https://www.taxtmi.com/caselaws?id=784709 The dominant issue was whether an ad hoc disallowance of salary and wages debited in the books could be treated as "unexplained expenditure" under s. 69C so as to trigger s. 115BBE. The ITAT held that s. 69C applies only where the source of expenditure is not explained; when payments are recorded in the books and the AO does not allege any expenditure outside the books, the deeming fiction cannot be invoked. At most, the claim may be examined under s. 37(1) for business nexus. Consequently, s. 69C was held inapplicable to the salary/wage disallowance. Separately, the disallowance of workman and staff welfare expenses was upheld as there was no disagreement on that issue. en-us Mon, 05 Jan 2026 00:00:00 +0530 Thu, 08 Jan 2026 15:49:18 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=784709 The dominant issue was whether an ad hoc disallowance of salary and wages debited in the books could be treated as "unexplained expenditure" under s. 69C so as to trigger s. 115BBE. The ITAT held that s. 69C applies only where the source of expenditure is not explained; when payments are recorded in the books and the AO does not allege any expenditure outside the books, the deeming fiction cannot be invoked. At most, the claim may be examined under s. 37(1) for business nexus. Consequently, s. 69C was held inapplicable to the salary/wage disallowance. Separately, the disallowance of workman and staff welfare expenses was upheld as there was no disagreement on that issue. Case-Laws Income Tax Mon, 05 Jan 2026 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=784709