2025 (12) TMI 55

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....essment year 2016-17, arising from the assessment order passed under section 143(3) of the Act by the Income Tax Officer, Ward 1(1)(3), Ahmedabad on 24.12.2018. 2. Facts of the Case 2.1 The assessee is engaged in the business of import and export of chemicals and filed its return of income for A.Y. 2016-17 on 16.10.2016 declaring total income of Rs. 11,06,742/-. The return was processed under section 143(1) and subsequently selected for scrutiny under CASS. 2.2 During the course of assessment proceedings, the Assessing Officer noted that the assessee had debited a sum of Rs. 22,20,220/- towards "Travelling and Boarding Expenses" in the profit and loss account. The AO issued a show-cause notice dated 10.12.2018 proposing disallowanc....

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.....O. is wholly illegal, unlawful and against the principles of natural justice. 2.1 The Id. CIT(A) has grievously erred in law and or on facts in upholding the disallowance in respect of travelling expenses of Rs. 11,10,110/. 2.2 That the in the facts and circumstances of the ld. CIT(A) ought not to have upheld the disallowance in respect of travelling expenses of Rs. 11,10,110/- It is, therefore, prayed that the disallowances of Rs. 11,10,110/- upheld by the CIT(A) may kindly be deleted. 4. During the course of hearing before us, the learned Authorised Representative reiterated the submissions made before the lower authorities and submitted that the disallowance pertains to the Director's travel to Iran in ....

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....nses. The relevant finding of the Tribunal is extracted below: "... the CIT(A) has disallowed 25% of the confirmed total expenses after taking into account past history of the expenses and in consonance with the business acquired by the assessee from the foreign parties. Therefore, the disallowance out of travelling expenses made by the Assessing Officer and the 25% confirmed by the CIT(A) is accordingly sustained." 6.1 In the present case, the Director's visit to Iran was undertaken in connection with the CII Business Delegation, which, though not supported by complete evidence of actual participation, has been substantiated in part through contemporaneous correspondence and submission of invoices. The business nature of such i....