K.L. Pandey, J.
1. This is a reference Under Section 44(1) of the Madhya Pradesh Sales Tax Act, 1958, made at the instance of the assessee. The questions which have been referred to us for our opinion are as follows :
(i) Whether, if the turnover returned by the assessee is supported by the regularly maintained books of accounts and no flaw in the accounts can be detected, the assessing authority is bound to accept the turnover returned by the assessee ?
(ii) Whether, in the facts and circumstances of the case, the turnover returned by the assessee should have been accepted by the assessing authority ?
(iii) Whether, under the circumstances of the case, this Tribunal was warranted in regarding the estimate made by the Departmental Authorities as 'best Judgment' assessment Under Section 11(4) of the Central Provinces and Berar Sales Tax Act, 1947 ?
(iv) Whether, under the circumstances of the case, the direction by this Tribunal to the Sales Tax Officer, for disposal of the case 'in the light of the directions above' was proper
2. The facts material for this reference, as set out in the statement of the case, are these. The applicant is a forest contractor and deals in firewood and timber at Chhindwara. The period of assessment is 15th November, 1955, to 2nd November, 1956. During that period, the applicant had taken forest contracts for Rs. 1,00,600. In his return, he showed a total turnover of Rs. 85,269-5-9. Although the turnover was supported by entries made in the applicant's books of account maintained in the regular course of business, the Sales Tax Officer, Chhindwara, did not accept the account books as correct on the ground that the return was low. By an order dated 1st October, 1957, he made a best Judgment assessment on the basis of an estimate of gross return at 2 times the price of the forest produce paid by the applicant. In the appeal filed by the applicant, the Appellate Assistant Commissioner also did not accept the book-sales as entered in the regularly maintained account books of the applicant as the real sales of the applicant. By his order dated 24th August, 1959, the Appellate Assistant Commissioner assessed the gross turnover at an arbitrary figure of Rs. 1,50,000. The applicant then appealed to the Board of Revenue (Tribunal) which took the view that the estimate of the gross turnover made by the Appellate Assistant Commissioner could not be accepted because it was completely arbitrary and without any reasonable basis. Accordingly, by its order dated 6th May, 1961, the Tribunal remanded the case to the Sales Tax Officer for a fresh assessment according to law. It may be mentioned here that even the Tribunal stated that the turnover given by the applicant was too suspicious to be accepted even though it was supported by regularly maintained books of account.
3. It is urged before us that since the Sales Tax Authorities and the Tribunal found that the applicant's account books were regularly maintained and did not also disclose any flaw which could discredit the entries made in those books, they were bound to accept the book-sales and to proceed to tax the sales on that basis. In support of his view, he relied upon two cases: S. Veeriah Reddiar v. Commissioner of Income-tax, Travancore-Cochin  38 I.T.R. 152 and R.M.P. Perianna Pillai & Co. v. Commissioner of Income-tax  42 I.T.R. 370. We consider it sufficient to say that these cases considered the meaning and scope of the proviso to Section 13 of the Indian Income-tax Act, 1922. It is well-settled that even apart from that proviso, the Income-tax Officer may, for good and sufficient reasons, reject the account books as unreliable and make an assessment Under Section 23(3) of that Act: Gunda Subbayya v. Commissioner of Income-tax, Madras  7 I.T.R. 21 F.B.. So far as this case is concerned, we consider it sufficient to say that there was no burden on the assessing authorities to prove by positive evidence that the account books were unreliable and further that the conclusion that the account books are unreliable is a conclusion of fact: Ganga Ram Balmokand v. Commissioner of Income-Tax, Punjab  5 I.T.R. 464. In view of this position, our answer to the first question is that even if the account books are regularly maintained and no flaw can be discovered in those books, the assessing authorities are not bound to accept them if they be found to be otherwise unreliable.
4. The second question is, in our opinion, a question of fact.
5. In regard to the third question, the Tribunal has taken the view that there was a best Judgment assessment because, consequent upon rejection of the account books, the assessment was made on the basis of an estimate. We consider that the Tribunal rightly regarded the assessment as a best Judgment assessment. This was not a case where the returns were accepted and an assessment was made on the basis of those returns. The Sales Tax Officer was not satisfied with the returns and required the applicant to produce his account books. In compliance with this requirement, the applicant produced the account books which were found to be unreliable. That being so, there was no compliance with Clause (a) of Sub-section (4) of Section 11 of the Act of 1947 and the Sales Tax Officer was entitled to make a best Judgment assessment: Raghubar Mandal Harihar Mandal v. State of Bihar  8 S.T.C. 770.
6. The fourth question is easily answered. The only direction given by the Board was that there should be a fresh assessment according to law because the one made by the Appellate Assistant Commissioner was arbitrary. We think no exception can be taken to this direction. In this connection, we may refer to the decision of the Supreme Court in Raghubar Mandal Harihar Mandal v. State of Bihar  8 S.T.C. 770 wherein their Lordships stated that when the returns and the books of account are rejected, the assessing officer must make an estimate and to that extent he must make a guess; but the estimate must be related to some evidence or material and it must be something more than mere suspicion. He must make what he honestly believes to be a fair estimate of the proper figure of assessment and for this purpose he must take into consideration such materials as the assessing officer has before him, including the assessee's circumstances, knowledge of previous returns and all other matters which the assessing officer thinks will assist him in arriving at a fair and proper estimate. It is, however, urged that there is in the body of the order of the Board, an implied direction that the sale proceeds of the forest produce should be taken at 2 times the price paid therefor. In our opinion, those observations were made by the Board merely to indicate what according to it might have enabled it to hold that the estimate was on reasonable and proper ground. We think that those observations do not in any way fetter the Judgment of the Sales Tax Officer who has to decide the case in the light of the observations made by the Supreme Court in the case we have just mentioned. In conclusion, all that we need say is that this question does not raise any point of law.
7. Having regard to what we have said in the foregoing paragraphs, we would answer the questions referred to us as therein indicated by us. In the view we have taken, we would direct the applicant to bear his own costs and pay those of the non-applicant. Hearing fee Rs. 75.