A division bench of the Calcutta High Court has upheld the order of the Single bench transferring income tax proceedings from Kolkata to Delhi stating that the Congress leader has not been able to make out any case for interference with the order of transfer on anyone of the settled principles for interference of an administrative order.
Last month, the Calcutta High Court has dismissed a petition by the former Chief Minister of Madhya Pradesh seeking transfer of income tax proceedings to Delhi from Kolkata.
A search operation under Section 132(1) of the Income Tax Act and survey under Section 133A of the Income Tax Act was conducted on Praveen Kakkar, Rajendar Miglani, Lalit Chhallani, Prateek Joshi and Himanshu Sharma at Kolkata, Indore, Bhopal and other places by the Investigation Wing, Delhi. The operation was conducted on April 7, 2019 and subsequent dates. The search operations resulted in statement of certain persons that there was transfer of cash to the tune of almost Rs. 20 crores from the residence of the petitioner at Delhi. Subsequently, income tax order was passed by the Principal Commissioner of Income Tax, Kolkata – 9 wherein the petitioner’s income tax assessment was transferred from Kolkata to New Delhi under Section 127 of the Income Tax Act.
In a single bench order, Justice Shekhar B. Saraf observed that the Principal Commissioner of Income Tax, Kolkata has clearly delineated the reasons of the transfer under Section 127 of the Income Tax Act in the Impugned Order for a detailed and coordinated investigation of the petitioner.
“It is to be noted that the files of several other persons have also been transferred under Section 127 of the Income Tax Act. The petitioner is the only one whose file is still not being transferred because of the writ petition filed before the Calcutta High Court,” the Court said.
Dismissing the appeal, Justice T.S. Sivagnanam and Justice Hiranmay Bhattacharyya held that “when the assessee himself complained that no reasons were recorded in the show-cause notice dated 05.09.2019 and the order of transfer (quashed in the earlier writ proceedings), the income tax department was duty bound to follow the directions in WPA 11901/2021 dated 27.09.2021. Therefore, to state the show-cause notice, and order of transfer were coloured on facts is unacceptable. Further, it appears that the assessee, before the learned Writ Court has embarked on facts, as was done before us, this has resulted in the learned Writ Court to consider the same and render a finding. In any event in this litigation adjudication of the merits is out of bounds, hence any argument as advanced on behalf of the appellant in that regard has to necessarily fail. If the assessee states that he claims no right to be assessed at a particular place while exercising the power under Section 127 of the Income Tax Act, our task becomes easier. This is so because the assessee had been provided with adequate opportunity to put further his submissions on the proposal for transfer, opportunity of personal hearing was granted and availed of, reasons have been recorded by the department. There is no challenge to the decision making process. The plea of mala fide has not been pleaded or proved. The plea of inconvenience has been found to be not tenable. In the net result, we have to necessarily uphold the order of transfer.”
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