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2017 (3) TMI 133 - AT - Income TaxAddition on bogus purchase - information received from the Sales Tax Department that the assessee was one of the beneficiary of the hawala entries - Held that:- The assessee filed a copy of ledger account, purchase bills, delivery challans, proof of payments through banking channels and stock tally which proved beyond doubt that the assessee has received materials which were consumed in manufacturing process of pharmaceuticals and the AO did not point out any defects or deficiency in the books of account except basing his conclusion qua bogus purchase on the basis of information received from the Sales Tax Department, GOM. In our opinion the assessee has discharged the onus cast upon it and now the burden shifts to the revenue to disprove the contentions of the assessee by carrying out further inquiries which was not done in the present case. Moreover, the assessee was not confronted with the statements recorded by the VAT department of GOM from the hawala dealers which itself is in violation of principle of natural justice. AO has wrongly made addition on account of bogus purchase from the hawala parties. We are therefore not in agreement with the conclusion drawn by the FAA that the suppressed GP/NP being more than the hawala purchases for sustaining the additions. Accordingly we set aside the order of CIT(A) and direct the AO to delete the additions - Decided in favour of assessee
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