TMI Blog2014 (1) TMI 1741X X X X Extracts X X X X X X X X Extracts X X X X ..... the business which form part of capital. CIT (A) shall analyse afresh if the loss on account of foreign exchange fluctuations which is relatable to the revenue account or capital account. If the loss is relatable to the "revenue account", assessee should be entitled to the relief in view of the judgment of the Hon‟ble Supreme Court in the case of CIT vs. Woodword India Pvt. Ltd (2009 (4) TMI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. Briefly stated relevant facts of the case are that the assessee is engaged in the business of import and export of cut polished diamonds‟. Assessee filed the return declaring the total income of ₹ 22,54,270/-. Assessment was completed u/s 143(3) of the Act and the assessed income was determined at ₹ 1,61,40,170/-. During the assessment, AO disallowed the exchange loss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t one‟ and did not allow the same. The AO relied on the decision of the Apex Court in the case of M/s. Satlej Cotton Mills Limited 116 ITR 1 to support his view while disallowing the claim of the assessee. Aggrieved with the decision of the AO, assessee carried the matter in appeal before the first appellate authority. 4. During the proceedings before the first appellate authority, CIT (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ases. This aspect was wrongly considered as a capital related activity‟, by the CIT (A). Further, it is submitted that the exchange difference was arisen on account of advances received from the customers and against the sale realization. Ld Counsel also submitted that the transactions made by the assessee in foreign currency have been accounted in accordance with AS-11 issued by the ICAI a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relief in view of the judgment of the Hon‟ble Supreme Court in the case of CIT vs. Woodword India Pvt. Ltd (312 ITR 254). Accordingly, we set aside the issue to the files of the CIT (A) to adjudicate the issue afresh after affording a reasonable opportunity of being heard to the assessee. Accordingly, the grounds raised by the assessee are allowed for statistical purposes. 8. In the resul ..... X X X X Extracts X X X X X X X X Extracts X X X X
|