Best judgment assessment must rest on material, not pure guess, under sales tax law.

An assessment under section 10(2)(b) of the Bihar Sales Tax Act, 1944 must be a fair estimate based on relevant material and evidence, not a pure guess or bare suspicion. Rejecting the books of account does not permit the assessing authority to adopt an arbitrary turnover figure; best judgment assessment still requires some factual foundation, even though strict rules of evidence do not apply. The referred question was answered in the negative, in favour of the assessee.

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Issues: Whether, under section 10(2)(b) of the Bihar Sales Tax Act, 1944, the assessing authority could estimate gross turnover by pure guess without reference to any material or evidence.

Analysis: The assessment under section 10(2)(b) was required to be made after hearing the dealer and considering such evidence as the dealer produced and such other evidence as the authority required on specified points. The provision was treated as substantially similar to section 23(3) of the Indian Income-tax Act, 1922, under which a best judgment assessment is permissible only when it is based on some material and not on mere suspicion or bare guess. Rejection of the books of account did not authorise the assessing authority to adopt a turnover figure arbitrarily. The estimate had to be a fair estimate founded on relevant material, even if technical rules of evidence did not strictly apply.

Conclusion: The assessing authority was not entitled to make an assessment on a pure guess or without any material. The answer to the referred question was in the negative, in favour of the assessee.

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