Best judgment assessment allows reasonable turnover estimation from available materials, including different profit margins for distinct goods.

In a best judgment assessment triggered by late filing of returns, the taxing authority may make a reasonable estimate from available materials, including accounts, past conduct, and business volume, rather than confining itself to the dealer's returned figures. Such estimation may involve some guesswork, but it must not be arbitrary. Applying that principle, the enhancement of turnover by adding different profit margins to different classes of goods was upheld because the dealer traded in goods taxable at different rates and the accounts showed distinct classes of business. The bifurcation and enhancement were therefore treated as justified on the facts.

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Issues: Whether, in a best judgment assessment made for delayed filing of return, the enhancement of turnover by adding profit margins of 15% and 20% to different classes of goods was lawful and justified.

Analysis: Once the dealer attracted assessment under the best judgment provision for failure to file the return within time, the assessing authority was entitled to make a reasonable estimate on the basis of the accounts, past conduct, volume of business and other relevant factors. The assessment was not required to be confined to the dealer's returned figures. Estimation necessarily involves some guesswork, but it must not be arbitrary. On the facts, the enhancement made by the appellate authority was supported by materials and was found to be reasonable. The further bifurcation of commodities for applying different profit additions was also held to be justified because the dealer dealt in goods taxable at different rates and the accounts disclosed different classes of business.

Conclusion: The enhancement and bifurcation were upheld, and the question was answered against the dealer.

Ratio Decidendi: In a best judgment assessment, the taxing authority may make a reasonable estimate from the available materials, and such an estimate will not be interfered with unless it is shown to be arbitrary or unreasonable.

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