TMI Blog1987 (7) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... managing director and business executive of the assessee-company on their tour to Mauritius amounting to Rs. 20,270 was intimately connected with the business of the assessee-company and hence was allowable as a business expenditure in respect of the assessment year 1979-80 ? " The material facts giving rise to this reference, briefly, are as follows : The assessee is a limited company carrying on the business of manufacturing flour mill products, foodstuff, oil products, etc. For the assessment year 1979-80, the assessee claimed a sum of Rs. 20,270, being the amount of travelling expenses for the Mauritius trip of the managing director and the chief executive, as business expenditure. It was contended before the Inspecting Assistant-Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mit their report to the board of directors regarding the work which had actually been done by these persons to justify payment of travelling expenses. The Inspecting Assistant Commissioner (Asst.) has rightly observed that the trip was undertaken for helping the Mauritius Government in erecting or setting up a flour mill in that country which was in the nature of consultancy job. Since consultancy service was no part of the appellant's business, it was clearly not admissible. Since the expenditure was incurred for exploring the possibility of export of technical know-how which did not pertain to the sphere of business activities of the company, the expenditure was clearly not allowable, being either of capital nature or not connected with t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd machineries, relating to objects of the company and tools, implements and any other materials of whatsoever kind used in or conducive to manufacture or use of such machinery. ID. To acquire, develop and impart technical and managerial now-how in machineries, engineering, chemicals, food, animal feed, milling and other connected industries either by itself or in collaboration with others in India or elsewhere in the world." It was, however, conceded before us by learned counsel for the assessee that the aforesaid clauses were inserted in the memorandum of association on April 27, 1981, and were not in existence during the assessment year in question. In these circumstances, on the basis of the aforesaid clauses in the memorandum of as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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