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)

Rajendra Maganbhai Patel, Mumbai vs. The Asstt. Commissioner of Income Tax, Circle International Taxation, Vadodara

ITA 106/AHD/2023[2015-16]Status: DisposedITAT Ahmedabad04 Mar 2025AY 2015-16

Bench: Shri T.R. Senthil Kumar & Shri Makarand V. Mahadeokarआयकर अपील सं/Ita Nos.105/Ahd/2023 & 106/Ahd/2023 निर्धारण वर्ष / Assessment Years : 2013-14 & 2015-16 Respectively Rajendra Maganbhai Patel C-1/8, Bhadran Nagar S.V. Road, Malad West Mumbai - 400 064 Maharashtra स्थायी लेखा सं./Pan: Asipp 5675 N बनाम / V/S. The Asstt.Commissioner Of Income Tax, Circle International Taxation, Vadodara (अपीलार्थी/ Appellant) (प्रत्यर्थी / Respondent) Assessee By: Shri Tushar Hemani, Sr.Advocate & Revenue By : Shri Parimalsinh N. Parmar, Ar Shri Prathvi Raj Meena, Cit-Dr सुनवाई की तारीख / Date Of Hearing : 26/02/2025 घोषणा की तारीख / Date Of Pronouncement: 04/03/2025 आदेश/Order Per Makarand V. Mahadeokar, Am: Both These Appeals By The Assessee Pertain To Assessment Years (Ays) 2013-14 & 2015-16 & Are Directed Against The Final Assessment Orders Passed By The Assessing Officer [Hereinafter Referred To As “Ao"] Under Section 147 R.W.S.144C(13) Of The Income Tax Act, 1961 [Hereinafter Referred To As "The Act"], Pursuant To The Directions Of The Dispute Resolution Panel [Hereinafter Referred To As “Drp”]. The Core Issue In Both The Appeals Concerns The Addition Made By The Ao On Account Of Credits In The Assessee'S Non- Resident External (Nre) Bank Accounts.

For Appellant: Shri Tushar Hemani, Sr.Advocate &For Respondent: Shri Parimalsinh N. Parmar, AR
Section 143(2)Section 147Section 148

Keb Hana Bank, Chennai vs. DCIT, International Taxation -1(2), Chennai

In the result, the appeal filed by the assessee is dismissed

ITTPA 122/CHNY/2024[2021-22]Status: DisposedITAT Chennai28 Feb 2025AY 2021-22

Bench: Shri S.S. Viswanethra Ravi & Shri Jagadishआयकर अपील सं./I.T.(Tp)A. No.122/Chny/2024 िनधा"रण वष"/Assessment Year: 2021-22 Keb Hana Bank, Vs. The Deputy Commissioner Of 4Th Floor, No. 29, Bannari Amman Income Tax, Towers, Dr. Radhakrishnan Salai, International Taxation 1(2), Mylapore, Chennai 600 004. Chennai. [Pan:Aadck4261D] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri Lalit Kumar, C.A. ""थ" की ओर से/Respondent By : Ms. Gauthami Manivasagam, Jcit सुनवाई की तारीख/ Date Of Hearing : 28.02.2025 घोषणा की तारीख /Date Of Pronouncement : 28.02.2025 आदेश /O R D E R Per S.S. Viswanethra Ravi: This Appeal Filed By The Assessee Is Directed Against The Order Dated 25.10.2024 Passed Under Section 143(3) R.W.S. 144C(13) Of The Income Tax Act, 1961 [“Act” In Short] For The Assessment Year 2021-22. 2. When The Appeal Was Taken Up For Hearing, The Ld. Ar Shri Lalit Kumar, C.A. Drew Our Attention To The Letter Dated 24.02.2025 & Submits That The Assessee Filed Two Appeals Before This Tribunal Against The Same Impugned Order. The Appeal In It(Tp)A No.

For Appellant: Shri Lalit Kumar, C.AFor Respondent: Ms. Gauthami Manivasagam, JCIT
Section 143(3)