MUKUND MANOHAR SANGAMNERKAR,PUNE V. DY. COMMISSIONER OF INCOME TAX, CIRCLE-1(1), PUNE, PUNE

CO 9/PUN/2024

AI Insights

The case involves an appeal by the Revenue against the order of the CIT(A), which had deleted additions made by the Assessing Officer under Section 68 of the Income Tax Act concerning unexplained capital introduced by the assessee, Mukund Manohar Sangamnerkar, a pediatrician. The Assessing Officer had made substantial additions to the assessee's income for the assessment year 2017-18, alleging discrepancies in the capital balances and unexplained investments. The CIT(A) found that the additions were not justified as the assets were acquired in earlier years and not during the year under consideration. The Tribunal agreed with the CIT(A)'s findings but modified the CIT(A)'s decision regarding the disallowance of expenses, reducing it from 20% to 10%.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 32460 (ITAT-PUNE)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 16-10-2024
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 06-08-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 01-04-2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RAMNATH P. MURKUNDE
• Assessee Lawyers: ABHAY A. AVCHAT
• Keywords: Capital asset; Corroborative evidences; TDS
• Section: 143(2); 68; 44AB; 20

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “A”, PUNE BEFORE SHRI R. K. PANDA, VICE PRESIDENT AND SHRI VINAY BHAMORE, JUDICIAL MEMBER आयकर अपील सं. / ITA No.1092/PUN/2023 िनधाᭅरण वषᭅ / Assessment Year: 2017-18 DCIT, Circle-1(1), Pune. Vs. Mukund Manohar Sangamnerkar, 210/B, AMOGH, Opp. Ganjave Chowk, Navi Peth, Near Lokmanya Wachanalay, Pune- 411030. PAN : ADXPS4789A Appellant Respondent C.O. No.09/PUN/2024 (Arising out of ITA No.1092/PUN/2023) िनधाᭅरण वषᭅ / Assessment Year: 2017-18 Mukund Manohar Sangamnerkar, 210/B, AMOGH, Opp. Ganjave Chowk, Navi Peth, Near Lokmanya Wachanalay, Pune- 411030. PAN : ADXPS4789A Vs. DCIT, Circle-1(1), Pune. Appellant Respondent आदेश / ORDER PER VINAY BHAMORE, JM: This appeal filed by the Revenue is directed against the order dated 24.08.2023 passed by LD. CIT(A)/NFAC for the assessment Revenue by : Shri Ramnath P. Murkunde Assessee by : Shri Abhay A. Avchat Date of hearing : 06.08.2024 Date of pronouncement : 16.10.2024 ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 2 year 2017-18. The assessee is also in cross objection bearing Cross Objection No.09/PUN/2024. 2. The facts of the case, in brief, are that the assessee is an individual engaged in medical profession being doctor (Paediatrician) e-filed his return of income on 03.11.2017 declaring total income of Rs.76,11,090/-. The case was selected for scrutiny through CASS and accordingly notice u/s 143(2) and 142(1) of the IT Act along with questionnaire were issued to the assessee. During the course of assessment proceedings, it was found by the Assessing Officer that there is a difference in the closing capital balance appearing in the balance sheet as on 31.03.2016 with that of opening capital balance appearing in the balance sheet as on 01.04.2016. Accordingly, the Assessing Officer enquired from the assessee regarding difference & details of capital introduced and its source with supporting evidence. In reply, the assessee submitted that upto assessment year 2012-13 a composite balance sheet of personal as well as professional assets was prepared but from assessment year 2013-14 personal assets and professional assets were bifurcated and inadvertently only professional balance sheet was uploaded on income tax portal along with income tax return. This practice of preparing and ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 3 uploading only professional balance sheet on income tax portal continued till assessment year 2016-17 and when another Chartered Accountant started preparing the financial statement he integrated personal balance sheet with professional balance sheet and accordingly from assessment year 2017-18 a composite balance sheet was again started to be uploaded along with income tax return. Due to the above integration of both the balance sheets, difference is appearing. It was however submitted that no such investment was made during the period under consideration. The Assessing Officer did not accept the reply of the assessee and made addition of Rs.2,83,20,233/- to the income of the assessee and vide order dated 22.12.2019 determined the taxable income at Rs.3,59,31,320/- as against the income returned by the assessee at Rs.76,11,090/-. 3. Against the above order, the assessee preferred first appeal before the ld. CIT(A)/NFAC. Since the assessee remained absent ld. CIT(A)/NFAC decided the appeal ex-parte. However, the ld. CIT(A) allowed the appeal of the assessee by observing as under :- “5.3 I have carefully considered the facts and evidences on record. The appellant has not complied to the notices issued during the appellate proceedings. I find that the AO treated capital introduced of Rs 1,37,22,454 in F.Y 2012-13 as unexplained and added it to total income u/s 68 of the Act for A.Y 2017-18 as AO also held that the ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 4 claim of the appellant that all these properties were purchased through accrued income and through bank channel with proper legal agreements is not supported with any documents. 5.4 Section 68 of the Act reads as under: 68. Where any sum is found credited in the books of an assessee maintained for any previous year, and the assessee offers no explanation about the nature and source thereof or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year : Provided that where the assessee is a company (not being a company in which the public are substantially interested), and the sum so credited consists of share application money, share capital, share premium or any such amount by whatever name called, any explanation offered by such assessee-company shall be deemed to be not satisfactory, unless— (a) the person, being a resident in whose name such credit is recorded in the books of such company also offers an explanation about the nature and source of such sum so credited; and (b) such explanation in the opinion of the Assessing Officer aforesaid has been found to be satisfactory: Provided further that nothing contained in the first proviso shall apply if the person, in whose name the sum referred to therein is recorded, is a venture capital fund or a venture capital company as referred to in clause (23FB)of section 10.” 5.5 For the purpose of easy understanding of the provision, the section can be divided into 7 parts as under: 1) A sum is credited into the books of the assessee 2) Maintained for the previous year 3) Assessee does not give any explanation about the source of the sum 4) Assessee does not give any explanation about the nature of the sum 5) The answer by the Assessee does not satisfy the Income Tax Officer 6) The sum credited is chargeable to income tax 7) If the above conditions are satisfied, sum is credited to the income of the assessee in the previous year. 5.6 I find that it is not disputed by the AO that the capital of Rs 1,37,22,454 was introduced earlier to the F.Y 2012-13. Although it might have been not disclosed deliberately or otherwise, or it has not ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 5 been proven by the appellant with supporting evidences, it capital assets were not proven by the AO that they were introduced in F.Y 2016-17. Therefore, it cannot be considered as a sum is credited into the books of the assessee maintained for the previous year. Since, the conditions are not satisfied, the sum cannot be credited to the income of the assessee in the previous year. Moreover, these capital assets were acquired in earlier years prior to F.Y 2012-13 and can be brought to tax only in their respective F.Y of acquisition. As such it also cannot be brought to tax in F.Y 2016-17. Therefore, the addition of Rs 1,37,22,454 u/s 68 of the Act in A.Y 2017- 18 is not sustainable and is directed to be deleted. The appeal on Ground No 1 is treated as allowed. 6. Ground No 2 is directed against the AO adding FD with Bank of Baroda of Rs.1,20,41,210 and Prabodh share investment of Rs 16,36,558. The AO found that the appellant has introduced FD with Bank of Baroda of Rs 1,20,41,210 and Prabodh share investment of Rs 16,36,558 as capital during A.Y 2017-18. The appellant replied to the AO that :- “Books of account of earlier financial years were wrongly showing investments in negative side to show correct balance of Prabodh Shares Investment and Bank of Baroda sweep FD we have correct balance in FY 2016-17. Further these balances were shown in personal balance sheet wrongly in each year upto F.Y 2016-17. In F.Y 2016-17 we have made reconciliation and had shown in our income tax return by giving second effect to capital account. Bank FD statement is attached for your perusal along with reconciliation statement of earlier years.” 6.1 I have carefully considered the facts and evidences on record. The appellant has not complied to the notices issued during the appellate proceedings. The AO made the addition of Rs 1,36,77,768 (FD with Bank of Baroda of Rs 1,20,41,210 and Prabodh share investment of Rs 16,36,558)u/s 68 of the Act only on the ground that the appellant failed to prove the source. As discussed earlier, for the purpose of easy understanding of the provision, the section 68 can be divided into 7 parts as under: 1) A sum is credited into the books of the assessee 2) Maintained for the previous year 3) Assessee does not give any explanation about the source of the sum 4) Assessee does not give any explanation about the nature of the sum 5) The answer by the Assessee does not satisfy the Income Tax Officer 6) The sum credited is chargeable to income tax ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 6 7) If the above conditions are satisfied, sum is credited to the income of the assessee in the previous year. 6.2 I find that although it might have been not disclosed deliberately or otherwise, or it has not been proven by the appellant with supporting evidences, it is not established by the AO that the FD with Bank of Baroda of Rs 1,20,41,210 and Prabodh share investment of Rs 16,36,558 were introduced in F.Y 2016-17. The appellant has submitted that these are of earlier years. It also cannot be considered as a sum is credited into the books of the assessee maintained for the previous year. As these FD or investments are apparently made from its bank account source and the AO has not brought on any evidence that a sum has be credited to the books of the appellant in the previous year. Moreover, these capital assets can be brought to tax only in their respective F.Y of acquisition. As such it also cannot be brought to tax in F.Y 2016-17 if it is not proven that it is only acquired in the F.Y 2016-17. Therefore, the addition of Rs 1,36,77,768 u/s 68 of the Act in A.Y 2017-18 is not sustainable and is directed to be deleted. The appeal on Ground No 2 is treated as allowed. 7. Ground No 3 is directed against the AO adding unexplained introduction of capital in F.Y 20 14-15 LIC Maturity of Rs.1,51,885 and capital introduction of Rs.2,55,601. During the course of assessment proceedings, the AO found on verification of personal capital account for A.Y 2015-16 that the appellant has claimed addition to capital of Rs 1,51,885 being LIC maturity and Rs 2,55,601 as capital introduced without any narration. This LIC maturity has been received in the Bank of Baroda A/c No 04470100003139. The AO in absence of any attachment with the reply added the capital introduced of Rs 1,51,885 as capital from undisclosed sources u/s 68 of the Act. Further the AO added the capital introduced of Rs 2,55,601 as income form undisclosed sources u/s 68 of the Act. 7.1 I have carefully considered the facts and evidences on record. The appellant has not complied to the notices issued during the appellate proceedings. The AO made the addition of introduction of capital in F.Y 20 14-15 LIC Maturity of Rs.1,51,885 and capital introduction of Rs.2,55,601u/s 68 of the Act only on the ground that the appellant failed to prove the source. As discussed earlier, for the purpose of easy understanding of the provision, the section 68 can be divided into 7 parts as under: 1) A sum is credited into the books of the assessee 2) Maintained for the previous year 3) Assessee does not give any explanation about the source of the sum ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 7 4) Assessee does not give any explanation about the nature of the sum 5) The answer by the Assessee does not satisfy the Income Tax Officer 6) The sum credited is chargeable to income tax 7) If the above conditions are satisfied, sum is credited to the income of the assessee in the previous year. 7.2 I find that these are introduction of capital in F.Y 2014-15 of LIC Maturity of Rs.1,51,885 and capital introduction of Rs.2,55,601. It is not established by the AO that they were introduced in F.Y 2016- 17. The appellant has submitted that these are of earlier years. The amount of Rs 1,51,885 is LIC maturity which has been transferred to the bank of the appellant directly by LIC in F.Y 2015-16. It cannot be in any stretch of imagination added as a sum is credited into the books of the assessee maintained for the F,Y 2016-17. the AO has not brought on any evidence that capital introduction of Rs.2,55,601has be credited to the books of the appellant in the FT 2916-17. Moreover, these capitals can be brought to tax only in their respective F.Y. As such it also cannot be brought to tax in F.Y 2016- 17 if it is not proven that it is only acquired in the F.Y 2016-17. Therefore, the addition of LIC Maturity of Rs.1,51,885 and capital introduction of Rs.2,55,601u/s 68 of the Act in A.Y 2017-18 is not sustainable and is directed to be deleted. The appeal on Ground No 3 is treated as allowed. 8. Ground No 4 is directed against the AO adding ad hoc disallowance of Rs.5,12,525/- in expenses incurred during the year. During the course of assessment proceedings, the AO found that the appellant has claimed expenses totalling Rs 25,62,628. On perusal of the ledger submitted by the appellant, the AO found that majority of the expenses are incurred in cash and its genuineness cannot be verified. Accordingly, the AO disallowed 20% of the expenses totalling Rs 5,12,525.I have carefully considered the facts and evidences on record. The appellant has not complied to the notices issued during the appellate proceedings. I find that the appellant has not submitted any evidences during the assessment as well as appeal proceedings to provide that the addition made by the AO is not genuine. No documentary evidences or explanations have been submitted to prove the genuineness of such expenses. In view of the above, the addition made by the AO is sustained and the appeal on Ground No 4 is treated as dismissed. 9. Ground No 5 is general in nature and needs no adjudication. 10. Conclusion: In the result, appeal of the appellant is partly allowed.” ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 8 4. From perusal of the above order, it appears that the ld. CIT(A)/NFAC has deleted the additions made on the basis of deemed introduction of capital but sustained the 20% ad-hoc disallowance of Rs.5,12,525/- out of total expenses of Rs.25,62,628/-. It is this order against which the Revenue is in appeal before this Tribunal. The assessee is also in Cross Objection against the appeal of the Revenue as well as against the sustainment of ad-hoc disallowance of expenses by LD CIT(A)/NFAC. 5. First, we shall take up the appeal of the Revenue for adjudication of the issue. ITA No.1092/PUN/2023 – By Revenue : 6. The Revenue has raised the following grounds of appeal :- “1) Whether on the facts and the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition made by the AO u/s 68 of the Act on account of introduction of unexplained capital, without considering the fact that since for the first time assessee integrated his books of accounts in FY 2016-17 and thereby credited the sum to capital account during F. Y. 2016-17, provisions of section 68 gets invoked? 2) Whether on the facts and the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition made by the AO u/s 69 of the Act (inadvertently mentioned as u/s 68 in assessment order) on account of the FD/investments not recorded in the books of account, without considering the fact that even though the investment was made through bank account neither the same was recorded in the books of accounts, the same coming into existence only in FY 2016- 17, nor the assessee provided the source of deposits into the bank account from which the alleged investments were made? ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 9 3) Whether on the facts and the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition made by the AO u/s 68 of the Act on account of income received from LIC Maturity of Rs, 1,51,885/- and Capital introduction of Rs. 2,55,601/-?” 7. The ld. DR submitted before us that the order passed by the ld. CIT(A)/NFAC deleting the addition of Rs.2,78,07,708/- (13722454 + 13677768 + 407486) is not correct. It was further submitted by the ld. DR that even in the absence of assessee before the ld. CIT(A), the order passed in favour of the assessee is bad in law. The ld. DR submitted before us that the assessee for the first time introduced Rs.1,37,22,454/- as his opening capital, which was not appearing in the balance sheet from the assessment year 2012- 13 to assessment year 2016-17. It was also submitted by LD DR that LD CIT(A)/NFAC erred in deleting the addition of Rs.1,36,77,768/- regarding investment made in Bank of Baroda Flexi Fixed deposit & prabodh share investment & also Rs.4,07,486/- ( LIC Maturity & personal capital introduction). LD DR submitted before us that the introduction of capital in the balance sheet for the first time should be treated as investment in the year under consideration. Accordingly, it was requested before the Bench to confirm the additions made by the Assessing Officer. ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 10 8. The ld. AR submitted before us that it is an admitted fact that upto assessment year 2012-13 the personal and professional assets were incorporated in a composite balance sheet and was uploaded on the income tax portal. But inadvertently from assessment year 2013-14, the personal assets were bifurcated and remained to be included in the balance sheet which was uploaded on income tax portal. It was further submitted that all the assets were acquired through banking channels in respective assessment years and nothing was invested during the period under consideration. The ld. AR pointed out that the ld. CIT(A)/NFAC even in the absence of assessee has understood the crux of the matter and rightly held that the additions in the period under consideration cannot be made merely on the basis of book entry being introduction of capital. It was further submitted that the ld. CIT(A)/NFAC in his order has given a categorical finding that admittedly all the assets were purchased prior to the assessment year 2017-18 and there was no such assets/ investment which was purchased/invested in assessment year 2017-18 and was not forming part of the balance sheet uploaded on income tax portal. The ld. AR vehemently relied on the order passed by the ld. CIT(A)/NFAC and further argued that it is evident from the copy of income tax return for ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 11 assessment year 2012-13 wherein total application of funds was shown at Rs.1,76,99,738/- and proprietor’s capital was shown at Rs.1,33,91,213/-. The ld. AR thereafter requested to peruse the income tax return for assessment year 2013-14 wherein total application of funds was shown at Rs.59,09,676/- and proprietor’s capital was shown at Rs.48,80,176/-. Accordingly, it was submitted by ld. AR that the reduction in total application of funds and also in proprietor’s capital itself suggests that personal assets have been segregated and not appearing in the balance sheet uploaded on the income tax portal from assessment year 2013-14. It was submitted that since last many years the books of accounts of the assessee were regularly audited u/s 44AB of the IT Act and no investments was made in cash but through banking channel only. In support of its contentions personal balance sheets starting from A Yr 2013-14 to A Yr 2016-17 were produced before the AO, as well as before LD CIT(A)/NFAC , wherein all those investments were appearing. 9. Regarding deleting addition of Rs.1,51,885/- (LIC maturity receipts), & introduction of capital of Rs.2,55,601/- during F Yr 2014-15, it was submitted that policy of Life Insurance Corporation was matured for Rs.1,51,885/- during F Yr 2014-15 & ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 12 the above LIC maturity amount was credited in Bank of Baroda Account No.04470100003139 and a specific narration was mentioned from LIC and an amount of Rs.2,55,601/- was introduced during F Yr 2014-15 by the assessee himself. Accordingly LD Counsel of the assessee submitted that at one hand the AO is accepting the fact that the amounts were introduced /received in F Yr 2014-15 but only on the basis of their introduction/ incorporation in the composite balance sheet, addition is made in the year under consideration. LD AR submitted before us that this practice cannot be said to be correct & judicious approach. 10. Regarding the deletion of addition on account of FD of Bank of Baroda it was submitted that there was an opening balance of Rs.78,71,028/- in the sweep account of FDR as on 01-04-2016 & rest of the amount was transferred from assessee’s bank account. It is evident that in sweep FD account there are reverse entry as well as credit entry regarding purchase of FD. Copy of sweep FD account statement was also produced before the AO as well as before LD CIT(A)/NFAC. It is evident that there is no cash purchase of FD. Prabodh shares were also purchased in the F Year 2014-15, statement of account of the assessee in the books of ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 13 Prabodh share was produced before LD AO as well as before LD CIT(A)/NFAC & it was found by LD CIT(A)/NFAC that no such investment was made during the period under consideration. 11. Accordingly, it was requested before the Bench to dismiss the appeal of the Revenue and confirm the order passed by the ld. CIT(A)/NFAC. 12. We have heard the ld. Counsels from both the sides and perused the material available on record including paper book furnished by the ld. Counsel of the assessee. We find that the assessee being a leading medical doctor maintained regular books of accounts which are duly audited u/s 44AB of the IT Act. It is an admitted fact that upto the assessment year 2012-13 a composite balance sheet was prepared and uploaded on income tax portal which includes personal and professional assets. From Asstt Year 2013-14 Personal & professional assets were bifurcated and only the balance sheet consisting of professional assets was uploaded on the income tax portal. This practice continued upto to the assessment year 2016-17 but from assessment year 2017-18 the Chartered Accountant of the assessee decided to disclose complete assets of the assessee and, therefore, incorporated personal and professional assets in the balance sheet. For this purpose, he ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 14 prepared personal balance sheet right from assessment year 2013- 14 upto assessment year 2016-17 and incorporated the same figure along with the balance already appearing in the balance sheet. We also find that the assessee has furnished complete details of all the assets which were purchased/acquired during the assessment year 2012-13 to assessment year 2016-17. We also find that copy of the flexi fixed deposits statement of Bank of Baroda was also produced before the Assessing Officer wherein opening credit balance of Rs.78,71,088/- was already appearing and the transactions pertaining to assessment year 2017-18 were also appearing therein and all the transactions was through banking channels only and nothing was transacted in cash. We further find that the investments in M/s Prabodh Earth Sanchay was also made through banking channels only. For this purpose, the statement of the assessee in the books of M/s Prabodh Earth Sanchay for the assessment year 2016-17 and also for the assessment year 2017-18 was produced which clearly suggest that all the transactions were made through banking channels only and due TDS was also made by the payer/deductor. From perusal of these statements, it is also evident that there was an opening balance of Rs.16,87,365/- as on 01.04.2015 which itself proves that the investments of ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 15 Rs.16,87,365/- was neither invested in financial year 2015-16 nor in financial year 2016-17 but was already invested prior to these assessment years. It was also clarified that by mistake some wrong entry in negative was entered in the accounts which was corrected during the period under consideration. Accordingly, it was rightly observed LD CIT(A) that investment of Flexi fixed deposit in BOB & Prabodh shares pertains to earlier period not related with assessment year under consideration. We therefore hold that the ld. CIT(A)/NFAC has rightly allowed the appeal on this count also. Considering the totality of the facts, we are of the considered opinion that the Assessing Officer has not brought on record any evidence which suggests that any of the investments represented through opening capital was made during the period under consideration and the same was not recorded in the books of accounts for the period under consideration. It is further observed that all the assets/investments which is represented through the capital account which was integrated/shown as opening capital of personal assets pertains to prior years and not related to assessment year under consideration. Therefore, we do not find any infirmity in the order passed by the ld. CIT(A)/NFAC and accordingly the same is confirmed by us. ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 16 13. In the result, the appeal of the Revenue in ITA No.1092/PUN/2023 stands dismissed. C.O. No.09//PUN/2024 – By Assessee : 14. The cross objection is belatedly filed by the assessee. There is a delay of 17 days. The AR requested to condone the above delay and also filed an affidavit in support of delay application. We are satisfied with the reasons mentioned in the delay condonation application and deem it fit to condone the delay of 17 days in filing of this cross objection. The delay is condoned & the cross objection is admitted for adjudication. 15. The ld. AR submitted before us that the Assessing Officer has disallowed 20% of expenses without any sufficient reasons. The genuineness of the same was doubted by the AO. It was submitted that the expenses relates to repair and maintenance, travelling and conveyance, staff welfare expenses and hospital expenses amounting in all to Rs.25,62,628/- and ad-hoc disallowance of 20% of the above expenses which comes to Rs.5,12,525/- was disallowed treating the same as not incurred for the purpose of profession. The ld. AR contended that all the expenses were exclusively in connection with profession only and ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 17 without pointing out any specific defect in particular expenses, the same cannot be disallowed. Accordingly, ld. AR requested before the Bench to delete the addition of Rs.5,12,525/- made on this account. 16. With regard to the cross objection filed by the assessee, ld. DR submitted before the Bench that the disallowance made by the Assessing Officer and confirmed by the ld. CIT(A)/NFAC is justified, therefore, requested before the Bench to confirm the same. 17. We have heard the ld. Counsels from both the sides and perused the material available on record. We find that the assessee is a senior doctor and showing substantial amount of income since last many years. The books of accounts were audited and certified by the Chartered Accountant. The Assessing Officer has made disallowance of 20% out of the above expenses on ad-hoc basis by doubting the genuineness of above expenses. LD AR furnished before us the complete details of such expenses & requested that all the expenses are genuine & were incurred for professional purposes only. Considering the totality of the facts we deem it fit to restrict the disallowance to 10% of Rs.25,62,628/- which comes to Rs.2,56,263/-. The grounds raised in the cross objection are ITA No.1092/PUN/2023 C.O. No.09/PUN/2024 18 partly allowed and relief of Rs.2,56,263/- is allowed to the assessee. 18. In the result, the cross objection filed by the assessee in C.O. No.09/PUN/2024 stands partly allowed. 19. To sum up, the appeal filed by the Revenue is dismissed and the Cross Objection filed by the assessee is partly allowed. Order pronounced on this 16th day of October, 2024. Sd/- Sd/- (R. K. PANDA) (VINAY BHAMORE) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; ᳰदनांक / Dated : 16th October, 2024. Sujeet आदेश कᳱ ᮧितिलिप अᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The Pr. CIT/CIT concerned. 4. िवभागीय ᮧितिनिध, आयकर अपीलीय अिधकरण, “A” बᱶच, पुणे / DR, ITAT, “A” Bench, Pune. 5. गाडᭅ फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. "