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Facts
The assessee, a Visa consultant, made cash payments for credit card bills due to necessity for client VISAs. The assessee failed to provide details of the source of these cash payments to the AO and CIT(A). The addition was made by the AO under Section 69A of the Income Tax Act.
Held
The Tribunal noted that neither the AO nor the CIT(A) had examined the merits of the case due to lack of details. The assessee submitted these details before the Tribunal and thus, the matter was remitted back to the AO for fresh consideration.
Key Issues
Whether the addition made under Section 69A for cash payment of credit card bills is valid without proper opportunity and verification. Whether Section 69A is applicable to such payments.
Sections Cited
143(3), 69A
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH: ‘SMC’: NEW DELHI
Before: SHRI MAHAVIR SINGH
Assessee by : Shri Sachin Garg, CA Revenue by : Shri Manoj Kumar, Sr. DR Date of Hearing : 27.10.2025 Date of Pronouncement : 27.10.2025 ORDER PER MAHAVIR SINGH, VP:
This appeal by the Assessee is arising out of the order of ADDL/JCIT (A)-8, Mumbai, in appeal no. CIT(A), Delhi-10/10475/2019-20 vide order dated 06.09.2024. Assessment was framed by ITO, Ward 29(8), Delhi, for the Assessment Year 2017-18 under Section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) vide his order dated 10.12.2019.
The assessee has raised the issue that the CIT(A) erred in confirming the addition made by the AO u/s 69A of the Act, being cash payment of credit card bills, without granting adequate and proper opportunity of being heard. For this, the assessee has raised the following ground no. 1, as under: 1
ITA No.-5502/Del/2025 Anil Paul “1. That the impugned order passed by the Ld. CIT(A) is bad in law and on the facts and circumstances of the case. That the Ld. CIT(A) has erred in confirming the addition without granting adequate and proper opportunity of being heard, thereby violating the principles of natural justice. That the Ld. CIT(A) has erred in law and on facts in upholding the addition of? 6,77,680/- under section 69A of the Act in respect of cash payment of credit card bills, without appreciating that the said provision is not applicable to such payments and that no unexplained money was found in possession of the appellant.
I have heard the rival contentions and gone through the facts and circumstances of the case. I have noticed that the assessee is a Visa consultant and has received fees along with professional fees from the clients. Due to necessity of cash payments for VISA, the assessee frequently withdrew from the credit card. The assessee before the AO, could not submit the details of the client’s source of cash payments made for credit card bills, flow chart or bank statement.
Even these details were not submitted before the Ld. CIT(A). For practical purposes, it seen that neither the AO nor the CIT(A) has gone into the merits of the case without examining the details. The assessee has now filed these details before me. Going by the nature of the details submitted, I deem it appropriate to remit the issue back to the file of the AO, and AO is directed to look into the details of source of credit deposits in respect of credit card payments and after verification decide the matter accordingly.
In the result, appeal of the assessee is allowed for statistical purposes.