Allowing the appeal of the assessee and dismissing the appeal of the revenue the  Tribunal held that the assessee maintained proper books of accounts which were subject to audit under S.  44AB of the Act and the AO had not pointed out any specific defect on the said books of accounts. The  CIT(A) had also categorically stated in the impugned order that the AO had never disputed purchases, stock statements, yields, VAT returns and though nothing adverse was pointed out about the evidence supplied by the assessee during the course of assessment proceedings. In the present case the sales made by the assessee to M/s Kalka Udyog was against C Form and Form No. 49 etc which were duly declared in VAT returns which had been accepted by the concerned Department and nothing contrary to that has been brought on record. In the instant case the assessee included the impugned sales in its turnover and duly recorded the same in its books of accounts which had not been rejected by the AO and even the sale declared by the assessee in its books of accounts was not disturbed. The AO had accepted the purchases declared by the assessee which were not found to be inflated. The sales of the assessee were also not found to be suppressed and even the GP rate declared was found to be genuine therefore the Assessing Officer was not justified in treating the entire sales on the basis of statement of third party as bogus and adding the same in hands of the assessee. CIT(A) although accepted the sales of the assessee to be genuine but made the addition by applying the GP rate of 8.8% which was already declared by the assessee and accepted by the Department.  The AO had not provided the opportunity asked by the assessee to cross examination Shri Trilok Goel on the basis of which the impugned sales was treated as bogus and even the assessee furnished all the documents relating to purchase/sales, transportation etc, various copies of accounts, VAT returns, copy of C Form obtained from M/s Kalka Udyog. Therefore the AO arbitrarily added the entire sales in the hands of the assessee and the  CIT(A) although considered the sales declared by the assessee as genuine but wrongly made the addition by applying the GP rate of 8.8% declared by the assessee on the same sales which was also part of the turnover of the assessee on which the profit was also already declared.Accordingly, the same is deleted.(AY. 2012-13)