Ad-Hoc 5% Expense Disallowance Held Unsustainable by ITAT

Indutch Composites Technology Private Limited Vs DCIT (ITAT Ahmedabad) Ad-hoc 5% Disallowance Unsustainable: ITAT Deletes Disallowance of “Miscellaneous Expenses” The Ahmedabad “C” Bench of the Income Tax Appellate Tribunal allowed the assessee’s appeal for AY 2015-16 and deleted the ad-hoc disallowance of 5% made on “Miscellaneous Expenses”. The Tribunal found that the Assessing Officer disallowed expenses merely on the assumption that they were incurred in cash, without verifying the supporting bills, vouchers, ledgers and audited accounts produced by the assessee. It was noted...