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TMI Blog2017 (4) TMI 1416X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case, it is urged, that no reason has been recorded at all. 3. Shri Manish Mishra sought to explain that the reasons given in impugned order is "decentralization of cases from central charges" and should be taken a "sufficient reason". 4. We have heard learned counsel for petitioner and Shri Manish Mishra for respondent. 5. Petitioner is a company registered under Companies Act, 1956 (hereinafter referred to as " Act, 1956") having its registered office at Delhi since 30.9.2003. It is regularly filing income tax return at Delhi and is subjected to assessment by Assessing Officer at Delhi. 6. There was search seizure operation under Section 132(1) on 9.7.2008 on petitioner's premises and other group concern, their directors and family members etc. Consequent thereto, jurisdiction in cases of 21 persons was centralized and transferred to Deputy Commissioner of Income Tax/Assistant Commissioner Of Income Tax, Central Circle, Meerut. The said Assessing Officer issued notices under Section 153(A) calling aforesaid persons to file their returns for six Assessment Years (hereinafter referred to as "A.Y.") for being subjected to assessment as per provisions contained under Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, pass the order;" (emphasis added) 13. Provision is very clear. Order of transfer can be passed after complying two requirements; (i) after giving Assessee a reasonable opportunity of hearing wherever it is possible to do so; and (ii) recording of reasons for doing so. 14. Statute says that "opportunity of hearing" is necessary in such cases where it is possible to do so meaning thereby it is not necessary to be observed invariably in each and every case, whenever orders transferring cases are passed. However, second requirement that 'reasons' shall be recorded is applicable in all the cases irrespective of the fact whether order of transfer has been passed after giving opportunity of hearing or not. Statute is clear and in emphatic terms requires that 'reasons' shall be recorded by Competent Authority. Not only that, but, reasons must be communicated to Assessee, otherwise very purpose of recording reasons would be frustrated. When it is said that order shall be passed after recording reasons, in our view, reasons cannot be recorded and kept in file but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmunicated in the order of transfer. Revenue took a defence that reasons were mentioned in the show cause notice, therefore, order of transfer for absence of reasons would not be bad. This argument of Revenue was not accepted. Court said that Section 127 has been introduced in Act, 1961 and even substituted Section 127 by Finance Act, 1976 emphasizes upon "recording of reasons". Once an order is passed transferring a case of an Assessee to another area, order containing reasons has to be communicated. Communication of order is absolutely essential requirement since Assessee is then made aware of reasons which impelled authority to pass order of transfer. Assessee shall have an opportunity to approach High Court under Article 226 of Constitution of India. Court thus said that "we are clearly of opinion that the requirement of recording reasons under Section 127(1) 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 Assessee". Court specifically overruled an otherwise judgment of Delhi High Court in Sunanda Vs. Union of India, (1975) 99 ITR 391. Court said, when law requires ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority, having power of transfer under section 127 or any Assessee has apprehension, or for other administrative reason, it is found necessary that case should be transferred from jurisdiction of one authority to another, the same may be done. Statute also incorporates requirement of principles of natural justice as also recording of reason but simultaneously has used phrase "whenever it is possible to do so". This has been noticed by a Constitution Bench in Kanshi Ram Agarwal Vs. Union of India, AIR 1965 SC 1028. Reading Section 127, Court has said that Section 127(1) imposes an obligation on the authority exercising power under the said Section to record 'reasons' for directing transfer of a case from one Income Tax Officer to another. It further requires that whenever power conferred by Section 127 is intended to be exercised, an opportunity should be given to Assessee, "whenever it is possible to do so" and reasons have to be recorded for making order of transfer. Court thus held that opportunity to Assessee shall be offered "whenever it is possible to do so" but order must contain reasons for transfer. Court held that "requirement that opportunity should be given, cann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Assesseee but if other factors of importance of higher degree are available, an order of transfer otherwise validly passed, is not to be assailed as something which has caused no serious prejudice to Assessee. 26. An attempt on the part of learned counsel for Assessee that mere fact that opportunity was not given shall vitiate order of transfer, in our view, cannot be accepted for the reason that Statute does not make requirement of opportunity mandatory but it is subject to condition "wherever it is possible to do so" and in a given case, the mere fact that notice was not given to Assessee, will not vitiate order if the circumstances do justify such non affording of opportunity. 27. Thus, at the pain of repetition, we hold that careful reading of Section 127(2)(a) leads no manner of doubt that requirement of "reasonable opportunity" to Assessee is subjected and conditional i.e. "whenever it is possible to do so" department may proceed to pass an order of transfer without giving such opportunity. When a phrase has actually been used by Legislature in a statute, we cannot either ignore it or omit or render it redundant by reading that in every case an opportunity is must, else o ..... 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