Gaganpreet Singh Sachdeva, New Delhi vs Department Of Income Tax

ACIT, Vs. Gaganpreet Singh Sachdeva, Circle 33(1), 10/84, Club Road, New Delhi. Punjabi Bagh, New Delhi. PAN: AOCPS4642A

(Appellant) (Respondent)

Assessee By : Shri V.K. Bhutani, CA Department By : Shri T. Vasanthan, Sr. DR

Date of Hearing : 27.04.2015 Date of Pronouncement : 27.04.2015

ORDER PER R.S. SYAL, AM:

This appeal by the Revenue is directed against the order passed by

the CIT(A) on 31.1.2013 in relation to the assessment year 2009-10. ITA No.2254/Del/2013

2. The only issue raised in this appeal is against the deletion of

addition of Rs.13,16,205/- made by the AO on account of unexplained

payments from credit cards.

3. Briefly stated, the facts of the case are that assessee, an individual,

was earning salary from M/s Pal Mohan Electronics Pvt. Ltd., M/s

Rishigagan Construction Pvt. Ltd., and M/s Vam Electro Devices Pvt.

Ltd. As per the AIR information, the assessee made payments of

Rs.13,16,205/- through his credit cards. In the opinion of the AO, the

amount was liable to be added to the assessee's total income for want of

any reconciliation/clarification/explanation about the source of the above

amount. The ld. CIT(A) deleted the addition.

4. We have heard the rival submissions and perused the relevant

material on record. It is observed that the assessee categorically stated

before the ld. CIT(A) that the above payments were made for the

expenses incurred by two companies, namely, M/s Pal Mohan

Electronics Pvt. Ltd., and M/s Vam Electro Devices in the capacity of

their Director. The ld. CIT(A) has further recorded that the payments

2 ITA No.2254/Del/2013

made against these bills were recorded by these companies in their

books of account. The ld. CIT(A) observed that the assessee explained

these facts to the AO vide his letters dated 5.12.2011 and 22.12.2011,

but, the same were not referred to by the AO in the assessment order.

The above facts amply demonstrate that the assessee, a Director of the

above two companies, incurred expenses on behalf of the companies and

the payments were simply made through his credit card. Merely because

the payments were made through the assessee's credit cards, the amount

so spent does not per se become unexplained income of the assessee,

more so, when it has been explained that the expenses so incurred were

booked by these companies in their regular books of account. The ld.

DR could not controvert any of the findings given by the ld. CIT(A) in

the impugned order. In such circumstances, we find that the assessee

succeeded in giving explanation about the amount spent through his

credit cards and no addition was called for. The impugned order is

upheld.

3 ITA No.2254/Del/2013

5. In the result, the appeal is dismissed.

The order pronounced in the open court on 27.04.2015.

Sd/- Sd/- [C.M. GARG] [R.S. SYAL] JUDICIAL MEMBER ACCOUNTANT MEMBER

Dated, 27th April, 2015. dk Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT (A) 5. DR, ITAT

AR, ITAT, NEW DELHI.

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