https://www.taxtmi.com/caselaws?id=446586 The ITAT Bangalore upheld CIT(A)'s decision treating foreign exchange loss on Letter of Credit for fixed asset purchase as capital expenditure, not revenue. The tribunal ruled that forex loss directly linked to capital asset acquisition is capital in nature and cannot be charged to profit and loss account, following SC precedent in Tata Locomotive case. However, AO was directed to allow depreciation benefit under section 32. Regarding section 14A disallowance, the tribunal partially allowed the appeal, directing that only investments yielding exempt income should be considered for disallowance calculation under Rule 8D(2)(iii), not all investments. en-us Fri, 29 Sep 2023 00:00:00 +0530 Wed, 06 Dec 2023 12:10:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=446586 The ITAT Bangalore upheld CIT(A)'s decision treating foreign exchange loss on Letter of Credit for fixed asset purchase as capital expenditure, not revenue. The tribunal ruled that forex loss directly linked to capital asset acquisition is capital in nature and cannot be charged to profit and loss account, following SC precedent in Tata Locomotive case. However, AO was directed to allow depreciation benefit under section 32. Regarding section 14A disallowance, the tribunal partially allowed the appeal, directing that only investments yielding exempt income should be considered for disallowance calculation under Rule 8D(2)(iii), not all investments. Case-Laws Income Tax Fri, 29 Sep 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=446586