ANIL MITTAL VS CHIEF COMMISSIONER OF INCOME-TAX
1999 P T D 630
[225I T R 282]
[Punjab and Haryana High Courts (India)]
Before Ashok Bhan and N. K. Sodhi, JJ
ANIL MITTAL and others
Versus
CHIEF COMMISSIONER OF INCOME-TAX
C. W. P. No.5383 of 1996, decided on 22/05/1996.
Income-tax---
----Transfer of case---Requirement of recording reasons in order of transfer mandatory---Transfer of case from place G to place D---No reasons recorded in order of transfer---Transfer invalid---Indian Income Tax Act, 1961, 5.127.
The recording of reasons in an order of transfer under section 127 of the Income Tax Act, 1961, is a mandatory requirement.
Where the order of transfer of a case from place G to place D under section 127 of the Income Tax Act, 1961, did not contain the reasons for the transfer:
Held, that the order of transfer was invalid.
Ajantha Industries v. C.B.D.T. (1976) 102 ITR 281 (SC) fol
N. K. Sud for Petitioner.
R. P. Sawhney and Sanjay Goel for Respondent
JUDGMENT
This petition has been filed under Article 226/227 of the Constitution of India, for issuance of a writ of mandamus/certiorari to quash the order, dated January 16, 1996 (Annexure P-19), passed under section 127(2)(a) of the Income Tax Act, 1961 (hereinafter referred to as "the Act"), on the ground that it does not contain reasons for transferring the case of the assessee from Gurdaspur to New Delhi.
Counsel for the assessee has placed reliance upon a judgment of the Supreme Court in Ajantha Industries v. C.B.D.T. (1976) 102 ITR 281, where their Lordships, on interpretation of section 127(1) of the Act, have held that reasons have to be recorded in the order while transferring the case of an assessee from one jurisdiction to another jurisdiction. It was held as under (headnote):
"The requirement of recording reasons under section 127(1) of the Income Tax Act, 1961, for the transfer of a case from one Income tax Officer to another, is a mandatory direction under the law and non-communication thereof to the assessee is not saved by showing that the reasons exist in the file although not communicated to the assessee. Recording of reasons and disclosure thereof are not a mere idle formality. When law requires reasons to be recorded in a particular order affecting prejudicially the interests of any person, who can challenge the order in Court, it ceases to be a mere administrative order and the vice of violation of the principles o1 natural justice on account of omission to communicate the reasons is not expiated. ,
Where, after giving an opportunity to the appellants for a proposed transfer of their cases 'for facility of investigation' from the Income tax Officer at Nellore to an Income-tax Officer at Hyderabad, the Central Board passed an order under section 127(1) of the Income Tax Act, 1961, transferring the cases but in the order served on the appellants no reasons were recorded or communicated:
Held accordingly, that non-communication of the reasons in the order passed under section 127(1) was a serious infirmity and the order was invalid."
On a perusal of the order, Annexure P-19, we find that no reasons whatsoever have been recorded in the order by the respondent while passing order under section 127 of the Act transferring the case of the assessee from Gurdaspur to New Delhi. The order, Annexure P-19, is against the provisions of section 127 of the Act and the law laid down by their Lordships of the Supreme Court in the case of Ajantha Industries (1976) 102 ITR 281. The same being bad in law cannot be sustained.
This petition is allowed and the order, Annexure P-19, is quashed. However, we leave it open to the respondent to pass a fresh order, if so required, in accordance with law after giving due opportunity to the assessee before passing the order and recording its reasons in the order.
M.B.A./1714/FCPetition allowed