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Delhi HC begins hearing pleas by Gandhi clan, AAP against I-T assessment transfer

Transfer of an assessment to the central circle of the Income Tax department is a black mark and can only be done in cases of search and seizure, senior advocate Arvind Datar told the Delhi High Court on Thursday in petitions by three Congress leaders - Sonia Gandhi, Rahul Gandhi and Priyanka Gandhi Vadra, Aam Aadmi Party (AAP) and others.

Delhi HC
Delhi HC

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Published : Jul 29, 2021, 9:52 PM IST

New Delhi: Transfer of an assessment to central circle of the Income Tax department is a black mark and can only be done in cases of search and seizure, senior advocate Arvind Datar told the Delhi High Court on Thursday in petitions by three Congress leaders - Sonia Gandhi, Rahul Gandhi and Priyanka Gandhi Vadra, Aam Aadmi Party (AAP) and others.

Datar, who was appearing for Gandhi's and others, argued before a bench of Justices Manmohan and Navin Chawla that while only rarest of the cases go out of faceless assessment, even those that are transferred are marked to the concerned assessment officer and not the central circle. Sanjay Bhandari is in search and seizure (which forms the basis of the transfer of cases of Gandhi's, as per the authorities). No reason for transfer is given for the political party, Datar submitted.

The court was hearing a batch of nine petitions challenging the I-T authorities' decision to transfer the tax assessments of Gandhi clan, AAP and five charitable trusts to the central circle. The five charitable trusts are Sanjay Gandhi Memorial Trust, Jawahar Bhawan Trust, Rajiv Gandhi Foundation, Rajiv Gandhi Charitable Trust and Young Indian.

Datar submitted before the court that the question of law in the nine pleas was broadly the same and similar notices of transfer of assessment were issued to the parties before the court. He stated that he would treat the plea by Sanjay Gandhi Memorial Trust as the lead matter for the purposes of his arguments. Once the faceless scheme has come into force, how can the cases be transferred outside to the centre circle, he questioned.

He argued that faceless assessment was the rule as the same avoided human contact and scope of any unhealthy practices. In March, the high court had issued notice to I-T department in pleas by the three Congress leaders against the transfer of their IT assessments for the assessment year 2018-19 to central circle for treating it along with arms dealer Sanjay Bhandari's group.

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The Gandhi's have challenged the decision of the Principal Commissioner of Income Tax on the ground that they have nothing to do with the Sanjay Bhandari group's cases and there has been no instance of search or seizure in their cases. Bhandari, wanted in India on money laundering charges, has been allegedly linked to Priyanka Gandhi's husband, Robert Vadra, over a London-based flat. Vadra has denied any business connections with the accused.

Solicitor General Tushar Mehta had then argued that since the transfer was within the city, no prejudice was caused and the mandate demanded that only if the transfer was from one city to another, the officer had to give a hearing to the assesse. Response on AAP's petition was sought by the court on July 23.

In the petition, AAP has challenged the illegal, arbitrary, unreasoned and discriminatory action of the Commissioner of Income Tax, Exemption in transferring its case to the Central circle. It has been alleged that the order was passed in complete violation of various statutory provisions, notification and circulars and was without jurisdiction. The mere mentioning of a reason, that is, 'coordinated investigation' is not suffice in law to justify such transfer under Section 127 of the IT Act. The respondents are obligated to assign specific reasons with respect to 'coordinated investigation' so to be able to justify an order of transfer under section 127.

Since in the present matter there is no investigation pending against the petitioner, no such specific reason could have been there to justify such transfer, the plea said. The matter would be heard next September 11.

PTI

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