Section 106 – Procedure of Authority and Appellate Authority.

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Section 106 of CGST Act, 2017 – Procedure of Authority and Appellate Authority

Updated on: February 2026 (as applicable till date)
Prepared by: Yours Tax Consultant

1. Objective of Section 106

Section 106 provides that the Authority for Advance Ruling (AAR) and the Appellate Authority for Advance Ruling (AAAR) shall be guided by the principles of natural justice and have the power to regulate their own procedure.

This section gives procedural flexibility while ensuring fairness.

2. Statutory Provision – Section 106

Section 106:
The Authority or the Appellate 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 or of the discharge of its functions.

3. Meaning of “Regulate Its Own Procedure”

This power allows AAR and AAAR to:

  • Decide manner of hearings
  • Fix dates and timelines
  • Prescribe filing requirements
  • Determine sequence of submissions

This ensures smooth functioning without rigid procedural constraints.

4. Subject to the Provisions of the Chapter

The procedural autonomy under Section 106:

  • Is not absolute
  • Must comply with Sections 95 to 105
  • Must respect statutory limitations and safeguards

Authorities cannot override:

  • Limitation periods
  • Scope of questions under Section 97
  • Admission restrictions under Section 98

5. Principles of Natural Justice

Though not expressly stated, Section 106 is interpreted to mean:

  • Right to be heard
  • Fair opportunity of representation
  • Reasoned orders

Any arbitrary procedure can be challenged in writ jurisdiction.

6. Procedural Rules Supporting Section 106

The procedural framework is supplemented by:

  • Rule 104: Form and manner of application
  • Rule 106: Procedure of Authority for Advance Ruling
  • Rule 110: Procedure of Appellate Authority

7. Practical Application of Section 106

  • Hybrid or physical hearings
  • Calling for additional documents
  • Granting adjournments
  • Allowing written submissions

All such actions derive authority from Section 106.

8. Section 106 vs Section 105

  • Section 105: Powers similar to civil court
  • Section 106: Procedural autonomy

Section 105 deals with powers, Section 106 deals with procedure.

9. Importance of Section 106

Section 106:

  • Ensures flexibility in advance ruling process
  • Allows authorities to adapt to practical needs
  • Prevents procedural rigidity

It is the backbone of efficient adjudication.

10. Related Provisions

11. Professional Insight

Section 106 completes the advance ruling framework by granting procedural freedom with accountability. While flexibility is necessary, it must always operate within the boundaries of law, fairness and natural justice.

Disclaimer: This article is prepared based on the CGST Act, CGST Rules, notifications and prevailing legal position as applicable till date. Procedural practices may vary across States and UTs.

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