Best judgment assessment failed for want of reliable material; alleged business activity attribution also collapsed on insufficient evidence.

Best judgment assessment of turnover under the Mysore Sales Tax Act was invalid because it rested on inadequate material: the notebook showed only small pencil entries, the later discovery of workmen did not support a higher estimate, and absence of accounts alone could not justify an of concealed turnover. The inference that the assessee carried on timber, firewood and furniture business was also unsustainable, as it was based only on a statement attributed to the son and no evidence established that the activity was joint family business or otherwise attributable to the assessee. The assessment orders were set aside for want of legally sufficient evidence.

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Issues: (i) Whether the best judgment assessment of turnover under section 12(3) of the Mysore Sales Tax Act, 1957, made on the basis of the notebook and the visit to the business premises was valid; (ii) whether the inference that the petitioner carried on business in timber, firewood and furniture was supported by material.

Issue (i): Whether the best judgment assessment of turnover under section 12(3) of the Mysore Sales Tax Act, 1957, made on the basis of the notebook and the visit to the business premises was valid.

Analysis: A best judgment assessment must rest on material from which a reasonable estimate can be drawn and cannot be a matter of speculation. The notebook relied upon contained only small pencil entries and did not indicate large-scale credit sales. The later discovery that three workmen were employed, without more, was insufficient to support the estimate. The absence of accounts, by itself, did not furnish a lawful foundation where there was no material showing concealed books or a higher turnover.

Conclusion: The best judgment assessment was invalid and could not be sustained.

Issue (ii): Whether the inference that the petitioner carried on business in timber, firewood and furniture was supported by material.

Analysis: The only basis for the inference was a statement attributed to the petitioner's son. The presumption that a business carried on by a member of a Hindu joint family is joint family business does not arise automatically. Whether such business is separate or joint family business depends on the facts and circumstances of each case, and no evidence was produced to show that the business of the son belonged to the family or that the petitioner had any interest in it.

Conclusion: The finding that the petitioner carried on business in timber, firewood and furniture was unsupported by evidence and could not stand.

Final Conclusion: The assessment orders were set aside because both the turnover estimate and the attribution of additional business activities were founded on speculation rather than legally sufficient material.

Ratio Decidendi: A best judgment assessment under sales tax law must be founded on relevant material capable of supporting a reasonable estimate, and an inference of joint family business cannot be drawn without evidence establishing the required factual basis.

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