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Anil Kumar Kothari Versus Union of India (UOI) and Ors.

2010 (4) TMI 1181 - High Court Gauhati

Dated:- 28-4-2010 - Biplab Kumar Sharma ORDER Biplab Kumar Sharma, J. 1. Heard Mr. Kanan Kapoor, learned Counsel for the petitioner as well as Mr. U. Bhuyan, learned standing Counsel, IT Department. 2. This writ petition is directed against the order dt. 1st Aug., 2007 (Annex. B) by which the writ petitioner was directed to furnish true and correct return of income regarding asst. yr. 2000-01 in respect of which the petitioner was shown assessable as an assessee. The notice further provides that .....

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equested to direct all your Income Tax related correspondence to this office and from now onwards IT returns are also to be filed in this office only. 3. From the above what is seen is that by an order dt. 24th July, 2007 passed by the CIT, Guwahati-II, Guwahati jurisdiction over the petitioner had been transferred to the office of the Asstt. CIT, Central Circle-5, New Delhi and accordingly the petitioner was requested to make all the Income Tax related correspondences to the said office. 4. It .....

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learned Counsel for the petitioner upon a reference to the provision of Section 127(1) of the Act, submits that the impugned order is palpably illegal being violative of the said provision and thus it requires to be interfered with. He has also placed reliance on the decision of the apex Court in Ajantha Industries and Ors. v. CBDT and Ors. 1976 CTR (SC) 79 : (1976) 102 ITR 281 (SC) as well as the decisions in Naresh Kumar Agarwal v. Union of India and Ors. (2009) 25 DTR (Cat) 215 : (2010) 320 I .....

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e and co-ordinating and effective investigation". He submits that the reasons shown in the order dt. 24th July, 2007 being vague and indefinite, same cannot be said to be in compliance of the requirements of the reasons to be assigned as per the provisions of Section 127(1) of the Act. 8. Mr. U. Bhuyan, learned standing Counsel, IT Department, on the other hand, supporting the aforesaid order dt. 24th July, 2007, submits that the reasons assigned in the order being sufficient, the Writ Cour .....

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sident of Guwahati and having regard to his background and root in Guwahati, it is unbelievable that the authority was unable to serve notice on him. Further, stand of the petitioner is that since the requirement of assigning reasons as contemplated in Section 127(1) of the Act has also not been complied with, the impugned order is liable to be set aside and quashed. 10. In Ajantha Industries (supra), the apex Court dealing with the requirement of assigning reasons in the order has made the foll .....

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ether such a writ or special leave application ultimately fails is not relevant for a decision of the question. 7. We are clearly of opinion that the requirement of recording reasons under Section 127Q is a mandatory direction under the law and non-communication thereof is not saved by showing that the reasons exist in the file although not communicated to the assessee. Mr. Sharma drew our attention to a decision of the Delhi High Court in Sunanda Rani Jain v. Union of India and Ors. 1975 CTR (D .....

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Central Government in disposing of the revision application must record its reason and communicate these reasons to the parties affected thereby. It was further held that the reasons could not be gathered from the notings in the files of the Central Government. Recording of reasons and disclosure thereof is not a mere formality. Mr. Sharma drew our attention to a decision of this Court in Kashiram Aggarwalla v. Union of India and Ors. (1965) 56 ITR 14 (SC) : TC 69R.660. It is submitted that this .....

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resent case since that was a transfer from the ITO to another ITO in the same city, or, as stated in the judgment itself "in the same locality" and the proviso to Section 127(1), therefore, applied. When the law requires reasons to be recorded in a particular order affecting prejudicially the interest of any person, who can challenge the order in Court, it ceases to be a mere administrative order and the vice of violation of the principles of natural justice on account of omission to c .....

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ed to the assessee. The ITO need not communicate to the assessee the reasons which led him to initiate the proceedings under Section 34. The case under Section 34 is clearly distinguishable from that of a transfer order under Section 127(1) of the Act. When an order under Section 34 is made the aggrieved assessee can agitate the matter in appeal against the assessment order, but an assessee against whom an order of transfer is made has no such remedy under the Act to question the order of transf .....

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er Section 127 of the Act, it is necessary that the authority which proposes to transfer the case must, wherever it is possible to do so, give the assessee a reasonable opportunity of being heard with a view to enable him to effectively show cause against the proposed transfer. The notice must also propose to give a personal hearing. It is also necessary to mention in the notice the reasons for the proposed transfer so that the assessee could make an effective representation with reference to th .....

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as the notice is concerned though it has been mentioned that the proposed transfer is for 'co-ordinated investigation and assessment', it does not mention any specific reasons for transfer. Merely stating that transfer is for 'co-ordinated investigation and assessment' is not at all sufficient as the assessee should be intimated about the reasons in a comprehensive manner in order to enable him to make effective representation. 13. Section 127 mandates that assessee must be given .....

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