Case Law Details
Wipro Finance Ltd. Vs CIT (Supreme court of India)
Facts- The appellant submitted ROI on 29.11.1997 for the A.Y. 1997-1998, mentioning loss of income, amongst others, owing to exchange fluctuation of Rs. 1,10,53,909/. After processing the return u/s. 143(1)(a), the assessment was completed on 16.3.2000. As against the loss declared by the appellant due to exchange fluctuation, the assessment was concluded by positive taxable income. Against that decision, the matter was carried in appeal by the appellant before the Commissioner of Income Tax and eventually, by way of appeal before the Income Tax Appellate Tribunal.
In the appeal before the ITAT, ITAT concluded that exchange fluctuation loss is an expenditure incidental to carrying on of business and comes within the purview of section 37.
The matter was carried before the HC by the department. The High Court vide impugned judgment has reversed the view taken by the ITAT, mainly observing that the ITAT had not recorded sufficient reasons in support of its conclusion and in any case, the conclusion was without any basis.
Conclusion-
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