2012 (3) TMI 206

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....Income-tax Act ?   2. Whether the Appellate Tribunal is justified in not holding that the insertion of section 80HHE of the Income-tax Act, with effect from April 1, 1991, providing for grant of deduction on software develop- ment only with effect from April 1, 1991, militates against grant of such deduction under section 80HHC for the anterior period ?"   2. The assessee carries on the business of developing computer software. For the relevant assessment year 1989-90, it claimed a deduction to the extent of Rs. 21.55 crores under section 80HHC of the Act.   3. The Assessing Officer accepted the claim made by the assessee, but the Commissioner of Income-tax, exercising powers under section 263 of the Act, revised the....

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....e allowed, in computing the total income of the assessee, a deduction to the extent of profits, referred to in sub- section (1B), derived by the assessee from the export of such goods or merchandise :"   7. The first question that arises in this regard is whether the computer soft- ware recorded on magnetic tapes is goods or not ?   8. Learned counsel for the Revenue very frankly states that in view of the decision of the Supreme Court in Tata Consultancy Services v. State of A.P. [2004] 271 ITR 401 (SC), it must now be held that computer software, if it is recorded on magnetic tapes or otherwise and is marketable, it becomes "goods" susceptible to sales tax. Learned counsel for the Revenue also frankly states that in view o....

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.... company) resident in India, is engaged in the business of,-   (i) export out of India of computer software or its transmission from India to a place outside India by any means ;   (ii) providing technical services outside India in connection with the development or production of computer software, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction to the extent of the profits, referred to in sub-section (1B), derived by the assessee from such business :"   14. It is quite clear that on a comparison of the provisions of section 80HHC(1) and section 80HHE(1) of the Act, there is no substantial or material difference. &nb....