Document Fragment View

Matching Fragments

"(a) Justification for claim of deduction under section 80HHE of Rs. 2,01,31,460 :
The note enclosed on the "Nature of activities" of the assessed company (Viz, Annexure I) clearly establishes that it is engaged in the Export of Data processing/Software segments on computerised reservation system. Export of Processed data/computer software is one of the qualifying activities specified in section 80HHE(1)(i).
(b) Information sent outside is "Software" :
Your goodself has asked the assessed-company to establish that the information sent outside is Software. In this connection, your attention invited to the certificate dated 5-11-1996 of the Software Technology Parks of India (hereinafter referred to as the STPI) as also the Softex Form filed at pages 18 to 22 with the return of income. In annexure V enclosed it has been explained that the description of the software exported viz., "S/W.B" means "Data processing software" and this has been duly certified by the STPI, an autonomous society of the Government of India, Department of Electronicswhich is the technical body authorised to certify the software exports. The said certificate of the STPI dated 5-11-1996 read with the explanatory note in para 6 above duly establishes the software exports on the part of the assessed-company."

27. The Central Board of Direct Taxes was approached thereafter who very kindly in para 5 & 6 of their Circular No. 694 dated 22-11-1994 issued a similar clarification and extended the benefit of section 80HHE to software prepared on-site abroad. The clarifications issued by the Central Board of Direct Taxes through the aforesaid circular provided the much desired uniformity of government-policy among the Department of Electronics, CBEC and Central Board of Direct Taxes.

28. In early 1996 further new areas of software related activities like data entry and conversion, data processing, data analysis and control and data management emerged in International trade in which India could grab a significant share in exports. These activities are covered by the definition of "computer programme" as given in Copyright Act. Accordingly, CBEC on the recommendations of Department of Electronics issued further clarifications that export benefits will be available to EOU/STP units who export out of India all software developed, data entry and conversion done, data processed, data analysis and controlled or data management done. The CBEC substituted the words "development of software" with the words "development of software, data entry and conversion, data analysis and control or data management" vide its Notification No. 89/96 customs dated 19-11-1996. The said broad banding of scope of software activities provided desired momentum in software exports. The CBEC has further clarified "Computer Software-Scope of Exemption" vide its Notification F. No. 341/20/97-TRU dated 10-2-1998 (Circular No. 7/98-Cus). Even RBI has also clarified that such exports or services in non-physical form could be done on SOFTEX Form and that the designated officer of the Department of Electronics could process and certify such SOFTEX Form as in the case of other software exports through Data Links.

36. Apart from the above facts we also find that the assessed-company submits their monthly return for exports to the Competent Authority which has accepted the same in discharge of export obligation. We have also noted that the export of software as per the statutory requirements are also declared on exporters declaration form SOFTEX (specimen of SOFTEX form has been filed). The competent authority i.e., Department of Electronics authorised official also certifies that the software described in the SOFTEX form was actually transmitted and the export value declared by the exporter has been found to be in order and accepted by the authorised officer.