The assessee, engaged in trading sugar, had submitted complete audited books of accounts and explanations for the expenses. The Assessing Officer (made disallowances on an ad hoc basis without rejecting the books, which the Tribunal found unjustified. The Tribunal deleted the disallowance related to various business expenses such as salary, interest, and administrative costs, noting that the accounts were duly audited, and no specific defects were pointed out by AO. Additionally, the AO had made an addition based on discrepancies in purchases from different suppliers. The Tribunal accepted the reconciliation provided by the assessee, explaining that the differences were due to accounting treatments of freight and timing issues. All disallowances are deleted. (AY. 2010-11)