Income Tax Act, 2025
Section 8: Ins. by Act 27 of 1999, s. 47 (w.e.f. 12000).
8. Ins. by Act 27 of 1999, s. 47 (w.e.f. 12000).
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1[80HHE.Deduction in respect of profits form export of computer software, etc.—(1) Where an
assessee, being an Indian company or a person (other than a company) resident in India, is engaged in the
business of,—
(i) export out of India of computer software or its transmission from India to a place outside India
by any means;
(ii) providing technical services outside India in connection with the development or production
of computer software,
there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the
total income of the assessee, 2[a deduction to the extent of the profits, referred to in sub-section (1B),]
derived by the assessee from such business:
3* * * * *
4[Provided that if the assessee, being a company, engaged in the export out of India of computer
software, issues a certificate referred to in clause (b) of sub-section (4A), that in respect of the amount of
the export specified therein, the deduction under this sub-section is to be allowed to a supporting software
developer, then the amount of deduction in the case of an assessee shall be reduced by such amount which
bears to the total profits derived by the assessee from the export, the same proportion as the amount of the
export turnover specified in such certificate bears to the total export turnover of the assessee.
5[Explanation.—For the removal of doubts, it is hereby declared that the profits and gains derived
from on site development of computer software (including services for development of software) outside
India shall be deemed to be the profits and gains derived from the export of computer software outside
India.]
(1A) Where the assessee, being a supporting software developer, has during the previous year,
developed and sold computer software to an exporting company in respect of which the said company has
issued a certificate under the proviso to sub-section (1), there shall, in accordance with and subject to the
provisions of this section, be allowed in computing the total income of the assessee a deduction of the
profits derived by the assessee from the developing and selling of computer software to the exporting
company in respect of which the certificate has been issued by the said company 6[to such extent and for
such years as specified in sub-section (1B)].]
6[(1B) For the purposes of sub-sections (1) and (1A), the extent of deduction of profits shall be an
amount equal to—
(i) eighty per cent. of such profits for an assessment year beginning on the 1st day of April, 2001;
7[(ii) seventy per cent. thereof for an assessment year beginning on the 1st day of April, 2002;
(iii) fifty per cent. thereof for an assessment year beginning on the 1st day of April, 2003;
(iv) thirty per cent. thereof for an assessment year beginning on the 1st day of April, 2004,]
Where an
assessee, being an Indian company or a person (other than a company) resident in India, is engaged in the
business of,—
export out of India of computer software or its transmission from India to a place outside India
by any means;
providing technical services outside India in connection with the development or production
of computer software,
there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the
total income of the assessee, 2[a deduction to the extent of the profits, referred to in sub-section
of sub-section
Where the assessee, being a supporting software developer, has during the previous year,
developed and sold computer software to an exporting company in respect of which the said company has
issued a certificate under the proviso to sub-section
For the purposes of sub-sections
and
eighty per cent. of such profits for an assessment year beginning on the 1st day of April, 2001;
7[
seventy per cent. thereof for an assessment year beginning on the 1st day of April, 2002;
fifty per cent. thereof for an assessment year beginning on the 1st day of April, 2003;
thirty per cent. thereof for an assessment year beginning on the 1st day of April, 2004,]