its clients; hence, the ruling sought would not practically or legally govern the clients' registration, underscoring the mismatch between the statutory scheme and the relief sought.

Conclusions

2.8 The application, to the extent it seeks a ruling on the eligibility of GST registration for the applicant's clients at the applicant's address, is not maintainable under Section 95(a) of the CGST Act.

Issue 2: Whether the question falls within any of the clauses of Section 97(2) of the CGST Act

Legal framework

2.9 The Court examined Section 97(2) of the CGST Act, which exhaustively lists the questions on which advance ruling can be sought, namely: (a) classification of goods or services; (b) applicability of notifications; (c) determination of time and value of supply; (d) admissibility of input tax credit; (e) determination of liability to pay tax; (f) whether the applicant is required to be registered; and (g) whether any particular act of the applicant amounts to a supply.

Interpretation and reasoning

2.10 The Court noted that in the application form, the applicant had marked clause (f) - "whether applicant is required to be registered" - as the relevant category.

2.11 The Court found this classification to be incorrect because the applicant was already registered under GST, and the substantive question raised did not concern whether the applicant is required to be registered, but whether multiple registrations can be granted to different clients at the same premises.

2.12 The Court held that the question does not fall under any of the categories specified in Section 97(2), as it neither pertains to classification, notification applicability, time and value of supply, input tax credit, tax liability, the applicant's own registration requirement, nor characterization of any particular act of the applicant as "supply".

Conclusions

2.13 The question raised does not fit within any of the heads enumerated in Section 97(2) of the CGST Act; therefore, the application is not admissible within the statutory scope of advance ruling.

Issue 3: Effect of prior advance rulings cited and decision on admission under Section 98(2)

Legal framework

2.14 The Court referred to Section 98(2) of the CGST Act, which authorises the Authority to reject (not admit) an application where the questions raised are not covered by Section 97(2).

Interpretation and reasoning

2.15 The applicant cited prior rulings of other State Advance Ruling Authorities which had addressed similar questions on shared/virtual office space registrations.

2.16 The Court observed that in those rulings, the Authorities had not examined the threshold questions of admissibility and scope under Sections 95 and 97(2) in the manner now undertaken.

2.17 The Court noted that in another proceeding involving a similar fact situation, the Tamil Nadu Authority for Advance Ruling had refused to admit the application under Section 98(2) on similar grounds of non-coverage under Section 97(2), aligning with the approach now adopted.

Conclusions

2.18 The cited rulings of other Authorities were not treated as binding, and in view of Sections 95, 97(2) and 98(2), the application was rejected at the admission stage.

2.19 The application was held to be "not admitted" under Section 98(2) of the CGST Act, 2017, and was rejected on the ground that the questions asked do not fall within the matters specified in Section 97(2) and are not in relation to supplies undertaken or proposed to be undertaken by the applicant.

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