TaxTMI 
TaxTMI 
2021 (4) TMI 1026
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....wing reliefs: "7(a) quash and set aside the impugned order at Annexure "A" to this petition. (b) quash and set­aside all the proceedings initiated consequent to passing of the impugned order under section 127 of the Act; (c) pending admission, hearing and final disposal of this petition, to stay implementation and operation of the order at Annexure "A" to this petition and to also stay all further proceedings in relation to and arising from the transfer of the case records consequent to passing of the impugned order under section 127 of the Act; (d) any other and further relief deemed just and proper be granted in the interest of justice; (e) to provide for the cost of this petition." 4. The facts giving rise to this writ application may be summarised as under: 4.1 The writ applicant is a partnership firm. A survey action under Section 133A of the Income Tax Act, 1961 (for short, "the Act, 1961") was carried out by the ADIT (Investigation), Gandhidham on 26th September 2017 at the business premises of one Dahyabhai Bhurabhai Rabari and others including the writ applicant herein. 4.2 Eleven months thereafter, the respondent i....
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.... business transactions with Shree Ganesh Handling. Further, the proposed action of transferring the cases from Gandhidham to Rajkot was without proper application of mind and not in consonance with the requirements of sub­section (2) of section 127 of the Act; ➢ The proposed action of transferring the cases from Gandhidham to Rajkot would result into huge inconvenience and hardships to the Petitioner who is based in "Gandhidham" and his case was proposed to be transferred to "Rajkot";" 4.4 The respondent, vide order dated 2nd April 2019 passed under Section 120(4)(b) r/w Section 2(7A) r/w Section 127(1) of the Act, transferred the case of the writ applicant from the "ITO, Ward - 1, Gandhidham" to the "Joint Commissioner of Income Tax, Gandhidham Range, Gandhidham" along with the five other assessees with a view to carry out coordinated investigation. 4.5 Later, the respondent issued another notice dated 17th September 2019, calling upon the writ applicant to show cause as to why the case should not be transferred to the "DCIT, Central Circle - 2, Rajkot". Such notice referred to above was issued stating that ordinarily, the JCIT / Addl. CIT would not under....
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....had no objection if the cases were transferred to any particular officer in Gandhidham and if found necessary, the JCIT may be asked to issue direction under section 144A of the further ensure that whatever investigation is necessary is carried out;" 4.7 The aforesaid objections came to be overruled by the respondent and the impugned order dated 21st October 2019 came to be passed under Section 127(2) of the Act. The respondent transferred the case of the writ applicant from "the ITO, Ward - 1, Gandhidham" to "the DCIT, Central Circle - 2, Rajkot", along with the five other assessees. 5. Being dissatisfied with the impugned order of transfer passed under Section 127(2) of the Act, the writ applicant is here before this Court with the present writ application. ● SUBMISSIONS ON BEHALF OF THE WRIT APPLICANT: 6. Mr. Tushar Hemani, the learned Senior Counsel assisted by Ms. Vaibhavi Parikh, the learned counsel appearing for the writ applicant vehemently submitted that the impugned order transferring the case of the writ applicant from Gandhidham to Rajkot is patently bad, illegal, contrary to law and in gross violation of the fundamental rights guaranteed to the writ a....
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....rring the case of the Petitioner, which has not been done in the present case by the Respondent herein." 9. Mr. Hemani further submitted that unlike the cases covered under the search action under Section 132 of the Act, the cases covered under the survey action under Section 133A of the Act does not warrant centralization. Mr. Hemani submitted that as a matter of practice, the centralization of connected cases of those assessees, at whose premises "search" action under Section 132 of the Act has been carried out, is essential for effective and coordinated investigation and consequently, the assessment is framed under Section 153A / 153C of the Act, as the case may be. He would submit that however, in a case where survey action under Section 133A of the Act is carried out, the normal assessment proceedings would follow and consequently, the assessment shall be framed under Section 143(3) or 143(3) read with Section 147 of the Act, as the case may be. He also submitted that such cases, wherein "survey action" under Section 133A of the Act has been carried out, are not to be centralized. 10. Mr. Hemani would submit that indisputably, a "survey action" under Section 133A of the ....
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....sessment which is to be framed under Section 147 of the Ac. It is submitted that the case of the writ applicant is very well covered in the exceptional clause and hence, the contention raised by the respondent is not tenable in the eye of law. As regards the contention of the respondent that the "JCIT, Gandhidham", vide letter dated 26th August 2019 informed that he is not authorized by the system to undertake the assessment functions, thereby suggesting that the cases may be centralized to the central circle, it is submitted that such a letter cannot be taken as a base for justifying the transfer of the case of the writ applicant. It is submitted that in view of the above referred circular, the letter from the JCIT, Gandhidham loses its significance. He submitted that even on that score, the impugned order deserves to be quashed. 14. In such circumstances referred to above, Mr. Hemani prays that there being merit in his writ application, the same be allowed and the impugned order of transfer be quashed and set aside. ● SUBMISSIONS ON BEHALF OF THE REVENUE: 15. Mr. M. R. Bhatt, the learned Senior Counsel assisted by Ms. Mauna Bhatt, the learned Senior Standing Counse....
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....The aspect of alleged review has been considered in para 6.6 of the order. It is noted that in view of the E­assessment procedure, the assessment can be completed only on the Income Tax Business Application (ITBA) and in the said system, there is no functionality of assessment by the Joint CIT / Additional CIT and he cannot acquire any PAN. Further, notice cannot be issued to the writ applicant in the ITBA by the Joint CIT / Additional CIT. Reference has also been made to the letter addressed by the Joint CIT, Gandhidham stating that he is not authorized by the system to undertake the assessment function and accordingly, suggested that the cases may be centralized to the central circle. In the impugned order, all contentions raised by the writ applicants have been dealt with. 19. Mr. Bhatt would submit that the order passed under Section 127 of the Act is an administrative order. The only requirement is to adhere to the principles of natural justice. He would submit that the objections raised by the writ applicant have been duly dealt with by passing a wellreasoned and speaking order. Mr. Bhatt would submit that there is no vested right with the writ applicant to choose the ....
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....neral or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, transfer any case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) also subordinate to him. (2) Where the Assessing Officer or Assessing Officers from whom the case is to be transferred and the Assessing Officer or Assessing Officers to whom the case is to be transferred are not subordinate to the same Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner,- (a) where the Principal Directors General or Directors General or Principal Chief Commissioners or Chief Commissioners or Principal Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Principal Director General or Director General or Principal Chief Co....
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....s which are that such order can be passed only after giving the assessee a reasonable opportunity of being heard and recording his reasons for doing so, wherever possible. As per subsection (3) of Section 127 however, the opportunity of hearing would not be necessary where the transfer of a case is from an Assessing Officer to another Assessing Officer and such officers are situated in the same city, locality or place. Under clause (a) of sub­section (2) of Section 127, where the Assessing Officer or the officers from whom the case is to be transferred and the Assessing Officer or the officers to whom the case is to be transferred are not subordinate to the same Principal Directors General, Director General, Principal Chief Commissioners, Chief Commissioners or Principal Commissioners or Commissioners, the transfer of case would be only when such authorities to whom the Assessing Officers concerned are subordinate are in agreement. In such a case, the Principal Director General, Director General, Principal Chief Commissioner or Chief Commissioner or Commissioner from whose jurisdiction the case is to be transferred would pass an order after giving the assessee a reasonable oppo....
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.... the authority from whose jurisdiction the case is to be transferred, has to grant a reasonable opportunity of being heard to the assessee and then pass an order recording his reasons. This requirement would have two significant elements. One is that the authority under whose jurisdiction the assessment is being transferred has merely to show his agreement or disagreement, as the case may be. It is the authority from whose jurisdiction the case is being transferred, in addition to agreeing to transfer would have to grant an opportunity of hearing to the assessee and pass a reasoned order. The second element is that his agreement for transfer of the case cannot be equated with the decision to transfer. The decision can be reached only after hearing the assessee. He can form a final opinion that the case is to be transferred only after hearing the assessee, failing which, his decision would be ex­parte. Without the representation or involvement of the assessee, the requirement of hearing would then be rendered into an empty formality. [See Genus Electrotech Ltd. vs. Union of India and Others, (2018) 402 ITR 221 (Guj.)] 27. We have already noted the reasons for the transfer of ....
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....sub­section (1) or subsection (2) thereof. Such discretion of course has to be exercised for achieving the public purpose and not for any arbitrary or irrelevant consideration. On the other hand, it can also be seen that transfer of a pending case from one Assessing Officer to another outside of a city, locality or place is likely to cause considerable inconvenience to an assessee. Therefore, even though an assessee may not have a vested right to insist that his assessment be completed only at one place or by a particular Assessing Officer, nevertheless, the reasons for transfer must be weighty enough to offset against such personal inconvenience of an assessee. In exercise of power under Section 127 thus we are concerned with larger public interest on one hand and personal inconvenience on the other. However, as long as such powers are exercised bona fide, for public purpose and in the interest of Revenue, the role of the Court to dissect such reasons and to come to a different conclusion would be extremely limited. It is by now well settled that judicial review against the administrative order in exercise of writ jurisdiction, the Court is concerned with the decision making p....
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....er, such that detailed reasons and specific grounds are required to be provided, as the petitioner today argues. Equally, the showcause notice dated 9.10.2013 granted the petitioner in this case an opportunity of being heard. No oral representation was made by the petitioner on that date, nor was any request for another date made to the Commissioner. Written objections, however, were preferred, which were considered and disposed off by the impugned notice in this case. The argument, thus, that no chance to effectively represent the case was provided has no merit." 30. In Pannalal Binraj vs. Union of India, reported in (1957) 31 ITR 565, the Supreme Court observed while upholding the power of transfer that, inconvenience to the assessee or likelihood of misuse of the provision could not be a ground to declare the said provision to be void, but if there was abuse of the power, appropriate remedy could be taken. The relevant observations reads thus : "It follows, therefore, that Section 5(7A) of the Act is not violative of Article 14 of the Constitution and also does not impose any unreasonable restriction on the fundamental right to carry on trade or business enshrined in....
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.... Rajkot for coordinated and effective investigation. 6.3 It has not been elaborated by the assessees as to how the proposed centralization is in violation of CBDT Instruction No.8/2002 dtd.14/8/2002. 6.4 The contention that the proposal for centralization is without proper application of mind, is again mis­placed, mis­conceived and erroneous. The results of the Survey action including the incriminating material found demonstrate that the cases have to be centralized with one AO for effective and coordinated investigation to bringing the correct undisclosed/concealed income to tax. 6.5 The various hardships quoted by the assessee company for the proposed centralization of the case do not hold any water, for the following reasons:­ Since one year, all IT assessments are conducted through e­mail (known as e­assessments). The returns are filed online for the last so many years. The notices, the questionnaires. The information etc., are all sought through e­mail for which the assessee has to respond only through e­mail and the assessee/the other representative shall not appear before the AO in person. Even the relevant port....