This appeal by assessee for asst. yr. 2002-03 is directed against order of CIT(A) dt. 2nd July, 2007 raises following grounds of appeal: "1. In facts and circumstances of case and in view of submission, material and evidence on record, learned CIT(A) has grossly erred in law and in facts in maintaining assessee income of assessee appellant at Rs. 4,31,510 as against Rs. 2,78,470 disclosed by him in return of income and thereby erred in dismissing appeal of assessee. In facts and circumstances of case, and without prejudice to generality of forgoing ground of appeal No. 1 learned CIT(A) has erred in law and in facts in maintaining disallowance of Rs. 70,000 made by learned AO out of generator running expenses. In facts and circumstances of case, and without prejudice to generality of forgoing ground of appeal No. 1 learned CIT(A) has erred in law and in facts in maintaining disallowance of Rs. 1,77,172 made by learned AO out of travelling expenses. In facts and circumstances of case, and without prejudice to generality of forgoing ground of appeal No. 1 learned CIT(A) has erred in law and in facts in maintaining disallowance of Rs. 1,68,379 made by learned AO out of telephone and mobile phone expenses. In facts and circumstances of case, and without prejudice to generality of forgoing ground of appeal No. 1 learned CIT(A) has erred in law and in facts in maintaining disallowance of Rs. 44,638 made by learned AO out of vehicle maintenance expenses. In facts and circumstances of case, and without prejudice to generality of forgoing ground of appeal No. 1 learned CIT(A) has erred in law and in facts in maintaining disallowance of Rs. 5,252 made by learned AO out of general expenses." Ground No. (1) is general in nature and same does not require any adjudication. facts of ground No. (2) are that assessee filed its return of income on 7th Oct., 2002 declaring income of Rs. 2,78,470 from his business of manufacturing and trading of guwar gum, tamarind seeds and other herbal products. assessee has declared GP rate of 11.65 per cent on total turnover of Rs. 18.18 crores as against GP rate of 12.63 per cent on turnover of Rs. 20.65 crores in preceding asst. yr. i.e., asst. yr. 2001-02. assessee has claimed generator running expenses at Rs. 46,32,581 as against Rs. 32,93,803 claimed in immediately preceding assessment year. AO found that turnover has decreased but generator running expenses have been increased. Keeping in view, these facts and these expenses were not fully vouched or partly vouched or supported by internal vouchers. AO made lump sum disallowance of Rs. 70,000 to cover up element of unverifiable nature. learned CIT(A) also confirmed this addition. I have heard rival submissions and have perused available materials on record, carefully. It has been submitted by learned Authorised Representative Shri N.R. Mertia that it had processed 37.71 lakh kgs. of seeds as compared to 36.39 lakh kgs. seeds in preceding asst. yr. 2001-02. This fact is also supported by documents placed at page Nos. 8 and 10 of assessee s PB. learned CIT(A) has given reasoning that turnover in this year has decreased in terms of money. But in our considered opinion, this is not valid reasoning. consumption of power may be obtained through generator by assessee or as pointed out from supply of power by State Government, which is directly, related to quantity of seeds processed by assessee. Admittedly and obviously assessee has processed 37.71 lakh kgs. of seeds in this year s compared to 36.39 lakh kgs. seeds in preceding year. Therefore, consumption of electricity is definitely required more than last year. assessee keeps generator set on stand by and it is not possible to prove on record that electrical supply was erratic during relevant year. I do not agree with learned CIT(A) that there cannot be any co-relation of generator expenses with quantity of seeds processed. Rather, these are directly related to each other. other important factor which has been pointed out by learned Authorised Representative is that liability of Rs. 6,00,000 which included generator running expenses was paid during relevant year and this was not case in earlier year. learned CIT(A) has considered this fact but still he had maintained lump sum addition of Rs. 70,000. It is admitted fact that books of accounts of assessee were not rejected and production is more in this year. small amounts of diesel expenses were not verifiable. lump sum addition of Rs. 70,000 is not based on any logic. Therefore, legally it is not possible to sustain this addition as two years are not comparable and reasoning of assessee are plausible. Therefore, this addition is hereby ordered to be deleted. As result, this ground of appeal is allowed. facts of ground No. (3) are that assessee has claimed travelling expenses of Rs. 8.85 lakhs as against Rs. 4.74 lakhs in immediately preceding assessment year. AO has disallowed 1/5th of such expenses amounting to Rs. 1,77,172 on account of personal user of these; expenses. In first appeal learned CIT(A) has sustained this addition on the, basis of facts of immediately preceding assessment year. I have heard rival submissions and have perused evidence on record. It is found that most of business of assessee is related to export. assessee has claimed travelling expenses at Rs. 8.85 lakhs in this year as against Rs. 4.74 lakhs in immediately preceding assessment year. disallowance was made on reasoning that element of personal user of these expenses cannot be ruled out. learned CIT(A) has observed that assessee has failed to prove that these expenses were incurred wholly and exclusively for business purposes only for confirming impugned disallowance. After considering entire factual matrix, I am of opinion that rationale of impugned disallowance is not logical. By comparing expenses of one year with other year is not valid basis at least for making disallowances of travelling expenses unless these expenses are found to be unexplained or unvouched. assessee has claimed that these were spent wholly and exclusively towards his business of export. There is no iota of evidence on record which can point out that any part of these expenses was incurred except than for business purposes. In these circumstances, in my considered opinion it is not justifiable to make ad hoc disallowance on pretext that personal user must have been involved therein. In this regard, Tribunal order of Jodhpur Bench rendered in case of Ganesh Foundry vs. Asstt. CIT (2003) 78 TTJ (Jd) 736 is relevant, copy of this order has been filed by learned Authorised Representative. It has been held therein that when disallowance is made without pointing out item of disallowable nature it could not be sustained. facts of this ground are exactly similar to case of Ganesh Foundry (supra) relied by learned Authorised Representative Therefore, by respectfully following above decision, I delete entire addition made in this account and allow ground No. (3) of appeal of assessee. facts of ground No. (4) are that telephone expenses of Rs. 6,18,706 and mobile phone expenses of Rs. 2,21,734 were claimed by assessee during this year. On account of personal element involved AO has disallowed @ 20 per cent was added in total income of assessee. This addition was confirmed by learned CIT(A). After hearing both sides, I am of considered opinion that element of personal user in telephone expenses cannot be ruled out but keeping in view entire facts of this case, I find that impugned disallowance is on higher side. Instead of 20 per cent disallowance, I restricted same to 10 per cent and reduce this addition to just half. Therefore, ground No. (4) is partly allowed. Ground No. (5) relates to disallowance out of vehicle maintenance expenses. Disallowance of Rs. 44,638 at rate of 1/5th of total expenses claimed in vehicle running and maintenance expenses at Rs. 2,23,190 has been disallowed. I find that this disallowance is on higher side and, therefore, I restrict same to 1/10th and reduce same to just half in interest of justice and fair play. As result, ground No. (5) is also partly allowed. Ground No (6) relates to general expenses. This ground was not really pressed by learned Authorised Representative, at time of hearing; therefore, it is dismissed as not pressed. In result, appeal of assessee is partly allowed. *** SUNITA MINE CHEM IND. v. INCOME TAX OFFICER