ATS Promoters and Builders P. Ltd. and Others vs Chief Commissioner of Income Tax and Another

Badar Durrez Ahmed, J.—In this batch of writ petitions the order dated October 7, 2008, passed by the Commissioner of Income Tax, Delhi-I, New Delhi, u/s 127(2) of the Income Tax Act, 1961, is under challenge. By virtue of the said order, the Commissioner of Income Tax has transferred the cases of the petitioners to the Assessing Officer at Meerut, namely, the Assistant Commissioner of Income Tax, Central Circle, Meerut. The impugned order, in its entirety, reads as under:

Office of the Commissioner of income tax

Delhi-I, New Delhi F. No. : CIT-I/ITO Hq-I/Centralisation/08-09 7-10-2008

Order u/s 127(2) of the Income Tax Act, 1961

In exercise of the powers conferred by Sub-section (2) of Section 127 of the Income Tax Act, 1961 (43 of 1961), Section 11 of the Wealth-tax Act, 1957, Section 7 of the Gift-tax Act, 1958, and other powers enabling me in this behalf, I, Commissioner of Income Tax, Delhi-I, New Delhi, hereby transfer the case, particulars of which are mentioned hereunder in Col. 2, from the Assessing Officer mentioned in Col. 3, therein, to the Assessing Officer mentioned in Col. 4 after considering the objections filed by the assessee in response to show-cause notice u/s 127.

----------------------------------------------------------------------------- S. From To No. ----------------------------------------------------------------------------- 1 M/s Alstonia Township (P.) Ltd., ITO Ward 1(3) New Asst. CIT Central PAN - AAECA 4455A Delhi Circle, Meerut 2 Sh. Ashwani Talwar Deputy CIT, Asst. CIT Central PAN - AAAPT 0920E Cir.2(1) New Delhi Circle, Meerut 3 Sh. Anil Kumar Saha Deputy CIT, Asst. CIT Central PAN - AMYPS 1829D Cir.2(1) New Delhi Circle, Meerut 4 Sh. Geetamber Anand Deputy CIT, Asst. CIT Central PAN - ACHPA 0868K Cir.2(1) New Delhi Circle, Meerut 5 M/s ATS Infrastructure Ltd. Deputy CIT, Asst. CIT Central PAN-AADCA 0809B Cir.2(1) New Delhi Circle, Meerut 6 M/s ATS Promoters and ITO Ward 2(2) New Asst. CIT Central Builders Pvt. Ltd., Delhi Circle, Meerut PAN-AABCA 4298C 7 M/s ATS Construction and ITO Ward 2(2) New Asst. CIT Central Maintenance Pvt. Ltd. Delhi Circle, Meerut PAN - AACCS 0562 Q -----------------------------------------------------------------------------

This transfer is effected for administrative convenience and coordinated investigation.

This issues with the concurrence of the Commissioner of Income Tax (Central), Kanpur, vide his letter No. CIT (C)/ KNP 58-02-08/08-09/620, dated June 3, 2008.

The order shall come into force from October 13, 2008.

(Sd.) ...

Vijay Sharma,

Commissioner of Income Tax,

Delhi-I, New Delhi.

The learned Counsel for the petitioners submitted that on September 30, 2008, the Commissioner of Income Tax, Delhi, had issued a letter with regard to the proposal for transferring the jurisdiction over the petitioners'' cases to Meerut from Delhi. On October 6, 2008, the petitioners submitted detailed representations before the said Commissioner of Income Tax containing several objections to the proposal for transferring their cases to Meerut. On October 7, 2008, the petitioners also submitted a detailed representation before the Chief Commissioner of Income Tax (respondent No. 1). The said representation also contained several objections to the proposals for transfer of cases to Meerut. The objections taken by the petitioners were that the head office and the registered office of the company were situated in Delhi at 711/92 - Deepali, Nehru Place, New Delhi and the directors'' residences were either in Delhi or Noida only. The petitioners also took the objection that the main company being ATS Promoters and Builders Private Limited and the other group entities and its directors were being assessed in Delhi since the very incorporation of the company and other entities. It was also contended that the business activities of the petitioners were located at Noida which is close to Delhi and that there was no activity of the petitioners in Meerut. It was, therefore, contended that it would be very difficult for the assessee to attend the assessment proceedings on a day-to-day basis at Meerut. They had no objection to the centralization of all the assessment proceedings at one place but, according to the petitioners, that could easily be done at Delhi which would be convenient for all parties. It is apparent that the impugned order passed by the Commissioner of Income Tax, Delhi-I, does not deal with the objections and merely states that "after considering the objections filed by the assessee in response to the show-cause notice u/s 127" the cases were being transferred to the Assessing Officer at Meerut. The order also only states that the transfer was effected for administrative convenience and co-ordinated investigation.

The learned Counsel for the petitioners has placed before us a decision of this Court in the case of Nitin Developers And Const Vs. Commissioner of Income Tax, wherein it has been observed that the order of transfer u/s 127(2) ought to disclose proper application of mind to the objections which the assessee may have raised. The court observed that this principle is fairly well-settled. In the present case, we find that the order does not disclose proper application of mind to the objections and obviously the order does not indicate as to how the objections raised by the petitioners have been met.

In these circumstances, we set aside the impugned order. It would be open to the Commissioner of Income Tax (Delhi)-I, New Delhi, to pass another order u/s 127(2) after granting a further opportunity of hearing to the petitioners. We make it clear that the order that would be passed by the Commissioner of Income Tax ought to deal with the objections, if any, raised by the petitioners.

These writ petitions stand disposed of accordingly.

Dasti under the signature of the court master.