Capitalising the impact of foreign exchange fluctuation.

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.... liability of an assessee as expressed in Indian currency due to change in rate of exchange in relation to an asset acquired for the purpose of business or profession in foreign currency from a country outside India, it shall be dealt with in the manner specified in sub-sections (2) and (3). (2) For this section, "variation in liability" shall be computed as- A = B-C where,- ....

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....ital asset (not being capital asset referred to in section 74) for the purpose of section 72, and the amount arrived at after such addition or deduction shall be taken to be the actual cost of the asset or the amount of expenditure of a capital nature or, as the case may be, the cost of acquisition of the capital asset. (4) Where the assessee has entered into a contract with an authorised de....