Facts of the Case

Alankit Forex India Limited, along with numerous connected entities and individuals, filed writ petitions before the Delhi High Court challenging income-tax proceedings initiated following search and investigation actions. Subsequent to the search, jurisdiction over the petitioners’ cases was transferred to the Central Circle of the Income Tax Department.

Pursuant to such transfer, the Deputy Commissioner of Income Tax, Central Circle-28, Delhi issued various notices initiating assessment and related proceedings. The petitioners contested these actions, alleging absence of jurisdiction and non-compliance with statutory requirements. The matters were heard together as part of a batch of connected cases involving multiple petitioners arising out of the same investigative context.

 Issues Involved

  1. Whether the transfer of jurisdiction to Central Circle authorities pursuant to search/investigation was legally valid.
  2. Whether notices initiating assessment or reassessment proceedings were sustainable in law.
  3. Whether the Income Tax Department complied with statutory preconditions before issuing such notices.
  4. Whether the High Court should exercise writ jurisdiction to quash proceedings at the preliminary stage.

Petitioner’s Arguments

  • The petitioners contended that the impugned notices and proceedings were issued without lawful jurisdiction.
  • It was argued that mandatory statutory conditions for initiating assessment or reassessment proceedings had not been fulfilled.
  • The transfer to the Central Circle and subsequent actions were alleged to be arbitrary and violative of principles of natural justice.
  • The petitioners sought quashing of the notices and restraint on further proceedings. 

 Respondent’s Arguments (Revenue)

  • The Revenue submitted that the proceedings were initiated pursuant to lawful search and investigation operations.
  • Jurisdiction of the Central Circle authorities was validly assumed under the provisions of the Income Tax Act, 1961.
  • The Department argued that all procedural requirements had been duly complied with.
  • It was further contended that writ jurisdiction should not be invoked at the notice stage, particularly where statutory remedies were available.

Court Order / Findings

  • Transfer of jurisdiction to the Central Circle following search actions was within statutory authority.
  • The notices initiating assessment proceedings were issued in accordance with law.
  • No jurisdictional error or patent illegality warranting interference under Article 226 was demonstrated.
  • Assessment proceedings could lawfully continue, and the petitioners could avail appropriate remedies under the statutory framework. 

 Important Clarification

  • Courts ordinarily refrain from interfering at the stage of notice where alternate statutory remedies exist.
  • Post-search transfer of cases to Central Circle jurisdiction is generally valid if supported by statutory provisions.
  • Challenges to reassessment or assessment proceedings must establish clear lack of jurisdiction, procedural illegality, or violation of natural justice.
  • The ruling reinforces the principle that disputed factual issues should be adjudicated through the assessment and appellate process rather than writ proceedings.

Link to download the order – https://www.mytaxexpert.co.in/uploads/1772270237_ALANKITFOREXINDIALIMITEDVsDY.COMMISSIONEROFINCOMETAXCENTRALCIRCLE28DELHI.pdf 

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