Mala fide transfer challenge fails where administrative posting is backed by files and linked to efficient tax administration.

Administrative transfer and posting of an income-tax officer will not be interfered with unless mala fides or extraneous considerations are proved on reliable material. The Court found that the departmental files did not show any external pressure or improper influence, and treated assignment of connected cases to the seniormost officer as a normal administrative arrangement. It also noted that newspaper reports alone were insufficient to establish mala fide exercise of power. The power of transfer under Chapter XIII of the Income-tax Act must be exercised for convenient and efficient tax administration, and the challenge failed because no mala fide or extraneous exercise of power was proved.

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Issues: Whether the transfer and posting of the income-tax officer and the handling of the assessment file were vitiated by mala fides or extraneous considerations.

Analysis: The materials placed before the Court, including the departmental files, did not establish any external pressure or improper influence in the transfer and posting decisions. The assignment of the connected cases to the seniormost Income-tax Officer was treated as a normal administrative arrangement. The power of transfer under Chapter XIII of the Income-tax Act, 1961 is not arbitrary and is to be exercised for the convenient and efficient collection of tax. Newspaper reports were found insufficient to prove mala fide exercise of power.

Conclusion: The challenge failed, as no mala fide or extraneous exercise of power was proved.

Ratio Decidendi: Administrative transfers and postings within the income-tax department will not be interfered with unless mala fides or extraneous considerations are established on reliable material; the power must be used for efficient tax administration.

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