RISHI ANAND,OVERSEAS vs. WARD INT. TAX 1(1)(1) DELHI, INCOME TAX DEPARTMENT, DELHI, DELHI

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘D’, NEW DELHI Before Sh. Vikas Awasthy, Judicial Member & Smt. Renu Jauhri, Accountant Member IT(IT)A No. 73/Del/2025 : Asstt. Year : 2020-21 Rishi Anand, Vs Income Tax Officer, 442, Queen Mary Dr. Oakville, ON, Ward Intl.-1(1)(1), Canada L6K3M1, Edmonton AB, New Delhi Canada (APPELLANT) (RESPONDENT) PAN No. AISPA8751A Assessee by : Sh. Suresh Wadhwa, CA Revenue by : Sh. Saroj Kumar Dubey, CIT-DR Date of Hearing: 18.03.2026 Date of Pronouncement: 15.05.2026 ORDER Per Renu Jauhri, Accountant Member: The assessee by filing the present appeal sought to set aside the impugned assessment order dated 16.10.2025 passed by the Assessing Officer (for short AO) u/s 143(3) r.w.s. 144C(13) of the Income Tax Act, 1961 (hereinafter referred to as “Act”) for A.Y. 2020-21 in consonance with the order dated 17.09.2025 passed by the Dispute Resolution Panel (“DRP”) u/s 144C(5) of the Act.

2 IT(IT)A No. 73/Del/2025 Rishi Anand 2. That the Ld. AO has erred in law and on facts in passing the assessment order in a selective, arbitrary and mechanically preconceived manner, despite the categorical admission by Sh. Prateek Jain, under oath u/s 131(1 A), that he had utilized the Appellant’s credit card and reimbursed INR 41,71,482/-. 3. That, on the facts and in law, the Ld. Assessing Officer has erred in making an addition of INR 5,29,653/- as Undisclosed Commission under section 69A of the Income-tax Act, solely on the basis of directions or a new theory of circumstantial evidence as developed by the Dispute Resolution Panel (DRP). 4. That the Ld. AO has erred in law and on facts in treating gifts received by the Appellant from his blood relatives, aggregating to INR 15,00,000/- as Unexplained Money u/s 69A. 5. That the Ld. AO has erred in law and on facts by erroneously classifying Credit-Card Reward Points amounting to INR 1,97,766/- as Gifts from nonrelatives taxable u/s 56(2)(x) of the Act. 6. That the Ld. AO has erred in law and on facts by treating the cash deposit of INR 2,27,000/- as unexplained money u/s 69A of the Act. 7. That the assessment order passed by the Ld. AO is liable to be quashed as it appears to have been passed in undue haste, without proper verification, without making requisite inquiries, and in violation of the principles of natural justice and the statutory scheme of the Act. 8. That the additions sustained in the final order are devoid of merits and are wholly based on assumptions and presumptions, without any supporting material on record. 9. That the above grounds of appeal are independent and without prejudice to each other. 10. The Appellant craves leave to add, alter, amend or withdraw any ground(s) of appeal at the time of hearing.”

3 IT(IT)A No. 73/Del/2025 Rishi Anand Adinath Tours and Travels who used it for his personal as well as business activities. Entire expenditure is stated to have been reimbursed by Sh. Prateek Jain to the assessee through banking channels.

3.1 Based on the information available with the IT department regarding credit card expenses, a notice u/s 148 was served to the assessee on 31.03.2024 pursuant to order u/s 148A(d) dated 31.03.2024. Assessee filed return declaring income of Rs.39,440/- in response to notice u/s 148. After scrutiny, the assessment was completed and draft assessment order was issued at an income of Rs.42,99,078/- proposing to make the following additions: 1. Unexplained payment for credit card Rs.22,84,872/- 2. Reward points earned on credit card 2,47,766 3. Gifts from relatives Rs.15,00,000/- 4. Cash deposits in bank a/c Rs.2,27,000/- 3.2 Aggrieved, the assessee filed objection before the Dispute Resolution Panel (DRP). After considering the assessee’s submissions, ld. DRP reduced the proposed additions and accordingly assessment was finalized after re-computing the income as under: Returned Income 39,440/- Add: (u/s 69A) i. Unexplained income on a/c of Rs.5,29,653/- Credit Card bills ii. Reward points earned 1,97,766 ii. Unexplained income on a/c gifts Rs.15,00,000/- received from relatives iv. Unexplained cash deposits 2,27,000/-

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3.3 Further aggrieved, the assessee has preferred an appeal before the Tribunal against the assessment order. Ground Nos. 2 & 3: Addition on a/c of Credit Card reimbursement 4. Before us, ld. AR has submitted that the assessee is an NRI and had left for Canada in 2018. Before leaving, he handed over his credit card to his friend Mr. Prateek Jain, who used the same and reimbursed the amounts to the assessee. During the assessment proceedings, statement of Sh. Prateek Jain was also recorded by the ld. AO wherein he categorically confirmed these facts. He has further submitted that the ld. DRP reduced the addition and directed the AO to estimate the commission income earned by the assessee on usage of card by Sh. Prateek Jain on presumption without any basis. He has therefore argued that in the light of categorical confirmation by Sh. Prateek Jain as well as the evidence of reimbursement submitted by him, there was no basis for presuming and estimating any commission income in the hands of the assessee.

4.1 Ld. DR on the other hand has strongly relied on the orders of the lower authorities.

4.2 We have heard the rival submissions and perused the material on record. We are of the considered view that in the

5 IT(IT)A No. 73/Del/2025 Rishi Anand light of sworn statement of Sh. Prateek Jain and the evidence regarding reimbursement provided by him before ld. AO, the expenditure on credit card stands explained. Further in the absence of any evidence regarding commission received by the assessee from his friend, no addition could have been made purely on estimate basis. Accordingly, we hereby direct the AO to delete the addition of Rs.5,79,653/-. Hence, ground Nos. 2 & 3 are allowed in favour of the assessee.

Ground No. 4: Addition on a/c of gifts from relatives

5.1 Ld. AR submitted that requisite gift deeds dated 05.02.2025, Pan, bank statement and ITRs of the donors were submitted during the course of assessment proceedings. Death certificate of father of the assessee was also furnished. Entire amount was utilized by the assessee towards purchase of a house property which was registered in the name of assessee’s mother, Smt. Poonam Prasad. He has argued that once the identity of the donors and requisite supporting evidences have

6 IT(IT)A No. 73/Del/2025 Rishi Anand been furnished, there was no justification for treating these gifts as unexplained income of the assessee.

5.2 Ld. DR on the other hand relied on the orders of the lower authorities. He has further pointed out that the amount stated to be gifted by Ms. Pallavi Tandon is paid by her directly to the builder and to clear certain dues and therefore cannot be treated as a gift to the assessee. Similarly, the sum of Rs.2,00,000/- has been sent directly to the mother of the assessee by Sh. Pradeep Malhotra father-in-law of the assessee as per evidence filed relating to the cheque of Rs.5,00,000/- issued. Finally, with regard to the gift of Rs.5,00,000/- received from his father, late Sh. Arvind Kishore Prasad, no corroborative evidence has been filed by the assessee apart from his death certificate dated 30.06.2021.

5.3 We have heard the rival submissions and perused the material on record. We note that the evidences to show the transactions as gifts have been filed by the assessee. Copies of gift deeds (though obtained during the course of assessment proceedings), bank statement etc. have been filed before the AO as well as before us. With regard to the gift received from father, the assessee has furnished the confirmation from his mother as his father had expired on 30.06.2021. After considering the facts and circumstances, we are of the

7 IT(IT)A No. 73/Del/2025 Rishi Anand considered view that the onus to establish the genuineness of the gifts is adequately discharged by the assessee and hence no addition was called for on this account. We, therefore, delete the addition of Rs.15,00,000/- u/s 69A made on account of gifts received from relatives. Ground No. 5: Addition on a/c of cash credit reward points – Rs.1,97,766/-

6.1 Before us, ld. AR has submitted that credit card reward points are non-cash promotional incentive and thus is not taxable. Ld. DR on the other hand has argued that the assessee has himself taken the plea that credit card was used by his friend Sh. Prateek Jain and, therefore, reward points earned by the assessee amount to gift from his friend which is squarely covered u/s 56(2)(x) of the Act.

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6.2 We have heard the rival submissions and perused the material on record. Since the reward points are earned on the credit card expenses incurred by Sh. Prateek Jain thus the same have been rightly held to be a gift taxable u/s 56(2)(x) of the Act. Thus this ground of appeal of the assessee is hereby rejected and decision of ld. CIT(A) to tax the balance amount after allowing threshold exemption of Rs.50,000/- is upheld.

Ground No. 6: Cash deposits in bank account – Rs.2,27,000/- 7. Brief facts of this issue are that amounts totaling Rs.2,27,000/- were found to be deposited in assessee’s a/c with Kotak Mahindra Bank. The assessee explained that these were deposited by Sh. Prateek Jain by way of reimbursement of credit card usage by him. These amounts were transferred to assessee’s HDFC bank account from which payments towards credit card bills were made. Ld. AO proposed to make the addition of Rs.2,27,000/- on a/c of unexplained cash credit. On directions of ld. DRP, the bank a/c was re-examined that ld. AO held that the amounts remains unexplained as no corroborative evidence was furnished in support of the claim that these were deposits made by Sh. Prateek Jain.

7.1 Before us, ld. AR has submitted extracts of both the bank accounts of the assessee to correlate these payments and has

9 IT(IT)A No. 73/Del/2025 Rishi Anand argued that when the primary transactions on credit cards giving rise to such deposits have been explained and confirmed by Sh. Prateek Jain, there was no justification for making this addition.

7.2 We have heard the rival submissions and perused the material placed on record. We are inclined to agree with the submissions of the assessee and hold that the source and purpose of impugned cash deposits in assessee’s account has been explained satisfactorily and accordingly addition of Rs.2,27,000/- u/s 69A is hereby deleted.