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2015 (6) TMI 933 - AT - Income TaxDisallowance of traveling expenses - CIT(A) confirmed disallowance - Held that:- CIT(A) has not adverted to the submissions of the assessee as he had specifically submitted that the expenditure have been incurred on travelling of the executives for the business purpose of the assessee-company. There is no dispute with regard to proposition that deduction of expenditure is allowable if same is incurred for the business purpose. The assessee is required to demonstrate the business purpose. In the present case, as per assessee, the travelling expenditure was incurred on travelling of the executives of the company to study market condition and to contact prospective consumers for the purpose of trading in LNG. It is not disputed that such expenditure is allowable, however, the expenditure disallowed on the basis that the assessee failed to establish business nexus. In view of the ratio laid down by the Hon’ble Apex Court the cases of CIT vs. Malayalam Planations Ltd.(1964 (4) TMI 9 - SUPREME Court ) and Madhav Prasad Jatia vs. CIT (1979 (4) TMI 2 - SUPREME Court ), we are of the considered view that the ld.CIT((A) was not justified in rejecting the ground on the basis that there is nexus between the expenditure incurred and the business of the assessee-company. Therefore, we hereby set aside the order of the ld.CIT(A) and direct the AO to delete the addition. - Decided in favour of assessee.
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