MAHENDRA PRAKASH PAWAR,PUNE V. CIT(A)-2, CHENNAI, CHENNAI

ITA 1304/PUN/2025

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The case involves Mahendra Prakash Pawar, an employee of M.S. Agri Marketing Board, who appealed against the addition of Rs.21,69,933 to his income for the Assessment Year 2017-18. The addition was made by the Assessing Officer under section 69C of the Income-tax Act, 1961, alleging unexplained investment in credit card payments. The Tribunal examined the details of the credit card transactions, the income tax returns, and financial statements of the assessee's brother, Sachin Prakash Pawar, who used the credit cards for business purposes. The Tribunal concluded that the payments were adequately explained by the funds available with Sachin Prakash Pawar from his business activities.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 793585 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-09-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2017-2018
• Appeal Filed On: 20-05-2025
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANOJ TRIPATHI
• Assessee Lawyers: SHARAD VAZE
• Keywords: Set aside; Depreciation; Unexplained investment
• Section: 143(3); 142(1); 69C

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “SMC”, PUNE BEFORE DR.MANISH BORAD, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.1304/PUN/2025 Assessment Year: 2017-18 Mahendra Prakash Pawar, M S Agri Marketing Board, R-7, Market Yard, Gultekdi, Pune 411 037 Maharashtra PAN : AKUPP4879Q Vs. Income Tax Officer, Ward-4(5), Pune Appellant Respondent आदेश / ORDER The captioned appeal at the instance of assessee pertaining to A.Y. 2017-18 is directed against the order dated 15.03.2025 of Addl/JCIT (A)-2, Chennai passed u/s.250 of the Income-tax Act, 1961 (hereinafter also called ‘the Act’) arising out of Assessment Order dated 24.12.2019 passed u/s. 143(3) of the Act. 2. Brief facts of the case are that the assessee is an individual and is a salaried employee of M.S. Agri Marketing Board, Pune. Income of Rs.7,93,910/- declared in the return for A.Y. 2017-18 furnished on 20.05.2017. Case selected for Limited Scrutiny under CASS for the reason of “Credit Card payment”. Statutory notices were issued and duly served upon the assessee u/s.143(2) and 142(1) of the Act. Ld. Assessing Officer (AO) has observed that the assessee has made payment to Credit Cards issued by the following banks at Rs.21,69,933/- : Appellant by : Shri Sharad Vaze and Shri Amod Vaze Respondent by : Shri Manoj Tripathi (through virtual) Date of hearing : 11.09.2025 Date of pronouncement : 24.09.2025 Printed from counselvise.com ITA No.1304/PUN/2025 Mahendra Prakash Pawar 2 IndusInd Bank Rs.9,73,444/- Syndicate Bank Rs.10,49,989/- ICICI Bank Rs.14,65,500/- Total Rs.21,69,933/- 3. Ld. Assessing Officer further observed that the outstanding payments for credit cards of IndusInd Bank and Syndicate banks have been paid in cash. Assessee was asked to explain the source of cash deposited for clearing the credit card dues. It was stated by the assessee that the credit cards issued in his name have been used by his brother Mr. Sachin Prakash Pawar in the course of carrying on the business of Transportation and credit cards have been majorly used for purchase of fuel. It is also submitted that his brother is also filing regular income-tax returns and that he had sufficient funds to make the payment towards the outstanding credit card dues. However, ld. AO was not satisfied and he raised doubt on the source of cash utilised for credit card payments and finally concluded the assessment proceedings making addition for unexplained investment u/s.69C of the Act at Rs.21,69,933/-. 4. Aggrieved assessee preferred appeal before ld.CIT(A) but failed to succeed. Now the assessee is in appeal before this Tribunal. 5. Ld. Counsel for the assessee reiterated the submissions filed before the lower authorities and also took me through the paper book running into 105 pages indicating the details of credit card summary and statement of IndusInd Bank and Syndicate banks stating that the credit cards have been used for the purchase of Petrol and Diesel. Reference was also made to the income-tax Printed from counselvise.com ITA No.1304/PUN/2025 Mahendra Prakash Pawar 3 return, computation and financial statements of assessee’s brother Mr. Sachin Prakash Pawar. He submitted that credit card payments for IndusInd Bank and Syndicate banks have been cleared by the funds available with the brother and sofar as the credit card payment of Rs.1,46,500/- of ICICI Bank, the same has been utilised by the assessee and funds have been given from his own sources. 6. On the other hand, ld. DR supported the orders of the lower authorities. 7. I have heard the rival contentions perused the record placed before me. I note that the assessee is aggrieved with the addition of Rs.21,69,933/- confirmed by ld.CIT(A) which has been made by ld. AO invoking section 69C of the Act for unexplained investment. The impugned addition has been made for the unexplained payment for credit card dues and the details of the same are as under : IndusInd Bank Rs.9,73,444/- Syndicate Bank Rs.10,49,989/- ICICI Bank Rs.14,65,500/- Total Rs.21,69,933/- 8. Now from the above details filed before me, I notice that the payment of Rs.9,73,444/- has been made to the IndusInd Bank credit card and as per the summary of the credit card I notice that the credit card has been used to purchase Petrol and Diesel amounting to Rs.9,73,444/-. I also observe that the assessee’s brother Mr. Sachin Prakash Pawar carries on the business of Transportation, Hiring and Plying of Trucks and the gross receipts received for the F.Y. 2016-17 have been declared at Printed from counselvise.com ITA No.1304/PUN/2025 Mahendra Prakash Pawar 4 Rs.55,85,811/- and net profit after claiming depreciation of Trucks and Furniture has been declared at Rs.5,24,632/-. I also notice that Mr. Sachin Prakash Pawar has claimed Power and Fuel expenses at Rs.27,07,690/- and that the credit cards have been used for purchasing the fuel by the Drivers employed by Mr. Sachin Prakash Pawar. Source of cash payment to clear dues of IndusInd Bank are from the funds available with Mr. Sachin Prakash Pawar from his business sources. Details have been filed to state that the cash withdrawals from Axis Bank by Mr. Sachin Prakash Pawar is Rs.37,85,900/- by ATM and Rs.2,35,000/- through self cheque. 9. Similar is the situation for the credit card issued by Syndicate Bank. As per the details filed in the paper book, out of the total credit card payment of Rs.10,49,989/- sum of Rs.10,01,452/- has been incurred for making payment for purchase of Fuel. Now considering the cash withdrawals made by Mr. Sachin Prakash Pawar from his Axis Bank account and the genuineness of Power and Fuel expenses incurred by him during the year for the business purposes and the credit cards have been used by the employees of assessee’s brother for purchase of Fuel. I find that the assessee has successfully explained the source of cash payment of Rs.9,73,444/- and Rs.10,49,989/- totalling to Rs.20,23,433v/- for clearing the due of credit cards issued by IndusInd Bank and Syndicate Bank. 10. So far as the credit card issued by ICICI Bank is concerned, payment made on this credit card is only Rs.1,46,500/- and the same being utilised by the assessee and on perusal of the record I find that the assessee has sufficient funds at his disposal for making payment of Rs.1,46,500/- as assessee has declared income during the year at Rs.7,93,910/-. Printed from counselvise.com ITA No.1304/PUN/2025 Mahendra Prakash Pawar 5 11. In view of the above discussion and considering the facts and circumstances of the case, I find that since the assessee has successfully explained the sources of payment made for the credit cards issued by the above mentioned three banks totalling to Rs.21,69,933/- therefore the impugned addition is deleted. Finding of ld.CIT(A) is set aside and Grounds of appeal raised by the assessee are allowed. 12. In the result, the appeal filed by the assessee is allowed. Order pronounced on this 24th day of September, 2025. Sd/- (MANISH BORAD) ACCOUNTANT MEMBER पुणे / Pune; \u0001दनांक / Dated : 24th September, 2025. Satish आदेश क\u0002 \u0003ितिलिप अ ेिषत / Copy of the Order forwarded to : 1. अपीलाथ / The Appellant. 2. \u000eयथ / The Respondent. 3. The Pr. CIT concerned. 4. िवभागीय ितिनिध, आयकर अपीलीय अिधकरण, “SMC” ब\u0014च, पुणे / DR, ITAT, “SMC” Bench, Pune. 5. गाड\u0004 फ़ाइल / Guard File. आदेशानुसार / BY ORDER, // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे / ITAT, Pune. Printed from counselvise.com "