Mere family connection cannot be a ground for transfer of cases

Mere family connection cannot be a ground for transfer of cases

Transfer of assessee cases from Kolkata to Patna not for the purpose of co-ordinated and effective investigation but for centralization not valid. 

Relevant Case – Dillip Kumar Agarwal v. CIT (Calcutta High Court), Appeal No. WP No. 200 of 2009, Date : 17th March, 2009, Euivalent Citation- (2009) 314 ITR 291 (Cal.)

Relevant Section – 127(2)(a)

• In connection with search and seizure operations against the R group of companies, the Commissioner of Income-tax after hearing the assessees passed a reasoned order directing transfer of the cases of the assessees from the Income-tax Officers at Kolkata to Patna.
• On writ petitions challenging the transfer of cases the High Court held that the notices proposing transfer did not indicate that the transfer was for the purpose of co-ordinated and effective investigation. The transfer as proposed was for the purpose of centralisation.
• The assessees had made categorical statements in their representations that they had no business connection with their father, had no business at any place in Bihar, they managed their businesses on their own and had no business link with R, their father, and had no relation either in the business or otherwise in the R group of companies, but the authorities had not rebutted the categorical statements made in the written objections.
• Mere family connection cannot be a ground for transfer.
• Onus is on the revenue to produce material evidence  in support of their case that Assessee is with their father.
• Thus, as the order did not disclose any nexus of the assessees with R or the R group of companies, the order was without merit and could not be sustained.