Held that  the assessee had produced a copy of the purchase register, sale register, ledger purchase invoices, stock movement, copy of bank statement, to prove the genuineness of the purchases. The Assessing Officer had not doubted the corresponding sales made by the assessee. If such purchases were treated as not genuine, the corresponding sales should also have been considered as not genuine. Only the profit margin embedded in such transactions could have been taxed. Since the sales were not doubted, it was proved that the assessee was actually in possession of goods. The assessee had been benefitted by receiving a margin from the grey market. The addition to the extent of the profit element embedded in the amount of purchases made from the party was to be added. The disallowance in the case of the assessee to the extent of 4 per cent. of the purchases made by the assessee from the party would be fair and reasonable.(AY.2011-12)