The Mumbai bench of the Income Tax Appellate Tribunal (ITAT), in Lal Nathirmal Moolchandan v. ITO (International Taxation)-4(1), has held that the travelling expenses incurred by a Non- Resident Indian to manage property in India is not deductible from total income under the provisions of the Income Tax Act, 1961.
The assessee, in the instant case, is a non-resident individual showing income from House property, short term capital gain and income from other sources. The assessee claimed deduction u/s.57 on travelling expense of Rs.2,00,000/-, against compensation for amenities shown under other source of income. However, the Assessing Officer has disallowed the claim on account of travelling and other expenses.
Before the appellate authorities, the assessee claimed that to manage the property the assessee has to travel in India and hence it was claimed that the claim of travel expenses should be allowed against the amount received for the use of amenities of the property. It was further submitted that the assessee has visited many times in India and the travelling and lodging expenses are more than the amount claimed.
Dismissing the second appeal of the assessee, the Tribunal noted that the assessee in this case is claiming travelling expenses against the amount received from house property against use of amenities in the said house property. “The assessee’s plea is that the assessee had to incur huge expenditure in travelling to India to manage the property. We find that this submission of the assessee has been rejected by the authorities below. We find ourselves in full concurrence that no travelling expenses can be allowed for assessee’s international travel for income received related to house property in India. This is more so when the amount claimed is lump sum without any supporting whatsoever. Hence, we do not find any infirmity in the order of the authorities below and, hence, we uphold the same,” the bench said.
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