If your amp supports HDMI 5.1/7.1 PCM and DD/DTS passthrough, but not Dolby True HD and DTS HD MA passthrough, then in passthrough mode Kodi will just output the DD/DTS core/secondary streams (as EDID means it knows neither the TV nor AVR support DTS HD MA or Dolby True HD bitstreams) and you’ll get the lower quality lossy DD/DTS streams. In this case if you disable passthrough and you decode in Kodi and output in PCM 5.1/7.1 Kodi can decode the full quality lossless True HD and DTS HD streams output losslessly, as well as decoding DD and DTS lossy with no quality loss over bitstreaming (*)
That use case is particularly for AVRs that can’t decode a True HD or DTS HD MA/HRA bitstream, so where pass through for those won’t work.
(There were a generation of AVRs that supported PCM 5.1/7.1, but didn’t support HD Audio, over HDMI)
(*) losing DD/DTS metadata may mean some loudness processing for late night listening may not be as good though.