| Case ID |
54a67f76-1555-4555-b28b-bbc054b16dc4 |
| Body |
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| Case Number |
W. P. NO. 503 OF 2006 |
| Decision Date |
Jul 26, 2006 |
| Hearing Date |
Mar 07, 2006 |
| Decision |
The High Court held that the transfer of the case from Kolkata to Mumbai was not justified. It ruled that an order of transfer under Section 127 of the Income-tax Act is subject to scrutiny under Article 226 of the Constitution of India. The court found that there was no connection or nexus between the petitioner-company and the Mumbai-based company, Pioneer Embroideries Ltd. The court emphasized that the reasons given for the transfer did not substantiate any prima facie finding of undisclosed income or business connection. Consequently, the transfer order was set aside and quashed, but the authorities were allowed to issue a fresh order if further evidence of nexus emerged. |
| Summary |
The case revolves around the legality of transferring income tax jurisdiction from Kolkata to Mumbai under Section 127 of the Income-tax Act, 1961. The petitioner, P. S. Housing Finance (P.) Ltd., and its director, Surendra Kumar Dugar, contested the transfer on grounds of lack of connection with the Mumbai-based Pioneer Embroideries Ltd. The court examined the constitutional provisions and legal precedents regarding jurisdiction transfer, emphasizing the need for valid grounds for such actions. The ruling highlights the principles of natural justice, indicating that without a demonstrated link between the entities, such transfers are unwarranted. The decision reinforces the importance of substantiating claims of undisclosed income before altering jurisdiction, thereby protecting taxpayer rights. This case is significant for businesses and individuals facing similar jurisdictional challenges, underscoring the legal framework governing income tax assessments. |
| Court |
Calcutta High Court
|
| Entities Involved |
P. S. Housing Finance (P.) Ltd.,
Pioneer Embroideries Ltd.
|
| Judges |
MRS. INDIRA BANERJEE, J
|
| Lawyers |
J. P. Khaitan,
Sidhartha Chatterjee
|
| Petitioners |
P. S. Housing Finance (P.) Ltd.,
Surendra Kumar Dugar
|
| Respondents |
Union of India
|
| Citations |
2007 SLD 3579 = (2007) 290 ITR 316
|
| Other Citations |
Ajantha Industries v. CBDT [1976] 102 ITR 281 (SC),
Rajesh Mahajan v. CIT [2002] 257 ITR 577,
R.K. Agarwal v. CIT [2006] 283 ITR 532 (All)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
127
|