2023 (10) TMI 307

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..... ant by : Shri Siddarth Agarwal, Advocate For the Respondent by : Shri P. P. Barman, Addl. CIT, Sr. DR O R D E R PER GIRISH AGRAWAL, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of Ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi vide Appeal No. ITBA/NFAC/S/250/2022-23/1050540758(1) dated 09.03.2023 passed against the assessment order by ACIT (OSD), War .....

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..... in a loss of Rs. 17,25,690/-. Ld. AO called for details and explanations towards major expenses claimed under the head "Other Expenses/Miscellaneous expenses". In this respect assessee produced a detailed list of particulars for site expenses claimed in the P&L Account for an amount of Rs. 3,67,37,203/-. However, Ld. AO by observing that assessee has not provided any documentary evidence in suppor .....

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..... s the turnover of the assessee. From the said chart, ld. Counsel submitted that claim of assessee towards site expenses is more or less range bound from 19.1% in AY 2017-18 to 25.52% in AY 2016-17. He also submitted that no such disallowance has been made in the preceding as well as subsequent years and that there is no basis of adopting 20% to make an ad-hoc disallowance without pointing out any .....

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..... ave heard the rival contentions and gone through the material placed before us. We note that assessee is a company engaged in the business as railway contractor and supplier. Assessee has furnished the break-up of site expenses which it has claimed in its P&L Account. Ld. AO has adopted ad-hoc percentage of 20% to make a disallowance towards site expenses without giving any rational basis for the .....

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..... cord and the submissions made by the Ld. Counsel, as well as the provision of section 37(1), we delete the ad-hoc disallowance made by the Ld. AO and confirmed by the Ld. CIT(A). Accordingly, grounds taken by the assessee in this respect are allowed. 7. In the result, appeal of the assessee is allowed. Order pronounced in the open court on 23rd June, 2023.
Case laws, Decisions, Judgements, O .....

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