Foreign travel expenditure for overseas fundraising can qualify as application of income where trust funds support charitable objects.

Foreign travel expenditure incurred by a charitable trust to secure donations from overseas donors was treated as application of income for charitable purposes under section 11 of the Income-tax Act. The record showed that the travel was undertaken for fundraising and that the donations received were applied to the trust's charitable objects. Expenditure incurred outside India does not, by itself, disqualify deduction where the charitable purpose is in India and the income is used for the objects of the trust, so the disallowance was held unsustainable.

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Issues: Whether foreign travel expenditure incurred by a charitable trust for obtaining donations from overseas donors was allowable as application of income under section 11 of the Income-tax Act, 1961.

Analysis: The trust had received substantial foreign donations and placed record of the travel expenses and their purpose. The expenditure was found to have been incurred for securing donations from donors abroad, and the donations received were utilised for the charitable objects of the trust. Reliance was placed on judicial precedents holding that expenditure incurred outside India does not, by itself, disqualify deduction where the charitable purpose is in India and the income is applied for the trust's objects.

Conclusion: The foreign travel expenditure was allowable as expenditure for the trust's charitable purposes and the disallowance was unsustainable.

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