Best-judgment assessment requires a rational estimate, while reassessment may proceed under the amended limitation provision.

Best-judgment sales tax assessments may be set aside and reassessment permitted where the assessment is not properly grounded, but any fresh assessment must still rest on materials on record and a reasonable, intelligent estimate rather than conjecture or fancy. The Court upheld the High Court's order interfering under Article 226 and allowing reassessment to proceed. It also clarified that, for the reassessment year 1964-65, the assessee could not successfully invoke limitation in view of the amended second proviso to Section 21(2) of the U.P. Sales Tax Act. The challenge to the High Court's order therefore failed, subject to the guidance on how reassessment was to be made.

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Issues: Whether the High Court was right in setting aside the best-judgment sales tax assessments and permitting reassessment, and whether reassessment could proceed without a plea of limitation while still requiring a reasonable and well-grounded estimate.

Analysis: The assessments were best-judgment assessments and the High Court had interfered under Article 226 of the Constitution while leaving reassessment open. The appellate Court found no reason to interfere with that order. It clarified that, for the reassessment for 1964-65, the officer could not be met with a limitation plea in view of the amended second proviso to Section 21(2) of the U.P. Sales Tax Act. At the same time, the officer was required to consider the materials placed before him, if any, and, where best-judgment assessment was necessary, to make an intelligent estimate based on reasonable grounds and not on conjecture or fancy.

Conclusion: The reassessment was permitted subject to the stated guidance, and the challenge to the High Court's order failed.

Ratio Decidendi: A best-judgment assessment must rest on an intelligent, well-grounded reasonable estimate, and reassessment may proceed in accordance with the amended statutory position on limitation.

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