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2018 (3) TMI 801 - BOMBAY HIGH COURTLoan taken for capital expenditure utilized for working capital and loss on currency fluctuation - allowable business loss - Held that:- We find that both the CIT(A) as well as the Tribunal have on perusal of the record, have come to a conclusion that the loan taken was utilized only for working capital requirements. Therefore, loss on account of foreign exchange variation would be allowable as a trading loss. In fact, even the Assessing Officer has held that term loan was not utilized for purchase of plant and machinery. We find that this issue stands covered by the decisions of the Supreme Court in Sutlej Cotton Mills Ltd., v/s. CIT (1978 (9) TMI 1 - SUPREME Court) that loss arising during the process of conversion of foreign currency is a part of its trading asset i.e. circulating capital, it would be a trading loss. No substantial question of law. Appeal on admitted on first substantial question of law : a) Whether on the facts and in the circumstance of the case and in law, the Tribunal was justified in law in holding that in exercise of power under Rule 46 (A)(4) of the Income Tax Rules 1962, the CIT(A) can rely upon documents called for by him in respect of payment made to certain parties claimed as expenditure without giving notice/ hearing the other side on the additional documents called for?”
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