Microsoft (vs) IncomeTax Dept., India

Everyone must have read about the Microsoft issue...
I kind of found it interesting ..
Microsoft has been asked to pay up by the IT department ( Please read IT as IncomeTax . .. this will be the new IT that will be of interest to us in some time soon!!! ) to pay up a whooping 90 Crores...

This blame was put up by India because of the laws that are in place and Microsoft apparently broke them ... So whats this all about??

Basically this is quite a complex issue, but I'll try to explain it..

Whenever we buy products of Microsoft, they apparently "license" it to us.. remember, its always the licensing agreement that we agree to .. So in other words, Microsoft only pays its taxes for the licenses in India and not for selling products (there was a big argument whether s/w should be classified as a product or service and hence tax levied on it like others ..... case was by Lotus Soft, if i am right and they won it as the situation was different in their case)
Well whatever.. so every CD's tax was actually due to its license..
BUT the problem comes here:
If you remember, there are Enterprise/Network edition Windows CDs.. This is basically using the same CD and Microsoft giving many licenses/Product-keys in the same pack.. so one CD and many codes to authenticate the product..
This was caught saying that Microsoft was paying the TAX on only 1 CD while attempting to sell many licenses using that pack ..

Now it does make some sense right!!

So this matter was based upon one particular clause in the IT.. But as usual, there was another duplicate clause that stated just the opposite that they cannot be taxed upon (adding to the confusion which rule should be kept in mind ! ! ! )... and this was the older rule.. and this was what Microsoft had been following..
Now because of the new rule, Microsoft was taxed upon ALL such CDs that it had sold.. But as i found out, the case is slightly tilted towards Microsoft's side because the old rule is quite popular and is used in most countries.

Now i think the matter is scheduled to be heard sometime soon and apparently Microsoft has a Very Strong group of lawyers who go to ANY length to get out of legal shit such as this, and these people are really well paid !!!
How do you think it got away with all the apple-copying stuff!!!! :D its these lawyers behind this....

So i think most likely Microsoft will escape the TAXMAN this time around!!!