Best judgment assessment does not by itself prove suppression for sales tax penalty, and delayed reopening was disfavoured.

Penalty under the Tamil Nadu General Sales Tax Act could not rest on a mere best judgment assessment: suppression of turnover or actual taxable turnover had to be proved with greater certainty than is required for assessment. The assessee's failure to substantiate its explanation was not enough by itself to sustain penalty. On the facts noted, the dispute had already attained finality and the long delay in reopening the matter weighed against fresh interference or remand, so the penalty issue was left undisturbed and the challenge failed.

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Issues: Whether penalty under section 12(3) of the Tamil Nadu General Sales Tax Act, 1959 was sustainable on the basis of a best judgment assessment and the findings regarding alleged suppression of turnover, and whether the long delay in reopening the issue justified interference.

Analysis: Penalty under section 12(3) requires more than a mere best judgment estimate of turnover. The existence of actual turnover or suppression must be established with a higher degree of proof than is necessary for assessment, and the inability of the assessee to substantiate its explanation is not by itself enough to justify penalty. On the facts found, the appellate authority had proceeded on disputed estimations and the matter had already attained finality long earlier. In such circumstances, and after inordinate delay, it was considered inappropriate to reopen the penalty issue or to remit the matter for fresh fact-finding.

Conclusion: The penalty was not interfered with and the challenge to its cancellation failed.

Final Conclusion: The tax case was dismissed, leaving the assessee successful and the penalty order undisturbed.

Ratio Decidendi: A best judgment assessment, by itself, does not establish concealment or suppression for the purpose of penalty; penalty can be sustained only when actual taxable turnover and nondisclosure are proved with a higher degree of certainty.

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