https://www.taxtmi.com/caselaws?id=759214 The Bombay HC remanded a case to ITAT regarding foreign exchange losses on foreign currency loans used partly for importing assets and partly for acquiring domestic assets. The assessee had capitalized exchange losses under AS-11, while ITAT allowed proportionate treatment - capitalizing losses for imported assets under Section 43A and treating domestic asset-related losses as revenue expenditure under Section 37(1). The HC held that Section 43A mandatorily applies only to assets imported from abroad, but this doesn't automatically make other exchange losses revenue expenditure. The ITAT must determine whether the domestic component qualifies as non-capital expenditure under Section 37(1) independently of Section 43A's positive mandate. en-us Tue, 24 Sep 2024 00:00:00 +0530 Mon, 20 Jan 2025 18:23:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=759214 The Bombay HC remanded a case to ITAT regarding foreign exchange losses on foreign currency loans used partly for importing assets and partly for acquiring domestic assets. The assessee had capitalized exchange losses under AS-11, while ITAT allowed proportionate treatment - capitalizing losses for imported assets under Section 43A and treating domestic asset-related losses as revenue expenditure under Section 37(1). The HC held that Section 43A mandatorily applies only to assets imported from abroad, but this doesn't automatically make other exchange losses revenue expenditure. The ITAT must determine whether the domestic component qualifies as non-capital expenditure under Section 37(1) independently of Section 43A's positive mandate. Case-Laws Income Tax Tue, 24 Sep 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=759214