Loss on cancellation of forward contracts related to cancelled export orders is ordinary business loss

Brief of the Case ITAT Kolkata held In the case of Shri Jayant Kr. Bhura vs. ITO that the loss arising to the assessee upon cancellation of the forward contracts was referable to and related to the assessee’s export business and arose out of the export business. The booking of forward contracts was not the assessee’s business. In the given case, the assessee in order to hedge against losses had booked foreign exchange in the forward market with the bank but the export contract entered into by the assessee for export of commodities in some cases failed, the assessee is entitled to claim...