Foreign Exchange Fluctuation Loss arising out of Re-Statement of ECB Allowed

 Pharmabase India P. Ltd. V DCIT (ITAT Mumbai) The issue under consideration is whether CIT(A) was justified in confirming the disallowance of foreign exchange fluctuation loss arising out of re-statement of External Commercial Borrowings (ECB) at the year end rates in accordance with Accounting Standard – 11 (AS-11)? ITAT states that, there is no reason for the AO to take a divergent stand during the year under consideration by disallowing the foreign exchange loss, when there is no change in facts when compared to earlier years. Even otherwise, we find that this issue is also squarely cov...