From DDO wiki

Once per rest period, a Paladin may attempt to Smite evil with one normal melee attack. The number of times a Paladin can Smite Evil increases by 1 at level 5 and 10 and can be further increased by taking the Extra Smite Evil Enhancement. Smite evil also recharges at the rate of 1 every 90 seconds.

Adds Charisma modifier x 2 to your attack roll (that uses the best attack bonus in a normal attack sequence) and deals extra damage based on your paladin level. A Paladin with 12 Charisma (+1 modifier) and BAB 0 would add 2 (1 x 2 + 0) to the attack roll. A Paladin with 20 CHA (+5 modifier) and BAB 10 would add 30 (5 x 2 + 20) to the attack roll (because the 4th attack is at BAB+10 = 20).

The extra damage done is 7 + (3 x paladin level). For example a 6th level paladin does 7 + (3 x 6) (or 25) extra damage on a successful smite. If the paladin accidentally smites a creature that is not evil, or is not in range, the smite has no effect, but the ability is still used up.

[edit] Tips

• Before smiting, buff yourself with Eagle's Splendor and Divine Favor, and activate the Paladin Action Boost to-hit enhancement.
• Power Attack works very well in conjunction with smite because the bonus from the Charisma modifier offsets the -5 attack penalty.
• Use a weapon with a x3 critical multiplier, such as a Khopesh or Carniflex, or a weapon with a large threat range such as a Scimitar, to take full advantage of a deadly critical smite.
• Two handed weapons are effective at smiting due to the extra damage from your Strength modifier.
• Two-weapon attacks gain extra benefit because during parts of the attack sequence where both weapons make attacks, a single smite will affect both attacks.