Bogus purchase claims and paper transactions upheld as valid grounds for best judgment assessment against the assessee.

Purchases were treated as bogus where the alleged suppliers could not be traced, the transport agencies were non-existent, and cheque payments were promptly withdrawn in cash from a bank account opened elsewhere, showing paper transactions only. On these facts, the Tribunal's findings were held to be factual, not perverse or contrary to record, and the return was treated as incorrect and incomplete. The rejection of the purchase claims and the consequential best judgment assessment were therefore upheld against the assessee.

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Issues: Whether the rejection of the assessee's purchase claims and the consequential best judgment assessment were justified on the ground that the transactions were bogus and fictitious.

Analysis: The purchases were found to be unsupported by reliable verification. The alleged suppliers could not be traced at the stated addresses, the transport agencies were found non-existent, and the cheque payments were quickly withdrawn in cash from a bank account opened at a different place, indicating that the transactions were only on paper. The findings recorded by the Tribunal were findings of fact and were neither shown to be perverse nor contrary to the record. On these facts, the return was treated as incorrect and incomplete, justifying best judgment assessment.

Conclusion: The rejection of the purchase claims and the best judgment assessment were upheld, against the assessee.

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