The Gujarat High Court has held that in addition to income is invalid, as the earnings from foreign exchange fluctuations are not in connection with business activity.
The revenue filed an appeal against the order passed by Income Tax Appellate Tribunal in ITA No. 2750/Ahd/2009 dated 30.09.2011. It is a common order passed by the Tribunal namely it was passed ITA No. 2749/Ahd/2009 connected with ITA No. 2750/Ahd/2009 which allowed the deletion of the addition of Rs. 6,09,97,186/- made by the Assessing Officer, on account of gain on foreign exchange fluctuation.
The Court viewed that as the earningswere not in connection with the business of the assessee, Hazira LNG Pvt ltd, the said amount can’t be treated as income and can’t be added to the income.
Mr Varun K Patel, advocate appeared on behalf of the petitioner and Mr B S Soparkar appeared on behalf of the respondent.
Chief Justice Aravind Kumar and Justice Ashutosh J. Shastri upheld the view taken by the Tribunal and observed that the findings and conclusions are proper and reasonable and are arrived at by correctly applying the principle of law enunciated in the judicial pronouncements.
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