Best-judgment reassessment upheld where fresh material showed escaped turnover despite an earlier best-judgment assessment.

Section 21 of the U.P. Sales Tax Act permits reassessment where fresh material gives the assessing authority reason to believe that turnover has escaped assessment, and that power is not barred merely because the original assessment was also made on a best-judgment basis. The explanation to section 21(1) allows a further best-judgment estimate in suitable cases. On the facts, unreliable books, broker records showing higher sales, and other definite material justified reopening and a higher escaped-turnover estimate, which was sustained; a second estimate is impermissible only where it rests on mere change of opinion without new material.

---

---

Issues: Whether, after an original assessment made to the best of judgment, proceedings could be reopened under section 21 of the U.P. Sales Tax Act and a further best judgment assessment made on material showing escaped turnover.

Analysis: Section 21(1) authorises reassessment where the assessing authority has reason to believe that whole or part of the turnover has escaped assessment. The power does not depend on whether the original assessment was made on returns accepted as correct or on best judgment. The explanation to section 21(1) makes it clear that, once jurisdiction to reopen exists, assessment to the best of judgment is permissible in suitable cases. Earlier observations limiting the provision were treated as not binding on the present facts. On the facts found, the books of the assessee were unreliable, fresh material from the books of the broker showed sales far in excess of the disclosed turnover, and there was reason to believe that further turnover had escaped assessment. In such a situation, the assessing authority was entitled to estimate the escaped turnover even above the figure disclosed in the broker's books.

Conclusion: Reassessment under section 21 was valid even though the original assessment had also been made to the best of judgment, and the higher estimate of escaped turnover was sustained.

Ratio Decidendi: If fresh material gives the assessing authority reason to believe that turnover has escaped assessment, section 21 permits reassessment to the best of judgment even where the original assessment was itself made on best judgment basis; a second estimate is barred only when it is based merely on change of opinion and no new definite material.

---