RAJAN PRASAD,ANGUL vs. INCOME TAX OFFICER, ANGUL, ANGUL

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ITA 441/CTK/2025Status: DisposedITAT Cuttack26 September 2025AY 2022-23Bench: SHRI GEORGE MATHAN (Judicial Member), SHRI RAJESH KUMAR (Accountant Member)1 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal noted that the disallowance was an ad hoc disallowance without pointing out specific faults in claimed expenses. The Tribunal held that ad hoc disallowances are not permissible and, in the absence of specific disallowance, the ad hoc disallowance of 50% of expenses is liable to be deleted.

What were the facts?

The assessee filed an appeal against the order of the CIT(A) for AY 2022-2023. The Assessing Officer (AO) disallowed 50% of the total expenditure of Rs. 3,58,22,629/- without specifying which expenses were disallowed. The assessee contended that such ad hoc disallowances are not permissible under the Income Tax Act.

What were the issues?

Whether an ad hoc disallowance of expenditure made by the AO without specifying the nature of expenses is permissible under the Income Tax Act.

Which sections of the Income-tax Act were involved?

Income Tax Act

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CUTTACK BENCH CUTTACK

Before: SHRI GEORGE MATHAN & SHRI RAJESH KUMAR

Hearing: 26/09/2025Pronounced: 26/09/2025

आदेश / O R D E R Per Bench : This is an appeal filed by the assessee against the Ld.CIT(A), National Faceless Appeal Centre(NFAC), Delhi order dated 01/01/2025 passed in Appeal No. NFAC/2021-222/10327663 for the assessment year 2022-2023.

2.

It was submitted by the learned AR that the AO in the course of assessment has disallowed 50 percentage of the total expenditure of Rs.3,58,,22,629/-. It was the submission that the AO has not even specified which are the expenses which is being disallowed. It was the submission that ad hoc disallowances is not permissible under the Income Tax Act. It was a prayer that the disallowance may be deleted.

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