TMI Blog2006 (2) TMI 95X X X X Extracts X X X X X X X X Extracts X X X X ..... the court. The petitioners have approached this court through the aforementioned writ petitions under article 226 of the Constitution of India and seek to challenge the transfer of their case by a common order dated December 16, 2005 passed by the Commissioner of Income-tax-I, Kanpur, in exercise of powers vested under section 127(2), Income-tax Act, 1961 (called "the Act") from Kanpur to the Assessing Officer at New Delhi. For convenience we refer to the facts leading to Writ Petition No. 55 of 2006 (R.K. Agarwal v. CIT). According to the petitioner, he is engaged in the business of sale of printing paper and board. He is, besides Smt. Rekha Agrawal (wife of his brother) and Shri Mayank Agrawal (brother of the petitioner) partner in the firm, M/s. Malay Enterprises. In paras. 4 and 5, it is pleaded that the petitioner and his firm "has got absolutely no connection with the company known as M/s. Trimurti Fragrances P. Ltd. He is neither a shareholder nor a director of the aforesaid concern." The petitioner has however admitted that he is married to the sister of Pradeep Agarwal one of the directors of M/s. Trimurti Fragrances P. Ltd. In para. 6 of the writ petition, it is sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te, i.e., October 31, 2005, due to Dewali festival. I will be out of Kanpur therefore, I am sending my reply through speed post, I have to submit that I am a regular income-tax payee and filed our return of income up to the assessment year 2004-05. You have not assigned any reason in your notice under reference except a search has been conducted in Shikhar Gutkha group. I may submit that I have no connection with Shikhar Gutkha group except family relation with Shri Murlidhar Agarwal. Thus proposed action initiated by you is illegal and bad in the eyes of law and till then I reserve my right to reply further in this connection. Further I have to inform you that my case is very much identical to the case of Mr. Virendra Kumar Jain and M/s. Vijay Kumar Pradeep Kumar, Kanpur. The case of the aforesaid person and firm was transferred under section 127 by the Commissioner of Income-tax (Central), Kanpur to New Delhi. Being aggrieved, both of them filed a writ petition before the hon'ble Allahabad High Court and the hon'ble court vide order dated May 2, 2005 stayed the operation of order passed under section 127 and also held that 'Since the case of main company M/s. Trimurti Fragran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in their replies have merely stated that their cases are identical to that of Mr. Virendra Kumar Jain and M/s. Vijay Kumar Pradeep Kumar, Kanpur, which were transferred to Delhi by the Commissioner of Income-tax (Central), Kanpur. They have not elaborated their contention as to in which manner their cases are identical to the aforesaid Mr. Virendra Kumar Jain and Mr. Vijay Kumar Pradeep Kumar, Kanpur. They have also not given any explanation with regard to their contention that they do not have any connection with Shikhar Gutkha group of cases. Therefore, the objections raised by the said three assessees against the proposed transfer of their cases to the Deputy Commissioner of Income-tax, Central Circle-IX, New Delhi are therefore, not tenable. It is necessary to centralise the cases of the above named assessees with Deputy Commissioner of Income-tax, Central Circle-IX, New Delhi so that co-ordinated and post search investigation could be done in these cases consequent upon the aforesaid search and seizure action." Being aggrieved the petitioners have filed the abovementioned writ petitions invoking the extraordinary jurisdiction of this court under article 226, Constitution of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come-tax, Central Circle-9 therefore are not tenable" is misconceived approach. The pith and substance of the argument is that the assessees could not be required to prove something which is non-existent or in the negative; it is for the Department to prove the affirmative. It is being contended that if it is true that the petitioner had no concern or connection with Shikhar Gutkha group of cases, the question to centralize the cases of the petitioner with that of Shikhar Gutkha group did not arise at all. In reply learned counsel representing the Department referred to the show-cause notice which recites: "A search operation was also conducted on your residential premises along with the Shikhar Gutka group. Since your case is also found to be connected with Shikhar Gutka group, it is proposed to transfer your case to the Deputy Commissioner of Income-tax, Central Circle-9, New Delhi for the purpose of co-ordinated and effective investigation.". Referring to the recitation in the show-cause notice, it is being argued that no fault can be found in the impugned order of transfer, particularly in view of the admission of the assessee with respect to the case of Virendra Kumar Ja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o ensure that the assessee does not resort to such practices which may cause hindrance in the process. There can be no quarrel with the aforesaid proposition. But the question remains as to whether the Department on the basis of the above stand can completely ignore a categorical statement of the assessee that he has no connection/association with respect to the Shikhar Gutkha group cases. We find that no prejudice will be caused to the Department if the precise reason is disclosed to show that the authority did apply his mind to the material on record or information available on the basis of search and seizure operations, giving a link to the fact that the "assessee" has some connection or association and by making a mention of the said fact in the transfer order. This is more so necessary to show that the authority exercising its statutory power of transfer had actually gone through the record and applied its mind before passing the impugned order of transfer and that the power to transfer cases is not exercised mechanically. If the Department remains silent it will frustrate the whole object of the statutory provisions that transfer should not be passed mala fide or arbitraril ..... X X X X Extracts X X X X X X X X Extracts X X X X
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