Indian Kanoon - Search engine for Indian Law

"13. In the present case there is no dispute that the assessee developed 'Computer Software' and transmitted electronically to its head office. The assessee is an approved 100 per cent export oriented unit for development of computer software duly approved by the STP of India. The export of software during the previous year is evidenced by the Softex form duly certified by the competent officer of STPI. The consideration has been received by the assessee in the form of convertible foreign exchange. The only reason assigned by the Revenue authorities for denying exemption under section 10A of the Act is M/s. Semantic Space Technologies Ltd., Hyderabad that there has been no export sale by the assessee, since the computer software was transmitted to head office and since the assessee and the head office were one entity, there was no sale to any third party. This approach of the Revenue authorities were not correct in view of the provisions of section 10A(7) of the Act. The legal fiction of treating an assessee as a separate entity vis-à-vis sale by it or transfer by it from an eligible business or to an eligible business has been recognised under section 10A(7) of the Act. A plain reading of the provisions of section 10A(7) together with the provisions of section 80-IA(8) of the Act, which reads as follows reveals the statutory recognition of such legal fiction-