New Delhi, June 10 -- The move by the Directorate General of GST Intelligence to (DGGI) close Rs.32,403-crore of pre-tax proceedings against Infosys Ltd last week goes beyond the simple resolution of a tax dispute.

It signals the government's acceptance of the fact that business processes by software companies need not necessarily be organized in a way that is convenient for the tax administration, according to two people familiar with the development.

The closure of the case, based on a clarification issued by the Central Board of Indirect Taxes and Customs (CBIC) last June and verification of Infosys' transactions for the past five years, is significant as it changes the way GST authorities will examine the transactions of software co...