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TMI Blog2019 (7) TMI 1845X X X X Extracts X X X X X X X X Extracts X X X X ..... ame is deleted. Addition u/s 69C - unexplained expenditure incurred through credit card of Bank of America - not accepting the contention of assessee that payment of this card was made by his uncle Shri Sailesh Lakhi who is residing in USA - HELD THAT:- The assessee in his reply before the AO has explained the source of payment of credit card bill for all the three years as such payments were made by his uncle Shri Shailesh Lakhi, resident of USA. The assessee also filed the confirmation of his uncle Shri Shailesh Lakhi regarding the payment of the credit card bill of the assessee. These facts were not disputed by the AO. Thus the expenditure incurred by the assessee through credit card itself is not an unexplained expenditure but only the payment of credit card bill can be considered as unexplained expenditure. Once the assessee has produced all the details and confirmations regarding payment of credit card bill which has not been controvered by the AO then said payment of credit card bill made by the uncle of the assessee, r/o USA, cannot be held as unexplained expenditure of the assessee. Assessee has established the source of payment and if there is a violation or fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i Gems. In connection with business of these two firms, the assessee used to visit outside India and, therefore, opened an account in Hong Kong to make small payments like train ticket, taxi charges etc. The assessee further explained that this account was opened on behalf of these firms and a sum of USD 700 was deposited. The assessee explained that these two firms in the petition filed before the ld. Settlement Commission have offered this deposit in bank account to tax as an undisclosed income. The AO though accepted the fact that these firms have offered this amount in their petition to the ld. Settlement Commission yet no order or decision of ld. Settlement Commission was made till the passing of assessment order. Accordingly, the AO made an addition of the said amount of ₹ 45,997/- on account unaccounted cash in the hands of the assessee. 3.3 The assessee challenged the action of the AO before the ld. CIT(A) but could not succeed. 3.4 Before us, the ld.AR of the assessee submitted that this account was opened in the name of the assessee on behalf of these two firms i.e. M/s. Bihari Lal Holaram, partnership firm and M/s. Lakhi Gems. Therefore, the amount of USD 700 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ems have filed an application u/s 245C of the I.T. Act before the Income Tax Settlement Commission for the A.Y. 2010-11 to A.Y. 2017-18. In their petition, the unaccounted amount of USD 700 has been offered for taxation before the Hon'ble ITSC. However, the addition is being made here since the undisclosed bank account is in the name of the assessee. This addition is subject to the outcome of ITSC order since the same thing cannot be taxed twice. Thus it is clear that the AO has also considered this fact that the addition made in the hands of the assessee is subject to the outcome of the ld. Settlement Commission order since the same income cannot be taxed twice. Now the ld. Settlement Commission vide its order dated 22-04- 2019 has already accepted the said income offered by these two firms. We have carefully perused the order of the ld. Settlement Commission wherein this amount of ₹ 45,977/- was also part of the undisclosed income offered by these two firms for the A.Y. 2014-15. The total undisclosed income was offered at ₹ 28,71,319/- which was divided between two firms M/s. Bihari Lal Holaram, partnership firm and M/s. Lakhi Gems. in ratio of 95% : 5%. Fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by the AO and expressing the view that it is a hawala transaction. The ld.AR of the assessee has also contended that when the source of payment of the credit card has been explained by the assessee then it cannot be treated as unexplained expenditure. 4.5 On the other hand, the ld. DR has submitted that assessee has not disclosed the transactions carried out through credit card. When the AO asked the assessee about the credit card payments then the assessee explained that the payments of the credit card bill has been made by his uncle. The ld. DR relied on the orders of the authorities below. 4.6 We have considered the rival submissions as well as relevant material on record. The assessee in his reply before the AO has explained the source of payment of credit card bill for all the three years as such payments were made by his uncle Shri Shailesh Lakhi, resident of USA. The assessee also filed the confirmation of his uncle Shri Shailesh Lakhi regarding the payment of the credit card bill of the assessee. These facts were not disputed by the AO in his following findings in para 7.2. and 8 of his order for the Assessment Year 2015-16. 7.2 The reply of the assessee has b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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