The assessee, engaged in the business of new-born baby products, had purchases of ₹16.29 lakh disallowed u/s 69C on the basis of Sales Tax Department information alleging hawala transactions. The AO made the addition as the assessee could not produce the suppliers, though the assessee had furnished purchase bills, ledger, accounts, bank statements showing payments through banking channels, and corresponding sales were accepted. No opportunity of cross-examination of third-party statements was granted. The Tribunal held that the AO merely relied on third-party information without making further enquiry or providing cross-examination. Since the assessee had discharged the burden by submitting documents and showing payments through banking channels, and VAT authorities had accepted the transactions while granting ITC, the addition u/s 69C was unsustainable. Reliance placed on CIT v. Nikunj Eximp Enterprises (2015) 372 ITR 619) (Bom.) (HC) and Ashok Kumar Rungta v. ITO  /[2024] 301 Taxman 580 (2025] 474 ITR 160 (Bom HC) . Krishna Textiles v. CIT(2009)  310 ITR 227 (Guj)( HC) ,  Case of PCIT v. Kanak Impex (Ind) Ltd[2025] 474 ITR 175 / 172 taxmann.com 283 (Bom)( HC)   (Bom HC) distinguished on facts as in that case books were rejected and assessee had not cooperated. Accordingly, the addition u/s 69C was deleted.( ITA No. 525/Mum/2025 dt.  dt. 29.04.2025 ) (AY 2011-12)