OCEAN SPARKLE LIMITED,HYDERABAD vs. DCIT., CIRCLE 5(1), HYDERABAD

ITA 1030/HYD/2024Status: DisposedITAT Hyderabad06 August 2025AY 2010-11Bench: SHRI VIJAY PAL RAO (Vice President), SHRI MANJUNATHA G (Accountant Member)22 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that gain or loss on restatement of foreign currency monetary items as on the balance sheet date should be recognized as income or expenses in the profit and loss account, following the Supreme Court's decision in CIT vs. Woodward Governor India (P.) Ltd. The ITAT Hyderabad's contrary view in DCIT vs. Cyient Ltd. was not followed.

What were the facts?

The assessee claimed deduction for administrative expenses including donations and provisions for doubtful debts, and also reduced taxable income by forex gain. The PCIT initiated proceedings under Section 263, and the AO made additions based on the PCIT's directions.

What were the issues?

Whether forex gain on restatement of liabilities as on the balance sheet date is taxable income, and whether it should be recognized in the profit and loss account.

Which sections of the Income-tax Act were involved?

Section 263,Section 14A,Section 43A

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(4)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, HYDERABAD “A” BENCH: HYDERABAD

Before: SHRI VIJAY PAL RAO & SHRI MANJUNATHA G

Hearing: 31.07.2025Pronounced: 06.08.2025

PER MANJUNATHA G. :

The above appeal has been filed by the assessee against the order dated 14.08.2024 of the learned Commissioner of Income Tax-(Appeals)-National Faceless Appeal Centre [in short “NFAC], Delhi, relating to the assessment year 2010-2011. 2 ITA.No.1030/Hyd./2024

2.

Brief facts of the case are that, the appellant company is engaged in the business of O & M of ports and Marine services. The assessee had filed it’s return of income for the Assessment year 2010-11 on 30.09.2010 admitting total income Rs.10,16,37,986/- under normal provisions of the Income Tax Act, 1961, after claiming deduction u/sec.801A amounting to Rs.2,12,27,868/- and book profit u/sec.115JB of the Act at Rs.21,01,79,

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 263

All 13,616 judgments and leading authorities on Section 263 →

Recent GST High Court judgments

Search GST case law →