TMI Blog2017 (1) TMI 964X X X X Extracts X X X X X X X X Extracts X X X X ..... none of the material or evidence has been produced or relied upon by the opposite party to come to a conclusion that average business of the petitioner comes to ₹ 15,000. Moreover, when the petitioner is engaged in selling of some low cost tiffin, and some rasgola at no stretch of imagination the daily business would reach to such an amount. It is a fact that he has engaged six persons including himself and his brother. The best judgment assessment as required to be followed under law to make assessment u/s 43(1) of the Act being not followed by the opposite party, the impugned order is illegal, bad in law, vulnerable and liable to be quashed - petition allowed - decided in favor of petitioner. - W. P. (C) No. 1854 of 2016 - - - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lia, that before issue of notice under section 43 of the Act no assessment has been completed under section 39, 40, 42 or 44 of the Act and notice has been issued without forming any opinion as to the turnover escaping assessment as required under sub-section (1) of section 43. It is stated that without service of any report and without giving proper opportunity to the petitioner, the impugned assessment order was passed on November 20, 2015 in form VAT-312 showing daily average sale of the petitioner of ₹ 15,000 instead of ₹ 2,000 as contended by the petitioner basing upon, the books of account. It is claimed by the petitioner that the opposite party ridiculously determined the GTO and TTO of the petitioner at ₹ 1,03,50,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tatutory authorities in issuing reassessment notice cannot surrender or abdicate its statutory discretionary power in favour of a non-statutory authority and completely act under the dictate of such an authority. In support of such contention he further submitted that the impugned order has no supporting material and no independent opinion has been taken by opposite party to impose the tax in question. It is further submitted on behalf of the petitioner that the best judgment assessment made by the petitioner is not based on material and it is arbitrary, unfair and unreasonable. When there is no suppression of any purchase or sale at all, the assessment/reassessment has been made by the opposite party on the basis of surmises and presump ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... overnment land. It is not disputed that the petitioner has submitted the income-tax return for the period from April 1, 2013 to March 31, 2015. It is admitted fact that the petitioner used to maintain the books of account. It is revealed from the petition that the petitioner has mainly urged about best judgment assessment procedure which has not been legally adopted by the opposite party. Of course the opposite party in the impugned order has mentioned that during personal hearing the petitioner could not reconcile daily average sale of his business. The opposite party took up the best judgment assessment procedure. The relevant portion of the impugned order is quoted hereinbelow: . . . Now the assessment is completed to the best of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax amount calculates to ₹ 9,49,456.75. After the dealer is allowed deduction of ₹ 24,555 towards input tax credit on purchase and ₹ 43,664 towards the VAT payment at the time of filing of return, the balance tax due comes to ₹ 8,81,238. The dealer is also visited with a penalty equal to one time of tax due amounting to ₹ 8,81,238 under section 43(2) of the OVAT Act. Thus the tax and penalty together comes to ₹ 17,62,476, which is required to pay the dealer as per the terms and conditions of the demand notice enclosed. From the aforesaid order, it does not appear how the opposite party could put the daily average business of the petitioner as ₹ 15,000 when the return was filed showing the sale bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Bihar [1957] 8 STC 770 (SC), at page 778 where their Lordships observed: We find nothing in those observations which runs counter to the observations made in Dhakeswari Cotton Mills' case [1954] 26 ITR 775 (SC). No doubt it is true that when the returns and the books of account are rejected, the assessing officer must make an estimate, and to that extent he must make a guess; but the estimate must be related to some evidence or material and it must be something more than mere suspicion. To use the words of Lord Russell of Killowen again, 'he must make what he honestly believes to be a fair estimate of the proper figure of assessment' and for this purpose he must take into consideration such materials as the assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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