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2020 (1) TMI 577 - HC - VAT and Sales TaxMaintainability of petition - availability of alternative remedy - Best judgement assessment - enhancement of turnover - failure to file audit report - HELD THAT:- The present Writ Appeal is an exceptional case and deserves to be allowed, not because the assessing authority could not invoke his powers under Section 22(4) of the Act for the reason of not filing of the audit report, but because of the manner in which the 'best judgment assessment' has been passed by the assessing authority on 04.06.2018 for the assessment period 2016-17. The consequence of not getting his accounts audited even though his turnover is over Rupees One Crore and not submitting the audit report with the return or turnover is provided under explanation (2) to Section 63A itself viz., imposition of penalty of ₹ 10,000/-, that too after giving a reasonable opportunity of hearing to the assessee concerned - Firstly, we find that no separate opportunity of hearing also was given by the assessing authority before passing the order imposing for penalty of ₹ 10,000/- in the impugned assessment order dated 04.06.2018. Be that as it may. Since the assessee has paid the said amount of penalty to the assessing authority vide communication dated 29.03.2019 along with a demand draft, which is placed on record, we are not inclined to quash the penalty on the said ground. The 'Best Judgment Assessment' power given to the assessing authroity does not empower such assessing authority to pass 'Worst Judgment Assessment'. Though no strict yardstick can be prescribed either in Rules or otherwise, as to what will be the 'Best Judgment Assessment' in the facts and circumstances of the case, but such assessment orders when passed by the assessing authority has to reflect a due application of mind by the assessing authority to the relevant facts of the case. Without any material on record, such arbitrary additions to the declared turnover by the Assessee is not the intent and purport of Section 22(4) of the Act, which empowers the authority, which has been quoted by the assessing authority in the impugned assessment order, to pass any order as he thinks fit. Since in the present case, we found that the yardstick adopted by the learned assessing authority was shockingly arbitrary, we have chosen to interfere in the present case. However, we make it clear that it is not a general proposition of law that we are laying down - we are constrained to invoke our extraordinary writ jurisdiction in the present case under Article 226 of the Constitution of India and strike down the impugned 'best judgment assessment' order passed by the learned assessing authority on 04.06.2018. The matter remanded back to the learned assessing authority to pass fresh assessment order after giving reasonable opportunity of hearing to the assessee, within a period of six months from the date of receipt of a copy of this order - petition allowed by way of remand.
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