Judgment :- Girish Chandra Gupta, J. This appeal is directed against an order dated 4th May, 2012 passed by the Learned Trial Court refusing to pass any interim order as regards restoration of supply of electricity. Aggrieved by the order of refusal the petitioners have come up in appeal. The case of the writ petitioners briefly stated is as follows: The writ petitioner No.1 is a sick company and is engaged, inter alia, in manufacturing of forklift vehicle material, material handling equipment and such other business. They have 300 workers. Part of the factory premises is let out for shooting of TV serials etc. The consumption of electricity in the preceding 12 months from the date of incident was for an aggregate sum of Rs.2,00,000/-approximately. On 18th April, 2012 a surprise inspection was conducted at the factory of the petitioner No.1. During such inspection the petitioner No.1 was allegedly found to have been engaged in unauthorized use of electricity. Supply was disconnected at about 16.20 hours on 18th April, 2012. On 19th April, 2012 the West Bengal State Electricity Distribution Company Limited (hereinafter referred to as W.B.S.E.D.C.L) communicated to the writ petitioner No.1 a provisional assessment for a sum of Rs.2,28,29,694/-. The allegations contained in the letter dated 19th April, 2012 containing the aforesaid provisional assessment are as follows: “Dear Sir, With reference to above, please recall that one inspection was conducted at your industrial premises located at Konchowki, Bhasa, Diamond Harbour Road, P.O.: Bishnupur, Dist.: 24 Pgs (South) by me along with other officials of WBSEDCL on 18.04.2012 jointly with Mr. Asis Kumar Nandi, Manager (Electrical) and Mr. Shyama Prasad Roy, Engineer (Electrical Division) – both of your company. During such joint inspection, it was observed that the electricity of WBSEDCL provided exclusively for industrial purpose was used by your company for commercial purpose by allowing to run nos. of film & TV serial studios within your premises, understandably on rental basis. It was, in fact, elaborately demonstrated to us by Mr. Asis Kumar Nandi, Manager (Electrical) of your company how and by what means you have extended WBSEDCL’s power for using the same for the said commercial purpose. of film & TV serial studios within your premises, understandably on rental basis. It was, in fact, elaborately demonstrated to us by Mr. Asis Kumar Nandi, Manager (Electrical) of your company how and by what means you have extended WBSEDCL’s power for using the same for the said commercial purpose. It is however a different issue that after being aware of the consequences of such act on your part, which is a dishonest commission of unauthorized use of WBSEDCL’s power as per provision of Section 135 of the Electricity Act, 2002, Mr. Nandi completely denied the fact for obvious reason with the untrue claim that the said studios were being run through DG set. As per provision of Section 135 of the Electricity (Amendment) Act, 2007 read with Electricity Act, 2003, your power supply was disconnected on 18.04.2012 at around 16:20 Hrs. and one FIR was lodged against such dishonest act at Bishnupur Police Station on 18.04.2012 with submission of seized article having case no.301 dated 18.04.2012. Provisional Assessment under Sub-section (1) of Section 126 of the Electricity (Amendment) Act, 2007 read with Electricity Act, 2003 has been made by me being the assessing officer and is enclosed with the assessment memo no.SEC/BULK-399/1/04/2012/SUPP/2011)/229 dated 18.04.2012 with this order of provisional assessment. The amount of provisional assessment has come to Rs.2,28,29,694/-(Rupees two crore twenty eight lakh twenty nine thousand six hundred and ninety four only) calculated in line with the provision of Sub-section (1) of Section 126 of the Electricity Act, 2003. If you are not satisfied with the instant order for provisional assessment, you are at liberty as per clause 5.3 of regulation 36/WBERC of the Hon’ble WBERC to submit your written objection against the provisional assessment with me being the assessing officer within fifteen days from the date of receipt of this order of provisional assessment, on receipt of which, I being the assessing officer shall hear you and pass a final order as per provision of Clause 5.4 of regulation 36/WBERC of the Hon’ble WBERC. This is for your information and necessary action please.” The writ petitioners on 19th April, 2012 had also written to the aforesaid W. B. S. E. D. C. L. alleging, inter alia, as follows: “Dear Sir, Sub: Disconnection of our Line for Meter No.WBBB1561 And Consumer NO.D11399 at Knochowki Bhasa, South 24 pgs. This is for your information and necessary action please.” The writ petitioners on 19th April, 2012 had also written to the aforesaid W. B. S. E. D. C. L. alleging, inter alia, as follows: “Dear Sir, Sub: Disconnection of our Line for Meter No.WBBB1561 And Consumer NO.D11399 at Knochowki Bhasa, South 24 pgs. This is to bring to your kind notice that we are a Forklift Manufacturing Company and we are having Industrial Electric connection with connected load of 260KVA. We have deposited all Security Deposit and other charges as per your requirement. Surprisingly, yesterday a Team from your Office had visited our Factory premises without any intimation to us and after inspection carried away one light fitting used for Film Shooting. During the discussion they had enquired about the Film Shooting which was taking place in our premises and were explained to their satisfaction. Nevertheless, we find that our line has been disconnected without any Notice, which is illegal, unjustified and arbitrarily. Our Unit which has got more than 300 employees are suffering irreparable loss for your above disconnection. Ours is a Unit under BIFR and as per advise of Operating Agency, we are using the surplus area covered and opened for generation of additional revenue, and occasionally allow Film Producers/T.V. Serial Producers to avail facilities and infrastructure and we do not find anything illegal or in violation of Electric Rules or Act. Still, if any compliance is required, we are always ready for the same. You are requested to restore our line immediately to enable us to restart our production, else, we will have to declare a Lock-out in the Factory for which you will be responsible. We repeat, to make any compliance including payment of any additional charges/differential charges as per Law/Rules to your organization. You are requested to restore our line immediately to enable us to restart our production, else, we will have to declare a Lock-out in the Factory for which you will be responsible. We repeat, to make any compliance including payment of any additional charges/differential charges as per Law/Rules to your organization. We hope you will cooperate in the matter by restoring the electricity immediately, else, we will be compelled to take legal action as will be advised for the end of justice.” Challenging the aforesaid act of disconnection of supply of electricity and the provisional assessment including lodging of the FIR, the writ petition bearing No.8719 (W) of 2012 was filed, praying inter alia, for a declaration that the provisions of Sections 126 and 135 of the Electricity Act, 2003 (hereinafter referred to as the Act) are unconstitutional; revocation of the provisional assessment dated 19th April, 2012; revocation of the FIR and all connected activities including seizure; restoration of supply of electricity and further and other incidental reliefs. Mr. Gupta, learned advocate appearing in support of the appeal made his submissions assailing the legality of Sections 126 and 135 of the Act. He denied that there has been any unauthorised use of the electricity. He denied that the industrial supply of electricity was used for commercial purpose. He submitted that the shooting of TV serials was conducted with the help of diesel generating sets. He submitted that, in any event, the industrial supply could be used for commercial purposes under the terms of the contract into between the parties. He submitted that even assuming everything against him and further assuming the allegations that the writ petitioner was engaged in utilizing industrial supply of electricity for commercial purposes without authority, the loss or damage suffered by the licensee is only 10 paise per unit and by that process the licensee cannot by any stretch of imagination be said to have suffered loss of more than Rs.2,000/-per month. The provisional assessment for the astronomical figure of more than Rs.2 crores is perverse. He submitted that the disconnection and the provisional assessment was made without justification and in colourable exercise of power with the sinister objective of extorting money by abusing the statutory power. The learned Advocate General appearing for the respondents submitted that the Supreme Court in the case of Executive Engineer Southern Electricity Supply Company of Orissa Ltd. & Anr. He submitted that the disconnection and the provisional assessment was made without justification and in colourable exercise of power with the sinister objective of extorting money by abusing the statutory power. The learned Advocate General appearing for the respondents submitted that the Supreme Court in the case of Executive Engineer Southern Electricity Supply Company of Orissa Ltd. & Anr. –vs.-Sri Seetaram Rice Mill reported in 2012 (2) SCC 108 has held that an application challenging a provisional assessment under section 126 is not maintainable. He drew our attention to Clauses 3 and 4 of paragraph 87 of the judgment which read as follows: “In view of the language of Section 127 of the 2003 Act, only a final order of assessment passed under Section 126(3) is an order appealable under Section 127 and a notice-cum provisional assessment made under Section 126(2) is not appealable. Thus, the High Court should normally decline to interfere in a final order of assessment passed by the assessing officer in terms of Section 126 (3) of the 2003 Act in exercise of its jurisdiction under Article 226 of the Constitution of India.” He submitted that there is procedure laid down in Sections 126 and 135 of the Indian Electricity Act, 2003 for restoration of supply of electricity and there is no reason why this Court should make any departure at this stage. We have considered the rival submissions advanced by the learned Advocates. The judgment in the case of Executive Engineer (supra) does not lay down that a writ petition is not maintainable as contended. A brief discussion as regards the scheme of the act is however required for disposal of the appeal. “Section 126: (Assessment): ---(1) If on an inspection of any place or premises or after inspection of the equipments, gadgets, machines, devices found connected or used, or after inspection of records maintained by any person, the assessing officer comes to the conclusion that such person is indulging in unauthorized use of electricity, he shall provisionally assess to the best of his judgement the electricity charges payable by such person or by any other person benefited by such use. (2) The order of provisional assessment shall be served upon the person in occupation or possession or in charge of the place or premises in such manner as may be prescribed. (2) The order of provisional assessment shall be served upon the person in occupation or possession or in charge of the place or premises in such manner as may be prescribed. 1[(3) The person, on whom an order has been served under subsection (2) shall be entitled to file objections, if any, against the provisional assessment before the assessing officer, who shall, after affording a reasonable opportunity of hearing to such person, pass a final order of assessment within thirty days from the date of service of such order of provisional assessment of the electricity charges payable by such person.] (4) Any person served with the order of provisional assessment, may, accept such assessment and deposit the assessed amount with the licensee within seven days of service of such provisional assessment order upon him: 2[***] 3[(5) If the assessing officer reaches to the conclusion that unauthorised use of electricity has taken place, the assessment shall be made for the entire period during which such unauthorized use of electricity has taken place and if, however, the period during which such unauthorised use of electricity has taken place cannot be ascertained, such period shall be limited to a period of twelve months immediately preceding the date of inspection.] (6) The assessment under this section shall be made at a rate equal to 1[twice] the tariff rates applicable for the relevant category of services specified in sub-section (5). Explanation.-For the purposes of this section,- (a) “assessing officer” means an officer of a State Government or Board or licensee, as the case may be, designated as such by the State Government; (b) “unauthorised use of electricity” means the usage of electricity – (i) by any artificial means; or (ii) by a means not authorised by the concerned person or authority or licensee; or (iii) through a tampered meter; or 2[(iv) for the purpose other than for which the usage of electricity was authorised; or (v) for the premises or areas other than those for which the supply of electricity was authorized.”] Section 127. (Appeal to Appellate Authority): ---(1) Any person aggrieved by the final order made under section 126 may, within thirty days of the said order, prefer an appeal in such form, verified in such manner and be accompanied by such fee as may be specified by the State Commission, to an appellate authority as may be prescribed. (Appeal to Appellate Authority): ---(1) Any person aggrieved by the final order made under section 126 may, within thirty days of the said order, prefer an appeal in such form, verified in such manner and be accompanied by such fee as may be specified by the State Commission, to an appellate authority as may be prescribed. (2) No appeal against an order of assessment under sub-section (1) shall be entertained unless an amount equal to 3[half of the assessed amount] is deposited in cash or by way of bank draft with the licensee and documentary evidence of such deposit has been enclosed along with the appeal. (3) The appellate authority referred to in sub-section (1) shall dispose of the appeal after hearing the parties and pass appropriate order and send copy of the order to the assessing officer and the appellant. (4) The order of the appellate authority referred to in sub-section (1) passed under subsection (3) shall be final. (5) No appeal shall lie to the appellate authority referred to in subsection (1) against the final order made with the consent of the parties. (6) When a person defaults in making payment of assessed amount, he, in addition to the assessed amount shall be liable to pay, on the expiry of thirty days from the date of order of assessment, an amount of interest at the rate of sixteen per cent, per annum compounded every six months. Section 135. (6) When a person defaults in making payment of assessed amount, he, in addition to the assessed amount shall be liable to pay, on the expiry of thirty days from the date of order of assessment, an amount of interest at the rate of sixteen per cent, per annum compounded every six months. Section 135. (Theft of Electricity): ---1[(1) Whoever, dishonestly, -- (a) taps, makes or causes to be made any connection with overhead, underground or under water lines or cables, or service wires, or service facilities of a licensee or supplier as the case may be; or (b) tampers a meter, installs or uses a tampered meter, current reversing transformer, loop connection or any other device or method which interferes with accurate or proper registration, calibration or metering of electric current or otherwise results in a manner whereby electricity is stolen or wasted; or (c) damages or destroys an electric meter, apparatus, equipment, or wire or causes or allows any of them to be so damaged or destroyed as to interfere with the proper or accurate metering of electricity, (d) uses electricity through a tampered meter; or (e) uses electricity for the purpose other than for which the usage of electricity was authorised, so as to abstract or consume or use electricity shall be punishable with imprisonment for a term which may extend to three years or with fine or with both: Provided that in a case where the load abstracted, consumed, or used or attempted abstraction or attempted consumption or attempted use - (i) does not exceed 10 kilowatt, the fine imposed on first conviction shall not be less than three times the financial gain on account of such theft of electricity and in the event of second or subsequent conviction the fine imposed shall not be less than six times the financial gain on account of such theft of electricity; (ii) exceeds 10 kilowatt, the fine imposed on first conviction shall not be less than three times the financial gain on account of such theft of electricity and in the event of second or subsequent conviction, the sentence shall be imprisonment for a term not less than six months, but which may extend to five years and with fine not less than six times the financial gain on account of such theft of electricity: Provided further that in the event of second and subsequent conviction of a person where the load abstracted, consumed, or used or attempted abstraction or attempted consumption or attempted use exceeds 10 kilowatt, such person shall also be debarred from getting any supply of electricity for a period which shall not be less than three months but may extend to two years and shall also be debarred from getting supply of electricity for that period from any other source or generating station: Provided also that if it is proved that any artificial means or means not authorized by the Board or licensee or supplier, as the case may be, exist for the abstraction, consumption or use of electricity by the consumer, it shall be presumed, until the contrary is proved, that any abstraction, consumption or use of electricity has been dishonestly caused by such consumer. (1A) Without prejudice to the provisions of this Act, the licensee or supplier, as the case may be, may, upon detection of such theft of electricity, immediately disconnect the supply of electricity: Provided that only such officer of the licensee or supplier, as authorized for the purpose by the Appropriate Commission or any other officer of the licensee or supplier, as the case may be, of the rank higher than the rank so authorised shall disconnect the supply line of electricity: Provided further that such officer of the licensee or supplier, as the case may be, shall lodge a complaint in writing relating to the commission of such offence in police station having jurisdiction within twenty four hours from the time of such disconnection: Provided also that the licensee or supplier, as the case may be, on deposit or payment of the assessed amount or electricity charges in accordance with the provisions of this Act, shall, without prejudice to the obligation to lodge the complaint as referred to in the second proviso to this clause, restore the supply line of electricity within forty-eight hours of such deposit or payment.] (2) 1[Any officer of the licensee or supplier as the case may be,] authorized in this behalf by the State Government may -- (a) enter, inspect, break open and search any place or premises in which he has reason to believe that electricity 2[has been or is being,] used unauthorisedly; (b) search, seize and remove all such devices, instruments, wires and any other facilitator or article which has been, or is being, used for unauthorized use of electricity; (c) examine or seize any books of account or documents which in his opinion shall be useful for or relevant to, any proceedings in respect of the offence under sub-section (1) and allow the person from whose custody such books of account or documents are seized to make copies thereof or take extracts therefrom in his presence. (3) The occupant of the place of search or any person on his behalf shall remain present during the search and a list of all things seized in the course of such search shall be prepared and delivered to such occupant or person who shall sign the list: Provided that no inspection, search and seizure of any domestic places or domestic premises shall be carried out between sunset and sunrise except in the presence of an adult male member occupying such premises. (4) The provisions of the Code of Criminal Procedure, 1973, relating to search and seizure shall apply, as far as may be, to searches and seizure under this Act. Section 146. (Punishment for non-compliance of orders or directions): Whoever, fails to comply with any order or direction given under this Act, within such time as may be specified in the said order or direction or contravenes or attempts or abets the contravention of any of the provisions of this Act or any rules or regulations made thereunder, shall be punishable with imprisonment for a term which may extend to three months or with fine, which may extend to one lakh rupees, or with both in respect of each offence and in the case of a continuing failure, with an additional fine which may extend to five thousand rupees for every day during which the failure continues after conviction of the first such offence: 1[Provided that nothing contained in this section shall apply to the orders, instructions or directions issued under section 121.] Section 152. (Compounding of offences): ---(1) Notwithstanding anything contained in the Code of Criminal Procedure 1973, the Appropriate Government or any officer authorized by it in this behalf may accept from any consumer or person who committed or who is reasonably suspected of having committed an offence of theft of electricity punishable under this Act, a sum of money by way of compounding of the offence as specified in the Table below: TABLE Nature of Service 3. Agricultural Service 4. Other Services (KW)/Horse Power(HP) or part thereof for Low Tension (LT) supply and per Kilo Volt Rate at which the sum of money for Compounding to be collected per Kilowatt Ampere(KVA) of contracted demand for High Tension (HT) 2. Commercial Service (1) (2) 1. Agricultural Service 4. Other Services (KW)/Horse Power(HP) or part thereof for Low Tension (LT) supply and per Kilo Volt Rate at which the sum of money for Compounding to be collected per Kilowatt Ampere(KVA) of contracted demand for High Tension (HT) 2. Commercial Service (1) (2) 1. Industrial Service twenty thousand rupees; ten thousand rupees; two thousand rupees; four thousand rupees: Provided that the Appropriate Government may, by notification in the Official Gazette, amend the rates specified in the Table above. (2) On payment of the sum of money in accordance with sub-section (1), any person in custody in connection with that offence shall be set at liberty and no proceedings shall be instituted or continued against such consumer or person in any criminal court. (3) The acceptance of the sum of money for compounding an offence in accordance with sub-section (1) by the Appropriate Government or an officer empowered in this behalf empowered in this behalf shall be deemed to amount to an acquittal within the meaning of section 300 of the Code of Criminal Procedure, 1973. (4)The Compounding of an offence under sub-section (1) shall be allowed only once for any person or consumer. Section 154. (Procedure and power of Special Court): --- (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, every offence punishable under [2sections 135 to 140 and section 150] shall be triable only by the Special Court within whose jurisdiction such offence has been committed. Section 154. (Procedure and power of Special Court): --- (1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, every offence punishable under [2sections 135 to 140 and section 150] shall be triable only by the Special Court within whose jurisdiction such offence has been committed. (2) Where it appears to any court in the course of any inquiry or trial that an offence punishable under sections 135 to 139 in respect of any offence that the case is one which is triable by a Special Court constituted under this Act for the area in which such case has arisen, it shall transfer such case to such Special Court, and thereupon such case shall be tried and disposed of by such Special Court in accordance with the provisions of this Act: Provided that it shall be lawful for such Special Court to act on the evidence, if any, recorded by any court in the case of presence of the accused before the transfer of the case to any Special Court: Provided further that if such Special Court is of opinion that further examination, cross-examination and re-examination of any of the witnesses whose evidence has already been recorded, is required in the interest of justice, it may re-summon any such witness and after such further examination, cross-examination or re-examination, if any, as it may permit, the witness shall be discharged. (3) The Special Court may, notwithstanding anything contained in sub-section (1) of section 260 or section 262 of the Code of Criminal Procedure, 1973, try the offence referred to in sections 135 to 139 in a summary way in accordance with the procedure prescribed in the said Code and the provisions of sections 263 to 265 of the said Code shall, so far as may be, apply to such trial: Provided that where in the course of a summary trial under this sub-section, it appears to the Special Court that the nature of the case is such that it is undesirable to try such case in summary way, the Special Court shall recall any witness who may have been examined and proceed to re-hear the case in the manner provided by the provisions of the said Code for the trial of such offence: Provided further that in the case of any conviction in a summary trial under this section, it shall be lawful for a Special Court to pass a sentence of imprisonment for a term not exceeding five years. (4) A Special Court may, with a view to obtaining the evidence of any person supposed to have been directly or indirectly concerned in or privy to, any offence tender pardon to such person on condition of his making a full and true disclosure of the circumstances within his knowledge relating to the offence and to every other person concerned whether as principal or abettor in the commission thereof, and any pardon so tendered shall, for the purposes of section 308 of the Code of Criminal Procedure,1973, be deemed to have been tendered under section 307 thereof. (5) The 1[Special Court shall] determine the civil liability against a consumer or a person in terms of money for theft of energy which shall not be less than an amount equivalent to two times of the tariff rate applicable for a period of twelve months preceding the date of detection of theft of energy or the exact period of theft if determined whichever is less and the amount of civil liability so determined shall be recovered as if it were a decree of civil court. (6) In case the civil liability so determined finally by the Special Court is less than the amount deposited by the consumer or the person, the excess amount so deposited by the consumer or the person, to the Board or licensee or the concerned person, as the case may be, shall be refunded by the Board or licensee or the concerned person, as the case may be, within a fortnight from the date of communication of the order of the Special Court together with interest at the prevailing Reserve Bank of India prime lending rate for the period from the date of such deposit till the date of payment. Explanation. -For the purposes of this section, “civil liability” means loss or damage incurred by the Board or licensee or the concerned person, as the case may be, due to the commission of an offence referred to in sections 135 to 139.” There is no reason to suppose that the assessing officer has already reached a conclusion as regards unauthorised use of electricity as contended by Mr. Gupta. The assessing officer after inspection of the premises of the writ petitioner has merely expressed his opinion, howsoever he may have couched the same, that he has reasons to suspect that the writ petitioner has been indulging in unauthorised use of electricity. We are supported in our aforesaid view by sub-Section (5) of Section 126 and Section 152 of the Act. Sub-section (5) of Section 126 provides “if the assessing officer reaches to the conclusion that unauthorised use of electricity has taken place”. Such conclusion is intended to be arrived at after hearing the assessee. Therefore the conclusion referred to in sub-section (1) of Section 126 is bound to be a prima facie conclusion. That the legislature wanted the aforesaid conclusion to be nothing more than reasonable suspicion would become clear from Section 152 of the Act quoted above. The assessing officer has assessed and is entitled to assess provisionally the quantum of loss or damage suffered by the licensee to the best of his judgment at the statutory rate. The concept of loss or damage is discernible from the explanation appended to Section 154(6) of the Act. From the caption of Section 126 it appears that the exercise is investigatory in nature and the ultimate object is to recover the loss or damage under Section 154 (5) and (6) of the Act. The concept of loss or damage is discernible from the explanation appended to Section 154(6) of the Act. From the caption of Section 126 it appears that the exercise is investigatory in nature and the ultimate object is to recover the loss or damage under Section 154 (5) and (6) of the Act. The writ petitioner is entitled to file his objection disclosing such defence as he may have. The assessing officer shall thereafter give an opportunity of hearing to the assessee following the principles of natural justice. The assessing officer shall form an opinion for reasons to be recorded under Section 126(5) of the Act as to whether there has been unauthorised use of electricity. In case he answers the issue in the affirmative, he shall find the period of unauthorised user and shall thereafter assess for reasons to be recorded the quantity of electricity unauthorisedly used and the amount payable at the statutory rate. The assessee upon deposit of 50% of the assessed amount shall have a right to prefer an appeal under Section 127 if he is dissatisfied with such assessment. Depending upon the result of the appeal he may have to deposit further amount in default he is liable to pay interest under Section 127(6) and is also punishable under Section 146. Such deposit is however subject to final determination of civil liability by the Special Court under Section 154(5) of the Act. Any deposit made in excess of the liability so determined is refundable together with interest under Section 154(6) of the Act. In making the provisional assessment the assessing officer has to exercise his best judgment as regards the quantity of electricity unauthorisedly used. The rate to be applied to such quantity has been statutorily fixed. Any deposit made in excess of the liability so determined is refundable together with interest under Section 154(6) of the Act. In making the provisional assessment the assessing officer has to exercise his best judgment as regards the quantity of electricity unauthorisedly used. The rate to be applied to such quantity has been statutorily fixed. Best judgment assessment is one of the procedures recognised by Section 144 of the Income Tax Act 1961 which provides as follows:- “(1) If any persona- a) fails to make the return required [under sub-section (1) of section 139] and has not made a return or a revised return under sub-section (4) or sub-section (5) of that section, or b) fails to comply with all the terms of a notice issued under sub-section (1) of section 142 [or fails to comply with a direction issued under subsection (2A) of that section], or c) having made a return, fails to comply with all the terms of a notice issued under subsection (2) of section 143, the [Assessing] officer, after taking into account all relevant material which the [Assessing] officer has gathered, [shall, after giving the assessee an opportunity of being heard, made the assessment] of the total income or loss to the best of his judgment and determine the sum payable by the assessee on the basis of such assessment: Provided that such opportunity shall be given by the Assessing Officer by serving a notice calling upon the assessee to show cause, on a date and time to be specified in the notice, why the assessment should not be completed to the best of his judgment: Provided further that it shall not be necessary to give such opportunity in a case where a notice under sub-section (1) of section142 has been issued prior to the making of an assessment under this section.] (2) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year.]” In the Income Tax Act of 1922 the method was also there in Section 23(4) thereof. The decided cases on the topic throw abundant light on the scope and method of such assessment which we shall notice. In the case of Commissioner of I.T. vs. Badridas Ramrai Shop reported in AIR 1937 PC 133 Their Lordships of the Privy Council opined as follows:- “There remains for consideration the point whether the assessment can be attacked on the ground that it was not made by the officer to the best of his judgment within the meaning of Section 27. The Judicial Commissioners have laid down two rules which impose upon the officer the duty of (1) conducting some kind of local inquiry before making the assessment under Section 23 (4) and (2) recording a note of the details and results of such inquiry. Their Lordships find it impossible to extract these requirements from the language of the Act, which after all is, in such matters, the primary and safest guide. The Officer is to make an assessment to the best of his judgment against a person who is in default as regards supplying information. He must not act dishonestly, or vindictively or capriciously because he must exercise judgment in the matter. He must make what he honestly believes to be a fair estimate of the proper figure of assessment, and for this purpose he must, their Lordships think, be able to take into consideration local knowledge and repute in regard to the assessee’s circumstances, and his own knowledge of previous returns by and assessments of the assessee, and all other matters which he thinks will assist him in arriving at a fair and proper estimate: and though there must necessarily be guess-work in the matter, it must be honest guesswork. In that sense too the assessment must be to some extent arbitrary. In that sense too the assessment must be to some extent arbitrary. Their Lordships think that the section places the officer in the position of a person whose decision as to amount is final and subject to no appeal; but whose decision if it can be shown to have been arrived at without an honest exercise of judgment, may be revised or reviewed by the Commissioner under the powers conferred upon that official by Section 33." In the case of Gurumukh Singh vs. Commissioner of Income Tax reported in AIR 1944 Lahore 353(2), the Full Bench expressed the following views:- “On giving my full consideration to the different views expressed in the judgments cited above, I am personally inclined to hold that the proceedings taken by the Income-tax Officer under Subsection (3) of Section 23 cannot be characterised as judicial proceedings as we understand them, but all the same as remarked by me in 19 Lahore 10, he is required to proceed without bias and give sufficient opportunity to the assessee to place his case before him as well as to meet the case made out against him. In other words, he is bound to conduct himself in accordance with the rules of justice, equity and good conscience, even though he may not be compelled to observe all the formalities of a Court of law. Under the law as it stands, while proceeding under Sub-Section (3) of Section 23 the Income-tax Officer is bound to hear such evidence as the assessee may produce in support of his return and, if, after hearing the evidence so produced, he still thinks that he is not satisfied on any particular point, he can require the assessee to produce further evidence on that point. To that extent he may be taken to proceed quasi judicially, but his quasi-judicial functions begin and end here. If not satisfied with the character of the evidence produced by the assessee, he is not bound to lead evidence on his own account with a view to rebutting it. He may gather information in any manner he likes and utilise it against the assessee even if it does not in all respects satisfy the requirements of the Evidence Act. If not satisfied with the character of the evidence produced by the assessee, he is not bound to lead evidence on his own account with a view to rebutting it. He may gather information in any manner he likes and utilise it against the assessee even if it does not in all respects satisfy the requirements of the Evidence Act. The very nature of the proceedings conducted by him necessitates the use of such media for collecting information as he may not like to disclose to the assessee, and he is perfectly within his right if on inquiry by the assessee he refused to disclose the source of his information. But if he makes up his mind to reject the evidence of the assessee on any grounds which appeal to him to be sufficient for that purpose, it is but fair and just that he should acquaint the assessee with those grounds so as to enable him to disabuse his mind, if possible, by explaining them away as baseless or untenable. It is, however, impossible to hold that if once the assessee under Sub-section (3) of Section 23 leads evidence, whether reliable or unreliable, or produces any document, whether genuine or fictitious, the Income-tax Officer must base his decision on that evidence unless he is in a position to bring on the record any definite evidence to the contrary. My answer to the second set of questions would, therefore, be as follows: (a) An Income-tax Officer is not bound to rely on such evidence produced by the assessee as he considers to be false. (b) He can have recourse to the proviso to Section 13 even in those cases where he rejects the accounts produced by the assessee on the ground that they are not genuine, and thus fail to represent truly his income and profits. (c) If he proposes to make an estimate in disregard of the evidence, oral or documentary, led by the assessee, he should in fairness disclose to the assessee the material on which he is going to found that estimate. (d) He is not, however, debarred from relying on private sources of information, which sources he may not disclose to the assessee at all. (d) He is not, however, debarred from relying on private sources of information, which sources he may not disclose to the assessee at all. (e) In case he proposes to use against the assessee the result of any private enquiries made by him, he must communicate to the assessee the substance of the information so proposed to be utilised to such an extent as to put the assessee in possession of full particulars of the case he is expected to meet and should further give him ample opportunity to meet it, if possible.” The aforesaid views were approved by the Supreme Court in the case of D. C. Cotton Mills Ltd. vs. Commissioner of I.T., West Bengal reported in AIR 1955 SC 65 wherein Their Lordships held as follows:- “As regards the second contention, we are in entire agreement with the learned Solicitor-General when he says that the Income-tax Officer is not fettered by technical rules of evidence and pleadings, and that he is entitled to act on material which may not be accepted as evidence in a court of law, but there the agreement ends; because it is equally clear in making the assessment under Sub-section (3) of Section 23 of the Act, the Income-tax Officer is not entitled to make a pure guess and make an assessment without reference to any evidence or any material at all. There must be something more than bare suspicion to support the assessment under Section 23(3). The rule of law on this subject has, in our opinion, been fairly and rightly stated by the Lahore High Court in the case of ‘AIR 1944 Lahore 353 (2) (FB) (A). In this case we are of the opinion that the Tribunal violated certain fundamental rules of justice in reaching its conclusions. Firstly, it did not disclose to the assessee what information had been supplied to it by the departmental representative. Next, it did not give any opportunity to the company to rebut the material furnished to it by him, and lastly, it declined to take all the material that the assessee wanted to produce in support of its case. The result is that the assesee had not had a fair hearing. The estimate of the gross rate of profit on sales, both by the Income-tax Officer and the Tribunal seems to be based on surmises, suspicions and conjectures. The result is that the assesee had not had a fair hearing. The estimate of the gross rate of profit on sales, both by the Income-tax Officer and the Tribunal seems to be based on surmises, suspicions and conjectures. It is somewhat surprising that the Tribunal took from the representative of the department a statement of gross profit rates of other cotton mills without showing that statement to the assessee and without giving him an opportunity to show that that statement had no relevancy whatsoever to the case of the mill in question. It is not known whether the mills which had disclosed these rates were situate in Bengal or elsewhere, and whether these mills were similarly situated and circumstanced. Not only did the Tribunal not show the information given by the representative of the department to the appellant, but it refused even to look at the trunk load of books and papers which Mr. Banerjee produced before the Accountant-Member in his chamber. No harm would have been done if after notice to the department the trunk had been opened and some time devoted to see what it contained. The assessment in this case and in the connected appeal, we are told, was above the figure ofRs.55 lakhs and it was fit and proper when dealing with a matter of this magnitude not to employ unnecessary haste and show impatience, particularly when it was known to the department that the books of the assessee were in the custody of the Sub-Divisional Officer, Narayanganj. We think that both the Income-tax Officer and the Tribunal in estimating the gross profit rate on sales did not act on any material but acted on pure guess and suspicion. It is thus a fit case for the exercise of our power under Article 136”. In the case of M/s Joharmal Murlidhar & Co. vs. Agricultural Income Tax Officer, Assam & Ors. reported in 1970(3) SCC 331 Their Lordships held as follows:- “Prima facie the order appears to be an arbitrary one. The assessing officer had not given any reasons for his conclusion. Even a best judgment assessment has to be made on some rational basis. The High Court refused to accept the contention of the assessee that the impugned assessments were made arbitrarily on the ground that the assessee had failed to take proper steps under the Act by appealing against the impugned order. Even a best judgment assessment has to be made on some rational basis. The High Court refused to accept the contention of the assessee that the impugned assessments were made arbitrarily on the ground that the assessee had failed to take proper steps under the Act by appealing against the impugned order. That is undoubtedly a good ground for refusing to give the relief to the assessee but all the same, taking into consideration, the amounts involved and the simple nature of the proof required to be adduced by the assessee, we direct as follows: The Assessing Officer shall issue a fresh notice to the assessee calling upon him to produce his income-tax assessment orders for the relevant assessment years. The assessee shall produce those orders within a month of the receipt of the notice. If he produces those orders, the impugned assessment orders shall stand cancelled and the assessing officer shall assess the assessee afresh. If the assessee fails to produce those orders, the impugned assessment orders shall stand and further steps may be taken on the basis of those orders”. In the case of Commissioner of Sales Tax vs. M/s. H. M. Esufali reported in 1973(2) SCC 137 Their Lordships held as follows:- “In estimating any escaped turnover, it is inevitable that there is some guess-work. The assessing authority while making the ‘best-judgment’ assessment no doubt should arrive at its conclusion without any bias and on rational basis. That authority should not be vindictive or capricious. If the estimate made by the assessing authority is a bona fide estimate and is based on a rational basis, the fact that there is no good proof in support of that estimate is immaterial. Prima facie, the assessing authority is the best judge of the situation. It is his ‘best-judgment’ and not of anyone else’s. The High Court could not substitute its ‘best-judgment’ for that of the assessing authority. In the case of ‘best-judgment’ assessment, the courts will have to first see whether the accounts maintained by the assessee were rightly rejected as unreliable. If they come to the conclusion that they were rightly rejected, the next question that arises for consideration is whether the basis adopted in estimating the turnover has a reasonable nexus with the estimate made. In the case of ‘best-judgment’ assessment, the courts will have to first see whether the accounts maintained by the assessee were rightly rejected as unreliable. If they come to the conclusion that they were rightly rejected, the next question that arises for consideration is whether the basis adopted in estimating the turnover has a reasonable nexus with the estimate made. If the basis adopted is held to be a relevant basis even though the Courts may think that it is not the most appropriate basis, the estimate made by the assessing authority cannot be disturbed.” The writ petitioners in this case have also challenged the legality of the provisions of Sections 126 and 135 of the Act as regards which we express no opinion because the writ petition is yet to be heard. We, however, grant liberty to the writ petitioners to exhaust their remedy under Sections 126 and 127 of the Act without prejudice to their rights and contentions in the pending writ petition. The authorities are directed to disclose the material which may have been taken into account for the purpose of arriving at the conclusion as regards unauthorised use of electricity, the material for provisional assessment of both quantity and the valuation made by them within 3 weeks from date. The appellants shall be entitled to file their objection within three weeks thereafter. The matter shall thereafter be proceeded with following the principles of natural justice. With these directions the appeal and the application are both disposed of. Parties shall bear their own costs.