https://www.taxtmi.com/caselaws?id=458235 Forward foreign exchange contracts entered into as a genuine hedge against underlying business exposures are treated as hedging transactions, not speculative transactions, and the resulting marked-to-market loss is allowable as a business loss or recognised exchange difference. The analysis notes that exchange differences should be recognised to reflect real profits and that section 43AA, introduced with effect from 1 April 2017, specifically brought forward exchange contracts within its scope. For periods before that amendment, such contracts were outside the relevant taxing provision, so disallowance of the MTM loss was not sustainable. en-us Fri, 15 Mar 2024 00:00:00 +0530 Fri, 20 Dec 2024 21:01:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=458235 Forward foreign exchange contracts entered into as a genuine hedge against underlying business exposures are treated as hedging transactions, not speculative transactions, and the resulting marked-to-market loss is allowable as a business loss or recognised exchange difference. The analysis notes that exchange differences should be recognised to reflect real profits and that section 43AA, introduced with effect from 1 April 2017, specifically brought forward exchange contracts within its scope. For periods before that amendment, such contracts were outside the relevant taxing provision, so disallowance of the MTM loss was not sustainable. Case-Laws Income Tax Fri, 15 Mar 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=458235