Relief to Hindustan Unilever: ITAT deletes disallowance made towards foreign travel expenses of spouses of employees of company who accompanied business tour [Read Order]

The Income Tax Appellate Tribunal (ITAT) Mumbai bench while providing relief to Hindustan Unilever, deleted the disallowance made towards foreign travel expenses of spouses of employees of the company who accompanied the business tour.

Assessee, Hindustan Unilever Limited is a company engaged in the manufacture, trading and marketing (including export) of fast moving consumer goods (FMC goods). After filing the return assesse case was selected for scrutiny .After completing the the assessment AO disallowed travelling expenditure relating to foreign travel in respect of spouses who accompanied some of the company employees or official tour.

Aggrieved by the order, the assessee filed an appeal  before the Commissioner of Income Tax-Appeals [CIT(A)], who dismissed the appeal. Thereafter< the assessee  filed another appeal before the tribunal.

Before the bench Nishant Thakkar, counsel for the assessee submitted that the spouses have to sometime accompany the senior executives who were sent abroad to international educational institutions or to attend seminars or to work in Unilever companies on temporary posts abroad. Therefore,expenses are incurred for the purposes of business and hence allowable.

Madhu Malti Ghosh, Counsel for the revenue,  supported the decision of lower authorities.

The tribunal observed that identical issue was already decided in favour of assessee.

After considering  the facts submitted by both parties, the two member bench of Padmavathy S (Accountant Member) and Chandra Vikas Awasthy (Judicial Member) deleted the disallowance made towards travel expenses and allowed the appeal of assessee.

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