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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 13TH DAY OF NOVEMBER, 2017 BEFORE THE HON’BLE Dr.JUSTICE VINEET KOTHARI W.P.Nos.36428-36433/2017 (T-IT)
BETWEEN
M/s. Dhammanagi Developers Pvt. Ltd., Represented by its Director Smt. Mangala Babu Dhammanagi, Aged about 53 years No.137, Railway Parallel Road, Kumara Park West, Bangalore-560 020.
M/s. Dhammanagi Hospitalities Pvt. Ltd., Represented by its Director Smt. Mangala Babu Dhammanagi, Aged about 53 years No.137, Railway Parallel Road, Kumara Park West, Bangalore-560 020.
M/s. D & N Associates Represented by its Partner Sri Anand Nadig, Aged about 51 years No.137, Railway Parallel Road, Kumara Park West, Bangalore-560 020.
Date of order 13-11-2017 W.P.Nos.36428-36433/2017 M/s. Dhammanagi Developers Pvt. Ltd. & Ors., Vs. The Principal Commissioner of Income-tax, Bengaluru-2, & another.
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M/s. Dhammanagi & Sanu Developers Pvt. Ltd., Represented by its Managing Director Sri Harsha B. Dhammanagi Aged about 29 years No.137, Railway Parallel Road, Kumara Park West, Bangalore-560 020.
Shri. K. Purushothama Adiga S/o Sri S.M. Adiga Aged about 38 years No.39, Shri Gurukrupa Mahakavi Kuvempu Road, Venkatadril, Behind Apollo Hospital, Bannerghatta Road, Bangalore-560 076.
M/s. Dhammanagi Property Developers Represented by its Partner Smt. Mangala Babu Dhammanagi Aged about 53 years No.137, Railway Parallel Road, Kumara Park West, Bangalore-560 020.
...Petitioners (By Sri.Annamalai S., Advocate along with Sri. M.Lava, Advocate for Sri. Shankar A., Advocate)
AND
The Principal Commissioner of Income-tax Bangalore-2, Office of the Principal Commissioner of Income-tax-2, 5th Floor,
Date of order 13-11-2017 W.P.Nos.36428-36433/2017 M/s. Dhammanagi Developers Pvt. Ltd. & Ors., Vs. The Principal Commissioner of Income-tax, Bengaluru-2, & another.
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BMTC Building, Koramangala 6th Block, 80 feet Road, Bengaluru-560 095.
The Deputy Commissioner of Income-tax, Central Circle, Office of the Deputy Commissioner of Income –tax, Saraf Colony, Shraddha Building, Khanapur Road, Tilakwadi, Belagavi-590 006.
...Respondents
(By Sri K.V. Aravind, Advocate)
These Writ Petitions are filed under Articles 226 and 227 of the Constitution of India praying to quash the order passed under the provision of Section 127 of the Act by the R-1 vide common order dated 3.7.2017 referred as Annexure-A.
These Writ Petitions coming on for Preliminary Hearing in ‘B’ Group this day, the Court made the following:
Date of order 13-11-2017 W.P.Nos.36428-36433/2017 M/s. Dhammanagi Developers Pvt. Ltd. & Ors., Vs. The Principal Commissioner of Income-tax, Bengaluru-2, & another.
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ORDER
Sri.Annamalai S., Advocate along with Sri.M.Lava, Advocate for Sri.Shankar A., Advocate for petitioners Sri.K.V.Aravind, Adv. for respondents
The petition has been filed by the different assessees of the same group - M/S.Dhammanagi Developers Pvt. Ltd., and others. The assessees have prayed that all the assessments may be consolidated and transferred to the competent assessing authority at Bengaluru, whereas, the learned Commissioner by the impugned order Annexure-A dated 3.7.2017 has transferred even the assessments at Bengaluru to Belagavi, which is challenged by the present petitioners on the ground of administrative convenience.
The reason assigned by the respondent- Principal Commissioner of Income Tax for transfer of
Date of order 13-11-2017 W.P.Nos.36428-36433/2017 M/s. Dhammanagi Developers Pvt. Ltd. & Ors., Vs. The Principal Commissioner of Income-tax, Bengaluru-2, & another.
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cases from Bengaluru to Belagavi as recorded in the impugned order which is quoted below:
“Apart from the above, the submission made by the assessee group on 3.7.2017 before the undersigned are also duly taken note of and the matter has been discussed with Pr.CIT (Central) once again. Therefore, after considering the assessee group submissions and also the need for effective and co-ordinated investigation and completion of assessments, it is necessary that the above cases be centralized with DCIT, Central Circle, Belagavi. Hence, all the above cases are being transferred to DCIT, Central Circle, Belagavi setting aside the objections of the assessee. The order shall come into force with immediate effect.”
Sd/- (Y.RAJENDRA) Pr. Commissioner of Income Tax (I/C) Bangalore-2, Bangalore.
Date of order 13-11-2017 W.P.Nos.36428-36433/2017 M/s. Dhammanagi Developers Pvt. Ltd. & Ors., Vs. The Principal Commissioner of Income-tax, Bengaluru-2, & another.
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Learned counsel for the respondent-department Mr.Aravind has submitted a chart before this Court that in all there are 15 assessment cases of the said group, out of which, 4 were being assessed at Belagavi, 2 at Mangaluru, 1 at Panaji, 8 at Bengaluru, prior to passing of the impugned order by Principal Commissioner of Income Tax, under Section 127 of the Act on 3.7.2017 directing transfer and consolidation of all assessees at Belagavi.
Learned counsel for the petitioners, Mr.Annamalai S. however submitted that most of petitioners-assessees business activity is at Bengaluru and for its administrative convenience, all the cases may be transferred and consolidated for assessment at Bengaluru, then it will be more convenient and
Date of order 13-11-2017 W.P.Nos.36428-36433/2017 M/s. Dhammanagi Developers Pvt. Ltd. & Ors., Vs. The Principal Commissioner of Income-tax, Bengaluru-2, & another.
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practically possible to attend and co-operate in the writ proceedings
Having heard the learned counsels this Court is of the opinion that the respondent-Principal Commissioner has not assigned any cogent and over- riding reasons to transfer the cases of assessees from Bengaluru to Belagavi and consolidated all the 15 assessments at Belgavi. Obviously the convenience of the petitioners-assessees group for getting these assessments centralized at Bengaluru is apparent, not only because more number of assessees of the said group were already being assessed at Bengaluru, but the assessees’ desire and administrative convenience to transfer all cases to Bengaluru has not been controverted in any manner by the Department. The reason in the impugned order as quoted above namely “for effective and co-ordinated investigation and
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completion of assessments”, can be met even at Bengaluru also and it is not necessary that the assessee should be put to inconvenience for the said reason specially when there is no contrary strong reason given in the impugned order to transfer all the cases to Belagavi. The respondent-Department comprises of Public Servants and they have their Offices and Officers at Bengaluru, who can undertake the assessments work for all the 15 assessments of this group at any of these two places. Therefore, the comparative convenience of assessees should be given the preference.
Accordingly, this Court is of the opinion that the impugned order does not assign any proper reasons for consolidating and transfer of all the assessment proceedings of the said Assessee Group at Belagavi and the said order is therefore liable to be quashed and the same is quashed.
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The respondent-Department is directed to transfer all the cases pertaining the said group of 15 assessments in numbers to Bengaluru, for completing the assessments in accordance with law at Bengaluru. The Bengaluru Assessment Authority will proceed from the stage where the earlier Assessing Authority has so far left the assessment proceedings.
The Authority to whom such assessments are consolidated and transferred, may even issue fresh notices to the assessees and the assessees will not be entitled to raise any objections in regard to the expiry of limitation resulting on account of pendency of these writ petitions. Writ petitions are accordingly allowed. No costs.
Sd/- JUDGE