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Issues: Challenge to order of transfer under Article 226 of the Constitution based on lack of opportunity, absence of recorded reasons, and alleged mala fide intent.
Analysis: 1. Lack of Opportunity: The petitioner contended that no opportunity was given before the transfer order. However, the court found that the notice was served on the assessee, and the acknowledgment receipt was produced, indicating compliance with Section 127 of the Income-tax Act, 1961. Additionally, a letter from the petitioner expressing no objection to the transfer was presented, further supporting that the opportunity was provided. The court concluded that the opportunity as required by law was indeed given to the assessee. 2. Absence of Recorded Reasons: The petitioner argued that no reasons were recorded for the transfer. The court examined the order sheet, which revealed that the transfer was proposed to facilitate investigation, and the assessee had no objection to the transfer. The court found that the reason for transfer, i.e., to facilitate the investigation, was properly recorded before issuing the notice. The court opined that the condition precedent for the transfer was duly complied with, as the reason was explicitly stated in the order. The court noted that the transfer was necessary for investigating the petitioner-company, which belonged to a group of companies. 3. Alleged Mala Fide Intent: The petitioner further alleged that the transfer order was passed mala fide. However, the court found no evidence on record to support this claim. The court concluded that there was no indication of mala fide intent in the passing of the impugned order. Consequently, the court rejected this contention as well. In the final decision, the court dismissed the application challenging the transfer order, discharged the rule nisi, vacated any interim order, and awarded no costs. The court also opined that a stay of operation of the order was not warranted based on the evidence presented during the proceedings.
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