9911796707
|
Home
Issues:
1. Whether income accrued to the assessee due to fluctuations in foreign exchange rates? 2. Whether the assessee is entitled to weighted deduction on commission paid for exports? Analysis: 1. The first issue before the court was whether income accrued to the assessee due to fluctuations in foreign exchange rates. The assessee had credited its profit and loss account with a sum representing the estimated amount of exchange difference on outstanding bills related to exports. The Tribunal held that the exchange difference did not relate to the last day of the previous year but was on an ad hoc basis. It was questioned whether the entries in the books of the assessee resulted in the accrual of income. The Tribunal concluded that no income arose or accrued due to fluctuation in foreign exchange rates. The court found the factual position confusing as the figure was included in the financial statements but later claimed to be not relevant. The Tribunal was directed to re-examine the matter to get a correct picture of the factual position and allow the assessee to explain the entries made. 2. The second issue involved whether the assessee was entitled to weighted deduction on commission paid for exports. Referring to a previous decision, the court held in favor of the assessee. The court noted that the question of weighted deduction was covered by the decision in Kerala Nut Food Co.'s case. The court directed the Tribunal to dispose of the references accordingly, answering the question of weighted deduction in favor of the assessee and against the Revenue. In conclusion, the court's judgment addressed two main issues related to income accrual from foreign exchange fluctuations and entitlement to weighted deduction on commission paid for exports. The court found the factual position confusing regarding the exchange difference and directed the Tribunal to re-examine the matter. The decision on weighted deduction was in favor of the assessee based on a previous court ruling.
|
