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2006 (7) TMI 161 - HC - Income TaxCorrectness/validity of an order u/s 127 - power of transfer of case - case transferred from Kolkata to Central, Mumbai - Petitioner has had its registered office in Kolkata, ever since its incorporation in 1988 - Petitioner No.1 engaged in the business of real estate development and has since its inception been assessed to tax at Kolkata, where its registered office is situate - HELD THAT:- In view of the judgment of the Supreme Court in the case of Ajantha Industries v. CBDT [1975 (12) TMI 1 - SUPREME COURT], the judgment case of Rajesh Mahajan v. CIT [2002 (7) TMI 94 - PUNJAB AND HARYANA HIGH COURT] and the judgment of R. K. Agarwal v. CIT [2006 (2) TMI 95 - ALLAHABAD HIGH COURT], there can be no doubt that an order of transfer u/s 127 of the Act, is amenable to scrutiny under article 226 of the Constitution of India. In proceedings under article 226 of the Constitution of India, this court might examine the reasons for transfer of a case, and if the reasons ex facie do not justify transfer, an order of transfer might be interfered with by this court. The petitioner-company and Pioneer Embroideries Ltd., are distinct body corporates, separately assessed to income-tax. Even though petitioner No.2 might be a director of the petitioner-company as also Pioneer Embroideries Ltd., petitioner No.2 is an individual assessee. In the absence of any business connection between the petitioner-company and Pioneer Embroideries Limited and in the absence of any finding that the valuables or documents seized from the residence of petitioner No.2 had any relationship with Pioneer Embroideries Limited or any of its sister concerns, there could be no question of transferring the case of the petitioners to Mumbai. There can, however, be no doubt that the income-tax authorities might continue with the investigation, if any, against each of the petitioners - The impugned order is set aside and quashed. This order will, however, not prevent the respondent authorities from issuing a fresh order of transfer u/s 127 of the Income-tax Act, 1961, transferring the case of petitioner No.2 to Mumbai in the event any real nexus is found between any articles or documents found in the residence of petitioner No.2 and Pioneer Embroideries Ltd., or any of its sister concerns. The writ application is disposed of.
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