The Delhi High Court dismissed the plea challenging notice preceding the order of transfer.
The petitioner, Dev Wine Sales Corporation challenged the order d passed in exercise of powers under Section 127 of the Income Tax Act, 1961, of transfer of jurisdiction of the petitioner from Delhi to Faridabad.
The petitioner contended that since its inception and since the Assessment Year 2014-15 has been assessed at Delhi. In the show-cause notice issued prior to exercising the power, no reason whatsoever was given and even in the impugned order, no reason whatsoever has been given.
Mr. Abhishek Maratha, the counsel for the respondents contended that both the partners of the petitioner are residents of Faridabad and which fact has been concealed from this Court. It is further stated that the address given of the petitioner at Delhi was found to be a fictitious address and else the information during the simultaneous raids at as many as 16 places has revealed Devender Kumar Gupta, who has filed this petition and who is the managing partner of the petitioner, to be the kingpin.
The Division Bench of Justice Rajiv Sahai Endlaw and Sanjeev Narula dismissed the challenge for various reasons.
Firstly, the proposal for transfer arose from previous investigation of the revenue and search and seizure under Section 132 of the Act.
Secondly, there was undoubtedly a link in the business at two places; (c) that the assessment of all those who were associated by the same Assessing Officer was important.
Thirdly, it was not in the Court’s domain to second guess the Revenue’s reasoning or sit in appea.
Fourthly, the admitted nexus between the businesses at Delhi and Faridabad satisfied the limited scrutiny permitted under Article 226 of the Constitution of India.
Fifthly, the purpose of Section 127 of the Act is not to subject the assessee to any liability other than in regular assessment and a Section 127 order does not cause any prejudice to the assessee
Sixthly, the requirement of opportunity of hearing before transfer is also subject to “wherever it is possible to do so”.
Seventhly, the assessee will have full opportunity to represent in front of the Assessing Officer to whom the case is transferred.
“Though the counsel for the petitioner has also contended that the change of jurisdiction is not limited from Delhi to Faridabad but would also change the jurisdictional High Court from this Court to the High Court of Punjab & Haryana but once we find the partners of the petitioner to be residents of Faridabad and assessed at Faridabad, we agree with the reasoning given in the impugned order, of administrative convenience for the exercise of the power of transfer,” the court said.
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