Section 144C(5) of the Income Tax Act

Income-tax Act, 2025: s.275

Section 144C(5) 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(5) is CIT v. Samsung Electronics Ltd. (345 ITR 494), cited in 461 of the 865 judgments on BharatTax that turn on this section.

Leading authorities on Section 144C(5)

CIT v. Samsung Electronics Ltd.
345 ITR 494 · 2012 · High Court
461
citing judgments

Payments by Indian residents to non-resident foreign software suppliers for software are considered royalty, constituting income deemed to accrue in India under section 9(1)(v), thereby requiring tax deduction at source under section 195.

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. Cotton Naturals (I) (P.) Ltd.
55 Taxmann.com 523 · 2015 · High Court
273
citing judgments

The interest rate for benchmarking foreign currency loans advanced to Associated Enterprises should be the market-determined rate applicable to the currency of the loan, such as LIBOR for US Dollar loans, rather than a domestic lending rate like the Indian PLR.

CIT v. Siemens Aktiongesellschaft
310 ITR 320 · 2009 · High Court
259
citing judgments

Reimbursements of actual expenses without any profit element are not taxable income. Additionally, mere amendments to the Income-tax Act do not override the provisions of Double Taxation Avoidance Agreements (DTAAs).

III v. HCL Technologies Ltd.
93 Taxmann.com 33 · 2018 · Supreme Court
245
citing judgments

When computing the deduction available under Section 10A of the Income-tax Act, communication expenses must be excluded from the total turnover for the purpose of calculating the eligible relief.

Maruti Suzuki India Ltd. v. CIT
381 ITR 117 · 2016 · High Court
220
citing judgments

The Bright Line Test (BLT) is not a recognized method under the Income-tax Act and Rules for benchmarking advertising, marketing, and promotion (AMP) expenses or for determining the existence of an international transaction or its Arm's Length Price. The Revenue must first establish the existence and price of an international transaction before seeking an ALP adjustment.

East India Pharmaceutical Works Ltd. v. CIT
224 ITR 627 · 1997 · Supreme Court
146
citing judgments

Where an assessee has mixed funds (both interest-bearing and interest-free funds) and makes an interest-free advance or investment, it is presumed that the interest-free funds were utilized first if they are sufficient to cover such advances or investments. This prevents disallowance of interest on borrowed funds under Section 36(1)(iii).

MOHD. HANIF QUARESHI AND OTHERS v. STATE OF BIHAR AND OTHERS. 381 7
6 SCC 312 · 2012 · Reported
138
citing judgments

Where proceedings are initiated under Section 147, but the assessment is completed under Section 143(3), it is not a prerequisite that the assessee must have filed a return under Section 139.

CIT v. Cushman & Wakefield (India) (P.) Ltd.
367 ITR 730 · 2014 · High Court
120
citing judgments

This case determines the Arm's Length Price (ALP) for intra-group services and reimbursements, clarifying when charges constitute services warranting a mark-up versus mere pass-through costs. It provides guidance on the circumstances under which an ALP adjustment, including an ALP of 'nil', is appropriate for such transactions.

CIT v. Tata Autocomp Systems Ltd.
56 Taxmann.com 206 · 2015 · High Court
119
citing judgments

When determining the arm's length price for interest on a foreign currency loan advanced to an Associated Enterprise, the Indian Prime Lending Rate is not applicable. Instead, the interest rate should be benchmarked based on the prevailing foreign currency rate, such as EURIBOR, or the rate in the country where the loan is received/consumed.

Judgments on Section 144C(5)

Xchanging Solutions Limited (Formerly Known As Cambridge Solutions Limited), Bangalore vs. The Deputy Commissioner of Income Tax, Circle 7(1)(1), Bangalore

In the result appeal filed by the assessee is partly allowed

ITA 385/BANG/2025[2011-12]Status: DisposedITAT Bangalore06 Apr 2026AY 2011-12

Bench: Shri Prashant Maharishi & Shri Soundararajan K.Assessment Year 2011-12 M/S. Xchanging Solutions Limited Vs. (Formerly Known As Cambridge Solutions Limited), Xchanging Tower, 39/40, Digital Park, Hp Avenue, The Deputy Commissioner Of Income Tax Electronic City, Hosur Main Road, Circle – 7(1)(1), Electronic City S.O., Bangalore. Konapanna Agrahara, Bangalore – 560 100 Pan: Aafcs9303L Appellant Respondent Appellant By : Shri Padamchand Kincha, Ca Respondent By : Dr. Divya K. J – Citdr Date Of Hearing : 13.01.2026 Date Of Pronouncement : 06.04.2026 O R D E R Per Prashant Maharishi1. This Appeal Is Filed For Assessment Year 2011 – 12 Against The Assessment Order Passed By The Deputy Commissioner Of Income Tax, Circle 7 (1) (1), Bangalore (The Learned Ao) Passed In Pursuance Of Direction Of The Learned Dispute Resolution Panel'S Wherein The Income Tax Appellate Tribunal Vide Its Order Dated 19 January 2022 In Ita A No. 492/Bangalore/2015 & Subsequent Miscellaneous Application No. 61/Bangalore/2022 Dated 26/8/2022 Was Passed. 2. Over & Above The Several Grounds Raised By The Assessee The Main Contention Is That The Order Passed By The Learned Assessing Officer On 27 December 2024 Is Invalid. Page 2 Of 11 3. Brief Facts Of The Case Shows That The Assessee Company Filed Its Return Of Income At The Total Income Of Rs. Nil. The Case Was Selected For Scrutiny Which Resulted Into The Final Assessment Order Passed Under Section 143 (3) Read With Section 144C (13) Of The Income Tax Act, 1961 (The Act) Determining The Assessed Income At ₹ 190,805,854/–.

For Appellant: Shri Padamchand Kincha, CAFor Respondent: Dr. Divya K. J – CITDR
Section 143Section 144CSection 254Section 92C