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2019 (10) TMI 514 - AT - Income TaxAd hoc disallowance of expenditure - HELD THAT:- Disallowance has been made on purely adhoc basis without pointing out any specific defect in the vouchers so maintained by the assessee. There is no finding that the expenses have not been incurred for the purpose of business or expenses are bogus in nature. Unless and until the AO brings out specific defect or gives a specific finding that expenses claimed are bogus in nature or not incurred for the purposes of the business, there is no basis for making such adhoc disallowances for the sake of making such disallowances knowing full well that the same cannot be sustained during the appellate proceedings. We accordingly delete the addition so made by the Assessing officer and the ground of appeal so taken by the assessee is allowed Addition on account of Electricity expenses - HELD THAT:- In respect of premises situated at 5/8, Kala Kua, Alwar, the same has been taken on rent by the assessee company from the owner of the said premises Smt. Sumitra Devi Sanghi, a fact not disputed by the Revenue. Where the electricity meter is in name of the owner and the electricity bills comes in the name of the owner, the assessee reimburses and the pays the same to the owner, we see no infirmity in the said claim of the assessee company and the same is directed to be allowed. In respect of premises situated at Flat No.703, Wonder Height, Alwar, the same has been taken on rent by the assessee company from the owner of the said premises and has been provided to Shri Nikunj Sanghi, the Director of the assessee company for his residential accommodation. The said Flat No. 703 is adjoining the other two flats namely Flat No. 701 & 702 and all these three flats have been claimed as converted into one residential accommodation for Shri Nikunj Sanghi, the Director of the assessee company. Apparently, Flat No. 701 & 702 are owned by Shri Nikunj Sanghi only and one electricity meter has been installed for the combined residential accommodation consisting of three flats. The electricity meter apparently is taken in the name of Shri Nikunj Sanghi, being the owner of the two flats and not in the name of the other owner namely, Nalini Goyal who is the owner of the other flat. Where the facts relating to three flats combined and converted into a single residential accommodation for Shri Nikunj Sanghi, the Director of the assessee company is not being disputed by the Revenue, merely because the electricity meter is not in name of the both the owners and is in name of one of the owners only, the same cannot be a basis for disallowance of electricity expenses and the same is directed to be allowed.
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