Case Law Details
RKKR Holdings Pvt. Ltd. Vs ITO (ITAT Chennai)
There is no dispute with regard to the fact that two Directors of the assessee company have travelled to USA, London and Singapore. Although, there is no direct nexus between the foreign travel expenses incurred by the assessee and business receipts from those destinations, but fact remains that there is an increase in turnover when compare to previous financial years. Therefore, it can be safely concluded that there is a business exigency in incurring foreign travel expenses by the assessee company. But, fact remains that there is no correlation between huge expenditure incurred for foreign travel and increase in volume of the business of the assessee. Therefore, considering the facts and circumstances of the case, we are of the considered view that a reasonable amount should be disallowed from the foreign travel expenditure incurred by the assessee and thus, we direct the AO to restrict the disallowance of foreign travel expenses to the extent of 50% of actual expenses incurred by the assessee.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
This appeal filed by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-18, Chennai, dated 26.12.2019 and pertains to assessment year 2005-06.
2. The assessee has raised the following grounds of appeal:
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