The appeal is against the disallowance of expenditure incurred on foreign travel amount, incurred in the context of foreign travel to seek donations.

The Assessee is a charitable trust registered under section 12A and with a registration under the FCRA – Foreign Contribution Regulation Act. Return of income was filed declaring nil income after claiming exemption under section 11. The Assessing officer disallowed the expenditure incurred on foreign travel under scrutiny assessment.

The assessee’s contention is expenditure incurred on foreign travel was to obtain donations from the donors who were abroad and hence must be allowed. Upon appeal, the Ld. CIT(A) confirmed the Orders of the Assessing Officer.

The Hon’ble Tribunal noted that-the assessee had received substantial portions of donations from abroad. The details of the donations received and utilization of the same was also enclosed in the records.  That the expenditure incurred was for obtaining the donations from the various donors who were stationed abroad, and the utilization of the donation was also for the objects of the trust. In view of the judicial pronouncements, the Hon’ble Tribunal held that since the donations received are utilized for charitable purpose, which was never doubted by the Assessing Officer, the foreign travel expenses incurred for obtaining the above said donations is to be allowed as an expenditure.(AY. 2016-17)