17 - Assessment

No. There are many judgements to support that the assessing authority can not arbitrarily make the best judgement. In the case of Kachwala Gems [2006 (12) TMI 83 - SUPREME COURT], it was held that it is well settled that in a best judgement assessment there is always a certain degree of guess work.  No doubt the authorities concerned should try to make an honest and fair estimate of the income even in a best judgment assessment, and should not act totally arbitrarily, but there is necessarily some amount of guess work involved in a best judgment assessment, and it is the assessee himself who is to blame as he did not submit proper accounts.

In the case of Dhakeswari Cotton Mills [1954 (10) TMI 12 - SUPREME Court], it was held that technical rules of evidence and pleadings are not applicable in best judgement assessment, but it can not be pure guess. There must be something more than mere suspicion to support assessment.

 

Best judgment assessment must be reasoned, not arbitrary; it requires material support and more than mere guesswork. A best-judgement assessment allows limited estimation but the assessing officer must make an honest, fair and reasoned estimate and cannot act wholly arbitrarily; technical rules of evidence are relaxed but the assessment must be based on more than mere suspicion or pure guesswork and should be supported by adequate material rather than unsupported conjecture.