Due service of notice and best judgment turnover estimates stand when refusal and enquiry materials support the assessment.

Service of notice was treated as duly effected where repeated notices were issued, service was avoided, registered post was returned with endorsements of refusal, and the record was supported by other modes of service and surrounding materials; the objection that the postal endorsement did not name the addressee was rejected. A best judgment estimate of turnover was upheld because it had a material basis, being supported by enquiry reports, spot verification, and examination of local persons, and was therefore not arbitrary or unsupported by evidence. The questions were answered in favour of the Revenue.

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Issues: (i) Whether service of notice on the assessee had been duly effected. (ii) Whether the best judgment estimate of turnover had nexus with the materials on record or was arbitrary.

Issue (i): Whether service of notice on the assessee had been duly effected.

Analysis: Notices were issued on several occasions, and the record showed that service was avoided. Notices were thereafter sent by registered post and were returned with endorsements of refusal. The finding of the Tribunal was also supported by other modes of service and surrounding materials. The objection that the postal endorsement did not name the addressee was held insufficient in the face of the factual findings recorded on the record.

Conclusion: Service of notice was duly effected, and the finding on this aspect was upheld.

Issue (ii): Whether the best judgment estimate of turnover had nexus with the materials on record or was arbitrary.

Analysis: Best judgment assessment requires some material basis. The assessment here rested on three enquiry reports, spot verification, and examination of local persons by the officers concerned. The estimate was therefore founded on material collected during enquiry and could not be described as made without evidence or as arbitrary.

Conclusion: The turnover estimate had nexus with the materials on record and was not arbitrary.

Final Conclusion: The questions were answered against the assessees and in favour of the Revenue, and the reference stood concluded accordingly.

Ratio Decidendi: Refusal of service and supporting enquiry materials can sustain a finding of due service of notice and a best judgment assessment, provided the assessment is based on relevant material gathered during enquiry.

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