Adhoc disallowance of expense without specific finding is baseless

Today Retail Network Pvt Ltd Vs ITO (ITAT Delhi) ITAT Delhi held that disallowance of expenditure on adhoc basis, as a percentage of gross profit, without any specific findings is baseless and liable to be deleted. Facts- AO noticed that commission of Rs. 4,46,72,186/- was paid to Today Merchandise Pvt. Ltd. (fellow subsidiary). AO was of the opinion that the entire payment of commission was not for business reasons and basis the gross profit earned by the assessee, AO allowed 25% of commission and disallowed the balance. CIT(A) directed AO to delete the disallowance stating that adhoc disallo...