HARISH JAJODIA,MUMBAI vs. ACIT - 20(1) (PRESENT ACIT - 24(2)), MUMBAI

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ITA 6136/MUM/2016Status: DisposedITAT Mumbai23 March 2018AY 2006-075 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that since the credit card payment was made by the assessee's wife from her duly accounted sources, no adverse inference could be drawn in the hands of the assessee. Therefore, the addition sustained by the CIT(A) was deleted.

What were the facts?

The Assessing Officer reopened the assessee's case based on AIR information and made an addition for credit card payments. The CIT(A) restricted the addition after finding some entries to be duplicates, but sustained a part of it, disbelieving the assessee's claim that his wife made the payment from her own sources.

What were the issues?

Whether the credit card expenses paid by the assessee's wife from her explained sources constitute unexplained expenditure in the hands of the assessee.

Which sections of the Income-tax Act were involved?

Section 69C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

Before: SHRI G.S.PANNU, AM & SHRI RAVISH SOOD, JM

For Appellant: Ms. Prakash Jotwani, A.R, Shri Rajesh Kumar Yadav, D.R
For Respondent: Shri Rajesh Kumar Yadav, D.R

आदेश / O R D E R

PER RAVISH SOOD, JUDICIAL MEMBER:

1.

The present appeal filed by the assessee is directed against the order passed by the CIT(A)-51, Mumbai, dated 04.07.2016, which in itself arises from the order passed by the A.O under Sec. 143(3) r.w.s. 147 of the Income Tax Act, 1961 (for short ‘Act’), dated 21.02.2014 for P a g e | Harish Jajodia Vs. ACIT-20(1) A.Y 2006-07. The assessee assailing the order of the CIT(A) had raised before us the following grounds of appeal:

“1.(a) On the facts and circumstances of the case and in law, the Learned CIT(A) has erred in confirming the additions of Rs. 2,15,660/-. The same shall be deleted in full. 2.(a) The Learned CIT(A) ought to have appreciated the fact that the appellant had provided sources of incurring expenses on credit card by his wife at the time of assessment as well during appellate proceedings. (b) The Learned CIT(A) ought to have appreciated the fact, that appellant had submitted copy of return of income filed along with Balance sheet and capital account, which provided entire detail of source of payment of credit card bill. Hence, the contention of Ld. CIT(A) that the assessee had not given any proof for source and genuineness of deposit is not tenable.

3.

Your appellant craves leave to add to, alter, amend, modify or delete any of the grounds of appeal 2. Briefly stated, the issue involved in the present case lies in a narrow compass. The A.O on the basis of AIR information reopened the case of the assessee and made an addition of Rs.4,31,320/- in respect of payment made towards credit card of ABN AMRO bank. Aggrieved, the assessee carried the matter in appeal before the CIT(A). The CIT(A) persuaded by the contention of the assessee that the two entries against credit card payment were duplicate entries, directed the A.O to verify the same. However, as the A.O failed to verify the duplicity of the entries, therefore, the CIT(A) restricted the addition to Rs.2,15,660/-. The claim of the assessee that the cash deposit under consideration was made by his wife did not find favour with the CIT(A), who rejected the same for the reason that the assessee had failed to substantiate the genuineness of his claim and prove the source of income of his wife.

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