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| The Tax Publishers2020 TaxPub(DT) 0365 (Kol-Trib) INCOME TAX ACT, 1961
Section 68
Since entire addition was made based on information gathered from the Investigation Wing of the Department and AO had made the addition without giving any opportunity to cross examine, further assessee had produced all the relevant documents, therefore, AO was directed to delete the addition under section 68.
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Income from undisclosed sources - Addition under section 68 - Bogus purchases -
AO on the basis of specific information received from Pr. DIT (Inv.), observed that assessee had shown to have made bogus purchase from eight different concerns of Mr. S, who when searched by department gave statement that the said concerns were providing accommodation entries in lieu of commission. AO noted that assessee purchased goods from Mr. S and his eight concerns. Thereafter, AO was of opinion that said purchases from eight concerns were bogus and added 8% profit of total purchases to the income of assessee. Held: In the present case, since entire addition was made based on an information gathered from Investigation Wing of the Department and admittedly the statements were recorded behind back of assessee and AO had made addition without giving any opportunity to cross examine, therefore the sad reasons could not be the basis of an addition, when the fact was that assessee has produced all the relevant documents. Therefore, AO was directed to delete the addition under section 68.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
IN THE ITAT, KOLKATA BENCH
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