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Issues Involved:
1. Compliance with Section 127(1) of the Income-tax Act, 1961. 2. Violation of Section 124 of the Income-tax Act. 3. Allegation of mala fide intent behind the transfer order. Detailed Analysis: Issue 1: Compliance with Section 127(1) of the Income-tax Act, 1961 The petitioner argued that the transfer order did not comply with Section 127(1) of the Income-tax Act, 1961, as no reasons were mentioned in the order of transfer. The court examined Section 127(1), which stipulates that the Commissioner must provide the assessee a reasonable opportunity of being heard and record reasons for the transfer. The court noted that the show-cause notice issued to the petitioner explicitly mentioned administrative convenience as the reason for the proposed transfer. The Commissioner considered all objections raised by the petitioner before finalizing the transfer. The court concluded that the omission to restate the reason in the final order did not invalidate the transfer, as the reason had been communicated in the show-cause notice and considered during the hearing. Issue 2: Violation of Section 124 of the Income-tax Act The petitioner contended that the transfer order violated Section 124, which fixes territorial jurisdiction. The court clarified that the Act of 1961 does not grant the assessee an inherent right to be assessed by an Income-tax Officer of a particular area. The court emphasized that the jurisdiction of Income-tax Officers is determined not just by territorial boundaries but also by the classes of persons or incomes as directed by the Commissioner. The court referenced previous judgments, including Pannalal Binjraj v. Union of India, which upheld the validity of such transfers for administrative convenience. The court concluded that the transfer was justified on the grounds of administrative convenience and did not violate Section 124. Issue 3: Allegation of Mala Fide Intent The petitioner alleged that the transfer was made with a mala fide intent to harass, following searches and seizures by income-tax authorities. The court found no substance in these allegations, noting that the searches and seizures were not conducted with mala fide intent. The court reasoned that the transfer facilitated the availability of seized documents to the assessing officer in Delhi and supported administrative convenience. The court found no evidence of the transfer being made for any collateral purpose or to harass the petitioner. Conclusion: The court dismissed the writ petition, finding no failure to comply with the conditions prescribed under Section 127(1) of the Income-tax Act. The transfer was justified on the grounds of administrative convenience, and there was no violation of Section 124 or evidence of mala fide intent. The petition was dismissed without any order as to costs.
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