High Court upholds Tribunal decision disallowing foreign travel expenses in block assessment.

The Bombay High Court dismissed the appeal regarding the disallowance of foreign traveling expenses amounting to Rs. 21.66 lakhs claimed by the assessee during assessment years 199596, 199697, and 199798 under block assessment. The Tribunal found no evidence during a search to support the inadmissibility of the expenses and clarified that its decision was specific to the block assessment scheme. The High Court held that no substantial question of law arose, affirming the Tribunal's decision and ordering no costs to be paid.

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Issues involved: Disallowance of foreign traveling expenses u/s block assessment.

Summary:

Issue: Disallowance of foreign traveling expenses u/s block assessment

The appeal before the Bombay High Court pertained to the disallowance of an amount of Rs. 21.66 lakhs claimed by the assessee as foreign traveling expenses during the assessment years 199596, 199697, and 199798. The assessing officer sought to make an addition during a block assessment based on a search, where a Director of the assessee initially stated that the amount was incurred towards traveling expenses of his spouse but later retracted this statement. The Tribunal, however, noted that no evidence was found during the search to indicate the inadmissibility of the traveling expenses. The Tribunal clarified that its decision to delete the disallowance was specific to the block assessment scheme and did not preclude disallowance in regular assessments based on similar statements. As there was no evidence found during the search to support the inadmissibility of the expenses, and considering the Tribunal's clarification, the High Court found no substantial question of law to arise and dismissed the appeal.

The High Court, therefore, dismissed the appeal and ordered no costs to be paid.

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