Turnover enhancement needs rejected returns and a clear best judgment basis; time-barred or paid liabilities cannot be reopened by remand.

A revisional remand for reassessment of the 2014-15 period was unsustainable because no assessment notice had been issued and the five-year limitation period had expired; the remand was set aside. Remand for fresh penalty proceedings for 2015-16 and 2016-17 was also unnecessary because the admitted tax liability, including penalty, had already been paid; that direction was likewise set aside. For 2017-18, the turnover enhancement could not stand where the returns had not been rejected and no discernible best judgment basis for estimation was shown; the matter was remitted for fresh assessment, including penalty, within limitation.

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Issues: (i) Whether the revisional order could sustain remand for reassessment of the 2014-15 tax period in the absence of notice under the assessment provision and beyond the statutory limitation period; (ii) Whether remand for fresh penalty proceedings for the 2015-16 and 2016-17 assessment years was warranted when the admitted tax liability and related dues had already been paid; (iii) Whether the enhanced turnover and resulting liability for the 2017-18 period could be sustained without rejection of the returns or a discernible best judgment assessment, and whether remand for fresh assessment was required.

Issue (i): Whether the revisional order could sustain remand for reassessment of the 2014-15 tax period in the absence of notice under the assessment provision and beyond the statutory limitation period.

Analysis: The 2014-15 period was found to have proceeded without issuance of notice under the relevant assessment provision. The statutory bar on making an assessment after the expiry of five years from the end of the tax period applied. In the absence of prior valid initiation, the revisional direction for reopening the assessment could not be sustained. The existing assessment also reflected nil tax liability and acceptance of the return.

Conclusion: The remand for the 2014-15 period was unsustainable and was set aside in favour of the assessee.

Issue (ii): Whether remand for fresh penalty proceedings for the 2015-16 and 2016-17 assessment years was warranted when the admitted tax liability and related dues had already been paid.

Analysis: For these assessment years, both sides acknowledged that the tax liability, including the penalty component, had already been deposited. In that situation, sending the matter back only for fresh notice and reconsideration of penalty would serve no useful purpose and would be a meaningless exercise.

Conclusion: The revisional remand for 2015-16 and 2016-17 on the question of penalty was set aside in favour of the assessee.

Issue (iii): Whether the enhanced turnover and resulting liability for the 2017-18 period could be sustained without rejection of the returns or a discernible best judgment assessment, and whether remand for fresh assessment was required.

Analysis: The assessment order enhanced turnover substantially beyond the figures reflected in the returns, but did not show that the returns had been rejected or that any best judgment exercise had been undertaken on an identifiable material basis. In tax proceedings, an enhancement of turnover of this nature requires a legally supportable foundation, especially where the return is not rejected and the assessment does not disclose the basis of estimation. The revisional authority also failed to address this core question of law. Since the notices for the 2017-18 period were within limitation, the proper course was to remit the matter for fresh assessment in accordance with law, including the penalty aspect.

Conclusion: The matter for the 2017-18 period was remanded for fresh assessment, including consideration of penalty, in favour of the assessee to that extent.

Final Conclusion: The common revisional order was substantially interfered with for the earlier assessment years, while the 2017-18 assessment was sent back for fresh adjudication because the enhancement of turnover lacked an articulated best judgment basis.

Ratio Decidendi: A turnover cannot be enhanced in assessment without rejection of the return and a legally discernible best judgment basis, and a revisional remand is unsustainable where it would reopen a time-barred or already satisfied liability without serving any practical legal purpose.

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