TaxTMI 
TaxTMI 
2018 (12) TMI 1400
X X X X Extracts X X X X
X X X X Extracts X X X X
.... held by Mr.Kishore Kothapalli (erstwhile Director), 5% stake held by M/s.Global Tech Park Pvt. Ltd. and 23% from other shareholders in the petitioner. As a result of this acquisition Worldline Singapore became 100% owner of the petitioner. Prior to the said acquisition, Mr.Kishore Kothapalli and Mr.Satish P Chandra were Directors of the petitioner. They resigned from the Directorship of the petitioner with effect from 25.10.2017. b) On 01.02.2018, a survey under Section 133A of the Income Tax Act, 1961 was conducted at the office premises of the petitioner at Chennai by the Assistant Director of Income Tax (Investigation), Unit 3 and at office in Hyderabad, located at 620, Road No.33, Aditya Enclave, Venkatigiri, Jubilee Hills, Hyderabad. During the course of the survey proceedings, the petitioner produced certain documents. Pursuant to the said survey, show cause notice dated 04.06.2018 was issued by the first respondent asking the petitioner show cause as to why centralization of the petitioner's case should not be done with the Assessing Officer, Bangalore, the second respondent herein. The first respondent in the said notice dated 04.06.2018 bare....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ies involved required verification and investigation before reaching any conclusion. When huge amounts and numerous transactions between different parties are to be investigated, it is necessary to have co-ordinated investigation and therefore, the files of the petitioner necessarily to be transferred. 4. Learned counsel appearing for the petitioner after reiterating the contentions raised in the affidavit filed in support of the writ petition further submitted that perusal of the impugned order would show that the first respondent has not assigned the specific reasons for transferring the case except stating that the objections raised by the assessee cannot be the basis for not centralizing the case and that the materials, which were seized and impounded need to be further investigated. Thus, the learned counsel submitted that the above observation made by the first respondent in the impugned order alone is not satisfying the requirement, as contemplated under Section 127(1) of the Income Tax Act, since the first respondent is duty bound to record his reasons for transferring the case. In support of his contention, the learned counsel relied on (1976) 102 ITR 281(SC), Ajantha I....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Limited at House No.17. Whisper Valley, Raidurga, Hyderabad - 500 008. It is found from the records available with the Income Tax Department that your PAN:AAECP7679M is lying with the ITO. Corporate Ward 4(1), Chennai. Whereas. It is also seen that M/s.GTPL held 24-56% of shares in M/s.MRL Posnet Private Limited and Mr.Satish P Chandra is one of its directors also, that Mr.Kishore K.Kothapalli is a close associate of Mr.Satish P.Chandra and is involved in this financial affairs. During the course of search, it was found that M/s.MRL Posnet was acquired by a French company in the directors. On account of this Mr.Satish P Chandra has declared Capital Gains to the extent of Rs. 19 crores." 3. As there are substantial linkages between M/s MRL Posnet Private Limited and Mr.Satish P Chandra and his Company. M/s.GTPL which were covered u/s 132 of the Income Tax Act, 1961, your case along with the business concerns and individuals in which search was conducted is being proposed for centralization to the DCIT/ACIT Central Circle 1(1) Bengaluru so that a single Assessing Officer can do further investigation." 8. The petitioner did not accept the proposal and on the othe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eaning or purpose in issuing the show cause notice. Needless to say that reasons stated in the show cause notice are only to be construed as a prima facie view of the Authority issuing such show cause notice and not as his conclusive view or finding in respect of the subject matter in issue. Therefore, any reason stated in the show cause notice is always subject to change or affirmation depending upon the consideration of the objection raised against the propose made in the show cause notice. Therefore, an order passed in pursuant to the show cause notice, should necessarily deal with the reasons stated in the show cause notice as well as the objections raised against those reasons. Thus, after considering the reasons and objections, the final view of the Authority should be made available evidently on the face of the order itself with reasons and discussions. If not, the order passed without recording reasons, would have to be construed as the one out of non application of mind. 10. At this juncture, the decision of the Apex Court relied on by the petitioner reported in (1976) 102 ITR 281(SC), Ajantha Industries vs. CBDT, is relevant to be quoted, wherein it is observed as foll....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t in the 1961 Act section 127 replaced section 5(7A) where the legislature has introduced, inter alia, the requirement of recording reasons in making the order of transfer. It is manifest that once an order is passed transferring the case file of an assessee to another area the order has to be communicated. Communication of the order is an absolutely essential requirement since the assessee is then immediately made are of the reasons which impelled the authorities to pass the order transfer. It is apparent that if a case file is transferred from the usual place of residence or office where ordinarily assessments are made to a distant area, a great deal of inconvenience and even monetary loss is involved, That is the reason why before making an order of transfer the legislature has ordinarily imposed the requirement of a show-cause notice and also recording of reasons. The question then arises whether the reasons are at all required to be communicated to the assessee. It is submitted, on behalf of the Revenue, that the very fact that reasons are recorded in the file, although these are not communicated to the assessee, fully meets the requirement section 127(1). We are unable to acc....