Chapter XVIII - Appeals, Revisions and Alternate Dispute Resolutions
Section 381
Section 381: Board for Advance Rulings
Section 381 requires the Central Government to constitute one or more Boards for Advance Rulings, as necessary, from a date it appoints by notification. Each Board consists of two members nominated by the Board, each an officer of at least Chief Commissioner rank.
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Need advice on Section 381?
This article is for general information. Refer to the Income-tax Act, 2025 as amended by the Finance Act, 2026 and the Taxation and Other Laws (Amendment) Act, 2026 for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(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, 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.
Introduction
The Central Government must constitute one or more Boards for Advance Rulings as necessary from a notified date. Each Board has two members nominated by the Board, and each member must be an officer not below Chief Commissioner rank.
Key takeaways
Constitution
The Central Government constitutes one or more Boards from a notified date.
Membership
Each Board has two qualifying officers nominated by the Board.
Constitution of the Board
The Central Government shall constitute one or more Boards for Advance Rulings, as necessary, to give advance rulings under this Chapter, from such date as the Central Government may notify.
Composition
Each Board for Advance Rulings consists of two members, each an officer not below the rank of Chief Commissioner, as nominated by the Board (i.e., the Central Board of Direct Taxes).
Applying Section 381 in practice
Applicability and boundary. This provision establishes the decision-making body; it does not itself create a right to an advance ruling or prescribe the application process. The Central Government shall constitute one or more Boards, as may be necessary, from the notified date, and each Board has two members of at least Chief Commissioner rank nominated by the Board. A user seeking a ruling should begin with eligibility and the application question under section 383, then look to section 384 for handling of that application.
Check before relying on a ruling: identify the notified Board with jurisdiction, the application date and question, and whether the document is an actual ruling rather than an administrative communication. FAQ: Does section 381 let an applicant choose two members? No; member nomination is assigned to the Board under the Act.
Step-by-step flow for the constitution of Boards for Advance Rulings under Section 381
- 1
Has the Central Government constituted a Board for Advance Rulings?
Section 381(1) requires the Central Government to constitute one or more Boards, as necessary.
- No: No advance ruling can be given under this Chapter.
- Yes: Go to the next step.
- 2
Is the date on or after the date appointed by notification?
The Boards give advance rulings on or after the date the Central Government appoints by notification. Section 381 does not state that date.
- No: The Board cannot yet give rulings.
- Yes: Go to the next step.
- 3
Does the Board have two members?
Section 381(2) provides that it consists of two members.
- 4
Is each member an officer not below the rank of Chief Commissioner, nominated by the Board?
Both conditions apply to each member. If there is a vacancy or defect in constitution, see section 382.
Practical checklist
Do
- Check the Central Government notification constituting the relevant Board for Advance Rulings.
- Check that the Board’s two nominated members meet the Chief Commissioner rank requirement.
Avoid
- Do not confuse the Central Government’s constitution of the Board with the Board’s nomination of its members.
Illustrative example
Worked example: checking the forum before applying
Hypothetical facts (illustration only, not a real taxpayer): A non-resident company plans to apply for an advance ruling on a proposed transaction in India. Before applying, it wants to understand who will decide its application.
Constitution
The Central Government constitutes one or more Boards for Advance Rulings under Section 381(1). The company checks the notification that appoints the date from which rulings are given.
Composition
Under Section 381(2), the Board that hears its case consists of two members.
Members' rank
Each member is an officer not below the rank of Chief Commissioner, nominated by the Board.
Next step
The company then makes its application under section 383.
Outcome
- Its application will be decided by a two-member Board of officers of at least Chief Commissioner rank.
- The procedure for the application and ruling is in sections 383 and 384, not in Section 381.
Glossary
- Board for Advance Rulings
- A body constituted by the Central Government under Section 381 to give advance rulings under this Chapter.
- Member
- One of the two officers, each not below the rank of Chief Commissioner, nominated by the Board to a Board for Advance Rulings.
Frequently asked questions
Who nominates the two members?
The Board nominates them; each must be an officer not below the rank of Chief Commissioner.
How many members sit on a Board for Advance Rulings?
Two members, each an officer not below the rank of Chief Commissioner, as provided in Section 381(2).
Can there be more than one Board for Advance Rulings?
Yes - Section 381(1) allows the Central Government to constitute one or more such Boards, as necessary.
Need help applying this provision to your situation?
Talk to our team about seeking an advance rulingLast updated 2026-10-10