Court rules against appellant on revenue liability due to forex rates, payment to customs authorities under protest. The Court held in favor of the appellant, ruling that the increase in revenue liability due to foreign exchange rate fluctuation is not valid, citing a ...
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Court rules against appellant on revenue liability due to forex rates, payment to customs authorities under protest.
The Court held in favor of the appellant, ruling that the increase in revenue liability due to foreign exchange rate fluctuation is not valid, citing a previous case. Additionally, the Court found that the payment made to customs authorities under protest falls under s. 43B(a) of the IT Act, as it was mandatory and the assessee had no choice but to comply. Consequently, the Court dismissed the appeal, stating that no substantial question of law arises for consideration on both issues.
Issues involved: Increase in revenue liability due to foreign exchange rate fluctuation and deductibility of payment made to customs authorities under protest under s. 43B of the IT Act, 1961.
Issue 1: Increase in revenue liability due to foreign exchange rate fluctuation The appeal pertains to the assessment year 2002-03 and challenges the Tribunal's order regarding the increase in revenue liability caused by foreign exchange rate fluctuation. The counsel for the appellant argued that this issue has already been decided in favor of the assessee by the Delhi High Court in CIT vs. Woodward Governor India (P) Ltd. & Ors. The Court upheld that the increase in revenue liability due to foreign exchange rate fluctuation is not valid.
Issue 2: Deductibility of payment made to customs authorities under protest under s. 43B of the IT Act, 1961 The second issue raised in the appeal concerns the deductibility of a payment made to customs authorities under protest under s. 43B of the IT Act, 1961. The Tribunal's decision on this issue was based on a previous case for the assessment year 1999-2000. The Court examined the earlier order and found that the liability to make the payment to customs authorities was mandatory and the assessee had no choice but to comply. Therefore, the Court concluded that such payment falls under s. 43B(a) of the IT Act. As a result, the Court determined that no substantial question of law arises for consideration and dismissed the appeal on this issue as well.
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