Law:

Section:

Section 127 of the Income-tax Act, 1961 - Income-tax authorities - Power to transfer cases - Whether expression "case" used in section 127 comprises not only a pending proceeding but also proceedings which may have been completed on or before date of transfer and all proceedings which may be commenced after date of transfer - Held, yes - Whether order of transfer without considering assessee's explanation setting out reasons as to why his case should not be transferred would be invalid and, therefore, would be liable to set aside - Held, yes Words and phrases : Word 'case' as occurring in section 127 of the Income-tax Act, 1961 FACTS The petitioner firm was engaged in auditing work of other assessee. During the course of search at the premises of the petitioner, papers relating to other assessees were found. As the cases of the other assessees had been transferred, the Commissioner transferred the case of the petitioner also. On writ, the petitioner challenged the order of transfer on the grounds that, on the date of the order of the said transfer, no assessment proceeding was pending for any assessment year relating to the petitioner and that the reasons given for the transfer were not relevant or germane. HELD The expression "case" used in section 127 comprises not only a pending proceeding but also proceedings which may have been completed on or before the date of transfer. Indeed, it also includes all proceedings which may be commenced after the date of transfer. Therefore, the first contention of the petitioner had to be rejected. On the second contention, however, the order of transfer was liable to be set aside. In pursuance of a show-cause notice, the petitioner had submitted an explanation setting out reasons as to why his case should not be transferred. The impugned order did not deal with any of those reasons stated in the said explanation. In view of the fact that the petitioner was merely an auditor, the matter must be re-considered. Accordingly, the impugned order was quashed insofar as the petitioner was concerned. The Commissioner would pass orders afresh in accordance with law taking into consideration all the relevant facts and circumstances…

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