Adhoc disallowance is unsustainable where documentary evidence and TDS proof establish genuineness, leading to deletion.

Adhoc disallowance of professional fees was held unsustainable where the assessee produced exhaustive ledger entries, payment vouchers and TDS challans establishing the genuineness of the payments; the Tribunal found no pointed discrepancy and concluded that a 50% adhoc cut could not be maintained in face of documentary proof, resulting in deletion of the disallowance and allowance of the effective appeal grounds in favour of the assessee.

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Issues: Whether the adhoc disallowance of professional fees of Rs. 17,59,627/- sustained by the Commissioner (Appeals) for A.Y. 2007-08 was justified where the assessee furnished detailed ledger entries, payment vouchers and TDS challans.

Analysis: The assessee, a private limited company with audited accounts for A.Y. 2007-08, placed before the assessing officer and the first appellate authority comprehensive documentary records including ledger accounts, payment vouchers and TDS challans covering the professional fees claimed. Despite these materials and the absence of any pointed discrepancy in the records, the assessing officer made an adhoc disallowance of 50% of the professional expenses. The Commissioner (Appeals) sustained the disallowance after significant delay, including a notice requesting additional evidence many years after the year in question. The Tribunal examined the documentary record in the paper book and found the entries exhaustive and supported by TDS evidence, leaving no reason to doubt the genuineness of the expenditure. The Tribunal therefore evaluated whether the adhoc disallowance was sustainable in the face of the documentary proof tendered by the assessee.

Conclusion: The adhoc disallowance of professional fees of Rs. 17,59,627/- is deleted and the effective grounds of appeal on this issue are allowed in favour of the assessee.

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