TaxTMI 
TaxTMI 
2006 (10) TMI 65
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.... are taken up together and the same are disposed of by a common judgment. 2 The questions of law raised in the above appeals are as under: (a) Tax Case (A) Nos. 224 to 226 of 2003, 1093 of 2004, 1293 to 1299 of 2005, 1175 of 2005: "Whether, on the facts and circumstances of the case, the Tribunal was right in treating the transfer of the right to exhibit the films, as a sale of goods or merchandise for the purpose of deduction under section 8OHHC ?" (b) Tax Case (A) No. 295 of 2005 "Whether, on the facts and circumstances of the case, the Appellate Tribunal was right in law in holding that, the right of exploitation of the films outside India do constitute export of goods or merchandise and consequently the assessee would be ....
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.... treating the lease of the right to exhibit the films for a limited period, as a sale of goods or merchandise eligible for the purpose of deduction under section 8OHHC?" 3 For the sake of convenience, we are taking up Tax Case (A) No. 224 of 2003, in which the question of law reads as under: "Whether, on the facts and circumstances of the case, the Tribunal was right in treating the transfer of the right to exhibit films, as a sale of goods or merchandise for the purpose of deduction under section 8OHHC?" 4 The brief facts leading to the above question of law are as under : 5 The assessee is engaged in the film business. He held the rights over the film "Mudal Kural". The relevant assessment year is 1993-94 and the corresponding....
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....stipulates that the sale proceeds of such goods must be brought into India. The words "sale proceeds" mean, there should be only actual export sale. In this case, there is no sale of goods and hence the assessee is not entitled to relief under section 8OHHC of the Act. 7 Learned senior counsel appearing for the assessee submitted that the word "goods" or "merchandise" has not been defined in the Act and hence the meaning of these words has to be understood either from the dictionary or from other Acts. The dictionary meaning of the word "goods" is movable property, chattels, merchandises, freight (Oxford Dictionary). He also further stated that the word "goods" means not only tangible assets, but also intangible assets. It is also furthe....
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....ed the scope of section 8OHHC of the Act and allowed the assessee's appeal. The said Bombay High Court judgment is now reported in Abdulgafar A. Nadiadwala v. Asst. CIT [2004] 267 ITR 488. The contentions raised before the Bombay High Court by the counsel is at page No. 508 of the said judgment and the reads as follows : 'Points for determination: The substantial points for determination, in a narrow compass, on rival contentions as between the parties canvassing rival views, on the facts and circumstances of the case, are as under 1. Whether the product involved can be said to be 'goods' and/or 'merchandise'? 2. If yes, can it be said that it was exported out of India by way of sale or otherwise involvin....
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....OHHC of the Act." 11 In respect of the third point, the Bombay High Court held as follows (page 523) ; "Reading of the above illustrations in general and clauses (v) and (vi) thereof in particular make it clear that while describing the deduction under section 8OHHC the words used are 50 per cent. of the 'export proceeds' brought into India. It is, therefore, clear that even the Central Board of Direct Taxes has understood the words 'export proceeds' to be synonymous to 'sale proceeds'. If that be so, the amount received by way of consideration in the transaction in question can conveniently be termed as 'export proceeds' equal to that of 'sale proceeds'. Once we hold that the transaction involv....
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....e, nor showned any other High Court judgment, taking a country view to that of the Bombay High Court. Further, no compelling reasons were given by the Revenue to take a different view to that of the Bombay High Court and hence, we respectfully agree with the view taken by the Bombay High Court. Further, we note that contentions of the counsel are also well supported by the apex court judgment reported in [2004] 271 ITR 401, in the case of Tata Consultancy Services v. State of Andhra Pradesh In that judgment, the Supreme Court considered the scope of the word "goods" and held as follows (page 432) : "It is not in dispute that when a programme is created it is necessary to encode it, upload the same and thereafter unloaded. Indian law, as ....