Foreign Portfolio Investor's FCC Loss Classified as Short-Term Capital Loss, Tribunal Upholds Carry Forward Eligibility.

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....The assessee, a Foreign Portfolio Investor registered in India, entered into Forward Foreign Exchange Contracts (FCC) with HDFC Bank to safeguard against foreign currency fluctuation risk. The issue pertained to the treatment of loss arising from FCC as a short-term capital loss. The Tribunal held that while considering a similar issue, the coordinate bench in Citicorp Investment Bank (Singapore) Ltd. ruled that profit earned by a Singaporean bank on termination of forward contracts entered for safeguarding against foreign exchange fluctuation in respect of debentures purchased in India would be a capital gain exempt under the Indo-Singaporean DTAA. Additionally, in D.B. International (Asia) Ltd., it was held that the gain from a forward fo.........