Best Judgement Assessment under GST

Under the Goods and Services Tax (GST) regime, there are multiple provisions that deal with the assessment of tax liabilities. One of these provisions is the Best Judgement Assessment, which is also known as Summary Assessment. In this article, we will discuss what Best Judgement Assessment is, when it is done, and what are the implications of such an assessment.

What is Best Judgement Assessment?

Best Judgement Assessment is a provision under GST that empowers the tax authorities to assess the tax liability of a taxpayer when the taxpayer fails to furnish the required returns or documents. This assessment is done by the tax authorities to ensure that the taxpayer is paying the correct amount of tax as per the provisions of the GST Act.

Under this provision, the tax authorities can make an assessment to the best of their judgement, based on the information available to them. The assessment can be done for any tax period, and the taxpayer will be informed of the assessment in writing.

When is Best Judgement Assessment done?

Best Judgement Assessment is done in the following cases:

1. When a taxpayer fails to furnish the required returns or documents

2. When a taxpayer fails to appear before the tax authorities when summoned

3. When a taxpayer fails to respond to notices sent by the tax authorities

4. When a taxpayer is prevented by any sufficient cause from complying with the provisions of the GST Act

It is important to note that Best Judgement Assessment is done only when the tax authorities are satisfied that the taxpayer has failed to comply with the provisions of the GST Act. The assessment is done after giving the taxpayer an opportunity to be heard.

Implications of Best Judgement Assessment

Best Judgement Assessment has several implications for the taxpayer. Some of these are:

1. The taxpayer will be liable to pay the tax as assessed by the tax authorities

2. The taxpayer may be liable to pay a penalty for non-compliance

3. The taxpayer will not be entitled to any input tax credit on the tax paid as per the assessment

4. The taxpayer may be subject to further scrutiny by the tax authorities in the future

It is therefore advisable for taxpayers to comply with the provisions of the GST Act and to furnish the required returns and documents in a timely manner.

Conclusion

Best Judgement Assessment is a provision under GST that empowers the tax authorities to assess the tax liability of a taxpayer when the taxpayer fails to comply with the provisions of the GST Act. The assessment is done to the best of the tax authorities' judgement and has several implications for the taxpayer. Taxpayers should therefore ensure that they comply with the provisions of the GST Act to avoid any Best Judgement Assessment.