Transfer Order Under Section 127 Upheld: Assessee’s Non-Reply and Undenied Suspicious Transactions Justify Centralization.

By | May 23, 2025
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Transfer Order Under Section 127 Upheld: Assessee’s Non-Reply and Undenied Suspicious Transactions Justify Centralization.

Issue:

Whether a case transfer order under Section 127 of the Income-tax Act, 1961, issued by way of a “corrigendum” to an earlier order, can be challenged on the grounds that it “improved upon facts” and “reasons” not available in the original order, especially when the assessee failed to reply to the corrigendum notice and did not deny the suspicious transactions that necessitated the transfer.

Facts:

The assessee, a resident of Vadodara, had their case transferred from Vadodara to the DCIT, Pune, by an order dated November 29, 2023. The reason for the transfer was the assessee’s significant suspicious cash transactions with “GKA,” a party assessed with the DCIT, Pune, necessitating centralization for coordinated investigation. The assessee initially challenged this order via a Special Civil Application, where the Court granted liberty to the revenue to pass a “corrigendum order.”

Subsequently, the revenue issued an impugned show cause notice dated December 21, 2024, ostensibly as a corrigendum letter, followed by an impugned order dated January 2, 2025, confirming the transfer. The assessee argued that both the notice and the order (dated December 21, 2024, and January 2, 2025) were contrary to Section 127(2)(a) because they were merely in the form of a corrigendum to the original November 29, 2023, order. The assessee further contended that the revenue had “improved upon facts” and “reasons” in the corrigendum which were not present in the initial transfer order.

However, it was noted that the impugned notice and order were issued in continuation of the original transfer order to comply with the Act’s requirement of providing an opportunity of hearing to the assessee. Crucially, the assessee had not filed any reply to the notice dated December 21, 2024. Their current contention was that they did not reply because the “corrigendum notice” referred to details relied upon to transfer the case. Moreover, the assessee had not denied the transactions entered into with GKA.

Decision:

In favor of the revenue: The court held that the impugned corrigendum order of transfer passed by the revenue under section 127(2) could not be interfered with. The court reasoned that the notice and order were issued to provide an opportunity of hearing, as previously directed by the court. The assessee’s approach of not filing a reply to the detailed corrigendum notice (despite their current contention that it referred to relied-upon details) was not acceptable for quashing the order. Furthermore, the assessee had not denied the suspicious transactions with GKA, which formed the basis for the coordinated investigation. The court found that the transfer was justified for centralisation for co-ordinated investigation.

Key Takeaways:

  • Purpose of Section 127: Section 127 grants the power to transfer cases to facilitate coordinated investigation, especially when common parties or transactions are involved under different assessing officers.
  • Opportunity of Hearing in Transfer Orders: Section 127(2)(a) mandates providing a reasonable opportunity of hearing to the assessee, particularly if the transfer is from one city/region to another. The “corrigendum” process in this case was an attempt by the revenue to rectify the prior procedural lapse and comply with this requirement.
  • Assessee’s Obligation to Reply: Even if an assessee perceives procedural irregularities or “improvement of reasons” in a subsequent notice, it is incumbent upon them to file a comprehensive reply, raising all objections and explaining their position. Simply refraining from replying and then challenging the final order on that ground is often not accepted by courts.
  • Substance Over Form: The court looked at the substance of the revenue’s action – attempting to provide an opportunity of hearing and centralize investigation for suspicious transactions that were not denied by the assessee. The mere label of “corrigendum” or alleged “improvement of reasons” was not sufficient to invalidate the transfer, especially when the underlying reason (coordinated investigation of suspicious transactions) remained unchallenged on facts.
  • Justification for Centralization: Where there are interconnected transactions and parties being assessed in different jurisdictions, centralization of the case under one assessing officer is a valid ground for transfer under Section 127 to ensure a comprehensive and coordinated investigation. Case Transfer Under Section 127 Upheld Despite Assessee’s Non-Diligence and Corrigendum Process.

Issue:

Whether an income tax case transfer order issued as a “corrigendum” to a previous order, which also “improved upon facts and reasons,” should be set aside under Section 127 of the Income-tax Act, 1961, especially when the assessee claims improper notice and lack of opportunity to respond, but is found to have lacked diligence in responding to the notices and has not denied the underlying transactions.

Facts:

The assessee, a resident of Vadodara, had their case initially transferred under Section 127 from Vadodara to the DCIT, Pune, by an order dated November 29, 2023. The stated reason for the transfer was that the assessee had significant suspicious cash transactions with GKA, a party assessed with the DCIT, Pune, thus requiring centralization for a coordinated investigation. The assessee challenged this initial transfer order in a Special Civil Application, where the High Court disposed of the matter by granting liberty to the revenue to pass a “corrigendum order.”

Following this, the revenue issued an impugned show cause notice dated December 21, 2024, ostensibly as a “corrigendum letter.” Subsequently, the revenue passed a fresh impugned order dated January 2, 2025, again transferring the assessee’s case. The assessee contended that both the notice dated December 21, 2024, and the order dated January 2, 2025, were contrary to Section 127(2)(a) because they were issued as corrigenda to the November 29, 2023, order, and further, the revenue had “improved upon facts” and included reasons not present in the original November 29, 2023 order. The assessee also claimed they did not file a reply to the December 21, 2024 notice because it referred to details that were relied upon for the transfer, which they disputed.

It was noted by the court that the impugned notice and order (December 21, 2024, and January 2, 2025) were in continuation of the original November 29, 2023 order, aiming to comply with the Act by providing an opportunity of hearing to the assessee. Crucially, it was undisputed that the assessee had not filed any reply to the notice dated December 21, 2024. The assessee’s later contention (that they didn’t reply because the corrigendum notice referred to relied-upon details) was not accepted as a valid reason to quash the order. Moreover, the assessee had not denied the transactions entered into with GKA.

Decision:

In favor of the revenue: The court held that, on the given facts, the impugned corrigendum order of transfer passed by the revenue under section 127(2) could not be interfered with. The court reasoned that the subsequent notice and order were issued to provide a fair opportunity to the assessee as directed by the High Court, and the assessee’s failure to respond diligently to the notice, despite ample opportunity, weakened their claim. The fact that the assessee did not deny the suspicious transactions with GKA also played a role in the decision.

Key Takeaways:

  • Purpose of Section 127: Section 127 grants the Principal Commissioner or Commissioner (or higher authorities) the power to transfer cases to facilitate coordinated investigations or for administrative convenience. This power is broad but subject to the principles of natural justice, primarily the requirement to provide a reasonable opportunity of hearing (except in specific intra-city transfers).
  • Compliance with Court Directives: When a court directs authorities to issue a “corrigendum order” or provide an “opportunity of hearing,” the subsequent actions of the revenue are viewed in light of their attempt to comply with those directions.
  • Assessee’s Diligence in Responding to Notices: The judgment underscores the critical importance of an assessee’s diligence in responding to show cause notices, even if they perceive the notice to be flawed (e.g., as a “corrigendum” or “improving upon facts”). Failure to file a timely reply, especially when the opportunity to be heard is explicitly provided, can be detrimental to the assessee’s case. The court will not allow an assessee to use their own inaction to quash an order.
  • “Improving Upon Facts/Reasons” in Corrigendum: While authorities generally cannot introduce entirely new grounds for transfer that were not considered when the original order was passed, a “corrigendum” issued as a result of a court directive to ensure compliance with natural justice might legitimately provide more detailed reasons to facilitate the assessee’s understanding and response. The court considered the subsequent notice and order to be in continuation of the original transfer, aimed at providing due process.
  • Undenied Underlying Transactions: The fact that the assessee did not deny the significant suspicious transactions with GKA (the basis for the centralized investigation) likely weighed against the assessee’s argument that the transfer itself was unwarranted.
  • Limited Judicial Interference in Administrative Transfers: Courts generally show a degree of deference to administrative transfer orders under Section 127 unless there is a clear violation of jurisdiction, mala fide intent, or a complete denial of natural justice where the assessee has been diligent.
HIGH COURT OF GUJARAT
Vishal Darshanlal Talreja
v.
Principal Commissioner of Income-tax
BHARGAV D. KARIA and D.N. Ray, JJ.
R/SPECIAL CIVIL APPLICATION NO. 1841 of 2025
MARCH  3, 2025
K.K. Maghnani and K.B. Maghnani, Advs. for the Petitioner. Ankit Shah and Mrs. Kalpana K. Raval, Advs. for the Respondent.
ORDER
Bhargav D. Karia, J.- Heard learned advocate Mr. Sanket S. Bora with learned advocate Mr. K.B. Maghnani for the petitioner and learned Senior Standing Counsel Mr. Nikunt Raval for the respondent.
2. By this petition under Article 227 of the Constitution of India the petitioner has made the following prayers:
“A. to issue a Writ of Certiorari or a Writ in the nature of Certiorari or any other appropriate writ, order or direction, calling for the records of the Petitioner’s case and after going into the legality and propriety thereof, to quash and set aside the impugned notice dated 21st December 2024 at Ann.K and impugned order dated 2nd January 2025 at Ann-L and other consequential notices and order in pursuance thereof; or
B. that this Hon’ble Court be pleased to issue a writ of Prohibition or a writ in the nature of Prohibition or any other appropriate writ, order or direction under Article 226 of the Constitution of India prohibiting Respondents from taking any steps or coercive action in furtherance of the impugned order dated 2nd January 2025 and other consequential notices and order in pursuance thereof;
C. that this Hon’ble Court be pleased to issue a writ of Mandamus or a writ in the nature of Mandamus or any other appropriate writ, order or direction under Article 226 of the Constitution of India directing the Respondent No. 1 to provide the Petitioner with the information and documents relied by the Respondent No. 1 while passing the impugned Order dated 2nd January 2025; at Ann-L
D. that pending the hearing and final disposal of the Writ Petition ad-interim reliefs in terms of prayer clause “B”.
E. That pending the hearing and final disposal of the Writ Petition ad-interim reliefs in terms of prayer clause “C”;
F. For costs of this petition;
G. For any other relief as may be deemed fit in the facts and circumstances of this case.”
3. Brief facts of the case are that the petitioner-assessee who is a resident of Vadodara received an intimation from respondent no.1 on 9th November, 2023 along with notice issued under section 127 of the Income Tax Act, 1961 (For short “the Act”) with regard to transfer of case of the petitioner to Pune on the ground that the petitioner was having significant suspicious cash transactions with M/s. G.K. Associates which is assessed with DCIT Central Circle-2(2), Pune and therefore, in the interest of Revenue, case of the petitioner was sought to be transferred to Pune.
4. The petitioner furnished reply vide an email dated 20.11.2023 addressed to respondent no.1 with an attached letter dated 18.11.2023 contending as to why the case should not be transferred to Pune.
5. Respondent no.1 however passed an order under section 127 of the Act dated 29.11.2023 to transfer the case of the petitioner to Deputy Commissioner of Income-Tax, Central Circle-2(2), Pune for further consideration on the ground that the petitioner did not submit its response.
6. The petitioner thereafter addressed a letter dated 30.11.2023 to respondent whereby the petitioner submitted proof of its earlier submissions and asked respondent no.1 to revise its order dated 29.11.2023. A physical copy of the said letter was also given on 1.12.2023 to the office of respondent no.1.
7. It is the case of the petitioner that since the order dated 29.11.2023 was in violation of the principles of natural justice, the petitioner preferred Special Civil Application No.20913 of 2023 wherein this Court disposed of the matter by granting the liberty to the respondent to pass corrigendum order.
8. It is the case of the petitioner that respondent no.1 however issued impugned show cause notice dated 21.12.2024 under the guise of corrigendum letter and the impugned notice mentioned additional facts beyond the original notice dated 9.11.2023 directing the petitioner to make submissions.
9. It is the case of the petitioner that since the impugned notice was ultra vires the liberty granted by this Court, the petitioner had not given any reply to such notice.
10. The respondent no.1 thereafter passed the impugned order dated 02.01.2025. Being aggrieved by the same, the petitioner has preferred the present petition.
11. Learned advocate Mr. Sanket Bora for the petitioner submitted that the impugned notice dated 21.12.2024 issued by the respondent as well as order dated 02.01.2025 are contrary to the provisions of section 127(2)(a) of the Income Tax Act, 1961 (For short “the Act”) because both the impugned notice and order are in form of corrigendum to the earlier order dated 29.11.2023 passed under section 127 of the Act and hence, the respondent could not have improved upon the facts as well as the reasons which are not available in the order 29.11.2023.
12. It was further submitted that the corrigendum means correction of printed matter and therefore, the impugned notice relying upon further material is without jurisdiction and liable to be quashed and set aside. In support of such submission, reliance was placed on the decision of Hon’ble Allahabad High Court in case of Polyplex Corp. N Ltd v. Union of India reported in (Allahabad).
13. It was submitted that the impugned order dated 02.01.2025 being a corrigendum order also goes beyond what is contained in the show cause notice dated 21.12.2024 as reliance was placed by the respondent upon the letter dated 09.12.2024 received from PCIT(Central) Pune as well as the statements of Shri Vinod Chandwani and Shri Kiran Chandwani of G.K. Associates and also report of the DDIT which was never provided to the petitioner. It was therefore, submitted that the impugned order may be quashed and set aside, and the matter may be remanded to the respondent to enable the petitioner to file a reply and pass a fresh de novo order.
14. Per contra, learned Senior Standing Counsel Mr. Nikunt Raval for the respondent submitted that the petitioner was provided an opportunity of hearing vide impugned show cause notice dated 21.12.2024,however, the petitioner did not avail the opportunity and hence, the petitioner need not be given a further opportunity of hearing and as the impugned order is based upon the material available with the respondent, so as to transfer the case of the petitioner to Central Circle, Pune.
15. It was further submitted that the order under section 127 of the Act dated 29.11.2023 did not consider the reply filed by the petitioner and therefor, respondent no.1 has passed a corrigendum order after considering the reply of the petitioner after giving further opportunity of hearing by issuing the notice dated 21.12.2024 but the petitioner did not submit any response to the said notice. It was submitted that respondent no.1 therefore, was constrained to pass the corrigendum order considering the objections raised in the letter dated 18.11.2023.
16. Learned advocate Mr. Raval submitted that on the basis of record available with the respondent no.1, it was prima facie found that the petitioner was having significant suspicious cash transactions with M/s. G.K. Associates which is assessed with DCIT Central Circle-2(2), Pune and therefore, in the interest of Revenue, case of the petitioner is transferred to Pune. It was therefore, submitted that no interference may be made in the impugned order passed by respondent no.1 as a corrigendum order to order dated 29.11.2023 under section 127 of the Act.
17. Considering the submissions made by learned advocates for the parties, it emerges from record that the petitioner was provided the opportunity to make further submission vide notice dated 21.12.2024 pursuant to order dated 17.12.2024 passed by this Court in Special Civil Application No. 20913 of 2023. However, the petitioner did not avail the said opportunity to make further submissions. On perusal of the notice dated 21.12.2024 it is discerned that the details of the transactions entered into by the petitioner with M/s. G.K. Associates for the Financial year 20192020 to 2023-2024 are referred to so as to centralise the case of the petitioner with other group cases with DCIT Central Circle-2(2), Pune for coordinated investigation in public interest.
18. In view of above facts, the contention raised on behalf of the petitioner that no document/information is provided to the petitioner for exercising the power to transfer the case under section 127 of the Act is contrary to the record as order dated 29.11.2023 did not contain any reference to the objections raised by the petitioner and hence, the respondent no.1 has passed the impugned corrigendum order dated 02.01.2025 considering the material available with him regarding the transactions of the petitioner with M/s. G.K. Associates as well as the reply dated 18.11.2023 filed by the petitioner.
19. In such circumstances, reference made to the information received from PCIT Central Pune as well as report of DCIT (Investigation), Pune dated 3.12.2024 referred to and relied upon and for the purpose of transfer of case is justified and the copies of the same are not required to be given to the petitioner as the petitioner has not denied the transactions entered into by the petitioner with M/s. G.K. Associates. On perusal of the objections raised by the petitioner vide letter dated 18.11.2023 it appears that petitioner has objected such transfer on the ground of inconvenience, harassment and cumbersome to him.
20. Section 124 of the Act pertains to jurisdiction of the Assessing Officer and section 124(1) of the Act reads as under:
“124. Jurisdiction of Assessing Officers.
(1) Where by virtue of any direction or order issued under sub-section (1) or sub-section (2) of section 120, the Assessing Officer has been vested with jurisdiction over any area, within the limits of such area, he shall have jurisdiction-
(a)in respect of any person carrying on a business or profession, if the place at which he carries on his business or profession is situate within the area, or where his business or profession is carried on in more places than one, if the principal place of his business or profession is situate within the area, and
(b)in respect of any other person residing within the area.”
21. Section 127 of the Act provides for power to transfer cases which reads as under:
“SECTION 127 : Power to transfer cases.
(1) The [Principal Director General or] Director General or 3120 [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 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 [Principal Director General or] Director General or 3120 [Principal Chief Commissioner or] Chief Commissioner or [Principal Commissioner or] Commissioner,-
(a)where the [Principal Directors General or] Directors General or [Principal Chief Commissioners or] Chief Commissioners or [Principal Commissioners or] Commissioners to whom such Assessing Officers are subordinate are in agreement, then the [Principal Director General or] Director General or [Principal Chief Commissioner or] Chief Commissioner or [Principal 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 [Principal Directors General or] Directors General or [Principal Chief Commissioners or] Chief Commissioners or [Principal Commissioners or] Commissioners aforesaid are not in agreement, the order transferring the case may, similarly, be passed by the Board or any such [Principal Director General or] Director General or [Principal Chief Commissioner or] Chief Commissioner or [Principal Commissioner or] Commissioner as the Board may, by notification in the Official Gazette, authorise in this behalf.
(3) Nothing in sub-section (1) or sub-section (2) shall be deemed to require any such opportunity to be given where the transfer is from any Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) to any other Assessing Officer or Assessing Officers (whether with or without concurrent jurisdiction) and the offices of all such officers are situated in the same city, locality or place.
(4) The transfer of a case under sub-section (1) or sub-section (2) may be made at any stage of the proceedings, and shall not render necessary the re-issue of any notice already issued by the Assessing Officer or Assessing Officers from whom the case is transferred.
Explanation.-In section 120 and this section, the word “case”, in relation to any person whose name is specified in any order or direction issued thereunder, means all proceedings under this Act51 in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year.]”
22. On conjoint reading of the above provisions of the Act, the Assessing Officer acquires the jurisdiction as per provisions of section 124(1) of the Act for assessment whereas section 127(1) of the Act provides for powers to the concerned authority to transfer any case of an assessee from one Assessing Officer to another Assessing Officer or officer subordinate to such authority. Such powers can be exercised only after giving assessee a reasonable opportunity of hearing and recording the reasons for the same wherever possible subject to the provisions of sub-section(2) and sub-section(3) of section 127 of the Act stipulated for not providing opportunity of hearing to the assessee if the case is transferred within the jurisdiction from one Assessing Officer to another Assessing Officer.
23. Moreover, as per the provisions of section 127 of the Act, requirement of transferring the assessment in appropriate cases would have element of public interest and the assessee has no choice to select his Assessing Officer. Therefore, in the facts of the case, respondent no.1 has passed the corrigendum order by providing further opportunity of hearing to the petitioner vide notice dated 21.12.2024 so as to comply with the mandatory requirement of providing opportunity of hearing and after recording the reasons, case is found to be fit to be transferred from Vadodara to Pune.
24. Respondent no.1 has recorded the following reasons for transfer of case in the impugned corrigendum order dated 2.01.2025:
“4.2 The assessee has not submitted any response to the above notice till date. Hence this order is being passed based on objections raised in a letter submitted on 01/12/2023. In this letter it is contended that the assessee is not a beneficiary in the transactions pertaining to the searched groups. It is contended that there is no reference of any incriminating documents found against the assessee in the search and seizure action conducted in the case of GK Associates and SSD Group. Further the assessee has submitted that no inquiry has been carried out in his case in the post-search proceedings by the Investigation Wing. Hence this shows that there is no incriminating document or paper seized with G K Associates and SSD group that warrants centralization of the assessee’s case with the other Group cases.
4.2.1 The contentions raised are examined carefully and it is found that as per information received from PCIT(Central), Pune vide letter dated 09/12/2024, a search and seizure action u/s 132 of the Income-tax Act, 1961 was conducted in the case of M/s. G.K. Associates (Proprietorship Concern of Shri Vinod Chandwani) and SSD Group on 04.05.2023. One of the key employees of M/s. G.K. Associates is Shri Kiran Chandwani who is a sales executive and the WhatsApp chats retrieved from Shri Kiran Chandwani reveal that he was responsible for safekeeping of cash and maintaining records of unaccounted cash transactions pertaining to G.K. Associates (on the instructions of Vinod Chandwani). From the WhatsApp chat of Shri Kiran Chandwani, details of certain transactions with Vishal Talreja of Baroda were found. Shri Kiran Chandwani, in his statement recorded u/s 132(4) of the Act in search proceedings has identified Vishal Talreja as the party in his whatsApp chat. Further, it has been established during the post search investigation that cash transactions have occurred between M/s. G.K. Associates Group/Vinod Chandwani and Vishal Darshanlal Talreja. Further, as per report of DDIT(Investigation), Pune dated 03/12/2024, during the course of post-search enquiry, Mr. Vinod Chandwani has answered questions related to some transactions (found from chat between Kiran Chandwani and Vinod Chandwani) with regard to Vishal Talreja of Baroda. Shri Vinod Chandwani has categorically identified the name of Shri Vishal Darshanlal Talreja and he has also stated that Vishal is his cousin. Sh. Vinod Chandwani is partner with Sh. Vishal Talreja in two firms namely-i) Sant Kanwar Ram LLP (PAN: ADPFS5637R) and (ii) Sacho Satram Polymers (PAN: ACPFS3349P). Shri Vinod Chandwani’s answer in the search proceedings clarifies his business relations with Shri Vishal Talreja as well as the code word used in transactions. The cash transactions of Shri Vishal Talreja with M/s. G.K. Associates as tabulated by the Investigation Wing based on WhatsApp Chat and statement of Shri Kiran Chandwani recorded in post search proceedings is as under:
PANFY-2019-20FY-2020-21FY 2021-22FY-2022-23FY-2023-24
AFIPT3950PRs. 15,00,000Rs. 2,97,95,000Rs. 2,18,00,000Rs. 5,55,00,000Rs. 1,00,00,00

 

4.2.2. The above information culled from WhatsApp chat of Kiran Chandwani indicates that there are unaccounted cash transactions of the assessee with M/s. G.K. Associates (Prop. Vinod Chandwani) and therefore assessee’s contention that no incriminating material/transactions relating to him have been found is not found to be correct. The above information provided by DDIT(Inv.), Pune vide letter dated 03.12.2024 indicates Vishal Talreja’s close business association and unaccounted cash transactions with M/s. G.K. Associates that require a coordinated investigation to protect the interest of revenue for public purposes. It is also noted that the assessee has not furnished any reply to the above material disclosed to him vide letter dated 21.12.2024.
4.2.3 The assessee has stated that there is no enquiry conducted with him in the post-search proceedings hence there is no material evidence against him. As per information available with this office, a summons u/s 131(1A) of the Income- tax Act, 1961 dated 10/07/2023 was issued to Vishal Talreja vide DIN & Notice No. ITBA/INV/S/131/2023-24/ 1054262802 (1) by Investigation Wing Pune and he has replied to the said summons on 24.07.2023. Thus, the assessee’s contention that no post search enquiries were conducted does not appear to be correct.
4.3 The assessee has relied on the decision rendered by Hon’ble Madhya Pradesh High Court in the case of Sagarmal Spinning and Weaving Mills Limited v. CBDT, wherein it is stated that a reasonable opportunity of being heard should be provided and reasons for transfer must be recorded. As in the case of the assessee, the opportunity of being heard has been duly provided vide this office notice dated 09.11.2023, 21.12.2023 and 21.12.2024 and the submission of the assessee has been duly considered in this order. The reasons requiring centralization of case are duly recorded in preceding paras. Hence, the guidelines laid down by the Hon’ble Court are duly complied with. Further the assessee has relied on the decision rendered by Hon’ble Bombay High Court in the case of Ramswaroop v. CIT 208 (Bombay) to argue that reasons for transfer cannot be vague and general in nature, but must be specific. In this regard the digital evidence and statement recorded during the search and post-search proceedings indicate cash transactions with M/s. G.K. Associates which require centralization for co-ordinated investigation in public interest are duly highlighted in preceding paragraphs.
4.4 The assessee has raised further objection stating that the transfer of his case to DCIT, Central Circle 2(2), Pune, will be inconvenient, cause harassment and cumbersome, since his entire setup is in Vadodara of Gujarat State. In this regard, reference is made to the jurisdictional High Court’s decision in the case of ASHAPURA ENTERPRISE versus THE PRINCIPAL COMMISSIONER OF INCOME TAX-1 in appeal No. R/SPECIAL CIVIL APPLICATION NO. 20409 of 2019, wherein the Hon’ble Gujarat High Court has dismissed the assessee’s petition against centralization of case on similar grounds with following remarks as under: –
“The various hardships quoted by the assessee company for the proposed centralization of the case do not hold any water, for following reasons:
Since one year, all IT assessments are conducted through mail (known as e-assessments). The returns are filed online for the last so many years. The notices, questionnaires, the information etc., are all sought through email for which the assessee has to respond only through e-mail and the assessee/the other representative shall not appear before the AO in person. Even the relevant portions of books of accounts/bills/vouchers are to be uploaded online, if the AO asked for the same. Therefore, the contention of carrying huge records, being located at a different place from that of the AO, location inconvenience etc. raised by the assessee do not hold any water.”
Therefore, relying on the above decision, the objection raised by the assessee is not found to be tenable. Further the case of the assessee requires centralization for coordinated investigation in interest of revenue and for public purpose, as per the guidelines issued by the CBDT. In this regard, reliance is placed on the Hon’ble Gujarat High Court decision in the case of Shree Ram Vessel Scrap P. Ltd. v. Commissioner of Income tax, reported in (2013) 355 ITR 255 (Guj) wherein the Hon’ble Court has held that centralization for effective and coordinated investigation in public interest can be a good ground for transfer of a case.
4.5 In view of the above, it is clear that Shri Vishal Darshanlal Talreja has significant suspicious cash transactions with M/s. G.K. Associates. As M/s. G.K. Associates Group is assessed to tax with DCIT Central Circle 2(2), Pune, for the coordinated investigation and assessment in interest of revenue and for public purposes, the case of Shri Vishal Talreja being a related person is also required to be centralized with DCIT Central Circle 2(2), Pune.”
25. In case of Asharapura Enterprise v. The Principal Commissioner of Income Tax -1 (judgment dated 10.03.2021 passed in Special Civil Application No.20409 of 2019 and other allied matters), the coordinate Bench of this court while considering the provisions of section 127 of the Act, referring to decisions of various other Hon’ble High Courts as well as Hon’ble Supreme Court as well as decision of this Court in case of Genus Electrotech Ltd. v. Union of India and others reported in[2018] 402 ITR 221 (Gujarat) has observed as under:
“27 We have already noted the reasons for the transfer of assessment. We may refer to a decision rendered by a Coordinate Bench of this Court in the case of Shree Ram Vessel Scrap P. Ltd. v. Commissioner of Income-tax, reported in (2013) 355 ITR 255 (Guj), wherein this Court had upheld the stance of the Revenue that for effective and coordinative investigation, if otherwise established on the record, the same can be a good ground for transfer of a case. It was observed as under:

“20. Section 127 of the Act, as already noticed, pertains to power to transfer cases. Subsection (1) empowers the Director General, Chief Commissioner or the Commissioner after giving the assessee a reasonable opportunity of being heard wherever it is possible to do so and after recording his reasons, transfer any case from one more or more Assessing Officers subordinate to him to any other Assessing Officer or Assessing Officers also subordinate to him. Likewise, under sub-section (2) of Section 127 after following similar procedural requirements, it is open for the Director General, Chief Commissioner or Commissioner to transfer a case from one Assessing Officer to another who is not subordinate to him in agreement with the authority to whom he may be subordinate. Sub-section (3) of Section 127 provides that nothing contained in sub-section (1) or subsection (2) shall be deemed to require giving of any such opportunity where the transfer is from any Assessing Officer to another and offices of all such officers are situated in the same city, locality or place. Sub-section (4) of Section 127 provides that the transfer of a case under subsection (1) or sub-section (2) may be made at any stage of the proceedings and shall not render necessary the reissuance of any notice already issued by the Assessing Officer from whom the case is transferred.

21. Exercise of power under sub-section (1) and subsection (2) of the Act comes with certain procedural requirements namely, of granting a reasonable opportunity of being heard in the matter wherever it is possible to do so, of recording of reasons for passing such order and as provided by the Supreme Court in Ajanta Industries (supra) communicating such reasons also to the assessee. Subject to fulfillment of such procedural requirements, the authority under Section 127 enjoys considerable discretion while exercising the power contained in sub-section (1) or subsection (2) thereof. Such discretion of course has to be exercised for achieving the public purpose and not for any arbitrary or irrelevant consideration. On the other hand, it can also be seen that transfer of a pending case from one Assessing Officer to another outside of a city, locality or place is likely to cause considerable inconvenience to an assessee. Therefore, even though an assessee may not have a vested right to insist that his assessment be completed only at one place or by a particular Assessing Officer, nevertheless, the reasons for transfer must be weighty enough to offset against such personal inconvenience of an assessee. In exercise of power under Section 127 thus we are concerned with larger public interest on one hand and personal inconvenience on the other. However, as long as such powers are exercised bona fide, for public purpose and in the interest of Revenue, the role of the Court to dissect such reasons and to come to a different conclusion would be extremely limited. It is by now well settled that judicial review against the administrative order in exercise of writ jurisdiction, the Court is concerned with the decision making process and not the final decision itself. Unless the reasons which prompted the competent authority to transfer the case can be stated to be wholly irrelevant or arbitrary, the Court would not interfere with such reasons. Of course an order of such nature can and need to be quashed if it is demonstrated that same is passed either without jurisdiction or is actuated by mala fide either in fact or in law.”

28 In the case of Aamby Valley Ltd. v. Commissioner of Incometax, reported in  (Bombay), a Division Bench of the Bombay High Court held as under :

“8. We have considered the submissions. The power to transfer cases under Section 127 of the Act is to be undoubtedly exercised after following the principles of natural justice. However, the discretion of the authority to transfer a case has to be examined on the touchstone of the same not being arbitrary and/or perverse and/or mala fide. If there are reasons in the impugned order which indicates due application of mind to reach a view to transfer a case from one jurisdiction to another, then this Court will not interfere with the discretion of the administrative authority who transfers the case. This discretion is vested by the Act in high ranking officers viz. Commissioner of Income Tax and the necessity to transfer a case from the jurisdiction of one officer to another officer for better administration of the Act could be diverse and impossible to enumerate. It is for the above reason that Section 127 of the Act has not limited the exercise of jurisdiction by specifying any circumstances before the authority can exercise his powers to transfer the case. One more fact which cannot be lost sight of is that an assessee cannot choose his Assessing Officer and, therefore, if the transfer order does indicate some valid reasons to justify the transfer and such reasons are neither perverse or arbitrary or mala fide this Court would not interfere with the reasonable exercise of discretion.”

29 The Delhi High Court, in the case of Vishal Kumar v. Commissioner of Income, reported in (Delhi), held as under :

“10. The assessee also has the opportunity to present his case and be subject to a regular assessment, in front of the Assessing Officer to whom jurisdiction has been transferred. No prejudice is caused by the mere fact of a Section 127 order, such that detailed reasons and specific grounds are required to be provided, as the petitioner today argues. Equally, the show-cause notice dated 9.10.2013 granted the petitioner in this case an opportunity of being heard. No oral representation was made by the petitioner on that date, nor was any request for another date made to the Commissioner. Written objections, however, were preferred, which were considered and disposed off by the impugned notice in this case. The argument, thus, that no chance to effectively represent the case was provided has no merit.”

30 In Pannalal Binraj v. Union of India, reported in [1957] 31 ITR 565 (SC), the Supreme Court observed while upholding the power of transfer that, inconvenience to the assessee or likelihood of misuse of the provision could not be a ground to declare the said provision to be void, but if there was abuse of the power, appropriate remedy could be taken. The relevant observations reads thus :

“It follows, therefore, that Section 5(7A) of the Act is not violative of Article 14 of the Constitution and also does not impose any unreasonable restriction on the fundamental right to carry on trade or business enshrined in Article 19(1) (g) of the Constitution. If there is any abuse of power it can be remedied by appropriate action either under Article 226 or under Article 32 of the Constitution and what can be struck down is not the provision contained in Section 5(7A) of the Act but the order passed thereunder which may be mala fide or violative of these fundamental rights. This challenge of the vires of Section 5(7A) of the Act, therefore, fails.”

31 We may also refer to the instructions issued by the CBDT dated 18th September 2020, more particularly, clause 2(vi) thereof:

“All cases selected u/s 133A of the Act (excluding International Taxation) having impounded material will be transferred to the Central Charges vide order u/s 127 of the Act and the cases having no impounded material will be handled by the ReACs. The survey reports shall be uploaded on ITBA by the jurisdictional charges.”

26. Considering the position of law as discussed above and the reasons recorded by the respondent no.1, the contention raised on behalf of the petitioner that impugned notice dated 21.12.2024 and order dated 02.01.2025 being corrigendum notice and order containing further details is without jurisdiction, is not tenable as the same are in continuation of order dated 29.11.2023 so as to comply with the provisions of the Act to provide opportunity of hearing to the petitioner. It is not in dispute that the petitioner has not filed any reply to the notice dated 21.12.2024 and now it is contended that the petitioner did not file reply as the said corrigendum notice referred to details relied upon to transfer case. Such approach of the petitioner cannot be accepted to quash the impugned order.
27. In view of the provisions of section 127 of the Act and conspectus of law enumerated here in above, power of transfer of case of the petitioner cannot be said to have been exercised without jurisdiction or contrary to the material on record to justify such action. We are therefore of the view that we should not interfere with the impugned corrigendum order of transfer passed by respondent no.1 under section 127(2) of the Act.
28. Petition, therefore, fails and is accordingly rejected. No order as to costs.