CBEC wants to tax maintenance or repair or servicing of computer software- draft circular made real
DDT had pointed out in TIOL-DDT 207 dated 22 09 2005, that Board proposed to issue a circular clarifying that maintenance or repair or servicing of all computer software is taxable under section 65. Now the circular is finally issued. DDT had suggested that in order to avoid silly litigation, the Board should clarify that this circular has only prospective effect. Otherwise overactive officers are sure to shoot off Show Cause Notices. But Board has not given any such clarification. Let us hope the department will not initiate action, especially for the last five years alleging suppression that the assessees had suppressed the fact that Board is going to issue the clarification!.
Circular No. dated 7 th October 2005