Ad-hoc Disallowances without rejection of books unsustainable: ITAT Delhi

DCIT Vs Bright Point India Pvt. Ltd (ITAT Delhi)

Ad-hoc Disallowances without rejection of books unsustainable – ₹5.85 Cr Expense Deletion Upheld

Delhi ITAT has dismissed e Revenue’s appeal thereby upholding the relief granted by CIT(A) against ad-hoc disallowances of business expenses exceeding ₹5.85 crore. Tribunal categorically held that when books of account are neither rejected nor defects pointed out, AO cannot resort to arbitrary disallowances u/s 37(1).

Assessee engaged in wholesale trading of electronics, filed its return for AY 2017–18 declaring a

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