Section 10B deduction for software export units upheld where Software Technology Park approval was treated as sufficient.

Section 10B deduction was treated as available to a software development unit approved by the Software Technology Park authority, where the unit was otherwise a 100% export oriented undertaking and satisfied the remaining statutory requirements. Approval by that authority was regarded as sufficient for the purpose of the provision, and the incentive was construed liberally to advance its object rather than be defeated by a technical objection about the form of approval.

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Issues: Whether deduction under section 10B of the Income-tax Act, 1961 could be denied merely because the unit was approved by the Software Technology Park authority and not by the Board contemplated under the Industries (Development and Regulation) Act, 1951.

Analysis: The statutory condition for deduction under section 10B was examined in the context of a unit engaged in software development under the Software Technology Park scheme. The approval granted by the Software Technology Park authority was treated as sufficient where the unit was otherwise a 100% export oriented undertaking and satisfied the remaining requirements of the provision. The incentive provision was also treated as one that must receive a liberal construction so as to advance its object and not defeat it by a technical objection as to the approving authority.

Conclusion: The approval by the Software Technology Park authority was held to be equivalent for the purpose of section 10B, and the assessee was held entitled to the deduction.

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