Unrealized MTM Loss on Benchmark Linked Debentures Allowed as Deductible Expense

Nomura Capital (India) Private Limited Vs DCIT (ITAT Mumbai)

The appeal before the ITAT Mumbai arose from an order of the National Faceless Appeal Centre (NFAC) dated 28.02.2025, which upheld the assessment order passed under Section 143(3) of the Income-tax Act for Assessment Year 2012–13. The sole issue concerned the disallowance of Rs.1,84,97,467 claimed as unrealized loss arising on fair valuation of Benchmark Linked Debentures (BLDs).

The assessee, a non-banking finance company engaged in financing and lending, had issued principal-protected, secured, redeemable, non-

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