The ITAT held that where the assessee entered into a unilateral...

The ITAT held that where the assessee entered into a unilateral Advance Pricing Agreement (APA) with the Central Board of Direct Taxes (CBDT) and complied with its terms, the Assessing Officer's disallowance of foreign travelling expenses u/s 37(1) of the Income Tax Act, which formed part of the operating expenses and cost base, was in breach of the APA's letter and spirit and liable to be set aside. The Tribunal upheld the Commissioner of Income Tax (Appeals) order and dismissed the Revenue's ground of appeal. Regarding interest levied u/ss 234B and 234C on the additional income assessed pursuant to the APA, the Tribunal dismissed the cross-objection concerning Section 234C interest as not maintainable due to the assessee's failure to raise a ground of appeal before the CIT(A). However, the Tribunal held that the assessee was liable to pay interest u/s 234B on the differential between advance tax paid and assessed tax, as Section 234B does not exclude additional tax on additional income from the assessed tax. The assessee's contentions were rejected, and authorities cited did not support the assessee's case.

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