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of <h1>Court emphasizes need for genuine assessment under M.P. Sales Tax Act, quashes faulty orders, grants relief.</h1> <h3>Bhagwandas Khandelwal Versus The Commissioner of Sales Tax, Madhya Pradesh, Indore and Others</h3> The court found the best judgment assessment conducted under section 18(6) of the M.P. General Sales Tax Act to be lacking a proper basis, emphasizing the ... - Issues:1. Validity of best judgment assessment under section 18(6) of the M.P. General Sales Tax Act.2. Proper enquiry into the business of the dealer by the assessing officer for assessment.3. Consideration of previous year's assessment as a basis for best judgment assessment.4. Compliance with the requirement of a bona fide assessment based on reasonable material.Detailed Analysis:1. The petition was filed by a firm challenging a best judgment assessment conducted by the assessing officer under section 18(6) of the M.P. General Sales Tax Act for three quarters. The assessing officer issued a notice to the assessee to produce accounts, but the petitioner failed to appear, leading to an ex parte assessment. The assessment was based solely on the previous year's assessment without any indication of how the turnover was divided for tax assessment. The court found the assessment to be imaginary and lacking a proper basis, emphasizing the need for a genuine best judgment assessment supported by relevant material.2. The petitioner contended that the assessing officer did not conduct a proper enquiry into the business, which was a crucial aspect of the assessment process. The revision filed against the order highlighted this issue, stating that the assessing officer had not made a thorough enquiry. However, the revising officer merely relied on the previous year's assessment as a yardstick for the present assessment, failing to address the lack of proper enquiry into the current business operations. The court criticized the careless handling of the matter by the sales tax authorities and stressed the importance of a genuine assessment based on reasonable material.3. The court observed that using the previous year's assessment as the sole basis for the best judgment assessment was inadequate and did not provide sufficient grounds for the assessment conducted. The lack of explanation regarding the increase in assessment and the division of turnover for tax calculation raised concerns about the validity of the assessment process. The court emphasized the necessity of a bona fide assessment supported by relevant information and material to justify the conclusions reached by the assessing officer.4. In light of the deficiencies in the assessment process and the lack of a genuine basis for the best judgment assessment, the court quashed both the assessment order and the revision order. The court directed the sales tax authorities to proceed in accordance with the law, highlighting the importance of conducting assessments based on valid and reasonable grounds. The petitioner was allowed relief, and any outstanding security deposit was ordered to be refunded, with no costs imposed on either party.
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