Rejection of books and outside-State purchase inference failed where vouchers lacked only house numbers and records were otherwise accepted.

Rejection of books of account was not justified where the same books and trading pattern had been accepted in the preceding and subsequent years. The only defect identified was the absence of house numbers in self-prepared vouchers, but no material showed that the voucher-wise purchases were substantial or unreliable. On that record, an inference that scrap purchases had been made from outside Uttar Pradesh could not be sustained. The assessment addition based on alleged outside-State purchases was therefore deleted, and the assessee's explanation of local purchases was accepted.

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Issues: Whether the rejection of the assessee's books of account and the inference that scrap purchases were made from outside Uttar Pradesh were justified.

Analysis: The assessment for the year in question was tested against the record of the preceding and subsequent years, in which the same books and state of affairs had been accepted. The only infirmity noted by the Revenue was the absence of house numbers in self-prepared vouchers. Since no details were shown to indicate that the voucher-wise purchases were of substantial amount, no adverse inference could be drawn merely from the omission of house numbers. On the material on record, the inference that the purchases were from outside Uttar Pradesh could not be sustained.

Conclusion: The rejection of the books and the finding of taxable outside-Uttar Pradesh purchases were set aside, and the assessee's version of local purchases was accepted.

Final Conclusion: The revision succeeded and the assessee obtained relief against the tax addition based on alleged outside-State purchases.

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