Shree Ram Vessel Scrap Pvt Ltd v. Commissioner Of Income Tax-Vi

IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION NO. 16883 of 2012 TO SPECIAL CIVIL APPLICATION NO. 16886 of 2012 With SPECIAL CIVIL APPLICATION NO. 16888 of 2012TO SPECIAL CIVIL APPLICATION NO. 16896 of 2012 FOR APPROVAL AND SIGNATURE: HONOURABLE MR.JUSTICE AKIL KURESHI and HONOURABLE MS JUSTICE SONIA GOKANI ================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ?the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ?judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ?to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ SHREE RAM VESSEL SCRAP PVT LTD....Petitioner(s)VersusCOMMISSIONER OF INCOME TAX-VI....Respondent(s) ================================================================ Appearance: MR SN SOPARKAR, SR ADVOCATE, WITH MR B S SOPARKAR, ADVOCATE for the Petitioner(s) No. 1 MRS MAUNA M BHATT, ADVOCATE for the Respondent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE AKIL KURESHIandHONOURABLE MS JUSTICE SONIA GOKANI Date : 23/01/2013 ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE AKIL KURESHI) 1. These group of petitions arise out of a common background. They have been heard together and would be disposed of by this common judgement. background. They have been heard together and would be disposed of by this common judgement. 2. Facts are brief and virtually undisputed. The petitioners are members of the same family/group companies. They have been filing income tax returns regularly. Search operations were carried out by the income tax authorities at the premises of the petitioners on or around 17.2.2012. Assessment proceedings arising out of such search were pending before the respective Assessing Officers who are all authorities situated at Bhavnagar. Respondent Commissioner of Income Tax, Ahmedabad passed an order on 15.6.2012 under section 127(2) of the Income Tax Act, 1961 (“the Act” for short) transferring such pending assessments from Bhavnagar to Ahmedabad. Such orders were challenged by the petitioners before this Court in Special Civil ApplicationNo.11843/2012andconnected petitions. Such petitions were disposed of on 10.10.2012 on the assurance of the Revenue that Commissioner shall withdraw such order and pass such further fresh orders as may be found necessary after following the due process of law. 3. Thereupon the Commissioner issued show cause notice dated 11.10.2012 in which it was stated as under :notice dated 11.10.2012 in which it was stated as under : “At the outset,it is to intimate that the centralization order passed u/s 127(20 of the IT Act on 15[th] June, 2012 in your case is withdrawn. A fresh opportunity is being given to you to explain as to why your case should not be centralized at Ahmedabad for effective and coordinated investigation in your group cases. Accordingly, you are granted an opportunity to convey your objections in writing if any, within 10 days from the date of receipt of this letter. If you want to present your case personally or through your Authorised Representative, then the hearing is fixed on 30/10/2012 at 11.30 a.m. at the above mentioned address.” 4. The petitioners opposed the proposal for transfer of pending assessment cases by filing replies. In the said replies, it was contended that the 4. The petitioners opposed the proposal for transfer of pending assessment cases by filing replies. In the said replies, it was contended that the assessees file their returns at Bhavnagar or Mumbai where they are regularly assessed. It would therefore, be difficult for the assessees to attend the assessment proceedings at Ahmedabad. It was also contended that there is no rationale behind transferring the cases to Ahmedabad for coordinated investigation since such investigation can as well be centralised at Bhavnagar or Mumbai. Ground for proposed transfer is therefore, unjustified. They indicated that they have no objection if the cases are centralised either at Bhavnagar or Mumbai. 5. The Commissioner however, passed his impugned order dated 12.11.2012 and transferred all the cases to Assistant Commissioner, Central Circle-1(3), Ahmedabad. In his order, he considered the objections of the assessees but did not accept them observing that the assessees are attending the cases before the Commissioner(Appeals) at Ahmedabad. There is no requirement that the assessees should have their business activities in Ahmedabad also. It was observed that income tax department does not have Central Range Office at Bhavnagar. The assessees were therefore, offered any one of the places namely, Surat, Baroda, Rajkot and Ahmedabad where the department has centralised offices. The authorised representatives of the assessees however, did not accept any such other alternative places. The Commissioner further observed that it is necessary that group cases are centralised at one place in Gujarat where the department has offices under Central Range for carrying out coordinated investigations as no centralisation proposal from Mumbai office has been received in respect of this group of assessees. It is this fresh order passed by the Commissioner which the petitioners have challenged in these petitions. 6. Learned senior counsel Shri Saurabh Soparkar appearing for the petitioners questioned the order raising following contentions : 1)The reason indicated in the show cause notice for transferring of the cases namely, “for effective and coordinated investigation” is too vague and general. It does not specify the grounds on which the department desired to transfer the cases. In absence of any opportunity to meet with such grounds, requirement of hearing cannot be stated to have been fulfilled. 2)In any case, such reason is not sufficient permitting the department to transfer the cases. He submitted that this is the only ground on which the cases have been transferred by the Commissioner. Counsel further submitted that the cases could have been centralised either at Bhavnagar or Mumbai where the petitioners file their returns having their establishments and businesses. 3)Counsel lastly submitted that none of the assessees were assessed at Ahmedabad. All the assessees were filing their regular returns and were being assessed either at Bhavnagar or Mumbai. Transfer of cases at places where none of the assessees have their establishments, would be wholly impermissible. 4)In support of his contention that the reason indicated in the show cause notice and adopted in the final order for transferring the cases namely “for effective and coordinated investigation” is not sufficient to exercise powers under section 127(2) of the Act, counsel relied on following decisions : 1)Ajantha Industries v. Central Board of Direct Taxes reported in (1976) 102 ITR 281(SC). 2)Naresh Kumar Agarwal v. Union of India reported in (2010) 320 ITR 361(Cal.) 3)Anil Kumar Kothari v. Union of India reported in (2010) 232 CTR 104(GAU). 4)Vijaysanthi Investments (P.) Ltd. v. Chief Commissioner of Income-tax reported in (1991) 187 ITR 405(AP). 5)Power Controls v. Commissioner of Income-tax reported in (2000) 241 ITR 807(Delhi). 4)In support of his contention that the reason indicated in the show cause notice and adopted in the final order for transferring the cases namely “for effective and coordinated investigation” is not sufficient to exercise powers under section 127(2) of the Act, counsel relied on following decisions : 1)Ajantha Industries v. Central Board of Direct Taxes reported in (1976) 102 ITR 281(SC). 2)Naresh Kumar Agarwal v. Union of India reported in (2010) 320 ITR 361(Cal.) 3)Anil Kumar Kothari v. Union of India reported in (2010) 232 CTR 104(GAU). 4)Vijaysanthi Investments (P.) Ltd. v. Chief Commissioner of Income-tax reported in (1991) 187 ITR 405(AP). 5)Power Controls v. Commissioner of Income-tax reported in (2000) 241 ITR 807(Delhi). 7. On the other hand, learned counsel Mrs. Mauna Bhatt for the respondent opposed the petitions contending that the statutory requirements as contained in section 127(2) of the Act were followed before passing of the impugned order. Opportunity of hearing was granted to the Bhatt for the respondent opposed the petitions contending that the statutory requirements as contained in section 127(2) of the Act were followed before passing of the impugned order. Opportunity of hearing was granted to the petitioners. Their objections were considered and disposed of by a speaking order. Reasons were recorded in the order itself. Such order was duly communicated. She therefore, submitted that all the requirements for exercise of power under section 127(2) of the Act as interpreted by various Courts were fully complied with. 7.1)Counsel submitted that the assessments which have been transferred arise out of search operations in connection with group of persons/companies belonging to the same family/group. It was therefore, necessary that such assessments be consolidated before a single Assessing Officer. She submitted that all assessments arising out of search operations are placed at the disposal of centralised wing of the department. This was done as per instructions contained in CBDT circular dated 17.9.2008. She submitted that in the said circular it is provided that : “Instances have come to notice of the Board that Search cases are not being centralized promptly, thereby causing delay in initiation of the search assessment proceedings, deferment of payment of taxes and finally resulting in completion of search assessments at the fag end of the limitation period. 2.In supersession of existing Board’s instruction no.8/2002 dated 14[th] August, 2002 on above subject, I am directed to inform that following procedure for early centralization of search cases should be followed : (c)In regions where there is no central circle or the group is assessed in more than one CCIT region or involving more than one CIT charges, then the DGIT(Inv.) should identify the CIT charge in which the group searched will be centralized in consultation with the CCIT in whose jurisdiction the main case of the group are assessed to tax within seven days of initiation of search.” 7.2)Counsel submitted that the reasons stated in the show cause notice for transferring the cases cannot be stated to be vague or general. The final order clarified that the cases were being transferred at Ahmedabad since it was necessary that group cases are centralised at one place in Gujarat. Since the department did not have a Central Circle office in Bhavnagar, the cases were transferred at Ahmedabad after giving option to the assessees if they so preferred that the cases be transferred either at Surat, Baroda, Rajkot or Ahmedabad. 7.3)In support of her contention that the reason“foreffectiveandcoordinated investigation” cannot be stated to be insufficient or vague or general, counsel relied on the following decisions : 1)General Exporters v. Commissioner of Income-tax and another reported in (2000) 241 ITR 845(MAD) 7.3)In support of her contention that the reason“foreffectiveandcoordinated investigation” cannot be stated to be insufficient or vague or general, counsel relied on the following decisions : 1)General Exporters v. Commissioner of Income-tax and another reported in (2000) 241 ITR 845(MAD) 2)Arti Ship Breaking v. Director of Income-tax (Investigation) and others reported in (2000) 244 ITR 333(Guj) 3)Redwood Hotel(P.) Ltd. v. Chief Commissioner of Income-tax and others reported in (2003) 259 ITR 191(KER) 4)Virender Kumar Jain v. Commissioner of Income-tax and others reported in (2006) 283 ITR 541(All). 5)Trimurti Fragrances P. Ltd. v. Commissioner of Income-tax and another reported in (2006) 283 ITR 547(All). 6)Rimjhim Ispat Ltd. v. Commissioner of Income-tax-II, Kanpur reported in (2007) 164 Taxman 90(All.) 7)Charan Pal Singh v. Commissioner of Income-tax and another reported in (2008) 307 ITR 132(P&H). J.R. Tantia Charitable Trust v. Deputy 8)J.R. Tantia Charitable Trust v. Deputy Commissioner of Income-tax, Central Circle Bikaner reported in (2011) 203 Taxman 348. 8. Having thus heard learned counsel for the parties, we may peruse the record more closely. In the show cause notice dated 11.10.2012, the Commissioner conveyed to the petitioners that opportunity is being given to explain why your cases should not be centralised at Ahmedabad for effective and coordinated investigation in the group cases. The petitioners raised objections and contended that none of the petitioners have establishments at Ahmedabad. They are assessed at Bhavnagar or Mumbai. Cases can therefore, be consolidated at one of those two places but not at Ahmedabad. It would be inconvenient for the petitioners to travel to Ahmedabad regularly. Such objections were considered by the Commissioner but rejected in the speaking order dated 12.11.2012. In the said order he recorded and considered the objections in the following manner : “5. I have considered the objections of the assessees. The main objection of this group of assessees is that since the business of the assessees is either at Bhavnagar or Mumbai and they do not have any business activities at Ahmedabad, therefore, their cases may be centralized either at Bhavnagar or Mumbai. This request of the assessees cannot be accepted particularly when the appeal matters before CIT(A) and higher authorities are being attended by them at Ahmedabad only. For this purpose there is no requirement that the assessees should have their business activities in Ahmedabad also. Further the IT department, Gujarat does not have office under Central Ranges at Bhavnagar. Therefore, the Authorised Representatives was asked to chose any one of the places namely, Surat, Baroda, Rajkot and Ahmedabad where the IT department have Central Circle Offices. However, it was informed by the A.R. that none of the places would suit their assessees. It is necessary that the group cases are centralised at one place in Gujarat where the department has offices under Central Range for carrying out coordinated investigations as no centralisation proposal from Mumbai office has been received in respect of this group of assessees. In view of the above, the objections of the A.R. Are over-ruled and it is ordered that their cases be centralized with the ACIT, Central Circle-1(3), Ahmedabad. Accordingly, following jurisdictional order is being passed...” proposal from Mumbai office has been received in respect of this group of assessees. In view of the above, the objections of the A.R. Are over-ruled and it is ordered that their cases be centralized with the ACIT, Central Circle-1(3), Ahmedabad. Accordingly, following jurisdictional order is being passed...” 9. From the above, it can be seen that the reason for transfer of cases from Bhavnagar to Ahmedabad was that for group cases arising out of common search operations, they were required to be consolidated. Further, in view of the fact that the assessments arose out of search operations, they were required to be centralised and placed at the disposal of central wing of the Income-tax department. Since Bhavnagar did not have such wing, they were under proposal for transfer at Ahmedabad. During the course of hearing, the authorised representatives of the petitioners was offered that the cases could be transferred either at Surat Baroda or Rajkot. The authorised representatives however, did not accept such alternative. It was thereupon that the Commissioner proceeded to finalise the proposal contained in the show cause notice to transfer all the cases at Ahmedabad. 10. Question is does this order suffer from any legal infirmity? This issue we need to judge from the angle of sufficient opportunity being given and sufficiency of reasons on which transfer was effected. C/SCA/16883/2012 JUDGMENT 11.Section 120 of the Act pertains to jurisdiction of the Income Tax authorities. Section 124 pertains to jurisdiction of the Assessing Officer. Ordinarily, Assessing Officers assume jurisdiction to frame assessment in terms of provisions made in these sections. 12.Section 127 of the Act pertains to power to transfer cases and reads as thus : “127. Power to transfer case.- (1) The Director General or Chief 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 Director General or Chief Commissioner or Commissioner,— (a) where the Directors General or Chief Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Director General or Chief Commissioner or Commissioner from whose jurisdiction the case is to be transferred 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, pass the order; (b) where the Directors General or Chief Commissioners or Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such Director General or Chief Commissioner or Commissioner as the Board may, by notification in the Official Gazette, authorise in this behalf. (3) Nothing in sub-section (1) or sub-section (2) shall be deemed to require any such opportunity to be given where the transfer is from any Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) and the offices of all such officers are situated in the same city, locality or place. (b) where the Directors General or Chief Commissioners or Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such Director General or Chief Commissioner or Commissioner as the Board may, by notification in the Official Gazette, authorise in this behalf. (3) Nothing in sub-section (1) or sub-section (2) shall be deemed to require any such opportunity to be given where the transfer is from any Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) and the offices of all such officers are situated in the same city, locality or place. (4) The transfer of a case under sub-section (1) or sub-section (2) may be made at any stage of the proceedings, and shall not render necessary the re-issue of any notice already issued by the Assessing Officer or Assessing Officers from whom the case is transferred. Explanation.—In section 120 and this section, the word “case”, in relation to any person whose name is specified in any order or direction issued thereunder, means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year.” Section 127(2) of the Act empowers the Director General or Chief Commissioner or the Commissioner as the case may be to transfer a case from one Assessing Officer to another after giving the assessee a reasonable opportunity of being heard wherever it is possible to do so and after recording his reasons for doing so by passing an order. The requirement of exercise of power is thus an opportunity of hearing wherever it is possible to do so, recording of reasons and passing of an order. In case of Ajanta Industries(supra), the Supreme Court interpreted such requirement as to also communication of the reasons recorded to the assessee. In such decision, it was held that while making an order for transfer under section 127 of the Act, requirement of recording reasons is a mandatory direction, non communication of the same to assessee would not be saved by showing that reasons existed in file although not communicated to the assessee. 13.In the present case, the Commissioner issued show notice indicating tentative reasons on which he proposed transfer of the cases. The petitioners were allowed to raise their objections. Their authorised representative was also heard in person. After undertaking such steps, he passed a speaking order disposing of the objections. Such order was communicated to thepetitioners.Insofarasprocedural requirements of section 127(2) of the Act are concerned, thus stood satisfied. It is not even the case of the petitioners that opportunity of hearing was not given or that the reasons were not communicated. 14.Case of the petitioners however, is somewhat different. They contended that the expression “for effective and coordinated investigation” used in the show cause notice being too general and vague would not satisfy requirement of putting the petitioners to notice why cases were under proposal for transfer. They further contended that in any case such reason is not sufficient to permit the transfer. In this context, we may advert to the authorities cited by both the sides. 1)In case of Naresh Kumar Agarwal(supra), learned Single Judge of Calcutta High Court opined that expression “coordinated investigation and assessment” used in the show cause notice would not be sufficient as the assessee should be intimated about the reasons in a comprehensive manner in order to enable him to make effective representation. 1)In case of Naresh Kumar Agarwal(supra), learned Single Judge of Calcutta High Court opined that expression “coordinated investigation and assessment” used in the show cause notice would not be sufficient as the assessee should be intimated about the reasons in a comprehensive manner in order to enable him to make effective representation. 2)In case ofAnil Kumar Kothari(supra), learned Single Judge of Gauhati High Court referring to Supreme Court judgement in case of Ajanta Industries(supra) andNaresh Kumar Agarwal(supra) held and observed as under : “13. Section 127 mandats that assessee must be given a reasonable opportunity of being heard while exercising the power to transfer cases. Although a rider "wherever it is possible to do so" is also there, it is not the case of the respondents that it is not possible to do so. Further, the order is to be passed after recording the reasons for doing so. Apart from the fact that the petitioner was not provided with any opportunity of being heard in the matter, the reasons assigned in the order dated 24-7-2007 which is "administrative convenience and for co-ordinating effective investigation" also cannot be said to be the reasons as envisaged in section 127(1) of the Act. It is in this context, Mr. Kapoor, learned counsel for the petitioner has referred to the aforesaid two decisions rendered by Andhra Pradesh High Court and Calcutta High Court. In both the decisions, the High Courts have emphasised on the need to assign detailed reasons while holding that it is not sufficient merely to show in the notice that the transfer is proposed to "facilitate the detail and co-ordinated investigation". In the Andhra Pradesh High Court decision the said quoted portion, was assigned to be the reasons, which did not find favour of the court.” 3)In case of Vijayasanthi Investments (P.) ltd(supra), Division Bench of Andhra Pradesh High Court observed as under : “12. From the aforesaid decisions, it is clear that, in the matter of the transfer of a case under section 127 of the Act, it is necessary that the authority which proposes to transfer the case must, wherever it is possible to do so, give the assessee a reasonable opportunity of being heard with a view to enable him to effectively show cause against the proposed transfer. The notice must also propose to give a personal hearing. It is also necessary to mention if the notice the reasons for the proposed transfer so that the assessee could make an effective representation with reference to the reasons set out. It is not sufficient merely to say in the notice that the transfer is proposed "to facilitatedetailedandco-ordinated investigation." The reason cannot be vague and too general in nature but must be specific and based on material facts. It is again not merely sufficient to record the reasons in the file but it is also necessary to communicate the same to the affected party.” 4)In case of Power Controls(supra), Division Bench of Delhi High Court struck down the transfer of assessment proceedings on the ground that the reasons recorded in the file were not communicated to the assessees. While doing so, the Court clarified that they were not holding that administrative convenience or coordinated investigation cannot be a valid ground for transferring the cases belonging to a particular group to a single Assessing Officer. We may reproduce the observations of the Court in this context : too general in nature but must be specific and based on material facts. It is again not merely sufficient to record the reasons in the file but it is also necessary to communicate the same to the affected party.” 4)In case of Power Controls(supra), Division Bench of Delhi High Court struck down the transfer of assessment proceedings on the ground that the reasons recorded in the file were not communicated to the assessees. While doing so, the Court clarified that they were not holding that administrative convenience or coordinated investigation cannot be a valid ground for transferring the cases belonging to a particular group to a single Assessing Officer. We may reproduce the observations of the Court in this context : “19. We are, therefore, of the view that the petitioners have not been granted adequate opportunity to being heard before their cases were ordered to be transferred from Delhi of Faridabad. We may, however, clarify at this stage that we are not holding for a moment that "administrative convenience" and/or "coordinated investigation" cannot be a valid ground for transferring the cases belonging to a particular group to a single assessing officer. It would be a good ground for transfer but the requirement of law, which has to be observed before transferring the assessee's case from one officer to another, is that the assessee must be appraised of the basic and broad facts, which, in the opinion of theauthoritiesconcerned,necessitate coordinated investigation by a single assessing officer, to enable the assessee to put forth his viewpoint on the issue so that a considered decision is taken to prevent unnecessary harassment to the assessee and at the same time the object of the transfer is achieved, which of course is the prime consideration in such like matters.” From the above it can be seen that in the above decisions Courts have taken a view that the reasonforcoordinatedandeffective investigation or similar such expression would not be a sufficient ground for transferring the assessment proceedings. We may record that Calcutta High Court in case of Naresh Kumar Agarwal(supra) had opined that such ground indicated in the show cause notice would not satisfy the requirement of hearing being a vague and general ground. On the other hand Gauhati High Court in case of Anil Kumar Kothari(supra) concluded that such reason for passing the transfer order would be vitiated since such ground would not be sufficient to transfer the cases. Delhi High Court in case of Power Controls(supra) however, did not approve such logic. 15.We may now advert to the decisions taking a different view. 1) In case of Virender Kumar Jain(supra), Division Bench of Allahabad High Court was dealing with assessment proceedings arising out of search operation involving a firm/ group of companies and their partners/Directors while proposing to transfer the cases from Kanpur to Delhi on the ground that it was necessary for coordinated and meaningful investigation. Such transfers were challenged by the parties affected. Allahabad High Court rejected the petitions making following observations : “6. In the case of Peacock Chemicals P. Ltd. v. CIT and Mahesh Chand Vishan Swarup v. CIT (Bench presided over by B. P. J. Reddy), it is consistentlyheldthattheparamount consideration for transfer should be public interest and the reason to have co-ordinated investigation in the matter of one family members or group of company/firm is a good ground. In the instant case, the authority has recorded its satisfaction and given good reason which cannot be faulted. transfers were challenged by the parties affected. Allahabad High Court rejected the petitions making following observations : “6. In the case of Peacock Chemicals P. Ltd. v. CIT and Mahesh Chand Vishan Swarup v. CIT (Bench presided over by B. P. J. Reddy), it is consistentlyheldthattheparamount consideration for transfer should be public interest and the reason to have co-ordinated investigation in the matter of one family members or group of company/firm is a good ground. In the instant case, the authority has recorded its satisfaction and given good reason which cannot be faulted. 7. The contention of the petitioner that the Department should have furnished information with them (as claimed by them in their reply) is not at all sound as the Department cannot be compelled or required at the initial stage to disclose the "material" or "information" as it may "embarrass or prejudice" the assessment. The legal position is crystal clear and settled by a catena of the decisions of this Court and the apex court on this issue. this Court cannot go into the "sufficiency" of the reasons : There is no pleading that the impugned order of transfer is due to "bias" or "mala fide" or otherwise "arbitrary". The reasons indicated in the impugned order cannot be said to be irrelevant. Reference may be made to the decision of this Court in the case of Madhav Sharan Agrawal v. CIT . We may refer to our judgment rendered today, i.e., February 23, 2006 in Writ Petition No. 355 of 2005 : Trimurti Fragrances P. Ltd v. CIT [2006] 283 ITR 547, wherein we had an occasion to deal with this aspect in detail.” 2) In case ofTrimurti Fragrances P.Ltd.(supra), Division Bench once again upheld the transfer of assessment proceedings on the ground that for coordinated investigation, it was necessary to do so. It was observed as under : “23. In the instant case, this Court takes notice of the fact that otherwise also the distance between Kanpur and Delhi can be covered within a few hours and that the persons involved are already having their business transactions and activities between Kanpur and Delhi. The inconvenience projected by the assessee in question cannot be said to be of that magnitude which could prevail over other relevant considerations. 24.In view of the above, we find that there has been sufficient compliance with principles of natural justice and the impugned order of transfer cannot be said to be arbitrary or devoid of any rationale or in any way based on irrelevant considerations. It is to be noted that there is no case of the petitioner that the impugned order of transfer suffers from bias or mala fides. 25. In that view of the matter, the impugned order of transfer dated February 22, 2005/annexure 3 to the writ petition does not suffer from any manifest error, apparent on the face of record, warranting the interference of this Court under Article 226 of the Constitution of India.” 3) In case of Charan Pal Singh(supra), Division Bench of Punjab and Haryana High Court examined the legality of an order transferring the cases from Baroda to Chandigarh on the ground that search and seizure operations were carried out on the business premises of the company and its Directors, some of the persons of the group were being assessed at Chandigarh and therefore, for centralisation of these cases, it was vital from the point of view of coordinated investigation in the group to protect the interest of the Revenue, it was necessary to transfer the cases. When such order was challenged, Punjab and Haryana High Court rejected the petition making following observations : 3) In case of Charan Pal Singh(supra), Division Bench of Punjab and Haryana High Court examined the legality of an order transferring the cases from Baroda to Chandigarh on the ground that search and seizure operations were carried out on the business premises of the company and its Directors, some of the persons of the group were being assessed at Chandigarh and therefore, for centralisation of these cases, it was vital from the point of view of coordinated investigation in the group to protect the interest of the Revenue, it was necessary to transfer the cases. When such order was challenged, Punjab and Haryana High Court rejected the petition making following observations : “9. Undoubtedly, the order of transfer of assessment file of an assessee to a far off place puts the assessee in a great inconvenience and ought not to be ordered unless necessary in public interest to safeguard revenue by centralisation of cases for co-ordinated investigation. Such an order cannot be passed arbitrarily and can be justified only if there are valid reasons. The principles of natural justice as well as the statutory provision require that the reasons must be recorded in writing in the order itself and disclosed to the assessee to enable the assessee to take its remedies against such an order. At the same time, the power conferred for transfer cannot be interfered with having regard to the object for which such power is conferred. The impugned order records the reason, that is need for centralization for effective and co-ordinated investigation. The nexus between the petitioner and the Baroda company cannot be held to be non-existent. The decisions relied upon by learned counsel for the Revenue support the submission that if it was necessary for co-ordinated and effective investigation, transfer under section 127 of the Act could be justified. In the present case, there is nothing to show that there was any extraneous consideration or that reasons given were non existent or irrelevant.” 4) In case of General Exporters(supra), learned Single Judge of Madras High Court held that transfer of assessment cases for coordination of investigation is a good ground. It was a case where the assessment proceeding was transferred from Madras to New Delhi. Learned Judge observed as under : “As noticed above, the very object of transfer is to achieve the object of the Act. If coordinated investigation is necessary for the purpose of proper assessment, prevention of evasion of tax, collection of tax and other relevant matters, then the proper and coordinated investigation is a good ground for transfer of the case. It cannot be laid down as a proposition of law that the said ground cannot be a valid ground for transfer. In a given case, the same may not be a good ground for transfer, on being noticed that the coordinated investigation in no way will help to achieve the object of the Act. No doubt, transfer of a case from the place where the assessee has its place of residence of business to another place causes inconvenience but if it is necessary in the public interest, then the transfer on the ground of proper and coordinated investigation cannot be held to be impermissible in law. I find myself in disagreement with the viewthatcoordinatedorcentralised investigation will not be a ground of transfer under section 127 of the Act. I am in agreement with the view taken by the different High Courts, as mentioned above, holding that proper and coordinated investigation would be relevant ground to exercise the power under section 127 of the Act." 5) In case of Redwood Hotel(P) ltd.(supra), learned Single Judge of Kerala High Court upheld transfer of assessments passed under section 127(1) of the Act observing that “Of-course it is for the Department to consider consolidation of all the files of the firms and the companies and the partners and the directors, including those who are now assessed at Calicut and send it to the appropriate station. This is a matter for consideration by the Department. It was further observed that “However, I make it clear that there is no scope for interference by this Court in these matters which are purely administrative in nature; except when there is allegation of mala fides or want of jurisdiction. No assessee has a vested right to have his assessment decided by any officer or at any place. It is for the head of the department to allocate work among the officers under him subject to the Act and Rules. Trust(supra), learned Single Judge of Rajasthan High Court upheld the order of transfer of assessment from Sriganganagar to Bikaner office for coordinated investigation and administrative convenience. It was observed as under : “10. In the opinion of this Court, while it is true that Section 127 of the Act requires the competent authority to record his reasons for transferring any case from one Assessing Authority to another, such reasons apparently appear to have been recorded and communicated to the petitioner vide Annex-3 dated 10.06.2009, namely, that such transfer of case from Sriganganagar to Bikaner was required for coordinated investigation as the petitioner trust was a case closely connected with the search, since the search was conducted under the warrant of authorization under Section 132 of the Act purportedly issued in the name of three individuals (S/Sh. Shyam Sunder Tantia, Jagdish Rai Tantia and Anil Tantia). There is no dispute from the side of the petitioner-Trust that these persons against whom warrant under Section 132 of the Act was issued and executed, a search was carried-out at their place, are family members and are related with the petitioner-Trust being its trustees. On the other hand, Revenue has contended that even name of petitioner-Trust was mentioned in the search warrants. Therefore, it cannot be said that there was no reasons for transfer of the proceedings from Sriganganagar to Bikaner. Adequate opportunity was given to the petitioner to raise its objections against such transfer, but except filing a preliminary reply, Annex-2 dated 02.06.2009, in which the assessee really asked for further reasons in order to enable him to file appropriate objections, no such objections were really filed by it even though the assessee was specifically called upon to do so vide Annex-3 dated 10.06.2009 in which reasons for such transfer were even communicated to the assessee-Trust. transfer of the proceedings from Sriganganagar to Bikaner. Adequate opportunity was given to the petitioner to raise its objections against such transfer, but except filing a preliminary reply, Annex-2 dated 02.06.2009, in which the assessee really asked for further reasons in order to enable him to file appropriate objections, no such objections were really filed by it even though the assessee was specifically called upon to do so vide Annex-3 dated 10.06.2009 in which reasons for such transfer were even communicated to the assessee-Trust. 11. Therefore, in absence of any objection, order of transfer (Annex-4) under Section 127 of the Act, passed by Commissioner of Income Tax on 07.07.2009, cannot be held to be falling foul with the provisions of Section 127 (1) of the Act. In fact, under the said order, all the proceedings of all the family members of person searched under Section 132 of the Act of 1996 including, the petitioner-Trust, whose name was mentioned in such warrants under Section 132 of the Act also and, therefore, all connected cases were transferred from Sriganganagar to Bikaner to one Assessing Authority, and as many as 15 cases of the said family, were transferred by the learned Commissioner of Income Tax from Sriganganagar to Bikaner for coordinated investigation and administrative convenience. It is not in dispute that said Commissioner had power to transfer the proceedings of assessment from one range to another under his charge as per the provisions of Section 127 of the Act. Therefore, the said order under Section 127 of the Act is found to be perfectly valid and legal.” “23. From the aforesaid decisions the following position emerges: The assessee has to be assessed by an officer who has been vested With jurisdiction over an area where the persons carries on a business or profession under Section 124(1) of the Act. The exigencies of the tax collection may require the Income Tax Authorities to transfer the case of a particular assessee from the assessing officer of the area within which he resides or carries on business to another Income Tax officer under subsections (1) and (2) of Section 127 of the Act. The order of transfer is not a material infringement of the assessees' rights. Before transferring the case from one officer to another a notice has to be given to the assessee. The notice should briefly state the reasons why it is proposed to transfer the case. Before ordering transfer reasons have to be recorded and it has to be communicated to the assessee. The officer has to apply his mind to the materials on record or information available while passing an order, of transfer.” 8) We may also notice that before this Court in case of Arti Ship Breaking(supra) transfer of pending assessments came up for consideration. The thrust of the argument of the petitioners in the said cases was that the reasons though may have been recorded by the Commissioner for passing the order of transfer, same were not communicated to the petitioner. In view of decision of the Supreme Court in case of Ajanta Industries(supra), the order would be bad in law. While not accepting such a contention, this Court in the context of reasons recorded for effecting the transfer observed as under : “We have gone through the record and we have also perused the reasons which have been given by the concerned authority for transferring the case of the petitioner under sec. 127 of the Act. It is clear that the case of the petitioner has been transferred from Bhavnagar to Rajkot for administrative reasons. It has C/SCA/16883/2012 JUDGMENT “We have gone through the record and we have also perused the reasons which have been given by the concerned authority for transferring the case of the petitioner under sec. 127 of the Act. It is clear that the case of the petitioner has been transferred from Bhavnagar to Rajkot for administrative reasons. It has C/SCA/16883/2012