Disallowance of foreign travel expenditure justified as business expediency not proved

M M Creations Vs ACIT (ITAT Delhi)

ITAT Delhi held that disallowance of foreign travel expenditure justified as assessee failed to prove the business expediency of foreign trip and therefore assessee failed to discharge the primary onus.

Facts- Vide the present appeal, the appellant has contested that CIT(A) has erred in holding the expenditure incurred on foreign travel by the employees and partners for non-business purpose by disallowing the claim of Rs. 7,34,657/- is patently incorrect as it being an exporter needs to travel abroad for exhibiting the products exported.

Conclusion- Held that on thoughtful consideration of factual matrix of the issue basis taken by the Assessing Officer and findings returned by the ld. CIT(A) we note that the addition has been upheld by observing that since the assessee failed to prove the business expediency of foreign trip to Europe therefore the primary onus has not been discharged by the appellant either during the assessment or during appellate proceedings. The ld. CIT(A) also rightly concluded that the appellant has failed to prove that these expenses identified by the Assessing Officer, were incurred wholly and exclusively for the business purpose of assessee.

FULL TEXT OF THE ORDER OF ITAT DELHI

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