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TMI Blog2012 (6) TMI 115X X X X Extracts X X X X X X X X Extracts X X X X ..... ave been incurred:Rs.80,000/- (iv) Foreign Travel of Sh. Pawan Goel :Rs.17,122/- (v) Disallowance of Rs. 16,088/- u/s 40A (3) (vi) Interest u/s 217 be consequently reduced." 2. In paragraph 2 of the judgment, it was pointed out by this Court that the learned counsel for the assessee/appellant confined his grievance only to disallowance of payment of Rs. 2,00,000/- made to one Mr. Sunil Kumar. This issue has been considered and decided in favour of the appellant/assessee holding that there was sufficient evidence to prove the expenditure of Rs. 2,00,000/- by the assessee. 3. In this Review Petition, learned counsel for the appellant/assessee submits that there were two more grounds which were also pressed at the time of arguments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mission of learned counsel for the assessee/Review Petitioner that travelling expenses of Mr. Pawan Goel was disallowed without considering the affidavit of the Director, a resolution and the judgment of the Supreme Court in particular in S.A. Builders Vs. CIT (Appeals) (SC), [288 ITR 2]. From the order of the Assessing Officer, we find that the AO has not disputed that the aforesaid expenses were, in fact, by Mr. Pawan Goel on foreign travel. However, he was of the opinion that such expenses incurred by Mr. Pawan Goel were not for business purposes. 6. The CIT (A) confirmed the aforesaid order of the AO holding that Mr. Pawan Goel was neither a Director nor an employee of the office, but was a relative of the Director. The assessee had su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, therefore, there is a consistent finding of the authorities below that there has not been any „nexus‟ of expenses of Rs. 17,122/- for the purpose of business of the assessee and it is a finding of fact. 9. As mentioned above, the Revenue has not doubted the incurring of the expenditure of foreign travel by Mr. Sunil Kumar. The only question is as to whether this was for business purpose. It is recorded that the nexus between the foreign travel of Mr. Sunil Kumar and the business of the assessee has not been established. Normally, it would have been a finding of fact, as argued by the learned counsel for the Revenue. However, in the present case, we find that the only reason for disallowing the expenditure is that Mr. Pawan G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the view taken by the Delhi High Court in Phaltan Sugar Works (B.) Ltd. [2002] 254 ITR 377 (sic) that once it si established that there was nexus between the expenditure and the purpose of the business (which need not necessarily be the business of the assessee itself), the Revenue cannot justifiably claim to put itself in the arm-chair of the businessman or in the position of the board of directors and assume the role to decide how much is reasonable expenditure having regard to the circumstances of the case. No businessman can be compelled to maximize his profit. The income-tax authorities must put themselves in the shoes of the assessee and see how a prudent businessman would act. The authorities must not look at the matter from their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when interest can be charged under this Section: "217. [(1) Where, on making the regular assessment, [the [Assessing] Officer finds - (a) that any such person as is referred to in clause (a) of sub-section (1) of section 209A has not sent the statement referred to in that clause or the estimate in lieu of such statement referred to in sub-section (2) of that section; or (b) that any such person as is referred to in clause (b) of sub-section (1) of section 209A has not sent the estimate referred to in that clause,] simple interest at the rate of [fifteen] per cent per annum from the 1st day of April next following the financial year in which the advance tax was payable in accordance with the said [sub-section(1) or sub-section (2)] up to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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