TaxTMI 
TaxTMI 
1998 (3) TMI 64
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....e were to the tune of 1,07,339 Singapore dollars, which were converted in Indian currency at Rs. 244 per hundred Singapore dollars and valued at Rs. 1,69,143 in the profit and loss adjustment statement. The Income-tax Officer was of the view that the conversion should have been at the rate of Rs. 387 per hundred Singapore dollars, which were prevalent during the said period and he accordingly made an addition of Rs. 1,53,494. On appeal, the Commissioner of Income-tax (Appeals)-III, Madras 34, noted that there was an Instruction No. 1154, dated March 10, 1978, issued by the Central Board of Direct Taxes to the effect that in respect of the income, which has accrued, arisen or received prior to November 1, 1977, the rate of exchange pro....
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....der : "115. Rate of exchange for conversion into rupees of income expressed in foreign currency.---The rates of exchange for the calculation of the value in rupees of any income shall be as follows : (a) in respect of income accruing or arising or deemed to accrue or arise to the assessee or received or deemed to be received by him or on his behalf before the 6th day of June, 1966--- (i) 1 sh. 6. d = Re. 1 ; (ii) U.S. $1 = Rs. 4.762 ; (b) in respect of income accruing or arising or deemed to accrue or arise to the assessee or received or deemed to be received by him or on his behalf on or after the 6th day of June, 1966--- (1) where such income accrues or arises or is deemed to accrue or arise to the assessee or is r....
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....ther sources' (not being income by way of dividends and 'interest on securities'), the last day of the previous year of the assessee ; (d) in respect of income chargeable under the head 'Profits and gains of business or profession' in the case of a non-resident engaged in the business of operation of ships, the last day of the month immediately preceding the month in which such income is deemed to accrue or arise in India ; (e) in respect of income by way of dividends, the last day of the month immediately preceding the month in which the dividend is declared, distributed or paid by the company ; (f) in respect of income chargeable under the head 'Capital gains', the last day of the month immediately preceding the month in which th....
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....e is applicable to the facts of the instant case and not the substituted rule, which came into effect from April 1, 1990. The old rule 115 prescribes conversion rates for pound sterling and U.S. dollar into Indian rupees and did not at all provide for conversion rates for currencies of other countries. The moot question that arises for consideration, in such a situation, is as to : Whether the old rule 115 is applicable to conversion of Malayasian dollars into Indian currencies ? It is not as if such a question did never arise for consideration, anterior in point of time and the plain fact is that such a question arose for consideration before a Division Bench of this court, in the case of S. M. Syed Mohsin v. CIT [1979] 119 ITR....
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....xed in India. The attempt of the learned counsel for the assessee was to show that this expression 'any income' would refer only to the source of income and not to the place of origin. The language of the rule does not appear to suggest this construction. The rule-making authority was to make a rule in order to provide for the conversion of income earned in any foreign currency. The idea was to fix a rough and ready method so that the Income-tax Officer had not to hunt for himself the prevailing exchange rates of different currencies in relation to the Indian currency at different points of time." The rule as above is applicable on all fours to the facts of the instant case. What the Income-tax Officer, in the instant case has to do i....