Because it was initially paid through a spouse’s credit card and later reimbursed to her, mumbai: Income Tax Appellate Tribunal’s (ITAT) Mumbai bench recently held that genuine business expenditure cannot be disallowed merely.
The I-T officer had questioned, among other things, a payment of Rs 6.4 lakh made to the taxpayer’s wife, which was explained as reimbursement of expenses incurred using her credit card. However, tax experts stress that it is crucial to establish the business purpose and maintain all supporting records. A clear audit trail must be readily available to establish that the spouse merely paid the expense initially and was subsequently reimbursed in full. In this case heard by ITAT, the tax dispute related to foreign travel expenses claimed by the taxpayer. The appellate commissioner also questioned why the taxpayer had routed business payments through his wife’s card and treated the arrangement as potentially involving services rendered independently by her, which required deduction of tax at source against the reimbursement amount. You Can Also Check: Gold Rate in Mumbai | Silver Rate in Mumbai | Bank Holidays in Mumbai | Public Holidays in Mumbai | Mumbai AQI | Weather in Mumbai | Petrol Price in Mumbai | Diesel Price in Mumbai | CNG Price in Mumbai | LPG Price in Mumbai