Best judgment assessment on unreliable accounts upheld where turnover estimate was based on relevant materials and honest judgment.

Where a dealer's accounts are found false, unreliable, and marked by suppression of transactions, the assessing authority may reject them and determine turnover by an honest best judgment estimate on available materials. The Court held that such estimation is a matter of factual judgment, need not rest on strict evidentiary proof, and may be guided by principles applicable to best judgment assessments under income-tax law. It further held that the assessment is not invalid merely because the precise basis of the figure is not separately disclosed, so long as relevant materials were considered and the estimate was made in good faith.

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Issues: Whether, under the Bihar Sales Tax Act, the Sales Tax Officer was entitled to make a best judgment assessment on a gross turnover figure without disclosing the basis for adopting that figure.

Analysis: The assessment was made because the dealer's accounts were found to be false and unreliable, with suppression of transactions and adoption of dishonest devices. In such a case, the assessing authority is required to estimate the turnover to the best of its judgment. The Court treated the exercise as one involving judgment on facts, where materials may be imperfect and the estimate need not be based on strict evidentiary proof. It held that the principles governing best judgment assessment under the Income-tax law were applicable by analogy, and that the absence of a detailed basis for the estimate did not by itself invalidate the assessment where the authority had acted on relevant materials and honest judgment.

Conclusion: The Sales Tax Officer was entitled to make the assessment under Section 10(2)(b) on the figure adopted, even without giving a specific basis to justify that figure. The answer was in the affirmative, in favour of the Revenue.

Final Conclusion: The reference was answered by upholding the legality of the best judgment assessment made on unreliable accounts.

Ratio Decidendi: Where a dealer's accounts are found unreliable or false, the assessing authority may determine turnover by an honest best judgment estimate based on available materials, and such an assessment is not invalid merely because the precise basis of the figure is not separately disclosed.

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