ORDER

1. Delay condoned.

2. Leave granted in Special Leave Petitions.

3. The question which arises for determination in this batch of Civil Appeal(s) is whether the foreign exchange earned by transferring the right of exploitation of the films outside India by way of lease is admissible for deduction under Section 80HHC of the Income Tax Act 1961. According to the Department, movies/films are not goods. They are not merchandise. Hence Section 80HHC is not invokable. Further, according to the Department, there is a difference between "sale" and "lease" hence, the subject transaction will not fall under Section 80HHC.

Facts in Civil Appeal No. 3300/2007:

4. During the relevant Assessment Year 1993-94, the assessee, B. Suresh, transferred feature film rights for exploitation outside India and earned income in foreign exchange. The assessee claimed deduction under Section 80HHC in respect of the said receipts. The Assessment Officer (AO) held that the assessee was not entitled to deduction under Section 80HHC, inter alia, on the ground that the export was not of merchandise or goods as contemplated under Section 80HHC, but was merely an export of "rights" in the film. This decision of the