“best judgment assessment”

Assessment ProceduresSection 144Section 1441,400 judgments

The decision most relied on for best judgment assessment is Kachwala Gems v. JCIT (288 ITR 10), cited in 332 judgments on BharatTax.

Leading authorities on best judgment assessment

Kachwala Gems v. JCIT

288 ITR 10 · 2007 · Supreme Court

332

citing judgments

In a best judgment assessment, some guesswork is inherent, but the estimate must be fair and not arbitrary. Books of account can be rejected under Section 145(3) if the assessee fails to substantiate entries or prove the genuineness of transactions, leading to estimation of income.

Commissioner of Sales Tax v. H.M. Esufali H.M. Abdulali

90 ITR 271 · 1973 · Supreme Court

232

citing judgments

The Supreme Court established principles for best judgment assessments, stating that some guesswork is inevitable but the assessment must be bona fide, rational, and free from bias or capriciousness. An appellate authority cannot substitute its judgment for that of the Assessing Officer unless the AO's assessment is shown to be biased, irrational, vindictive, or capricious, especially when the assessee fails to provide proper accounts or counter-evidence.

CIT v. Gurubachhan Singh J. Juneja

302 ITR 63 · 2008 · High Court

147

citing judgments

When unaccounted receipts or suppressed sales are detected and books of account are rejected under Section 145(3), additions to income must be restricted to the profit element embedded in such transactions, not the entire transaction value. This profit element is to be estimated by considering the assessee's regular profit ratio as per books of account.

Man Mohan Sadani v. CIT

304 ITR 52 · 2008 · High Court

132

citing judgments

When assessing income from undisclosed or unrecorded sales, the entire sale proceeds cannot be added to the assessee's income; instead, only the net profit embedded in such unaccounted sales, determined by applying the assessee's net profit rate, should be taxed.

Brij Bhushan Lal Paraduman Kumar v. CIT

115 ITR 524 · 1978 · Supreme Court

113

citing judgments

The Supreme Court holds that an Assessing Officer, when making a best judgment assessment or estimating income, must act fairly, honestly, and rationally, basing the estimation on available material and avoiding arbitrary or capricious decisions. Adherence to natural justice principles is crucial during assessment proceedings.

CIT v. Laxminarain Badridas

5 ITR 170 · 1937 · Supreme Court

citing judgments

An income tax officer making a best judgment assessment must act honestly, not dishonestly, vindictively, or capriciously. They must make a fair estimate of the assessment, considering local knowledge, repute, and previous assessments.

State of Kerala v. C. Velukutty

60 ITR 239 · 1966 · Supreme Court

citing judgments

A best judgment assessment must be based on wisdom, truth, and legal principles, not arbitrary caprice. While it involves estimation and guesswork, this must have a reasonable nexus to available material and the case's circumstances.

Shankar Khandasari Sugar Mills v. CIT

193 ITR 669 · 1992 · High Court

citing judgments

Best judgment assessments under Section 144 must be a fair and rational estimation of income by the Assessing Officer, not capricious or arbitrary. Appellate authorities should accept clarificatory evidence to test the fairness of such assessments, even if produced for the first time.

Judgments citing best judgment assessment

Income-Tax Officer, Ward-4(2)(1), Ahmedabad vs. Late Khodaji Ranchhodji Thakor Legal Heir Narendakumar Khodaji Thakor, Ahmedabad

In the result, the appeal filed by the Revenue is, therefore, dismissed

ITA 948/AHD/2025[2017-18]Status: DisposedITAT Ahmedabad06 Nov 2025AY 2017-18

Bench: Dr. Brr Kumar & Shri Siddhartha Nautiyalआयकर अपील सं /Ita No.948/Ahd/2025 िनधा"रण वष" /Assessment Year : 2017-18 The Ito Late Khodaji Ranchhodji Ward-4(2)(1) बनाम/ Thakor V/S. Ahmedabad – 380 015 Legal Heir Narendrakumar Khodaji Thakor Ahmedabad – 382 481 "थायी लेखा सं./Pan: Afwpt 1453 K (अपीलाथ"/ Appellant) ("" यथ"/ Respondent) Assessee By : Shri Chetan Agarwal, Ar Revenue By : Shri B.P. Srivastava, Sr.Dr सुनवाई की तारीख/Date Of Hearing : 18/09/2025 घोषणा की तारीख /Date Of Pronouncement: 06/11/2025 आदेश/O R D E R Per Siddhartha Nautiyal, Jm: The Present Appeal Has Been Preferred By The Revenue Against The Order Of The Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As ‘Cit(A)’] Dated 24/02/2025 Passed U/S.250 Of The Income Tax Act, 1961 (Hereinafter Referred To As ‘The Act’) For The Assessment Year (Ay) 2017-2018. 2. The Revenue Has Raised The Following Grounds Of Appeal:

For Appellant: Shri Chetan Agarwal, ARFor Respondent: Shri B.P. Srivastava, Sr.DR

Section 133(6)Section 142(1)Section 144Section 148Section 250

nature of his income. As a result, the AO proceeded to complete the assessment under section 144 of the Act — a best judgment assessment — based on the material available on record. During the course of proceedings, the AO obtained information from Punjab National Bank under section

Navneetbhai Ramanlal Patel, Ahmedabad vs. The ITO, Ward-2(1)(2), Ahmedabad

In the result, the appeal of the assessee is allowed

ITA 223/AHD/2025[2016-17]Status: DisposedITAT Ahmedabad04 Nov 2025AY 2016-17

Bench: Dr. Brr Kumar & Shri Siddhartha Nautiyalआयकर अपील सं /Ita No.223/Ahd/2025 िनधा"रण वष" /Assessment Year : 2016-17 Navneetbhai Ramanlal Patel The Ito बनाम/ 19, New Ambica Park Society Ward-2(1)(2) V/S. D Cabin Sabarmati Ahmedabad – 380 051 Ahmedabad – 380 019 "थायी लेखा सं./Pan: Aqzpp 2479 D (अपीलाथ"/ Appellant) ("" यथ"/ Respondent) Assessee By : Shri Hiren Trivedi, Ar Revenue By : Shri C. Dharani Nath, Sr.Dr सुनवाई की तारीख/Date Of Hearing : 17/09/2025 घोषणा की तारीख /Date Of Pronouncement: 04/11/2025 आदेश/O R D E R Per Siddhartha Nautiyal, Jm: The Present Appeal Has Been Preferred By The Assessee Against The Order Of The Learned Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre (Nfac), Delhi [Hereinafter Referred To As ‘Cit(A)’] Dated 14/10/2024 Passed U/S.250 Of The Income Tax Act, 1961 (Hereinafter Referred To As ‘The Act’) For The Assessment Year (Ay) 2016-2017. 2. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: Shri Hiren Trivedi, ARFor Respondent: Shri C. Dharani Nath, Sr.DR

Section 143(1)Section 144Section 147Section 148Section 234ASection 250Section 271(1)(c)

Swadeshi Polytex Ltd. v. ITO [127 ITR 287 (All.)] and CIT v. Motor General Finance Ltd. [254 ITR 449 (Del.)] to justify the best judgment assessment in cases of non-compliance with statutory notices. 4. Aggrieved, the assessee filed an appeal before the Commissioner of Income Tax (Appeals ... sufficient opportunities during the assessment proceedings and that, in the absence of cooperation from the assessee, the AO was justified in resorting to best judgment assessment. The CIT(A) further noted that the assessee had failed to explain the alleged trading loss or provide any corroborative evidence to rebut

Kishan Kumar Vinod Kumar, Kanpur vs. Income Tax Officer, Ward-1(1)(2), Kanpur

In the result, the appeal of the assessee stands allowed for statistical purposes

ITA 450/LKW/2025[2017-18]Status: DisposedITAT Lucknow31 Oct 2025AY 2017-18

Bench: Shri. Sudhanshu Srivastavaassessment Year:2017-18 Kishan Kumar Vinod Kumar V. The Income Tax Officer 51/1, Ramganj Ward 1(1)(2) Kanpur (U.P) Kanpur Tan/Pan:Aafhk0124A (Appellant) (Respondent) Appellant By: Shri Rakesh Garg, Advocate Respondent By: Shri R.R.N. Shukla, D.R. O R D E R

For Appellant: Shri Rakesh Garg, AdvocateFor Respondent: Shri R.R.N. Shukla, D.R

Section 115BSection 144Section 69A

side of the assessee to the notices issued by the AO, the AO proceeded to complete the assessment on the basis of Best Judgment Assessment, after issuing show cause notice to the assessee. While completing the assessment under section 144 of the Act, the AO treated the cash deposits

Dipakraj Krishnamuni Marathe, Jalgaon vs. ITO Ward 1(4), Jalgaon

In the result, the appeal filed by the assessee is partly allowed

ITA 708/PUN/2025[2017-18]Status: DisposedITAT Pune31 Oct 2025AY 2017-18

Bench: Dr.Manish Borad

For Appellant: Shri Sarang GudhateFor Respondent: Shri R.Y. Balawade

Section 139Section 142(1)Section 144Section 250Section 270ASection 69A

failed to file any written submission or any evidence to explain the source of cash deposit of Rs.10,45,000/-. Ld. AO passed Best Judgment Assessment making addition of Rs.10,45,000/- to the business income declared by the assessee at Rs.2,55,050/-. Subsequently, assessee preferred appeal before ld.CIT

Chandarkishor Nandkishor Seksaria, Mumbai vs. Income Tax Officer Ward 42(2)(1), Mumbai

In the result the appeal filed by the assessee is allowed for statistical purposes

ITA 4203/MUM/2025[2017-18]Status: DisposedITAT Mumbai31 Oct 2025AY 2017-18

Bench: Hon’Ble Shri Sandeep Gosain & Shri Girish Agrawalchandarkishore Vs. Ito, Ward 42(2)(1) Nandkishore Seksaria Kautilya Bhawan, Bkc 70, Seksaria House, Jb Bandra (E) – 400 051. Nagar, Andheri (E), Mumbai – 400 059. Pan/Gir No. Amxps4815N (Applicant) (Respondent)

Section 142(1)Section 144Section 148Section 250Section 270A

notice dated 22.03.2022. In response, the Authorized Representative filed reply on 23.03.2022 with necessary justifications. f. Despite these submissions, the AO passed a best judgment assessment under section 144 on 25.03.2022, alleging that the Appellant had been non-responsive. 3. Aggrieved, the Appellant preferred appeal before

Rakesh Ramadhar Singh, Mumbai vs. Income Tax Officer Ward 2(3)(2), Mumbai

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 4027/MUM/2025[2017-18]Status: DisposedITAT Mumbai31 Oct 2025AY 2017-18

Bench: Shri Beena Pillai & Smt.Renu Jauhrirakesh Ramadhar Singh Vs. Income Tax Officer, 304, B-Wing Dolphin Ward 2(3)(2), Heritage, Nehru Road, Opp. Room No. 581A, Military Camp, Santacruz 5Th Floor, Aayakar Bhavan, East, Maharishi Karve Road, Mumbai-400029. Mumbai-400020. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No:Altps1647P Appellant .. Respondent

For Appellant: Shri Ramesh JainFor Respondent: Shri Annavaran Kosuri- Sr. AR

Section 144Section 147Section 250

requiring the assessee to furnish his return of income. As no compliance was made by the assessee, ld. AO proceeded to make a best judgment assessment u/s. 144(1) of the Act. Based on information gathered by the department, and in view

Rajesh, Kasganj vs. Income Tax Officer, Ward-4(3)(3), Kasganj

In the result, assessee’s appeal is allowed for statistical purposes

ITA 358/AGR/2025[2011-12]Status: DisposedITAT Agra30 Oct 2025AY 2011-12

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singhassessment Year: 2011-12

Section 142(1)Section 144Section 147Section 148Section 250

account. Perusal of assessment order also shows that due to non-responsive conduct of the assessee, learned Assessing Officer was compelled to pass best judgment assessment u/s. 144 of the Act. Such an irresponsive and reluctant conduct of the assessee is unacceptable. However, in the interest of justice, we deem

Bhagvan Das L/H Shri Gauri Shanker, Firozabad vs. ITO Ward 2(2)1, Firozabad

In the result, both the appeals are allowed for statistical purposes

ITA 260/AGR/2025[2012-2013]Status: DisposedITAT Agra30 Oct 2025AY 2012-2013

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singh

Section 144Section 147Section 148Section 250Section 271(1)(c)Section 54B

remand report was not provided to him to file his rejoinder. It is also noted that the Assessing Officer has also made best judgment assessment u/s. 144 of the Act, as no response was filed by appellant assessee in compliance to various notices issued by Ld. Assessing Officer. The additional

Bhagvan Das L/H Shri Gauri Shanker, Firozabad vs. ITO Ward 2(2)(1), Firozabad

In the result, both the appeals are allowed for statistical purposes

ITA 259/AGR/2025[2012-2013]Status: DisposedITAT Agra30 Oct 2025AY 2012-2013

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singh

Section 144Section 147Section 148Section 250Section 271(1)(c)Section 54B

Manoj Kumar Das, Begusarai vs. Assessment Unit Income Tax Department, Delhi

Appeal is allowed for statistical purposes

ITA 391/PAT/2025[2015-16]Status: DisposedITAT Patna30 Oct 2025AY 2015-16

Bench: 19/07/2025. The Appeal Is Delayed By Around 37 Days. 4. That The Assessee States That The Reason For Delay Is That The Assessee Is Suffering From Hiv Aids & Is Constantly Under Treatment. Copy Of Medical Treatment Is Enclosed.

Section 115BSection 142(1)Section 144Section 147Section 148Section 250Section 68

transferred to respective sellers through the impugn bank account. 15. For that the order of the Id assessing officer is far away from best judgment assessment u/s 144 of the Act, for the reason that the Id assessing officer could have resorted to estimation of profit rather than treating

Neville Homi Sarkari, Na vs. Arivs.Income Tax Officer International Taxation, Surat

In the result, the appeal of the assessee is allowed for statistical purposes in terms indicated above

ITA 185/SRT/2024[2017-18]Status: DisposedITAT Surat30 Oct 2025AY 2017-18

Bench: Shri Dinesh Mohan Sinha & Shri Bijayananda Prusethआयकर अपील सं./Ita No.185/Srt/2024 Assessment Year: (2017-18) (Physical Hearing) Neville Homi Sarkari Income-Tax Officer (International बनाम/ Vallabh Baug G6, Chikhali Taxation), Surat, Aaykar Bhawan, Vs. Road, Near Iti, Antalia, Anvil Business Centre, Adajan, Surat- Antalia Via Bilimora, Antalia 395 007 S.O. Nandarkha-396 325 "थायीलेखासं./जीआइआरसं./Pan/Gir No: Celps 7187 B (अपीलाथ"/Appellant) (""थ" /Respondent)

Section 115BSection 142(1)Section 144Section 250Section 69A

reply of the assessee, who did not file necessary details, the AO invoked the provisions of Sec. 144 of the Act and made best judgment assessment adding Rs.11,50,000/- u/s 69A of the Act. Aggrieved by the addition made by AO, assessee filed appeal before CIT(A), who confirmed

Tangmarg Investment and Trading Pvt.Ltd, Pune vs. ACIT, Circle-7, Pune

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1878/PUN/2025[2017-18]Status: DisposedITAT Pune29 Oct 2025AY 2017-18

Bench: Dr.Manish Borad & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.1878/Pun/2025 Assessment Year : 2017-18

For Appellant: Shri Kishor B PhadkeFor Respondent: Shri Bharat Andhale

Section 143(2)Section 144Section 249(2)

However, the assessee failed to respond to the notices issued by ld. AO leaving no option for ld.AO to conclude the proceedings as Best Judgment Assessment u/s.144 of the Act on 24.12.2019 making various additions totalling to Rs.76,86,180/-. However, ld. AO gave benefit of forward of brought forward

Pullarao Perugu, Ongole vs. ITO., Ward-1, Ongole

In the result, the appeal of assessee in ITA

ITA 1132/HYD/2024[2017-18]Status: DisposedITAT Hyderabad29 Oct 2025AY 2017-18

Bench: SHRI VIJAY PAL RAO, HON’BLE (Vice President), SHRI MANJUNATHA G, HON'BLE (Accountant Member)

Section 142(1)Section 144(1)(b)Section 147Section 148Section 249(3)Section 271A

details in response to the notices. Therefore, notice under Section 144(1)(b) of the Income Tax Act, 1961, was issued and proposed best judgment assessment. The assessee neither responded nor furnished the relevant details. Therefore, the A.O. completed the assessment under Section 147 r.w.s. 144 of the Act, dated

The Marthandam Bee Keepers Co Op Society Ltd, Marthandam, Kanyakumari Dist vs. Income Tax Officer Ward 1, Nagercoil

In the result, appeal filed by the assessee is allowed for statistical

ITA 2816/CHNY/2025[2018-19]Status: DisposedITAT Chennai28 Oct 2025AY 2018-19

Bench: Shri Aby T. Varkey & Shri M. Balaganesh

For Appellant: Mr.R. Harshvardan, AdvocateFor Respondent: Ms. Gauthami Manivasagam

Section 10Section 148Section 44BSection 68

hearing it i.e. it was & SP No.98/Chny/2025 (AY 2018-19) The Marthandam Bee Keepers Co-op. Society Ltd. :: 3 :: an ex parte order (best judgment assessment). Therefore, he prayed for one more opportunity by citing the decision of the Hon’ble Supreme Court in the case

Pramod Kumar, Ambah, Morena vs. Income Tax Officer, Lalitpur

In the result, assessee’s appeal is allowed for statistical purposes

ITA 412/AGR/2025[2020-21]Status: DisposedITAT Agra27 Oct 2025AY 2020-21

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singhassessment Year: 2020-21

Section 143(2)Section 144BSection 147Section 148Section 148ASection 250Section 250(6)

show cause notices/letters were issued on several occasions. However, assessee did not respond to the notices. The Assessing Officer was compelled to make best judgment assessment u/s. 147 r.w.s. 144 & 144B of the Act and determined total income of assessee at Rs.27,14,547/-. 3. Aggrieved, assessee preferred an appeal ... Perusal of assessment order also shows that due to irresponsive conduct of the assessee, learned Assessing Officer was compelled to pass best judgment assessment u/s. 147 r.w.s. 144 and sec. 144B of the Act. Such an irresponsive and reluctant conduct of the assessee cannot be appreciated. In the totality

Suleman Khan, Jhansi vs. Income Tax Officer, Jhansi

In the result, assessee’s appeal is allowed for statistical purposes

ITA 361/AGR/2025[2013-14]Status: DisposedITAT Agra27 Oct 2025AY 2013-14

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singhassessment Year: 2013-14

Section 133(6)Section 144BSection 147Section 148Section 2Section 250Section 69A

order also shows that due to irresponsive conduct of the assessee, learned 3 | P a g e Assessing Officer was compelled to pass best judgment assessment u/s. 147 r.w.s. 144 and sec. 144B of the Act. Such an irresponsive and reluctant conduct of the assessee is unacceptable. 8. We further

Dinesh Chand Kaushik, Aligarh vs. ITO, Delhi

In the result, assessee's appeal is allowed for statistical purposes

ITA 339/AGR/2025[2021-22]Status: DisposedITAT Agra27 Oct 2025AY 2021-22

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singh

Section 143(2)Section 144Section 250

were issued on various occasions and served upon the assessee. However, no response was submitted by the assessee. The Assessing Officer thus, completed best judgment assessment u/s. 144 of the Act and assessed assessee's total income at Rs.16,59,86,605/-. 3. Aggrieved, assessee preferred an appeal before ... first appeal. Perusal of assessment order also shows that due to irresponsive conduct of the assessee, learned Assessing Officer was compelled to pass best judgment assessment u/s. 144 of the Act. Such an irresponsive and reluctant conduct of the assessee is unacceptable, however, in the interest of justice, we deem

Income Tax Officer, Agra vs. Rameshwar Singh, Agra

In the result, revenue’s appeal is dismissed

ITA 286/AGR/2025[2018-19]Status: DisposedITAT Agra27 Oct 2025AY 2018-19

Bench: : Shri S. Rifaur Rahman & Shri Sunil Kumar Singhassessment Year: 2018-19

Section 115BSection 142(1)Section 144Section 147Section 148Section 148ASection 250Section 69ASection 69C

were issued and show cause notices on various occasions were also issued. Assessee remained irresponsive. In such circumstances, Assessing Officer completed the best judgment assessment u/s. 144 of the Act and assessed total income of assessee at Rs.1,19,01,460/-. 3. Aggrieved, assessee preferred first appeal before learned

Shivam Multispeciality and Accident Care Centre Pvt. Ltd., Pune vs. Income Tax Officer, Pune

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 696/PUN/2025[2017-2018]Status: DisposedITAT Pune27 Oct 2025AY 2017-2018

Bench: Shri R.K. Panda & Ms. Astha Chandraआयकर अपील सं. / Ita No.696/Pun/2025 धििाारण वर्ा / Assessment Year : 2017-18 Shivam Multispecialty & Accident Care Income Tax Officer, Centre Pvt. Ltd., Ward – 6(1), Pune Opp. Manali Resort, Near Dsk Dream City, Vs. Next To Loni Kalbhor Toll Naka, Pune-Solapur Mumbai Bypass Road, Fursungi, Pune-412308, Maharashtra Pan : Aapcs5482A अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee By : Shri Dhiraj Dandgaval Department By : Shri Akhilesh Srivastva Date Of Hearing : 06-08-2025 Date Of 27-10-2025 Pronouncement : आदेश / Order

For Appellant: Shri Dhiraj DandgavalFor Respondent: Shri Akhilesh Srivastva

Section 143(2)Section 144Section 68

assessee. However, the assessee failed to file any compliance before the Ld. Assessing Officer (“AO”) which constrained the Ld. AO to make a best judgment assessment under section 144 of the Act. The Ld. AO noted that during the year the assessee received share capital of Rs.1

Vaidehi Shashank Karade, Pune vs. ITO Ward-5 Panvel, Panvel

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 2100/PUN/2025[2015-16]Status: DisposedITAT Pune27 Oct 2025AY 2015-16

Bench: Dr.Manish Borad & Ms. Astha Chandra

For Appellant: Shri Kishor B. PhadkeFor Respondent: Shri Bharat Andhale

Section 144Section 147Section 148Section 250

However, due to non compliance by the assessee ld. AO concluded the re-assessment proceedings u/s.147 r.w.s.144 of the Act and passed the best judgment assessment making addition of Rs.1,13,34,600/-. Assessee preferred appeal before ld.CIT(A) on 18.11.2024 and there was delay of 268 days. Ld.CIT