Section 169 — Effect to advance pricing agreement

23[(1) Irrespective of anything to the contrary contained in section 263,
where an income is modified as a result of advance pricing agreement entered
into with any person then, such person shall, or any other person being an associated
enterprise may,—
( a) furnish a return or a modified return in accordance with and limited to the
agreement; and
( b) the time period for furnishing such return or modified return shall be three
months from the end of the month in which the agreement was entered
into,
where the tax years relevant for such return or modified return shall be the years cov-
ered by such agreement.]
(2) Except as provided in this section, all other provisions of this Act shall apply
accordingly as if the modified return is a return furnished under section 263.
(3) Where a modified return is furnished under sub-section (1), and assessment or
reassessment proceedings, in respect of a tax year to which the agreement applies,
were initiated before the filing of such return then,—
23. Substituted by the Finance Act, 2026, w.e.f. 1-4-2026. Prior to its substitution, sub-section
(1) read as under :
“(1) If a return of income for any tax year covered by an advance pricing agreement has
been furnished by any person, before the date of entering into the said agreement, he shall,
irrespective of anything to the contrary contained in section 263, furnish a modified return,
in accordance with and limited to the agreement, in respect of such tax years, within three
months from the end of the month in which the agreement was entered into.”
( a) if such proceedings have been completed before the filing of such return,
the Assessing Officer shall pass an order modifying the total income of
the relevant tax year; or
( b) if such proceedings are pending on the date of filing of modified return,
the Assessing Officer shall proceed to complete them,
as per the agreement after taking into consideration the modified return so
furnished.
(4) Irrespective of anything contained in section 275 or 286 or 296,—
( a) the order in respect of a case falling under sub-section (3)( a) shall be
passed within one year from the end of the financial year in which the
modified return under sub-section (1) is furnished;
( b) in respect of a case falling under sub-section (3)(b), the period of limita-
tion as provided in section 275 or 286 or section 296 for completion of
pending assessment or reassessment proceedings shall be extended by
twelve months.
(5) For the purposes of this section,—
( a) “agreement” means an agreement referred to in section 168(1);
( b) the assessment or reassessment proceedings for a tax year shall be deemed
to have been completed where—
( i) an assessment or reassessment order has been passed; or
( ii) no notice has been issued under section 270(8) till the expiry of the
limitation period provided under the said section.