In Brief
An assessee was assessed for income tax on cash credits of Rs. 2,26,000 shown in his books as purchases from unregistered marble dealers. The officer rejected these as bogus entries under Section 68. Years later, in penalty proceedings for the same assessment year, the assessee produced affidavits and recorded statements from 13 dealers, whom the officer examined and found credible; their identity was established. The appellate authority accepted this evidence and found no concealment of income. The Supreme Court held that this fresh evidence wholly dispelled the factual premise of the original addition. Since the transactions were now proven genuine, the addition could not be maintained, and the appeal was allowed with the addition set aside.">
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