Archive · 7 Oct 2026
ITAT Says Cash Withdrawals Need Not Match Credit-Card Payments Exactly
A taxpayer paid a large credit-card bill using cash.
Tax officials asked where the money came from.
The taxpayer said it had been withdrawn from a bank account.
The Jaipur tax tribunal found that the bank records showed enough cash had been withdrawn.
Officials had not shown that the cash was spent on something else.
The tribunal said each withdrawal did not have to be matched to a particular bill payment.
Cash could have been kept and used later.
People still need to explain large cash payments and keep records that show where the money came from.
A taxpayer paid about ₹10.90 lakh toward credit-card dues in cash, prompting income-tax scrutiny.
The assessing officer treated the amount as unexplained money under Section 69A of the Income-tax Act.
The taxpayer said the cash came from bank withdrawals and also cited business income and cash availability.
The Jaipur ITAT found sufficient withdrawals and no specific evidence that the cash had been spent elsewhere.
The tribunal ruled that a transaction-by-transaction match was not required, while taxpayers must still explain large cash payments.
- Who
- Shrawan Kumar Prajapat and the Income Tax Appellate Tribunal's Jaipur bench.
- What
- The tribunal ruled that sufficient bank withdrawals can support the source of cash used for credit-card payments without matching each withdrawal to a specific payment.
- When
- The article does not state when the ruling was issued.
- Where
- Jaipur, India.
- Why
- The taxpayer challenged the tax department's treatment of about ₹10.90 lakh in cash credit-card payments as unexplained money.
Tax department's position
Taxpayer's and tribunal's position
Proof of cash source
Tax department's position
The assessing officer treated the cash payments as unexplained, questioning whether the taxpayer had established the source of the money.
Taxpayer's and tribunal's position
The taxpayer said the money came from bank withdrawals, and the tribunal accepted that sufficient withdrawals supported the explanation.
Matching withdrawals to payments
Tax department's position
The authorities questioned whether the specific cash withdrawn was the same cash later used for the credit-card payments.
Taxpayer's and tribunal's position
The tribunal held that each withdrawal need not be matched to an individual payment when there was enough cash withdrawn and no evidence it had been spent elsewhere.
- Cash credit-card payments
- About ₹10.90 lakh
- Case
- Shrawan Kumar Prajapat vs ITO, ITA No. 1535/JPR/2025
- Tribunal
- Jaipur bench of the Income Tax Appellate Tribunal
- Relevant provision
- Section 69A of the Income-tax Act
- Taxpayer's explanation
- The cash came from bank withdrawals; he also cited business income and cash availability.
- Tribunal's reasoning
- Bank statements showed sufficient withdrawals, and authorities had not specifically found that the withdrawn cash was spent elsewhere.
- Practical implication
- A perfect one-to-one match between withdrawals and later cash payments is not necessarily required; records of cash availability and source remain important.