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Loss on foreign currency forward contracts which is not in respect of specified export or import is speculation loss
Case Law Details
- Case Name
- S. Vinodkumar Diamonds Pvt. Ltd. Vs. Addl. C.I.T. (ITAT Mumbai)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Related Assessment Year
- 2008- 09
- Courts
- All ITAT, ITAT Mumbai
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Forward transactions in commodities may fall within proviso (a) to section 43(5) of the Act, it is necessary that the raw materials or merchandise in respect of which the forward transactions have been made by the assessee must have a direct connection with the goods manufactured or the merchandise sold by him.
In other words raw material in respect of which the assessee has entered into forward transactions must be the same raw material which is used by him in his manufacturing business. We find that in the case under consideration assessee was not dealing in Foreign Exchang...
