Section 92CD and Section 169: Effect of Advance Pricing Agreement

Section 92CD of the Income-tax Act, 1961 governed the effect of an Advance Pricing Agreement for assessment years under the 1961 Act. From 1 April 2026, the corresponding current provision is Section 169 of the Income-tax Act, 2025.

Current-law note: The Income-tax Act, 2025 applies from 1 April 2026. Section 169 now deals with the effect of an Advance Pricing Agreement. Section 92CD remains relevant for periods and proceedings governed by the repealed Income-tax Act, 1961 under the applicable transition and savings provisions.

What is an Advance Pricing Agreement?

An Advance Pricing Agreement, commonly called an APA, is an agreement under the transfer-pricing framework that determines the arm's length price, or the manner in which that price is to be determined, for covered international transactions. Under the Income-tax Act, 2025, the APA provision is contained in Section 168. Its purpose is to provide greater certainty in the tax treatment of covered transactions and reduce transfer-pricing disputes.

Section 169 of the Income-tax Act, 2025

Section 169 is titled "Effect to advance pricing agreement". It provides the mechanism for giving effect to an APA through a return or modified return and through consequential assessment or reassessment action.

Key rule: Where income is modified as a result of an APA, the person who entered into the APA, or an associated enterprise where permitted by Section 169, may furnish the relevant return or modified return in accordance with and limited to the agreement. The statutory time limit is three months from the end of the month in which the APA was entered into for the tax years covered by the agreement.

Meaning of important terms

Modified return: A return furnished to give effect to the terms of the APA for a tax year covered by that agreement. Except to the extent Section 169 provides otherwise, the Act applies to the modified return as if it were a return furnished under Section 263.

Agreement: For Section 169, the relevant APA is the agreement contemplated by Section 168 of the Income-tax Act, 2025.

Associated enterprise: In transfer pricing, an associated enterprise is an enterprise connected with another enterprise through the statutory participation, control, capital or other tests prescribed by the Act. The Finance Act, 2026 expanded Section 169 so that an associated enterprise may also furnish a return or modified return in the circumstances covered by the provision.

How Section 169 operates

Situation	Effect
APA modifies income for a covered tax year	A return or modified return may be furnished in accordance with and limited to the APA, subject to Section 169.
Time for return or modified return	Three months from the end of the month in which the APA was entered into.
Assessment or reassessment already completed	The Assessing Officer is required to pass the consequential order modifying total income in accordance with the APA and the modified return, where the statutory conditions are met.
Assessment or reassessment pending	The proceedings are completed in accordance with the APA after taking the modified return into consideration.
Limitation for consequential order	For the completed-proceeding situation covered by Section 169, the order is generally to be passed within one year from the end of the financial year in which the modified return is furnished.
Pending proceedings	The relevant statutory limitation period is extended by twelve months as provided by Section 169.

Section 92CD of the Income-tax Act, 1961

For periods governed by the Income-tax Act, 1961, Section 92CD performed the corresponding function. It overrode Section 139 to require a person who had already furnished a return for an assessment year covered by an APA to furnish a modified return, in accordance with and limited to the APA, within three months from the end of the month in which the agreement was entered into.

Section 92CD further provided that, except as otherwise stated in that section, the other provisions of the 1961 Act applied as if the modified return were a return under Section 139. It separately dealt with completed assessments or reassessments, pending proceedings, extended limitation periods, the meaning of "agreement" by reference to Section 92CC, and when assessment or reassessment proceedings were deemed completed.

Section 92CD compared with current Section 169

Income-tax Act, 1961	Income-tax Act, 2025
Section 92CD	Section 169
Advance Pricing Agreement under Section 92CC	Advance Pricing Agreement under Section 168
Return framework linked to Section 139	Return framework linked to Section 263
Assessment year and previous year terminology	Tax year terminology
Modified return by the person who entered into the APA	Current provision also accommodates an associated enterprise in the circumstances specified after the Finance Act, 2026 amendment

Practical points for APA compliance

Identify first whether the relevant period is governed by the Income-tax Act, 1961 or the Income-tax Act, 2025.
Check the exact tax years covered by the APA and whether rollback provisions apply.
Calculate the three-month filing period from the end of the month in which the APA was entered into.
Limit the return or modified return to changes required by the APA.
Where assessment or reassessment proceedings are pending or already completed, review the consequential procedure and limitation provisions before filing.
Use the current e-Filing forms, rules and instructions applicable to the relevant tax year.

Official resources

For current compliance, verify the statutory text and forms on the official Income Tax Department portals. The Department provides the Income-tax Act, 2025 and comparison utilities, its Transfer Pricing guidance, and the Income Tax e-Filing portal.

Updated: 28 September 2026. This page is a general legal-information article. For a filing or proceeding, verify the Act, Rules, Finance Act amendments, notifications, applicable APA terms and portal instructions for the relevant tax year.