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TMI Blog2012 (10) TMI 1192X X X X Extracts X X X X X X X X Extracts X X X X ..... al; (4) Shri Ram Gopal Agrawal; (5) Shri Omprakash Agrawal; (6) Shri Vidya Sagar Agrawal; (7) Smt. Santosh Agrawal; (8)Smt. Sharda Devi Agrawal; (9) Smt. Pinki Agrawal transferring the cases from AO, Dhamtari i.e., ITO, Dhamtari to the AO at Visakhapatnam i.e., Asstt. CIT, (CC)-I, Visakhapatnam, which are under challenge in Writ Petn. (T) Nos. 35, 36, 37, 38, 39, 40, 41, 42 and 43 of 2012. 2. The order in all the cases though passed on two different dates, however, there being commonality in facts and law, they are disposed of by this common order. 3. Brief facts of the case, necessary for disposal of the present batch of petitions, are that on 19th Aug., 2011, a search and seizure operation was conducted on the premises of M/s Maa Mahamaya Industries Ltd. and the director's office as well as the other companies belonging to the group at Dhamtari, Raipur and Visakhapatnam. After completion of search and seizure, the respective petitioner was issued show-cause notice on 18th Jan., 2012 inviting objection from the assessees against the proposed transfer of jurisdiction of its case from AO i.e., ITO, Dhamtari/Raipur to Asstt. CIT, Central Circle-I, Visakhapatnam for a co-or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthorized officer under sub-s. (8) or sub-s. (9) shall be exercisable by such AO. 8. Sec. 127 of the Act confers power on the IT authorities to transfer the cases from one AO to any other AO, who are subordinate to another officer. Where the AO or AOs from whom the case is to be transferred and the AO or AOs to whom the case is to be transferred are not subordinate to the same Director General or Chief CIT or CIT, the power of transfer has been conferred on the CIT from whose jurisdiction, the case is to be transferred, if both the respective CITs are in agreement and such power of transfer is exercisable after giving the assessee a reasonable opportunity of being heard in the matter and after recording reasons for doing so. 9. On a plain reading of the provisions contained in s. 127, two aspects are necessarily to be complied with namely : a reasonable opportunity of being heard in the matter wherever it is possible to do so; and secondly the recording of reasons for transferring a case. In absence of these two requirements being fulfilled, the order may not withstand the judicial scrutiny when its legality is penetrated. 10. In the present case, the assessee was served w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act, it is necessary that the authority which proposes to transfer the case must, wherever it is possible to do so, give the assessee a reasonable opportunity of being heard with a view to enable him to effectively show cause against the proposed transfer. The notice must also propose to give a personal hearing. It is also necessary to mention in the notice the reasons for the proposed transfer so that 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. [Emphasis, italicized in print, supplied] 14. In Ajantha Industries v. CBDT [1976] 102 ITR 281 (SC), Hon'ble the Supreme Court held thus in paras 9, 10 and 11 : 9. This judgment was rendered by this Court on 21st Dec., 1956, and we find that in the 1961 Act, s. 127 replaced s. 5(7A)889 where th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 127 of the IT Act, 1961, entails a certain amount of prejudice to the assessee. Therefore, the Legislature has advisedly made a provision for giving the assessee a reasonable opportunity of being heard in the matter. It is also enjoined that the reasons for the transfer shall be recorded by the concerned authority. Furnishing of specific and intelligible reasons for the transfer of a case is only a concomitant of the concept of reasonable opportunity enshrined in s. 127(1) and (2). Unless the assessee knows the precise reasons for the transfer, he would be handicapped in putting forth his objections effectively. If a vague and omnibus ground, such as 'for detailed and co-ordinated investigation' is mentioned in the show-cause notice and repeated in the final order given, the assessee cannot be reasonably expected to project his viewpoint. The requirement of a reasonable opportunity will then be reduced to an idle formality. It is, therefore, incumbent upon the authorities to spell out the basic reason for the transfer, at least briefly and broadly, so that the assessee may have the opportunity of making an effective representation and an opportunity to question the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso the reason for proposed transfer was stated to be for co-ordinated investigation . The assessee(s) was expected to object to this stock phraseology co-ordinated investigation which was bald and vague in its tenor. However, in the opinion of this Court, if the basic reasons and foundations which have compelled or have put the AO to such inconvenience where co-ordinated investigation is not possible at Raipur are not known to the assessee and against this, the assessee could not have made any possible objection, the reason for proposed transfer is not only vague but by mentioning such reason proper opportunity is also not afforded to the assessee for raising his objection in the matter. 17. There is yet another reason as to why the pre-requirement of s. 127 as to the furnishing of reason in the transfer order is not complied with because while replying to para 8.10 of the writ petition, the respondents in para 7 of the return had stated that the order of transfer has been passed after providing reasonable opportunity to the petitioner(s) and that the other detailed reasons for transferring the case from ITO, Dhamtari and Asstt. CIT-2(1), Raipur to Asstt. CIT, Visakhapat ..... 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