Held, that a foreign exchange cover was not a contract for the purchase of a share or stock and did not fall within the purview of the term commodity and hence the characteristics of a speculative transaction were not satisfied. Since the definition of speculative transaction itself was not applicable, treating the transaction as speculative in nature was not sustainable in law. (AY. 2008-09, 2010-11)
ACIT v. Lifestyle International (P.) Ltd. (2021) 88 ITR 79 (Bang.) (Trib.)
S. 43(5) : Speculative transaction-Premium on forward cover – Commodity-Foreign exchange cover not contract for purchase of share or stock and does not fall within definition of commodity – Transaction not speculative.