In cases where certain items not offered for sale that are not included in the merchant`s returned sales are discovered from the merchant`s sales, it cannot be assumed that the valuation is based on good knowledge and beliefs, and if the account books are accepted with other records, there is no requirement to conduct reviews at the best judgment.21 Therefore, when it comes to recognising ledgers as a record, as long as they are reliable, the VAT agent has no choice but to carry out an assessment on the basis of the declarations submitted by the assessor and supported by his books of accounts. The question arises only in cases where the evaluated books are rejected as unreliable.22 In Sri Ghauker Khandsari Sugar Mills v. CIT (1992) 193 ITR 699 (Karnataka) was decided that the valuation should be reasonable to the best of our knowledge and belief in a fair and appropriate estimate of the evaluator`s income and the conclusion to be drawn from the available documents. It should be based on an appropriate survey and data, although the request may be a summary. The assessment should also be carried out on the basis of the elements discovered by the evaluating authority. In ITO v. Jitender Mehra (1995) 53 ITR 396 (Delhi ITAT), it was held that a unilateral assessment under section 144 of the Income Tax Act must be in accordance with the rules of justice, fairness and good conscience and must not be arbitrary and capricious. In accordance with section 70 of the Finance Act 1994, each appraiser is required, under the services tax, to assess his own tax liability in accordance with the legal provisions relating to the services provided and to submit the tax return in the manner and form prescribed to the Superintendent of Central Excise. However, section 14 of the Central Excise Act, 1944 empowers the central excise officer to notify each person, appear before him or her and provide evidence and documents necessary to file the income tax return, which he or she can verify to find the accuracy of the tax return and the information provided in the return. I found this very helpful and easy to understand, thank you. In the event of an assessment at his or her best discretion, an assessor has the right to lodge an appeal under Article 246A or to file a claim for recovery under § 246 with the Income Tax Officer16.
The evaluation of the best judgment can only be made after the evaluator has had the opportunity to be heard. These possibilities are provided by sending a notice explaining why the assessment should not be completed at its best discretion and that the possibility of consultation is not required once communication u/s 142(1) has been adopted.17 If a taxable service provider who is liable for payment of the services tax is unsure of the amount of the service tax to be collected or deposited, it may request the central excise duty officer to be able to make the payment of the services tax on a provisional basis, and the application or application must be submitted before the last due date of payment of the service tax. Any appraiser who wishes to make the payment on an interim basis must file a return detailing the service tax filed and the service tax to be paid, as well as the difference between the two for each month, in Form „ST-3A”. Valuation at the best of its discretion means the valuation or assessment under income tax law of the appraiser`s income by the appraising agent. The official judge will not act dishonestly or capriciously, he will give his best judgment. If the assessment is based on the fact that the assessor was unable to provide information or present his or her case appropriately, this would not be a sufficient purpose to impose a sanction. The penalty order cannot be upheld in the absence of evidence to support the conclusion that there has been an intentional repression of the taxable transaction justifying a penalty48. When judging to the best of his knowledge and beliefs, the AO must give the dealer a reasonable chance to present himself, which is useful in reaching a judgment.
If the trader does not provide that information, he should assess on the basis of the available information. Even if it is a „presumptive work”, the judgment should contain less speculative elements.49 According to this provision, if the assessor fails to make a statement or submit the documents or does not meet any of the above conditions, the official recognizing u/s 144 is authorized to assess the total income to the best of his knowledge and conviction, providing the taxpayer with a reasonable opportunity to be heard. However, this applies to the exclusion of the provision in section 142(1) of the Information Technology Act if the assessor has been informed in advance of the assessment.11 The evaluating authority u/s 144 is required to assess total income If the estimate made by the evaluating authority is a good faith estimate and is based on a rational basis, the fact that there is no solid evidence to support this estimate is irrelevant. At first glance, the evaluating authority is the best assessment of the situation. The „best judgment” is that of the judge and no one else.-.-.-.-.-. The High Court cannot replace its best judgment with that of the evaluating agent -.-.-.-.- Court must first consider whether the accounts held by the assessor were correctly dismissed as unreliable – CST v. H.M. Esufali H.M. Abdulai [1973] 90 ITR 271 (SC). In our previous article, we discussed the provisions for self-assessment, preliminary assessment and audit valuation under the GST. We will cover the rest of the GST assessments here.
At first glance, it is best for the evaluating authority to assess the situation. In the case of a valuation at best, the court must first consider whether the accounts held by the appraiser have been properly dismissed as unreliable.44 – While there is an element of conjecture in a „best judgment assessment”, it should not be a wild assessment, but should have a reasonable connection to the available material and the circumstances of each case. Although the article provides for a summary method due to the failure of the evaluator, it does not allow the evaluating authority to work capriciously without taking into account the available documents – State of Kerala v. C. Velukutty [1966] 60 ITR 239 (SC). The evaluation of the best judgment on a comparable basis should be discussed with the evaluator. FAQ – Can the best judgment be made by judging the authority completely arbitrarily, that is, on the basis of its work of conjecture? (d) Before making such an assessment, the Central Excise Duty Officer should take into account all relevant documents available in the records and/or evidence collected by the Central Excise Duty Officer, as set out above. Therefore, there should be an error on the part of the evaluator for (a) or (b) above or both.
This power of judgment should be exercised after the principles of natural justice have been respected, after the assessor has had the opportunity to represent his or her case. While there is no doubt that authorities should try to make an honest and fair estimate of income, even to the best of their discretion when evaluating and not act arbitrarily, there is always a certain amount of conjecture in the valuation at the best of our discretion. If the evaluator has not kept a project book, he must himself be held responsible for such an evaluation [Kachwala Gems v. JCIT 2006 (12) IMT 83 – SUPREME COURT] (b) The power to evaluate to the best of his knowledge and belief should be exercised only by the central excise officer and not by another person below his rank. 2. if a person fails to comply with all of the terms and conditions set out in a U/S. 142 notice or does not follow instructions requiring that his or her accounts be audited in accordance with Section 142(2A). This occurs when the investment agent has reasonable grounds to believe that a delay in assessing a tax liability may affect the interest of the income.
In order to protect the interests of revenues, it may insist on summary taxation on the basis of proof of tax liability. Prior approval from the additional/joint commissioner is required. Summary assessment means an accelerated assessment based on the statement submitted by the auditor. It is mainly completed without the presence of the taxpayer, as the delay in these contributions can lead to a loss of income. An assessment order issued on the basis of calculations made in the course of certain investigations on the basis of the records of previous years does not render an assessment null and void if the assessor was absent despite a communication against him. In addition, if the appraiser does not provide assistance at the request of the evaluating agent, he or she is entitled to make an assessment based on a reasonable presumption of documents available to him or her for the calculation of the tax payable. However, in the event that the evaluator is present at the specified time, he or she should be informed of the elements on which the staff member intends to rely.18 As such, we find that most of the GST valuation provisions are similar to the current indirect tax system. The Department had issued best judgment orders under subsection 62(1) against the assessor and had applied for tax against him. In accordance with the judgment orders at best, the Ministry has attached the appraiser`s current accounts. The application was filed by the appraiser and the High Court ordered the seizure of the appraiser`s benefit account to be lifted and also concluded that if the appraiser were to file his tax returns by October 7, 2018, the seizure in respect of the goods would be released in favour of the appraiser.