Best judgment assessment limitation under sales tax law requires a definite step within time, not just an earlier notice.

Best judgment assessment under section 11(4) of the Punjab General Sales Tax Act, 1948 had to be completed within three years from the end of the relevant return period. An earlier notice under section 11(2) did not, by itself, preserve time indefinitely; the Assessing Authority had to show a definite step within limitation evidencing that best judgment assessment had in fact been proceeded with. The burden lay on the authority to establish compliance with limitation, and on the stated facts the assessment made after three years was without jurisdiction and liable to be quashed.

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Issues: Whether a best judgment assessment under section 11(4) of the Punjab General Sales Tax Act, 1948 could be made after the expiry of three years from the end of the relevant return period, and whether the initiation of assessment proceedings within time was sufficient even if the assessment order was passed later.

Analysis: The statutory scheme distinguished between assessment on the basis of accepted returns under section 11(1), regular assessment after notice under section 11(3), and best judgment assessment under section 11(4). The limitation of three years expressly attached to the authority proceeding to assess to the best of its judgment under section 11(4), and a mere earlier notice under section 11(2) did not by itself authorise an unlimited postponement of best judgment assessment. The proceeding could be treated as within time only if there was some definite act or step, within the prescribed period, showing that the Assessing Authority had in fact proceeded to make a best judgment assessment. The burden was on the authority to show that such step occurred within limitation, while the exact point of commencement had to be determined on the facts of each case.

Conclusion: The best judgment assessment made after the expiry of three years was without jurisdiction, and the impugned assessments were liable to be quashed in favour of the assessee.

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