Rajasthan High Court - Jodhpur

M/S. Kashi Prayag Tradelink Pvt. Ltd vs Union Of India (2024:Rj-Jd:14135-Db) on 27 March, 2024

Bench: Pushpendra Singh Bhati, Yogendra Kumar Purohit

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      HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
                       JODHPUR
                D.B. Civil Writ Petition No. 7436/2019

1.       M/s. Kashi Prayag Tradelink Pvt. Ltd., Through - Director
         Smt. Sarita Sarda C/o Sh. Prayag Das Sarda, Aged 35
         Years, Sarda Mohalla, Deshnoke, Bikaner.
2.       Sarita Sarda W/o Mr. Nirmal Kumar Sarda, Aged About 35
         Years, By Caste Maheshwari, R/o House No. 230, Old
         Ward No-4, New Ward No. 6, Sarda Mohalla, Deshnoke,
         Bikaner.
                                                                      ----Petitioners
                                       Versus
1.       Union Of India, Through The Principal Comissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,
         Rajasthan.
2.       The Income Tax Officer (Tech.), Officer Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                                 Connected With
                D.B. Civil Writ Petition No. 1858/2018
Vinita Sarda W/o Mr. Anil Sarda, By Caste- Maheshwari, R/o-
House No. 230, Old Ward No-4/ New Ward No-6, Sarda Mohalla,
Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India Through- The Principal Commissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,
         Rajasthan.
2.       The Income Tax Officer Tech., Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 3087/2018
1.       M/s Vijay Sanjay Tradecom Pvt. Ltd., Sadar Bazar,
         Deshnoke, Bikaner.
2.       M/s Bhoomika Enterprises, Prop. - Vijay Kumar Khatri Huf

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         Sadar Bazar, Deshnoke, Bikaner. Both Represented By Mr.
         Vijay Kumar Khatri, Being The Director Of Petitioner No. 1
         And Karta Of The Petitioner No. 2 Respectively
3.       Vijay Kumar Khatri S/o Mr. Sri Krishna Khatri, By Caste-
         Khatri, Khatri Gali, Sadar Bazar, Deshnoke, Bikaner.
                                                                      ----Petitioners
                                       Versus
1.       Union Of India Through- The Principal Commissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,
         Rajasthan
2.       The Income Tax Officer Tech., Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 3990/2018
M/s K.g. Enterprises, Through Proprietor Mr. Kishan Gopal Sarda
S/o- Late Prayag Das Sarda, By Caste- Maheshwari, R/o Sarda
Mohalla, Deshnoke, Bikaner Office Address- Behind State Bank
Of India, Gangashahar Road, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India Through- The Principal Commissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,
         Rajasthan
2.       The Income Tax Officer Tech., Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 5160/2019
Anil Sarda S/o Mr. Kishan Gopal Sarda, Aged About 29 Years, By
Caste- Maheshwari, R/o- C/o Smt. Kashi Devi Sarda, House No.
230, Old Ward No-4 / New Ward No. 6, Sarda Mohalla,
Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through The Principal Commissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,


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         Rajasthan.
2.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 7393/2019
M/s. Shree Chamunda Enterprises, Through Proprietor Mr. Nirmal
Kumar Sharma S/o Mr. Sukhdev Sharma, By Caste- Sharma,
Age- 34 Years, R/o- Bhardwaj Mention, Near Kasat School, Ward
No. - 10, Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through- The Principal Commissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,
         Rajasthan.
2.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 7405/2019
Nirmal Kumar Sarda S/o Mr. Kishan Gopal Sarda, Aged About 36
Years, By Caste- Maheshwari, R/o- C/o Smt. Kashi Devi Sarda,
House No. 230, Old Ward No. -4 / New Ward No. 6, Sarda
Mohalla, Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through- The Principal Commissioner Of
         Income Tax, Aayakar Bhawan, Rani                           Bazar, Bikaner,
         Rajasthan.
2.       The Income Tax Officer (Tech)., Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 7408/2019
Kashi Devi Sarda W/o Late Prayag Das Sarda, Aged About 82
Years, By Caste- Maheshwari, Age- 82 Years, R/o- House No.
230, Old Ward No-4/ New Ward No.- 6, Sarda Mohalla,


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Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through- The Principal Commissioner Of
         Income     Tax     Aayakar         Bhawan,        Rani     Bazar,   Bikaner,
         Rajasthan.
2.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aaykar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 2066/2020
Vinita Sarda W/o Sh. Anil Sarda, Aged About 26 Years, By Caste-
Maheshwari, R/o- House No. 230, Old Ward No- 4 / New Ward
No. 6, Sarda Mohalla, Deshnoke, Bikaner
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through- Additional Commissioner Of
         Income Tax Central Range - 8, Iii Floor Ara Centre, E-2,
         Jhandewalan Extension, New Delhi
2.       Deputy Commissioner Of Income Tax, Central Circle - 32,
         Room No. 359, Iii Floor Ara Centre, E-2, Jhandewalan
         Extension, New Delhi
3.       The Principal Commissioner Of Income Tax, Aayakar
         Bhawan, Rani Bazar, Bikaner, Rajasthan.
4.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 3685/2020
Sarita Sarda W/o Mr. Nirmal Kumar Sarda, Aged About 36 Years,
By Caste- Maheshwari, R/o- C/o Smt. Kashi Devi Sarda, House
No. 230, Old Ward No - 4/new Ward No - 6, Sarda Mohalla,
Deshnoke, Bikaner
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through- Additional Commissioner Of
         Income Tax Central Range - 8, Iii Floor Ara Centre, E-2,

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         Jhandewalan Extension, New Delhi
2.       Deputy Commissioner Of Income Tax, Central Circle - 32,
         Room No. 359, Iii Floor Ara Centre, E-2, Jhandewalan
         Extension, New Delhi.
3.       The Principal Commissioner Of Income Tax, Aayakar
         Bhawan, Rani Bazar, Bikaner, Rajasthan
4.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 3769/2020
Anil Sarda S/o Kishan Gopal Sarda, Aged About 30 Years, By
Caste Maheshwari, R/o C/o Smt. Kashi Devi Sarda, House
No.230, Old Ward No.4/ New Ward No.6, Sarda Mohalla,
Deshnok, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through Additional Commissioner Of
         Income Tax Central Range - 8, Iii Floor Ara Centre, E-2,
         Jhandewalan Extension, New Delhi
2.       Deputy Commissioner Of Income Tax, Central Circle - 32,
         Room No.359, Iii Floor Ara Centre, E-2, Jhandewalan
         Extension, New Delhi
3.       The Principal Commissioner Of Income Tax, Aayakar
         Bhawan, Rani Bazar, Bikaner, Rajasthan
4.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 3827/2020
M/s. Kashi Prayag Tradelink Pvt. Ltd., Through - Director Smt.
Sarita Sarda, W/o Nirmal Kumar Sarda B/c Maheshwari Aged 36
Years R/o Sh. Prayag Das Sarda, Sarda Mohalla, Deshnoke,
Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through - Additional Commissioner Of


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         Income Tax Central Range- 8, Iii Floor Ara Centre, E-2,
         Jhandewalan Exetension, New Delhi.
2.       Deputy Commissioner Of Income Tax, Central Circle- 32,
         Room No. 359 Ii Floor Ara Centre, E-2, Jhandewalan
         Exetension, New Delhi.
3.       The Principal Commissioner Of Income Tax, Aayakar
         Bhawan, Rani Bazar, Bikaner, Rajasthan.
4.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 4049/2020
Kashi Devi Sarda W/o Late Prayag Das Sarda, Aged About 84
Years, By Caste Maheshwari, R/o House No. 230, Old Ward No.
4/new Ward No. 6, Sarda Mohalla, Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through Additional Commissioner Of
         Income Tax Central Range-8, Iii Floor Ara Centre, E-2,
         Jhandewalan Extension, New Delhi.
2.       Deputy Commissioner Of Income Tax, Central Circle-32,
         Room No. 359M, Iii Floor Ara Centre, E-2, Jhandewalan
         Extension, New Delhi.
3.       The Principal Commissioner Of Income Tax, Aayakar
         Bhawan, Rani Bazar, Bikaner, Rajasthan.
4.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                    ----Respondents
                D.B. Civil Writ Petition No. 5836/2020
Nirmal Kumar Sarda S/o Mr. Kishan Gopal Sarda, Aged About 37
Years, By Caste Maheshwari, R/o C/o Smt. Kashi Devi Sarda,
House No. 230, Old Ward No. 4, New Ward No. 6, Sarda Mohalla,
Deshnoke, Bikaner.
                                                                       ----Petitioner
                                       Versus
1.       Union Of India, Through Additional Commissioner Of


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         Income Tax Central Range-8, Iii Floor Ara Centre, E-2,
         Jhandewalan Extension, New Delhi.
2.       Deputy Commissioner Of Income Tax, Central Circle-32,
         Room No. 359, Iii Floor Ara Centre, E-2, Jhandewalan
         Extension, New Delhi.
3.       The Principal Commissioner Of Income Tax, Aayakar
         Bhawan, Rani Bazar, Bikaner, Rajasthan.
4.       The Income Tax Officer (Tech.), Office Of The Principal
         Commissioner Of Income Tax, Aayakar Bhawan, Rani
         Bazar, Bikaner, Rajasthan.
                                                                     ----Respondents


For Petitioner(s)            :     Mr. Nitin Trivedi
For Respondent(s)            :     Mr. K.K. Bissa, AGC



     HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI

HON'BLE MR. JUSTICE YOGENDRA KUMAR PUROHIT

Order

27/03/2024

In S.B. Civil Writ Petition No.7436/2019, 1858/2018,

3087/2018, 3990/2018, 5160/2019, 7393/2019,

7405/2019 & 7408/2019.

1. For the sake of convenience and looking into the

commonality of the issues raised, the present petitions are being

decided, while treating D.B. Civil Writ Petition No.7436/2019 as a

lead case:-

1.1. The reliefs claimed, in sum and substance, read as follows:

"A. By an appropriate Writ, Order or Direction, Notices dated 3-11-2017 (Annex.7) issued by the respondent no.2 & Order dated 8.12-2017 (Annex.10) passed by the respondent no.1 may kindly be quashed & set aside and accordingly the respondents may kindly be directed

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to exoneate the petitioners from all the proceedings and further to drop them qua petitioners as has been shown to be initiated in Notices dated 3-11-2017. B. That the heavy cost may kindly be imposed upon the Respondents for violating the statutory provisions of the Income Tax Act, 1961.

C. Any other order or direction, which this Hon'ble Court deems fit and proper in the facts and circumstances of the case, may kindly be passed in favour of the petitioners.

D. The cost of the writ petition may kindly be awarded in favour of the petitioners."

2. As revealed from the above prayer clauses, the petitioner is

aggrieved of the impugned transfer orders passed by the

respondent Principal Commissioner of Income Tax Department,

Bikaner under Section 127 of the Income Tax Act, 1961 (in short,

'Act of 1961') and the notices issued in pursuance thereof.

3. Learned counsel for the petitioners submits that the

impugned transfers have been made without providing any

opportunity of hearing to the petitioners, which as per the

petitioners, is violative of Section 127 of the Act of 1961. The said

Section 127 reads as follows:-

"127. Power to transfer cases.-(1) The Principal Director General or Director General or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, transfer any case from one or more Assessing Officers subordinate to him (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether

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with or without concurrent jurisdiction) also subordinate to him.

(2) Where the Assessing Officer or Assessing Officers from whom the case is to be transferred and the Assessing Officer or Assessing Officers to whom the case is to be transferred are not subordinate to the same Director General or Chief Commissioner or Commissioner,--

(a ) where the Directors General or Chief Commissioners or Commissioners to whom such Assessing Officers are subordinate are in agreement, then the Director General or Chief Commissioner or Commissioner from whose jurisdiction the case is to be transferred may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, pass the order;

(b ) where the Directors General or Chief Commissioners or Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such Director General or Chief Commissioner or Commissioner as the Board may, by notification in the Official Gazette, authorise in this behalf."

3.1. In support of such submission, learned counsel placed

reliance on (1.) Smt. Jeewan Kumari Vs. Union of India &

Ors. reported in (1979) 118 ITR 573 (Raj.), (2.) Noorul

Islam Educational Trust Vs. Commissioner of Income Tax

reported in (2017) 291 CTR (SC) 230 & (3) Murliwala

Agrotech Private Ltd. Vs. Union of India (D.B. Civil Writ

Petition No.6847/2021), decided on 20.07.2022 by this Court.

4. On the other hand, learned counsel representing the

respondents, while opposing the submission made on behalf of the

petitioners, placed reliance on the Division Bench judgment

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rendered by Hon'ble High Court of Madras in the case of

Advantage Strategic Consulting (P.) Ltd. Vs. Principal

Commissioner of Income Tax, Chennai reported in [2021]

430 ITR 1 (Madras).

7. Heard learned counsel for the parties as well as perused the

record of the case alongwith the judgments cited at the Bar.

8. This Court observes that the sole issue raised herein is

pertaining to impugned transfers so made without giving any

opportunity of being heard to the petitioners.

9. This Court further observes that the controversy raised

herein has already been settled by a Division Bench of this Hon'ble

Court in the case of Murliwala Agrotech Private Limited

(supra); the relevant portion whereof reads as under:

"At the outset, we may state here that Section 127(1) of the Income Tax Act, which deals with powers of the competent authority to transfer the assessment proceedings, is framed with the salutary objective of adherence to the principle of natural justice, which is fundamental to any proceeding of adversarial nature. It cannot be denied that the assessment/ reassessment proceedings under the Income Tax Act, would be adversarial to the assessee and hence, adherence to the principles of natural justice, is sine qua non.

Whenever it is proposed to transfer the case of assessee from one assessing authority to another, providing opportunity of hearing to the assessee is essential and can be circumvented only if the competent authority feels, for reasons to be recorded in writing, that it is not possible to do so. In the present case, the respondents have neither setup any such case that it was not possible to provide opportunity of hearing to the assessee, nor any reasons to do so were recorded before taking the decision to transfer the case from Circle Bikaner to Circle New Delhi.

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Notwithstanding the fact that the assessment proceedings under the Income Tax Act, have now become faceless, it cannot be denied that the assessee would be entitled to engage Counsel/ Advisors of his choice to defend himself even in the faceless proceedings and thus, the requirement of following the principles of natural justice cannot be evaded in a casual manner.

In the case of Advantage Strategic Consulting (P) Ltd. (supra), relied upon by counsel Mr. Bissa, the factual situation was totally different because transfer had been made from one Circle to another in the same city.

Furthermore, during pendency of the proceedings, the assessment order had been passed. In that situation, Hon'ble Division Bench went on to hold that proceedings before the High court, had become infructuous.

In the present case, the transfer order and the notices issued in furtherance thereof, have been stayed by this Court and as such, the facts of the case at hand are totally distinguishable.

A Division Bench of this Court in the case of Smt. Jeewan Kumari (supra), has held that as per Section 127(1) of the Income Tax Act, it was incumbent for the Board to have provided opportunity of hearing to the assessee before ordering transfer of their case. Similar view was taken by Hon'ble the Supreme Court in the case of Noorul Islam Educational Trust (supra).

Consequently, we are of the opinion that the impugned transfer order dated 21.11.2019 (Annexure-7) and the notices (Annexure-2, Annexure-6 and Annexure-

12), as a consequence thereof, do not stand to scrutiny and hence, the same are declared invalid and set aside."

14. This Court had granted the interim order in these matters,

which is in operation.

15. In light of the aforequoted judgment, the present petitions

are allowed in the same terms. Accordingly, impugned notices

dated 03.11.2017 and impugned transfer orders dated 08.12.2017

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(in all the above numbered petitions) along with entire proceeding

pursuant thereto are quashed and set aside.

16. The respondents are however, permitted to resume the

proceedings, in accordance with law, from the stage former to the

impugned transfer orders. If it is still proposed to transfer the case

of the petitioners, opportunity of hearing shall be provided to

them and thereafter, the proceedings shall be continued and

concluded, strictly in accordance with law within a period of three

months from today.

In S.B. Civil Writ Petitions No.2066/2020, 3685/2020,

3769/2020, 3827/2020, 4049/2020 & 5836/2020 :-

1. As a consequence to the transfer order passed by the

respondents themselves, transferring the matters to Deputy /

ACIT, Central Circle-14, New Delhi without providing any

opportunity of hearing, the authority has proceeded to finally pass

the assessment order, which is under challenge in these writ

petitions.

2. It is informed that each of the assesses were already before

this Court by filing aforementioned writ petitions in which the

transfer orders were under challenge and thus, the subsequent

cause of action gave reasons for the petitioners to file these writ

petitions again as the assessment orders were being passed in

pursuance of the transfer orders by the authority concerned.

3. Since this Court has already granted indulgence against the

transfer orders, therefore, for the same reasons as recorded by

this Court in Murliwala Agrotech Private Ltd. Vs. Union of

India & Ors. (D.B. Civil Writ Petition No.6847/2021),

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decided on 20.07.2022, the present petitions are also allowed in

the same terms.

4. Consequently, the assessment orders dated 11.12.2019 (CW

No.2066/2020), 20.12.2019 & 25.12.2019 (CW No.3685/2020),

20.12.2019 (CW No.3769/2020), 25.12.2019 (CW

No.3827/2020), 11.12.2019 (CW No.4049/2020) & 26.12.2019

(CW No.5836/2020) along with entire proceeding pursuant thereto

are quashed and set aside and the proceedings shall resume from

the stage of former to the transfer orders. If it is still proposed to

transfer the case of the petitioners, opportunity of hearing shall be

provided to them and thereafter, the proceedings shall be

continued and concluded, strictly in accordance with law within a

period of three months from today.

(YOGENDRA KUMAR PUROHIT),J (DR.PUSHPENDRA SINGH BHATI),J

55 to 68-Sudheer/-