Section 383 Income Tax Act 2025: How to Apply for an Advance Ruling?

Section 383 sets out three essential requirements for seeking an advance ruling: submit an application in the prescribed form and manner stating the question, pay the prescribed fee, and, if desired, withdraw the application within 30 days from the date of the application. The application is considered under the advance-ruling framework in Chapter XVIII.

What does Section 383 provide?

383. (1) An applicant desirous of obtaining an advance ruling under this Chapter, may make an application in such form and manner, as may be prescribed, stating the question on which the advance ruling is sought.

(2) The application shall be accompanied by a fee, as may be prescribed.

(3) An applicant may withdraw an application within thirty days from the date of the application.

Section 383 explained subsection by subsection

How can an applicant file an advance-ruling application?

1. Confirm eligibility: Read Section 380 to determine whether the applicant and proposed question fall within the defined categories.
2. Frame the question: Identify the transaction or issue and the specific question on which a ruling is requested.
3. Use Form No. 120: Rule 200(1) prescribes Form No. 120 for resident and non-resident applicants.
4. Prepare supporting material: Include the relevant facts, documents, verification and annexures required by the form and Rule 200.
5. Pay the applicable fee: Attach proof of payment as required by Rule 200(4).
6. Submit electronically: Rule 200(3) provides for electronic filing and the applicable digital-signature or electronic-verification requirements.
7. Monitor the proceedings: The Board's handling of an application, including admissibility and the pronouncement of a ruling, is governed by Section 384.

What is the fee for an advance-ruling application?

Section 383(2) does not itself prescribe a fixed amount. Rule 200 of the Income-tax Rules, 2026 sets out the applicable fee based on the type of applicant and, for specified transaction-based applications, the amount of the transaction. Applicants must check the applicable category in the official rule before payment.

For example, Rule 200 provides a Rs. 10,000 fee for the residual category described as "any other applicant". Different, higher fees apply to specified transaction-based categories. Do not assume that Rs. 10,000 is the fee for every application.

See the official Rule 200 fee table for the full schedule and transaction thresholds.

Can an advance-ruling application be withdrawn?

Yes. Section 383(3) expressly permits an applicant to withdraw the application within 30 days from the date of the application. The statute does not provide a general right under this subsection to withdraw at any later time. Keep proof of the application date and withdrawal communication.

Relevant statutory definitions and legal expressions

Advance ruling

Defined by the categories of determinations and decisions described in Section 380(a), including specified questions concerning transactions and tax liabilities.

Applicant

Defined in Section 380(b) by reference to the categories of persons eligible to seek an advance ruling.

Application

Section 380(c) defines an application as one made under Section 383(1).

Board for Advance Rulings

Defined in Section 380(d) as the Board constituted under Section 381.

Member

Defined in Section 380(e) as a Member of the Board for Advance Rulings.

Prescribed

In Section 383, this refers to requirements laid down in the applicable rules, particularly Rule 200 of the Income-tax Rules, 2026.

What happens after filing?

Section 384 governs the Board's examination of an application, the grounds on which an application must be rejected, the opportunity of hearing, and pronouncement of the advance ruling. Filing under Section 383 does not guarantee admission or a favourable ruling.

Practical illustrations

Example 1: Non-resident transaction

A non-resident seeks clarity on the tax liability arising from a proposed transaction. If the applicant and question qualify under Section 380, the applicant can use Form No. 120, provide the facts and pay the prescribed fee under Rule 200.

Example 2: Withdrawal after filing

An applicant files on 1 June and decides not to proceed. Section 383(3) permits withdrawal within 30 days from the application date. The applicant should check the exact deadline and preserve evidence of the withdrawal.

Example 3: Incorrect assumption about fees

An applicant assumes every advance-ruling request costs Rs. 10,000. Rule 200 instead uses different categories and transaction thresholds; the correct fee must be determined before submission.

Frequently asked questions

What is the heading of Section 383?

"Application for advance ruling."

Which form is used for an application under Section 383?

Rule 200(1) prescribes Form No. 120 for resident and non-resident applicants.

Is an application fee mandatory?

Yes. Section 383(2) requires the application to be accompanied by the fee prescribed under the rules.

Is the fee always Rs. 10,000?

No. Rs. 10,000 applies to the residual "any other applicant" category under Rule 200; other categories have different fees.

How long does an applicant have to withdraw?

Section 383(3) permits withdrawal within 30 days from the date of the application.

Can the Board reject the application?

Yes. Section 384 governs admissibility and specified grounds for rejection, including the applicable hearing requirement.

Official sources and related sections

Official references: Section 383, Income-tax Rule 200 and Form No. 120. Related provisions: Section 380, Section 381, Section 382 and Section 384.

Legal note: This article explains the statutory framework and does not replace review of the current prescribed form, rules and case-specific legal advice.