Indo European Breweries Ltd v. The Chief Commissioner Of

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGNAL CIVIL JURISDICTION WRIT PETITION NO. 2134 OF 2011 WITH CHAMBER SUMMONS NO. 323 OF 2011 Indo European Breweries Ltd., .. Petitioner. versus The Chief Commissioner of –Income Tax 3, & Ors. .. Respondents. ..... Mr. Sanjay Bansal, Sr. Adv. with Mr. Dinesh Parmar and Mr. Dushyant Kumar i/by M/s. Chambers of Kumar for the Petitioner. Mr. Tejveer Singh for the Respondent. ...... CORAM : DR.D.Y.CHANDRACHUD & A. A. SAYED, JJ. 20 DECEMBER 2011. P.C. : The Petitioner filed an application before the –Commissioner of Income Tax IV on 13 July 2011 stating thatwhile its registered office is at Aurangabad and Head Office at Delhi, all administrative work of the assessee is carried out at Delhi. On this ground a transfer of the cases of the assessee was sought from the Assessing Officer at Mumbai to the Assessing Officer at New Delhi. In response to the application, the Assessing Officer at Mumbai addressed a communication dated 30 August 2011 to the CIT-IV, New Delhi seeking the consent of the latter to the proposed transfer so as to enable the Competent Authority at Mumbai to pass an order under Section 127 of the Income Tax Act, 1961. An early reply was solicited since the assessment for assessment years 2004-05 and 2009-10 were getting barred by limitation on 31 December 2011. By a reply dated 26 November 2011 the Assessing Officer at New Delhi conveyed his no objection to the transfer of the cases from Mumbai to the DCIT Circle II(1) New Delhi. In these proceedings the relief that is sought is an appropriate direction for the transfer of the proceedings from Mumbai to New Delhi. 2.Under Section 124 of the Income Tax Act, 1961, jurisdiction over an assessee who carries on business is vested in the Assessing Officer who has jurisdiction over the area where the assessee carries on business or, where the assessee carries on business in more than one place if the principal place of his business is situate within the area. Sub-section (2) of Section 124 provides for the determination of the question as to jurisdiction by the Director General, the Chief Commissioner or the Commissioner, as the case may be. Under sub-section (4) if the Assessing Officer is not satisfied with correctness of the claim, he has to refer the matter for determination under sub-section (2) before the assessment is made. Section 127 vests the power to transfer a case from one or more Assessing Officers to any other Assessing Officer or Officers in the Director General, Chief Commissioner and Commissioner. 3. In the present case, the assessee has applied to the Commissioner for transfer of the proceedings to New Delhi. –The Commissioner of Income Tax IV Mumbai by his communication dated 17 October 2011 has informed the CIT-IV, New Delhi that : (i) The Scrutiny Assessment for AY 2009-10 is pending which would get time barred on 31 December 2011; (ii)The assessment for AY 2004-05 has been reopened under Section 148 which would get time barred on 31 December 2011; (iii) The assessee has filed two writ petitions before this Court; One for transfer of jurisdiction and another against reopening of assessment which are pending; (iv)The assessee by a letter dated 23 September 2011 was directed to furnish details along with supporting evidence. The letter records that jurisdiction would be transferred only after the disposal of the assessments which are becoming time barred. –The Commissioner of Income Tax IV Mumbai by his communication dated 17 October 2011 has informed the CIT-IV, New Delhi that : (i) The Scrutiny Assessment for AY 2009-10 is pending which would get time barred on 31 December 2011; (ii)The assessment for AY 2004-05 has been reopened under Section 148 which would get time barred on 31 December 2011; (iii) The assessee has filed two writ petitions before this Court; One for transfer of jurisdiction and another against reopening of assessment which are pending; (iv)The assessee by a letter dated 23 September 2011 was directed to furnish details along with supporting evidence. The letter records that jurisdiction would be transferred only after the disposal of the assessments which are becoming time barred. 4.The learned Counsel appearing on behalf of the Petitioner states that orders of assessment for assessment years 2004-05 and 2009-10 have already been passed. The assessee is stated to have initiated appellate proceedings to challenge the orders of assessment. Since the Commissioner is seized of the proceedings and has still to pass an order under Section 127, we do not consider it appropriate to exercise jurisdiction under Article 226 of the Constitution to direct transfer at this stage. We direct that the assessee shall in response to the communication dated 23 September 2011 (which has been referred to in the letter of the CIT-4, Mumbai dated 17 October 2011) furnish all relevant material to the Commissioner in order to enable him to determine as to whether an order under Section 127 requires to be passed. The assessee shall furnish all necessary material to the Commissioner within one week from today. The Commissioner shall thereupon pass an order after granting an opportunity of being heard to the assessee within a period of two weeks thereafter. In order to obviate any pending assessment being barred by limitation and to obviate such a plea, and having regard to the provisions of Section 153, we direct that all pending assessments shall remain stayed until a decision is taken by the Commissioner and for a period of six weeks thereafter. The learned Counsel appearing on behalf of the Petitioner states that he has no objection if the stay is operative for the entire period commencing from the filing of the Petition. Since orders of assessment have already been passed for the Assessment Years 2004-05 and 2009-10, for which the Petitioner is in appeal before the Commissioner (Appeals), we permit the Petitioner to raise all appropriate contentions before the Appellate Authority including on the issue of jurisdiction. 5.There shall be an order in those terms. The Petition stands disposed of accordingly. There shall be no order as to costs. 6.In view of the disposal of the Petition, the Chamber Summons does not survive and is dismissed. (Dr. D.Y. Chandrachud, J.) (A. A. Sayed, J.)