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)

M/S Aban Singapore Pte Limited, Hyderabad vs. DCIT, Chennai

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

ITTPA 38/CHNY/2022[2019-2020]Status: DisposedITAT Chennai20 Jul 2023AY 2019-2020

Bench: Shri V. Durga Rao & Shri G. Manjunathai.T.(Tp)A. No.38/Chny/2022 िनधा"रण वष"/Assessment Year: 2019-20 M/S. Aban Singapore Pte Limited, The Deputy Commissioner Of C/O P. Murali & Co., Vs. Income Tax, Chartered Accountants, 6-3-655/2/3, International Tax 1(1), Somajiguda, Hyderabad 500 082. Chennai. [Pan: Aaqca2845Q] (अपीलाथ" /Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By Shri P. Murali Mohan Rao, Ca : ""थ" की ओर से/Respondent By Shri Sasikumar, Cit For : Dr. S. Palanikumar, Cit सुनवाई की तारीख/ Date Of Hearing 19.06.2023 : घोषणा की तारीख /Date Of Pronouncement : 20.07.2023 आदेश /O R D E R Per V. Durga Rao: This Appeal Filed By The Assessee Is Directed Against The Final Assessment Order Passed Under Section 143(3) R.W.S. 144C(13) Of The Income Tax Act, 1961 [“Act” In Short] Dated 12.07.2022 Relevant To The Assessment Year 2019-20 In Pursuant To The Directions Of The Ld. Dispute Resolution Panel-2, Bengaluru Under Section 144C(5) Of The Act Dated 30.06.2022. The Assessee Has Raised Following Grounds: 1. The Final Assessment Order Passed By The Dy. Commissioner Of Income Tax, Intl Tax 11) & Chennai (Hereinafter Referred To General As Ao Is Bad Both In The Eyes Of Law & On Facts.

Section 143(3)Section 144C(5)Section 28Section 40Section 43Section 44BSection 90

M/S.Aban Singapore Pte Limited, Hyderabad vs. DCIT, International Tax 1(1), Chennai

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

ITTPA 13/CHNY/2022[2018-2019]Status: DisposedITAT Chennai20 Jul 2023AY 2018-2019

Bench: Shri V. Durga Rao & Shri G. Manjunathai.T.(Tp)A. No.13/Chny/2022 िनधा"रण वष"/Assessment Year: 2018-19 M/S. Aban Singapore Pte Limited, The Deputy Commissioner Of C/O P. Murali & Co., Vs. Income Tax, Chartered Accountants, 6-3-655/2/3, International Tax 1(1), Somajiguda, Hyderabad 500 082. Chennai. [Pan: Aaqca2845Q] (अपीलाथ" /Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By Shri P. Murali Mohan Rao, Ca : ""थ" की ओर से/Respondent By Shri Sasikumar, Cit For : Dr. S. Palanikumar, Cit सुनवाई की तारीख/ Date Of Hearing 19.06.2023 : घोषणा की तारीख /Date Of Pronouncement : 20.07.2023 आदेश /O R D E R Per V. Durga Rao: This Appeal Filed By The Assessee Is Directed Against The Final Assessment Order Passed Under Section 143(3) R.W.S. 144C(13) Of The Income Tax Act, 1961 [“Act” In Short] Dated 09.02.2022 Relevant To The Assessment Year 2018-19 In Pursuant To The Directions Of The Ld. Dispute Resolution Panel-2, Bengaluru Under Section 144C(5) Of The Act Dated 23.01.2022. The Assessee Has Raised Following Grounds: 1. The Final Assessment Order Passed By The Dy. Commissioner Of Income Tax, Intl Tax 1(1) & Chennai (Herein After Referred To As 'Ao') Is Bad Both In The Eve Of Law & On Facts.

Section 115ASection 143(3)Section 144C(5)Section 195(2)Section 44BSection 9(1)(vi)Section 90

M/S. Deep Drilling 5 Pte Limited, Singapore vs. DCIT, International Tax 1(1), Chennai

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

ITTPA 1/CHNY/2022[2018-19]Status: DisposedITAT Chennai20 Jul 2023AY 2018-19

Bench: Shri V. Durga Rao & Shri G. Manjunathai.T.(Tp)A. No.1/Chny/2022 िनधा"रण वष"/Assessment Year: 2018-19 M/S. Deep Drilling 5 Pte Limited, The Deputy Commissioner Of C/O P. Murali & Co., Vs. Income Tax, Chartered Accountants, 6-3-655/2/3, International Tax 1(1), Somajiguda, Hyderabad 500 082. Chennai. [Pan: Aafcd9063N] (अपीलाथ" /Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By Shri P. Murali Mohan Rao, Ca : ""थ" की ओर से/Respondent By Shri Sasikumar, Cit For : Dr. S. Palanikumar, Cit सुनवाई की तारीख/ Date Of Hearing 19.06.2023 : घोषणा की तारीख /Date Of Pronouncement : 20.07.2023 आदेश /O R D E R Per V. Durga Rao: This Appeal Filed By The Assessee Is Directed Against The Final Assessment Order Passed Under Section 143(3) R.W.S. 144C(13) Of The Income Tax Act, 1961 [“Act” In Short] Dated 21.01.2022 Relevant To The Assessment Year 2018-19 In Pursuant To The Directions Of The Ld. Dispute Resolution Panel-2, Bengaluru Under Section 144C(5) Of The Act Dated 30.12.2021. The Assessee Has Raised Following Grounds: 1. The Final Assessment Order Passed By The Dy. Commissioner Of Income Tax, Intl Tax 1(1) & Chennai (Herein After Referred To As 'Ao') Is Bad Both In The Eve Of Law & On Facts.

Section 115ASection 143(3)Section 144C(5)Section 195(2)Section 44BSection 9(1)(vi)Section 90