Treatment of loss due to foreign exchange fluctuations

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..... There was a loss on account of Foreign Exchange Fluctations on restatement of Foreign currency loan taken for purchase of Land, Building and Machinery ( indegenous) for a manufacturing project. How will it be treated in Income tax ?? - Reply By Rama Krishana - The Reply = I am not an expert but wish you to put your views and understanding first so that the same may be discussed further. - Reply B .....

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..... y Sanjeev Sharma - The Reply = Perplexed at your comments. I find nothing in Income tax Act which applies to this situation. Sec 43A also does not apply to this, being indegenous machinery. I had a problem and that is the reason for this query. If you know, I would appreciate your reply to the query. - Reply By Rama Krishana - The Reply = I hope your issue would be solved with the help of .....

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..... Supreme Court decision reported in 2009 -TMI - 32906 - SUPREME COURT - in this case, supreme court has allowed the deduction on account of foreign exchange fluctuation. In this case, a detailed discussion on cost u/s 43A has been made and reasoned decision has been delivered. - Reply By Sanjeev Sharma - The Reply = You mean Woodworth case. That does not apply to this situation.It says loss .....

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..... on account of revenue a/c and on account of capital a/c. Loss on account of revenue a/c is allowed as an expense. We have loss on account of capital a/c. In 43A situation, it is capitalised. In non 43A situation, will it be entirely disallowed ?? - Treatment of loss due to foreign exchange fluctuations - Query Started By: - Sanjeev Sharma Dated:- 17-9-2009 Income Tax - Got 4 Replies - Income Ta .....

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..... x - Discussion Forum - Knowledge Sharing, reply post by an expert, personal opinion Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax .....

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