Marked to market loss deduction follows ICDS-based computation for expected losses under the income tax framework. Marked to market loss and other expected loss are exceptions to the general rule that only realised losses are deductible. Under the Income Tax Act, 2025, section 32(h) allows such unrealised losses only when computed in accordance with ICDS notified under section 276(2). Under section 36(1)(xviii) of the Income Tax Act, 1961, the same principle applied, and section 40(13) barred deduction of expected loss except as allowable under section 36(1)(xviii).