Loss incurred on hedging transaction to safeguard foreign currency fluctuation loss is not speculative loss

PCL Foods Pvt. Ltd. Vs ACIT (ITAT Delhi) ITAT Delhi held that forward contract was purely hedging transactions entered into by assessee to safeguard against loss arising out of fluctuation in foreign currency, loss on such transactions could not be held as speculative transactions felling within ambit of section 43(5). Facts- The assessee is engaged in the business of purchasing paddy, removing husk and bran layers there from, extracting rice from the purchased paddy and polishing and grading the extracted rice. Thus, the assessee can be said to be engaged in ‘Rice milling activity’. The c...