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2012 (11) TMI 900 - AT - Income TaxValidity of Order u/s 263 - Taxability of Foreign Exchange Fluctuation Reserve - CIT found that this issue was not reflected in the assessment order by AO - Order passed by the AO as far as the issue is concerned, is erroneous and prejudicial to the interests of the Revenue – Held that:- It is necessary, to examine the components of the assets and holdings re-stated by the assessee in terms of Indian rupee so as to see whether any revenue item is re-stated and if so, whether the gains would be eligible to tax. AO has not at all discussed anything in his order on this important issue. Therefore, it is not possible to hold at present that whether the AO had in fact examined this aspect of the case. Hence, the assessment order is erroneous and prejudicial to the interests of the Revenue as far as the addition to the foreign currency fluctuation reserve account is concerned. Appeal decides in favour of revenue
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