In Abdulgafar A Nadiadwala v. Asstt. CIT (2004) 137TAX112 the assessee transferred overseas film telecasting rights for a period of five years to STAR TV and for this purpose recorded the films in beta cam Tapes that were exported. Making a note of 46th amendment to the Constitution on the expanded definition of sale the Bombay High Court held that the words ‘or otherwise’ in the definition of the word export turnover would include within it export of tapes which has incorporeal rights. But it is also a fact that such tapes are only used as a medium to effect transfer of the film telecasting rights similar to lease of right of exhibition of feature films.
The judgment provide an opportunity to even service providers such as engineers services etc. to claim deduction u/s 80HHC in every case where the services are rendered by use of tapes, cassettes, CDs, floppies etc. that are exported through custom clearance.