Section 144C(13) of the Income Tax Act

Income-tax Act, 2025: s.275

Section 144C(13) falls under section 144C of the Income-tax Act, 1961, which corresponds to section 275 (Reference to Dispute Resolution Panel) of the Income-tax Act, 2025.

Read section 275 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 144C(13) is Engineering Analysis Centre of Excellence (P) Ltd. v. CIT (432 ITR 471), cited in 914 of the 3,426 judgments on BharatTax that turn on this section.

Leading authorities on Section 144C(13)

Engineering Analysis Centre of Excellence (P) Ltd. v. CIT
432 ITR 471 · 2021 · Supreme Court
914
citing judgments

Payments for the supply or use of computer software, where there is no transfer of copyright but only a right to use the copyrighted product, are generally considered business profits and not 'royalty' or 'fees for technical services' under the Income Tax Act, 1961 or relevant DTAAs. This principle also applies to transponder fees, which are not taxable as royalty.

Sony Ericsson Mobile Communications India Pvt. Ltd. v. CIT
374 ITR 118 · 2015 · High Court
499
citing judgments

The existence of an international transaction for Advertising and Marketing Promotion (AMP) expenditure requires the revenue to discharge the burden of proof. An explanation inserted under Section 92B does not automatically make AMP expenditure an international transaction.

CIT v. EKL Appliances Ltd.
345 ITR 241 · 2012 · High Court
422
citing judgments

Transfer pricing adjustments for outstanding receivables are permissible only if the Tax Officer establishes, through analysis over a period, a pattern indicating an international transaction intended to benefit an associated enterprise. The Tax Officer cannot question purely business decisions like royalty payments or exceed jurisdiction by applying cost-benefit analysis to determine the arm's length price of services.

Ishikawajima Harima Heavy Industries Ltd. v. DIT
288 ITR 408 · 2007 · Supreme Court
394
citing judgments

Income from offshore supply of goods and services is not taxable in India if the entire transaction, including transfer of ownership and payments, occurs outside India.

CIT v. De Beers India Minerals (P.) Ltd.
346 ITR 467 · 2012 · High Court
371
citing judgments

For fees for technical or consultancy services to 'make available' technical knowledge or know-how under a DTAA, the service must transmit such knowledge, allowing the recipient to derive an enduring benefit and utilize it independently in the future.

DIT v. Morgan Stanley & Co.
292 ITR 416 · 2007 · Supreme Court
360
citing judgments

A Permanent Establishment (PE) signifies a foreign enterprise's virtual projection into another country, with a fixed place PE existing where an MNE's business is wholly or partly carried on. A dependent agent PE requires the agent to act as such and/or have the authority to conclude contracts for the foreign enterprise under DTAA provisions.

Asia Satellite Telecommunications Co. Ltd. v. DIT
332 ITR 340 · 2011 · High Court
359
citing judgments

Payments for the use of equipment, such as satellite transponders, do not constitute 'royalty' under Section 9(1)(vi) of the Income-tax Act, 1961, or under applicable tax treaties, especially when there is no transfer of the right to use a process or underlying technology.

DIT v. New Skies Satellite BV
382 ITR 114 · 2016 · High Court
325
citing judgments

An amendment to the Income Tax Act, such as the Finance Act, 2012 amendment to Section 9(1)(vi) defining royalty, does not automatically override or alter the definition of 'royalty' as provided in a Double Taxation Avoidance Agreement (DTAA) unless the DTAA itself is bilaterally amended. The definition of royalty in a DTAA remains unaffected by unilateral changes to domestic law.

21. In SB Gurbaksh Singh v. Union of India
2 SCC 181 · 2007 · Supreme Court
318
citing judgments
India Vs. Azadi Bachao Andolan 263 ITR 706 (SC); and Vodafone International Holdings B.V v. Union of India
341 ITR 1 · 2012 · Supreme Court
295
citing judgments

Legitimate tax planning is permissible, allowing taxpayers to arrange their affairs to minimize tax liabilities while respecting the "look at test" for transaction genuineness and the separate entity principle in corporate taxation. The source of funds for treaty-beneficial structures does not automatically invalidate the transaction.

Judgments on Section 144C(13)

Hp India Sales Private Limited, Bangalore vs. Joint Commissioner of Income Tax Ltu, Bangalore

In the result, the appeal filed by the assessee is partly allowed

ITA 524/BANG/2017[2012-13]Status: DisposedITAT Bangalore18 Aug 2022AY 2012-13

Bench: Shri George George K, Jm & Shri Laxmi Prasad Sahu, Am It(Tp)A No.524/Bang/2017 : Asst.Year 2012-2013 M/S.Hp India Sales Private The Joint Commissioner Of Limited (Formerly Known As Income-Tax, Ltu V. Bangalore. Hewlett-Packard India Sales Private Limited), 24 Salarpuria Area, Hosur Main Road, Adugodi Bangalore – 560 030. Pan : Aaacc9862F. (Appellant) (Respondent) Appellant By : Sri.Ajay Vohra, Senior Counsel / Sri. Neeraj Jain, Sri.Lalit Attal & Sri.Karon Dhanuka, Advoicates Respondent By : Sri.Harishchandra Naik, Cit-Dr Date Of Pronouncement : 18.08.2022 Date Of Hearing : 27.07.2022 O R D E R Per George George K, Jm : This Appeal At The Instance Of The Assessee Is Directed Against Final Assessment Order Dated 03.01.2017 Passed U/S 143(3) R.W.S. 144C(13) Of The I.T.Act. The Relevant Assessment Year Is 2012-2013. 2. The Brief Facts Of The Case Are As Follows: The Assessee Is A Company Engaged In Import Of Computer Peripherals From Its Associated Enterprises (Aes) For Sale In India & Also Rendered Certain Support Services. The Return Of Income For Assessment Year 2012-2013 Was Filed On 29.02.2012, Admitting Total Income Of Rs.544,61,99,276. The Return Was Revised On 25.03.2014

For Appellant: Sri.Ajay Vohra, Senior Counsel / Sri. Neeraj JainFor Respondent: Sri.Harishchandra Naik, CIT-DR
Section 143(2)Section 143(3)Section 144CSection 92BSection 92C

Jardine Lloyd Thomposn India P.Ltd, Mumbai vs. ITO 15(2)(2), Mumbai

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1319/MUM/2015[2010-11]Status: DisposedITAT Mumbai11 Aug 2022AY 2010-11

Bench: Shri B. R. Baskaran, Am & Shri Aby T. Varkey, Jm आयकर अपील सं/ I.T.A. No.1319/Mum/2015 (निर्धारण वर्ा / Assessment Years: 2010-11) Marsh Mclennan Global बिधम/ Ito, Range-15(2)(2) Services India Pvt. Ltd. Aayakar Bhavan, Vs. (Formerly Known As Jardine Mumbai-400020. Lloyd Thompson India Pvt. Ltd.) 1001-A, Supreme Business Park, Hiranandani Gardens, Powai, Mumbai-400076. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No. : Aabcj8288K (अपीलार्थी /Appellant) .. (प्रत्यर्थी / Respondent) Assessee By: Shri Nishant Thakkar / Ms. Jasmin Amalsadvala Revenue By: Ms. Samruddhi Hande (Sr. Ar) सुनवाई की तारीख / Date Of Hearing: 01/08/2022 घोषणा की तारीख /Date Of Pronouncement: 11/08/2022 आदेश / O R D E R Per Aby T. Varkey, Jm: This Is An Appeal Preferred By The Assessee Challenging The Assessment Order Dated 28.01.2015 Passed For Ay. 2010-11 By Ao U/S 143(3) R.W.S 144C (13) Of The Income Tax Act, 1961 (Hereinafter “The Act”) In Pursuance To The Directions Given By The Ld. Dispute Resolution Panel (Drp).

For Appellant: Shri Nishant Thakkar / Ms. JasminFor Respondent: Ms. Samruddhi Hande (Sr. AR)
Section 143(3)Section 92C(3)

Nuance Transcription Services India Pvt Ltd, Bangalore vs. The Assistant Commissioner of Income Tax Circle-5(1)(1), Bangalore

In the result, the appeal filed by the assessee is partly allowed

ITA 173/BANG/2017[2012-13]Status: DisposedITAT Bangalore10 Aug 2022AY 2012-13

Bench: Shri George George K, Jm & Shri Laxmi Prasad Sahu, Am It(Tp)A No.173/Bang/2017 : Asst.Year 2012-2013 M/S.Nuance Transcription The Assistant Commissioner Services India Private Limited Of Income-Tax, Circle 5(1)(1) V. Bangalore. First Floor, Block B, Salarpuria Aura, Khata No.434/170 Marathahalli-Sarjapur Outer Ring Road, Kaverappa Layout Bangalore – 560 103. Pan : Aaacf3465F. (Appellant) (Respondent) Appellant By : Sri.Vishal Kalra, Ca Respondent By : Sri.Harishchandra Naik, Cit-Dr Date Of Pronouncement : 10.08.2022 Date Of Hearing : 28.07.2022 O R D E R Per George George K, Jm : This Appeal At The Instance Of The Assessee Is Directed Against Final Assessment Order Dated 22.11.2016 Passed U/S 143(3) R.W.S. 144C(13) Of The I.T.Act. The Relevant Assessment Year Is 2012-2013. 2. The Brief Facts Of The Case Are As Follows: The Assessee Is Engaged In Providing Information Technology Enabled Services (Ites) To Focus Enterprises Limited, Usa, Which Is An Associate Enterprise (Ae) Of The Assessee. For The Assessment Year 2012-2013, The Return Of Income Was Filed Declaring Total Income Of Rs.23,99,94,900. The Assessment Was Selected For Scrutiny & Notice U/S 2 It(Tp)A No.173/Bang/2017. M/S.Nuance Transcription Services India Private Limited. 143(2) Of The I.T.Act Dated 14.08.2013 Was Served. During The Course Of Assessment Proceedings, It Was Noticed That The Assessee Had Entered Into International Transactions With Its Ae. Accordingly, The Case Was Referred To The Transfer Pricing Officer (Tpo) To Determine The Arm’S Length Price (Alp) Of The International Transaction Undertaken By The Assessee With Its Ae’S. The Tpo Vide Order Dated 28.01.2016, Passed U/S 92Ca Of The I.T.Act, Proposed The Following Tp Adjustments:-

For Appellant: Sri.Vishal Kalra, CAFor Respondent: Sri.Harishchandra Naik, CIT-DR
Section 133(6)Section 143(3)Section 2Section 92C