Best judgment reassessment can proceed without exact escapement details when supported by material and not arbitrary.

Reassessment under section 12(8) of the Orissa Sales Tax Act may proceed on a best judgment basis once books are rejected under section 12(5), and the authority is not limited to identifying the exact suppressed item or precise quantum of escapement. The estimate must, however, rest on some supporting material and cannot be capricious or arbitrary. The Tribunal erred in assuming that only specifically identified escaped turnover could be brought to tax under section 12(8), because the provision permits estimation where precise calculation is not possible.

---

---

Issues: Whether, in a reassessment under section 12(8) of the Orissa Sales Tax Act, the department was required to specify the exact escapement before best judgment assessment could be made.

Analysis: Section 12(8) authorises reassessment in accordance with section 12(5), which permits best judgment assessment once the books are rejected. In such an assessment, the authority is not confined to the exact suppressed item or exact quantum of escapement, because the estimate is necessarily based on material and judgment rather than precise calculation. The requirement is that the estimate must not be capricious or arbitrary and must rest on some supporting material. The Tribunal proceeded on an incorrect view that only specifically identified escaped turnover could be brought to tax under section 12(8).

Conclusion: The Tribunal was not right in holding that the department had to specify the escapement to sustain proceedings under section 12(8) of the Orissa Sales Tax Act.

---