2010 (4) TMI 1181

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ould be furnished in the form as prescribed in Sub-rule (1) of Rule 12 of the IT Rules, 1962 and should be delivered in the office within 15 days after service of the notice. In the last para of the notice, it has been stated as follows: It is also being intimated to you that vide order Memo No. 18/127/Centralisation/Crr/GHY-II/02-03/1365-69 dt. 24th July, 2007 of the CIT, Guwahati-II, Guwahati jurisdiction over your case has been transferred to this office and therefore, you are requested to direct all your Income Tax related correspondence to this office and from now onwards IT returns are also to be filed in this office only. 3. From the above what is seen is that by an order dt. 24th July, 2007 passed by the CIT, Guwahati-II....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....tended that the order dt. 24th July, 2007 purportedly passed under Section 127 of the IT Act, 1961 does not disclose any reason whatsoever. The reasons for transfer as have been disclosed in the said order dt. 24th July, 2007 is "administrative convenience and co-ordinating and effective investigation". He submits that the reasons shown in the order dt. 24th July, 2007 being vague and indefinite, same cannot be said to be in compliance of the requirements of the reasons to be assigned as per the provisions of Section 127(1) of the Act. 8. Mr. U. Bhuyan, learned standing Counsel, IT Department, on the other hand, supporting the aforesaid order dt. 24th July, 2007, submits that the reasons assigned in the order being sufficient, the Writ C....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....considerations. Whether such a writ or special leave application ultimately fails is not relevant for a decision of the question. 7. We are clearly of opinion that the requirement of recording reasons under Section 127Q is a mandatory direction under the law and non-communication thereof is not saved by showing that the reasons exist in the file although not communicated to the assessee. Mr. Sharma drew our attention to a decision of the Delhi High Court in Sunanda Rani Jain v. Union of India and Ors. 1975 CTR (Del) 135 : (1975) 99 ITR 391 (Del) : TC 69 R. 693, where the learned Single Judge has taken a contrary view. For the reasons, which we have given above, we have to hold that the said decision is not correct. ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... When the law requires reasons to be recorded in a particular order affecting prejudicially the interest 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 of natural justice on account of omission to communicate the reasons is not expiated. 8. Mr. Sharma also drew our attention to a decision of this Court in S. Narayanappa and Ors. v. CIT (1967) 63 ITR 219 (SC) : TC 51R.651, where this Court was dealing with Section 34 of the Act. It is clear that there is no requirement in any of the provisions of the Act or any section laying down as a condition for the initiation of the proceedings that the reasons which induced the CIT to accord sanction....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... the assessee could make an effective representation with reference to the reasons set out. It is not sufficient merely to say in the notice that the transfer is proposed "to facilitate detailed and co-ordinated investigation". The reasons cannot be vague and too general in nature but must be specific and based on material facts. It is again not merely sufficient to record the reasons in the file but it is also necessary to communicate the same to the affected party. 12. In Naresh Kumar Agarwal (supra), the Calcutta High Court also observed thus: 8. So far as the notice is concerned though it has been mentioned that the proposed transfer is for 'co-ordinated investigation and assessment', it does not mention any specific....