https://www.taxtmi.com/caselaws?id=461528 ITAT Surat-AT partly allowed the appeal regarding disallowances under sections 40A(3)(a) and 40A(3)(b). The assessee, engaged in cloth business with turnover below Rs. 40 lakhs, faced total disallowance of Rs. 33,73,201 which increased income from Rs. 1,49,160 to Rs. 35,22,360, creating an absurd result. Following the precedent in CIT v. S Mohammad Dhurabudeen, ITAT held that when books aren't rejected under section 145(3), disallowance shouldn't exceed probable profit percentage. The tribunal restricted total disallowance to 8% of turnover, directing AO to recalculate accordingly. en-us Tue, 30 Apr 2019 00:00:00 +0530 Fri, 11 Apr 2025 18:56:57 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=461528 ITAT Surat-AT partly allowed the appeal regarding disallowances under sections 40A(3)(a) and 40A(3)(b). The assessee, engaged in cloth business with turnover below Rs. 40 lakhs, faced total disallowance of Rs. 33,73,201 which increased income from Rs. 1,49,160 to Rs. 35,22,360, creating an absurd result. Following the precedent in CIT v. S Mohammad Dhurabudeen, ITAT held that when books aren't rejected under section 145(3), disallowance shouldn't exceed probable profit percentage. The tribunal restricted total disallowance to 8% of turnover, directing AO to recalculate accordingly. Case-Laws Income Tax Tue, 30 Apr 2019 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=461528