TMI Blog2014 (8) TMI 1051X X X X Extracts X X X X X X X X Extracts X X X X ..... never there is a gain the assessee is recognizing the same in its P & L Account. Hedging is a commercial necessity being followed by all engaged in import & export line because of the highly volatile currency fluctuation. As relying on the decision of DCIT vs. Bank of Bahrain and Kuwait (2010 (8) TMI 578 - ITAT, MUMBAI) to hold that the liabilities for foreign exchange was incurred during the normal course of assessee’s business and in fact the gain earned on such revaluation having been accepted and brought to tax in the respective years, there is no reason to arrive at a different conclusion in this year merely because there is a loss. Thus directing the AO to delete the addition - Decided in favour of assessee. - I.T.A. No. 3361/Mum/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-fareast-language:EN-US;} <![endif]--> SHRI N.K.BILLAIYA, AM, AND SHRI SANJAY GARG, JM For the Appellant : Shri K.A. Vaidualingan For the Respondent : Shri Pankaj Kumar O R D E R PER N.K.BILLAIYA, AM: This appeal by the assessee is against the order of the CIT(A)-9, Mumbai dated 22/02/2013 pertaining to assessment year 2009-10. 2. The sole grievance of the assessee is that the Ld. CIT(A) erred in upholding the disallowance of ₹ 32,95,500/- on the ground that Mark to Market loss are notional losses and the provision made is a contingent liability and therefore cannot be allowed as expenditure. 3. The assessee is in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in US dollars to hedge itself against risk out of fluctuation in foreign exchange. The assessee was entering into forward contract to hedge itself. Forward contract in foreign exchange are booked in the assessee s regular course of business, which are always denominated in foreign currency. Whenever there is a gain the assessee is recognizing the same in its P L Account. Hedging is a commercial necessity being followed by all engaged in import export line because of the highly volatile currency fluctuation. We find that the Benches of the Tribunal are consistently allowing such mark to market losses in ITA Nos. 7628/Mum/2011, 2855/Mum/2010, 7629/Mum/2011, 4456/Mum/ 2012, 6600/Mum/2012. The issue is also covered in favour of the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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