Mark to Market Losses on open forward exchange contract is allowable

Pre-requisite to invoke the provisions of section 14A r.w.r.8D of the Rules is that the assessee should have claimed some expenditure against exempt income assessee had not claimed any exempt income in its return.However he made disallowance of Rs. 1.25 crores(Rs. 1.19 crores interest expenditure + Rs.6.89 lakhs administrative expenses) and same was upheld by the FAA. The pre-requisite to invoke the provisions of section 14A r.w.r.8D of the Rules is that the assessee should have claimed some expenditure against exempt income.In the case under consideration, no exempt income was shown by the as...