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2016 (7) TMI 836 - AT - Income TaxBogus purchases - applicability of sec 69/69A - Held that:- In view of the foregoing, would require a restoration to the file of the assessing authority for a consideration of these aspects of the matter, i.e., the stock availability on each date; the capital invested in such an exercise; and the profit associated with the procurement of goods from other than the established sources (euphemistically called ‘grey market’), while procuring ‘bills’ of ‘goods’. We direct accordingly. He shall decide by issuing definite findings of fact, and after allowing the assessee due opportunity to explain and substantiate its case. The onus for the gain associated with the procurement of bills (and purchase of goods from the grey market), we may add, is on the Revenue. A finding qua quantitative reconciliation shall, however, have to precede the same, being the factual basis for the application of the hypothesis of the purchase from an alternate source. He shall decide, in terms of his findings, in accordance with law, and after allowing a reasonable opportunity to the assessee to substantiate his case. The addition for 1% of the impugned purchases (u/s. 69C) is, in any case, confirmed. Further, lest one considers us as having travelled outside the scope of the appeal, we may advert to the decisions, inter alia, in the case of Kapurchand Shrimal v. CIT [1981 (8) TMI 2 - SUPREME Court ] and Ahmedabad Electricity Co. Ltd. v. CIT [1992 (4) TMI 29 - BOMBAY High Court ]
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