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2003 (11) TMI 18 - HC - Income TaxDepreciation - adjustments in terms of section 43A(1) - (a) Whether, Tribunal was correct in deleting addition under the head depreciation due to foreign exchange rates fluctuation on the notional basis and not on actual payment? (b) Whether, the depreciation has to be allowed on addition in plant and machinery which represents notional increase in liability of foreign currency loan at the closure of the accounting period? – Held that even in a case where the assessee has completely paid for the plant and machinery in foreign currency prior to the date of devaluation but the variation in exchange rate affects the liability of the assessee (as expressed in Indian currency) for repayment of the whole or part of the monies borrowed by him from any person, directly or indirectly in any foreign currency specifically for the purposes of acquiring the asset, adjustments in terms of section 43A(1) can be made. - Thus, no fault can be found with the view taken by the Tribunal.
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