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TMI Blog2024 (8) TMI 430X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee did appear and furnish certain evidences to justify the claim of expenses. Surprisingly, even though the evidences were forwarded to the AO for verification and to furnish a Report, however, ultimately FAA declined to entertain the evidences. This, is in our view is unjustified. Be that as it may, ultimately FAA has found some merit in the submissions made by the assessee as well as evidences ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der dated 29.08.2019 of Learned Commissioner of Income Tax (Appeals)-I, New Delhi for assessment year 2015-16. 2. The dispute in the present appeal is confined to disallowance of certain expenses. 3. Briefly stated, facts are, the assessee is a resident corporate entity engaged in construction business. In the year in dispute the assessee filed its return of income on 30.09.2015 declaring loss of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e AO ultimately disallowed 50% out of the aforesaid expenses, resulting in addition amounting to Rs. 4,01,14,226/-. Assessee contested the aforesaid addition before Ld. First Appellate Authority. In course of proceedings before Ld. First Appellate Authority, assessee furnished certain evidences and made written submissions as well. The submissions made and evidences furnished were forwarded to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess, the rate of profit would be far less, hence, the disallowance made at 20% is unreasonable. Whereas Ld. Departmental Representative strongly relied upon the order of Ld. First Appellate Authority. 5. We have considered rival submissions and perused the material available before us. Undisputedly, the disallowance disputed in the present appeal has been made purely on estimate basis, both by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Stock and WIP, whereas, he has restricted the disallowance of purchase and administrative expenses at 20% of the amount claimed. On perusal of record, we do not find any basis for applicability of either 50% or 20% rate of disallowance. Considering the fact that the assessee is in construction business, in our view, disallowance @5% of purchases and administrative expenses would meet the ends o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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