Court Dismisses Petitioner's Challenge to Jurisdiction Transfer Citing Administrative Convenience and Public Interest
The Punjab and Haryana High Court has dismissed a petition filed by Bhupinder Singh challenging the transfer of his tax assessment jurisdiction from Chandigarh to Panaji, Goa. The decision was delivered by a division bench comprising Justices Deepak Sibal and Lapita Banerji on December 17, 2025.
The petitioner, Bhupinder Singh, sought to overturn an order dated September 8, 2025, issued by the Principal Commissioner of Income Tax, Chandigarh-I, which transferred his assessment jurisdiction to the ACIT/DCIT Central Circle, Panaji. The transfer was a consequence of search and survey operations conducted at the premises of M/s Blue Ocean Beverages Private Limited, Panaji, Goa, revealing incriminating evidence against Singh.
The court found that the transfer of jurisdiction was justified based on evidence linking Singh to undisclosed cash transactions associated with the sale of M/s Queen Distillers and Bottlers Private Limited, Chandigarh. The evidence emerged from WhatsApp chats between Lokesh Saran, Managing Director of M/s Aaroha, and Gaurav Sharma, detailing a cash transaction of Rs. 10 crores.
The High Court highlighted that the transfer was not mala fide and adhered to principles of natural justice, allowing Singh adequate opportunity to present his case. Furthermore, the court emphasized that technological advancements mitigate the inconvenience of jurisdiction transfers, as proceedings can be conducted digitally.
The court noted that the centralization of assessments at Panaji was crucial for efficient investigation and tax collection, given the interconnected nature of the entities involved. It dismissed Singh's argument that the transfer violated Section 158BD of the Income Tax Act, which dictates that incriminating material should be handled by the jurisdictional officer if no link to other entities exists.
Justice Sibal stated, "The petitioner's transfer was executed for administrative convenience, effective investigation, and coordinated assessment for efficient tax collection, all in the public interest."
The judgment reaffirms the legal principles guiding the transfer of jurisdiction under Section 127 of the Income Tax Act, 1961, ensuring that such transfers are conducted transparently, with reasons recorded and communicated to the assessee.
Bottom Line:
Income Tax Act, 1961 - Section 127 - Transfer of assessment jurisdiction is a machinery provision guided by public interest, administrative convenience, and efficient tax collection - Principles of natural justice must be followed, and reasons for transfer should be recorded and communicated to the assessee.
Statutory provision(s): Income Tax Act, 1961 - Sections 127, 131(1A), 132, 133A, 158BD
