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M/S Bansal Sharevest Services Ltd. and others v. Commissioner, Income Tax-II, Kanpur - WRIT TAX No. 1371 of 2005  RD-AH 4330 (18 October 2005)
Court No. 10
Civil Misc. Writ Petition No. 1371 of 2005
M/s. Bansal Sharevest Services Ltd. and others Vs. Commissioner, Income-tax-II, Kanpur
Hon. A.K. Yog, J.
Hon. Dilip Gupta, J.
This petition has been filed for quashing the order dated 6.9.2005 passed under Section 127 of the Income Tax Act, 1961 (hereinafter referred to as the ''Act') transferring three cases from the Assessing Officer, Kanpur to the Assessing Officer at Mumbai.
The petitioners were served with a notice under Section 127(2) (a) of the Act in connection with the centralization of the cases from Kanpur to Mumbai. Subsequently an order dated 18.6.2004 was passed under Section 127 of the Act transferring the cases for assessment at Mumbai. Feeling aggrieved, the petitioners filed a writ petition in this Court being Writ Petition No. 1120 of 2004 which was allowed by the judgment and order dated 7.4.2005 and the relevant portion of the order is quoted below:-
"On perusal of the aforementioned order we find that no reasons whatsoever has been mentioned in the order transferring the cases. This Court in the case of Vinay Kumar Jaiswal and others Vs. Commissioner of Income-tax and others reported in (1996) 221 ITR, 568 while dealing with the mater relating to the transfer of the case under section 127 of the Act has held as follows:-
"It is obvious that when certain factual allegations are made in the objections of the assessee, they have to be dealt with, otherwise the very purpose of hearing would be frustrated. In their objections, the petitioners had specifically mentioned that all the concerns of the family barring a few which were recently established are being assessed at Kanpur and they were payi9ng a good amount of tax in Kanpur. They have also mentioned that the accounts of all the concerns of the family are maintained at Kanpur and only manufacturing and trading activities are conducted at Bhilai. Hence it was incumbent upon the Commissioner of Income-tax to deal with the said averments which he has not done in the impugned order and for this reason also the impugned order has been vitiated."
Since in the present case no reasons have been recorded and there is no other order on record passed by Commissioner of Income-tax, we are of the considered opinion that the said order can not be sustained and is, therefore, set aside on the ground that the various objections raised by the petitioners have not been dealt with in the transfer order.
In view of the foregoing discussions, we set aside the order dated 18.06.2004 leaving it open to the Commissioner of Income-tax-II, Kanpur to pass a fresh order in accordance with law."
Pursuant to the aforesaid directions issued by this Court, a notice dated 12.8.2005 was issued to the petitioners to which written objections dated 26.8.2005 were filed containing various reasons for not transferring the records of the cases from Kanpur to Mumbai. The Commissioner of Income-Tax-II, Kanpur then passed the order dated 6.9.2005 which has been impugned in the present petition. The relevant portion of the order is quoted below:-
"The objections raised in the written submissions against the proposed transfer of these cases to Mumbai have been considered and not found tenable. Other cases f this group have been centralized at Mumbai and these cases are also connected with the said group, it is necessary to centralize the said three cases namely M/s Bansal Sharevest Services Ltd., Shri Pradeep Kumar Bansal and Shri Sonu Agarwal with Deputy Commissioner of Income Tax, Central Circle-8, Mumbai so that coordinated and meaningful investigations could be done in these cases on the basis of the material found and evidences collected during the aforesaid search and seizure action on the group.
In view of the above and in exercise of the powers conferred by sub section (2) of section 127 of the Income Tax Act (343 of 1996), section 11 of the Wealth Tax Act 1975 and all other powers enabling me in this behalf, I, the Commissioner of Income Tax-II, Kanpur hereby transfer the cases, particulars of which are mentioned hereunder in Col. 3, from the Assessing Officer mentioned in Col. 5 therein to the Assessing Officer mentioned in Col. 6.
Sl. No. PAN Name of the assesses Status From To
1 2 3 4 5 6
1 AACB7738B M/s Bansal Sharevest Service Ltd. Co. ACIT-IV Kanpur DCITCC-VIIIMumbai
2 ABRPB8429L Shri Pradeep Kumar Bansal Indl. ACIT-IV Kanpur DCITCC-VIIIMumbai
3 ................... Shri Sone Agarwal Indl. ACIT-IV Kanpur DCITCC-VIIIMumbai
We have heard the learned counsel for the petitioners and the learned Standing Counsel for the respondent and have perused the materials available on record.
Learned counsel for the petitioners submitted that the earlier order dated 18.6.2004 under Section 127(2) of the Act was quashed on the ground that the various objections raised by the petitioners had not been dealt with in the transfer order but inspite of the aforesaid observations, the Commissioner of Income-Tax-II, Kanpur did not consider the various objections raised by the petitioners in reply to the show cause notice and only a bald statement has been made that they have been considered and not found tenable. He, therefore, submitted that in such circumstances, the present order dated 6.9.2004 cannot be sustained and should be set aside. He further submitted that the reasons given for transferring the cases on account of the fact that other cases of this group had been centralized at Mumbai is also vague inasmuch as details of the said cases have not been furnished.
Learned Standing Counsel appearing for the respondents, however, defended the impugned order and contended that under Section 127 of the Act, the cases could be transferred for the reasons stated in the impugned order.
We have carefully considered the submissions advanced by the learned counsel for the parties.
A perusal of the judgment and order dated 7.4.2005 passed by this Court in Writ Petition No. 1120 of 2004 clearly shows that the earlier order dated 18.6.2004 in respect of the present petitioners was set aside on the ground that the various objections raised by the petitioners had not been dealt with in the order. In making the aforesaid observations, the Court placed reliance upon the observations made by this Court in the case of Vinay Kumar Jaiswal and others Vs. Commissioner of Income-tax and others reported in (1996) 221 ITR, 568. We find that the order impugned in the present petition suffers from the same defect inasmuch as the objections dated 26.8.2005 filed by the petitioners, a copy of which has been annexed as Annexure ''7' to the writ petition, have not been considered at all and only a bald statement has been made in the impugned order that the objections were not tenable. It may be pointed out that in their objections the petitioners had raised a number of grounds including the grounds that the statement contained in the notice regarding most of the cases of the group being assessed at Mumbai was factually incorrect and the main cases of Pradeep Kumar Bansal (petitioner No.3) and M/s Bansal Sharevest Services Ltd. (petitioner No.1) were being assessed at Kanpur since more than last ten years and that the Tax Consultant of the Chartered Accountant of the assesses were at Kanpur. It was further objected that if at all the group cases were to be assessed at one place for coordinated investigation, then they should be centralized at Kanpur. These objections have not been considered in the impugned order and a vague statement has been made that since other cases of this group had been centralized at Mumbai, it is necessary to centralize the said three cases at Mumbai so that coordinated and meaningful investigation could be done. Even the details of the cases, which had been earlier centralized, have not given in the impugned order. The observations made by this Court in the judgment and order dated 7.4.2005 in Writ Petition No. 1120 of 2004 have, therefore, not been complied with. Such being the position, the impugned order dated 6.9.2005 (Annexure ''1' to the writ petition) cannot be sustained and is liable to be set aside.
In view of the above, the writ petition succeeds and is allowed. The impugned order dated 6.9.2005 passed by the Commissioner of Income-Tax-II, Kanpur is set aside. It shall, however, be open to the Commissioner of Income-Tax-II, Kanpur to pass a fresh order in accordance with law within a period of six weeks from the date, a certified copy of this order is produced by either of the parties before the said Officer.
There shall be no order as to costs.
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