TMI Blog1974 (8) TMI 50X X X X Extracts X X X X X X X X Extracts X X X X ..... On October 28, 1971, a notice was received by the petitioner from the Commissioner of Income-tax, Haryana Himachal Pradesh, Delhi III, New Delhi, informing her firm that it had been proposed to transfer their case from the Income-tax Officer, Faridabad, to the Income-tax Officer, District III(9), New Delhi, on account of administrative convenience and that if they had any objection it may be sent to reach on or before 8th November, 1971. A reply was sent objecting to the transfer ; the assessee was further informed that the assessee should appear before the Commissioner on the 17th November, 1971 Shri V. K. Jain, general manager of the petitioner's firm, appeared along with the counsel and reiterated the objections sent earlier. By order dated November 24, 1971, the Commissioner transferred the petitioner's case from the Income-tax Officer, Faridabad, not to the Income-tax Officer, District III(9), New Delhi, as orginally stated, but to the Income-tax Officer, District II(5), New Delhi, in exercise of the powers conferred under section 127(1) of the Income-tax Act, 1961. The circumstances under which the transfer was effected are stated in the affidavit filed by Shri R. L. Mal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orm such functions in relation to the said case as the Board or the Commissioner (or any Inspecting Assistant Commissioner authorised by the Commissioner in this behalf) may, by general or special order in writing, specify, for the distribution and allocation of the work to be performed." Prior to this section being placed on the statute book the Supreme Court had occation to consider the corresponding provision under the previous Act. According to section 5(7A) of the previous Act of 1922, the Commissioner of Income-tax may transfer any case from one Income-tax Officer subordinate to him to another. The Central Board of Revenue may transfer any case from any one Income-tax Officer to another. It was held by N. H. Bhagwati J. in Pannalal Binjraj v. Union of India that section 5(7A) did not violate either article 14 or article 19(1)(g) of the Constitution merely because the powers may be abused and that if there is any abuse of power the same could be remedied by appropriate action. Under the Act of 1922, according to section 64(1) and (2), the place of assessment shall be the place where the assessee carries on business, profession or vocation ; where it is done in more places t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Officer to another. This is the administrative machinery which is set up for assessing the incomes of the assessees which are chargeable to income-tax. There is, therefore, considerable force in the contention which has been urged on behalf of the State that section 5(7A) is a provision for administrative convenience." The reasons for section 127(1) requiring a show-cause notice to be given to the assessee before the transfer of his case from one Income-tax Officer to another and for recording reasons as required by section 127(1) of the Act of 1961 subsequent to the above decision have been indicated by Gajendragadkar C. J., speaking for the Supreme Court, in Kashiram Aggarwalla v. Union of India. After referring to Pannalal Binjraj v. Union of India, the learned Chief Justice pointed out that though it upheld the validity of section 5(7A) and observed that it would be better if an opportunity is given to the assessee in cases where the power conferred by section 5(7A) is intended to be exercised because he would then be able to mention his objections to the intended transfer. It is in that connection that the Supreme Court further expressed its opinion that if the reasons fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f transfer within the same city or locality but the said reason, namely, administrative convenience, being required to be stated as a reason for the transfer when it happens to be outside the city or locality without being presumed. There is also yet another aspect which bears on the present discussion. The old section 64 [sub-clauses (1) and (2)] of the Act of 1922 is no longer there in the Act of 1961. Unlike the Act of 1922 which referred to the "place of assessment", the Act of 1961 refers to the "jurisdiction" of the Income-tax Officer. It may be truer to say that the Act of 1961 does not proceed on the basis of any right of the assessee to be assessed by the Income-tax Officer of a place where he either resides or carries on business. The use of the word "jurisdiction" also implies that assessment by an Income-tax Officer in a case where he does not have the territorial jurisdiction to deal with the case would not be invalid for such an objection may be deemed to have been waived on failure to object at the proper time (Raja Bahadur Kamakhya Narain Singh v. Union of India). It may also be noticed that the Income-tax Officers derive their jurisdiction to deal with the cases ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, on this branch of the argument, is whether the final order of transfer, which does not mention the reason for the transfer, is bad. Having given this matter my earnest consideration it seems to me that this is not a case where the order of transfer can be said to be bad on the ground of the reason not being recorded. The impugned order of transfer (copy of which is annexure "D" to the petition) has to be read only along with the show-cause notice (copy of which is annexure "B" to the petition), which clearly stated to the assessee that the proposed transfer was on the ground of administrative convenience. All the contentions of the assessee concerning the prejudice the assessee said it would suffer by reason of the said transfer have been borne in mind by the Commissioner as he himself has set out in his affidavit of return when he finally passed the impugned order of transfer on November 24, 1971. In Padfield v. Minister of Agriculture, Fisheries and Food the House of Lords rejected the argument that the minister's decision would not have been open to question if he had not given reasons. Lord Upjohn went to the extent of saying that, if the circumstances warranted, a court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rent should be and that the reasons "went but a little way towards explaining their departure in a downward direction from the figures preferred on all sides". It was nonetheless held in that case that defects were not such as to require the decision to be nullified. Danckwerts L.J. observed that while the decision could be criticised for lack of clarity : "......there is force in the contention that the committee is not a formal body and is not wholly composed of lawyers......it is not right to require a too high standard of the committee in this respect. It is possible, in my opinion, to appreciate from the decision of the committee the matters which affected their conclusions." It does not seem to me in the present case that the Commissioner's omission to state, once again, in the final order that he issued, that the transfer was on the ground of administrative convenience, would be a matter of any significance or any defect which is fatal. He would have had to repeat in the final order (though this might have been done with better advantage to avoid such a criticism) what had been stated earlier in the show-cause notice that the transfer was made owing to administrative ..... X X X X Extracts X X X X X X X X Extracts X X X X
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