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Foreign exchange

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RITESH KHANDELWAL

Corporate Taxation

115 Points Posted on 08 March 2008

Hi!!

1) If an individual keeps his money deposited with foreign (USA) branch of ICICI Bnk in USD and after 3 yrs he withdraws entire sum of money and transfers it to his ICICI Bank A/c of Indian Branch, then:
a) Is the foreign exchange fluctution to be considred under CAPITAL GAIN or Profit & gains from Bus./ Prf.(For sure his business has got nothing to do with Foreign Exchange)

Replies (1)

Rashmi Agrawal

Accountant

118 Points Posted on 08 March 2008

As you said that business has nothing to do with Foreign Exchange, the question of this income charged under the head income from business & profession does not arise. This income will not be charged under the head capital gains because it does not come under the definition of capital assets. This Income will be taxed under the head Income from other sources after considering the foreign exchange fluctation at the time of depositing amount from the foreign branch to the domestic branch. Others' Views are welcome.