Smt. Chandra Prabha Kushwaha and Others vs Commissioner of Income Tax and Another

The petitioner has questioned the legality of an order passed by the Commissioner of income tax, Allahabad, on December 17, 2012, u/s 127(2) of the income tax Act 1961 (hereinafter referred to as "the Act"). A copy of the order was received by the petitioner from the income tax Office, Mirzapur, on January 3, 2014, as stated in paragraph 1 of the writ petition. The power to transfer a case u/s 127 is conditioned by the requirement of furnishing a reasonable opportunity of being heard, wherever it is possible to do so, to the assessee and of recording reasons. The principles in this regard are well settled and have been laid down by the Supreme Court in Ajantha Industries and Others Vs. Central Board of Direct Taxes, New Delhi and Others, and in a judgment of a Division Bench of this court in Vinay Kumar Jaiswal and Others, Ganga Dharam Kanta and Another, Sneh Jaiswal and Others and Jaiswal Steel Processing Pvt. Ltd. and Others Vs. Commissioner of Income Tax and Others, .

In the present case, the impugned order dated December 17, 2012, was passed admittedly without furnishing a reasonable opportunity of being heard nor does it record any reason for the transfer of the case.

Learned counsel appearing on behalf of the Revenue states that reasons have been recorded in the letters dated October 29, 2012, and October 5, 2012, of the Commissioner of income tax (Central), Kanpur and DIR (Investigation), Kanpur.

Learned counsel has relied upon a judgment of a learned single judge of the Kerala High Court in Redwood Hotel (P.) Ltd. Vs. Chief Commissioner of Income Tax and Others, and submits that the cases needed to be centralized in view of the fact that a search had been carried out.

We are not inclined to express any opinion on the merits of the issue as to whether the cases are required to be centralized since that has to be determined after following the procedure prescribed u/s 127(2) of the Act. Moreover, the reasons have to be spelt out in the order which has been passed u/s 127(2) of the Act which is admittedly not the case here.

Hence, following the well settled position in law, we set aside the impugned order dated December 17, 2012, passed u/s 127(2) of the Act. We direct, in consequence, that the assessee shall be at liberty to file its reply to the proposed transfer of cases from Mirzapur to Allahabad within a period of two weeks from today and shall appear before the Commissioner of income tax at Allahabad on January 23, 2014.

We keep all issues to be decided by the competent authority. The fresh order may be passed in accordance with law after furnishing a reasonable opportunity of being heard to the assessee.

The petition is, accordingly, allowed to the extent indicated above. There shall be no order as to costs.