The High Court considered a case where the Assessing Officer added the entire value of certain purchases to the assessee’s income, deeming them to be bogus. Since there was no discrepancy between the purchases shown by the assessee and the sales declared, the Court held that the entire amount of the bogus purchases could not be treated as income. Following its earlier rulings, the High Court affirmed that the addition must be limited only to the extent of bringing the gross profit rate on such disputed purchases to the same rate as that applied by the assessee to its other genuine purchases.