21 November 2013
The provisions of section 43A of the Income Tax Act are summarised hereunder: a) Where the assessee has acquired any assets from a country outside India b) The assets are acquired for the purpose of business or profession. c) Consequent to change in rate of exchange, there is increase / decrease in the liability of the assessee expressed in Indian currency towards cost of the assets or repayment of money borrowed for acquiring capital asset along with interest in foreign currency. d) Such increase or reduction in the liability shall be added or deducted from the actual cost of assets as and when paid or received. The provisions of section as can be seen from the above are not applicable where indigenous assets are acquired out of foreign currency loans.
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