2002 (1) TMI 17 - HC - Income Tax

Business Loss Mercantile System Of Accounting - Loss Due To Devaluation Of Indian Rupee - Whether on the facts and circumstances of the case the Tribunal was correct in holding that the assessee was not entitled to claim the amount in question as deduction on account of difference in the exchange rate by devaluation on December 22 1981 which was about two months after the close of the accounting year? - we answer the question in the affirmative i.e. in favour of the Revenue and against the assessee.

Summary

The High Court of Rajasthan upheld the decision of the Tribunal that the assessee was not entitled to claim a deduction for a loss due to exchange rate difference as it occurred after the close of the relevant accounting year. The Tribunal found that the devaluation happened after the accounting year had ended, supporting the Revenue's position. The court ruled in favor of the Revenue and against the assessee.