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2018 (4) TMI 1623 - AT - Income TaxAddition made under the head peak credit of transactions related to bogus purchases - Held that:- As decided in bogus purchase of diamonds from BJ group has been already been deliberated upon by the Tribunal and it stands decided. Facts of the case under consideration are almost identical to the facts of Vama International[2018 (2) TMI 1760 - ITAT MUMBAI]. In that case also the AO had added the entire purchases to the income of the assessee and the FAA had given part relief to the assessee.In the instant case,the assessee was denied the opportunity of cross examination though it had made a request to the AO during the assessment proceedings.By not allowing cross examination of the third party,whose statement was being used against the assessee,the AO had violated the basic principles of natural justice.Only on that count the order can be quashed.But, we are considering other factors.BJ has retracted his statement.So,the authenticity of the material relied upon by the AO reduces to a great extent.The supplier has admitted the transaction and the AO has not doubted the sales.It is also found that DD had filed VAT returns. Addition u/s 68 - Held that:- In the case of Accommodation entry - without giving an opportunity of cross examination merely on the basis of oral statement additions cannot be made u/s. 68. It is further held that: "The oral statement of a third party recorded by Search authorities which was never placed to be confronted by assessee and no documentary evidence was supplied to assessee, could not be considered in making addition u/s. 68 on account of alleged accommodation entries.
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