https://www.taxtmi.com/caselaws?id=462432 ITAT Bangalore held that ad-hoc disallowances must be based on scientific and rational basis, not arbitrary percentages. The AO's 20% disallowance was set aside as it failed to consider assessee's financial data from earlier years. For wage expenses, ITAT allowed Rs. 1 lakh disallowance considering slight increase in labor costs. Freight expenses disallowance was deleted as expenses remained proportionate to sales compared to previous years. Interest expenses disallowance was largely deleted except Rs. 20,000 ad-hoc disallowance for non-submission of supporting documents. Appeal partly allowed. en-us Thu, 16 May 2024 00:00:00 +0530 Sun, 22 Jun 2025 13:13:20 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=462432 ITAT Bangalore held that ad-hoc disallowances must be based on scientific and rational basis, not arbitrary percentages. The AO's 20% disallowance was set aside as it failed to consider assessee's financial data from earlier years. For wage expenses, ITAT allowed Rs. 1 lakh disallowance considering slight increase in labor costs. Freight expenses disallowance was deleted as expenses remained proportionate to sales compared to previous years. Interest expenses disallowance was largely deleted except Rs. 20,000 ad-hoc disallowance for non-submission of supporting documents. Appeal partly allowed. Case-Laws Income Tax Thu, 16 May 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=462432