It's abuse of the contest rules, which encouraged at the IOCCC. You just have to be absolutely certain that it really IS "technically valid"[1] or it risks disqualification.
This one abuses the idea that they specify how the contest will be judged, which this "program" satisfies, as long as you don't look at the source.
$ make smr
cp smr.c smr
chmod +x smr
$ ./smr > smr.dup
$ diff smr smr.dup
$ echo $?
0
Also, it is a valid C file!
$ stat -c "%s" smr.c
0
$ gcc -Wall -c smr.c
$ echo $?
0
$ stat -c "%s" smr.o
927
The judge's comments for this one explain this in a bit more detail:
http://www.ioccc.org/1994/smr.hint
[1] the best kind of "valid" :)