DCIT v. Kunnam Granite Works (2022) 194 ITD 238 (Chennai) (Trib.)

S. 43(5) : Speculative transaction-Trading in derivatives-Hedging contract with its bankers to minimize possible fluctuation in foreign currency-Not speculation loss-Allowable as business or business expenditure. [S. 28(i), 37(1)]

Held that the assessee being an exporter of goods having huge receivables from customers entered into a hedging contract with its bankers to minimize possible fluctuation in foreign currency, which resulted in loss, same had rightly been treated as revenue expenditure or business loss and could not be considered as speculative loss within meaning of section 43(5) of the Act. (AY. 2009-10)