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2018 (3) TMI 1567 - ITAT COCHINNature of expenditure - permit fee paid - revenue or capital expenditure - Held that:- When the business is established and is ready to commence business, then it can be said of that business that is already set up. The words “ready to commence” would not necessarily mean that all the integrated activities are fully carried out and/or wholly completed. This requirement is also complied with in this case where the assessee has already commenced business and it is going on and the impugned expenditure was incurred in connection with Vellayambalam project for getting approval from the Municipal Corporation and it cannot be said that the expenditure was incurred before the commencement of business or it cannot be disallowed on the pretext that the assessee has not offered income from Vellayambalam project in respect of which the expenditure was incurred. The impugned expenditure was incurred by the assessee after setting up of business and it is to be revenue expenditure. - Decided in favour of the assessee Disallowance being 1/5th of expenses relating to foreign travel as having incurred for personal purposes - Held that:- In this case though the assessee has claimed an expenditure towards foreign travel expenditure undertaken by the Directors the assessee has not produced details of the work carried out by the Directors at various countries. The assessee has only filed details of flight tickets in support of the claim of that expenditure. Unless the assessee submitted the details of the names of the clients or customers with whom the Directors held talks and the number of days spend therein, it is not possible to hold that the entire expenditure claimed by the assessee is wholly and exclusively for the purpose of the business of the assessee. It was necessary for the assessee to furnish details of the work carried out by the Directors at abroad in connection with the business of the assessee. Hence, the Assessing Officer is justified in disallowing a part of the expenditure as personal in nature. - Decided against assessee.
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