D.N. Choudhury, J.
1. The legality and validity of transferring the file of the assessee under Section 127 of the Income-tax Act, 1961, is the subject-matter of both the writ petitions.
2. The material facts leading to the filing of both the cases are given below. The petitioners are assessees under the Income-tax Act who were served with notices dated May 13, 1992, proposing the transfer of the petitioners' cases from the jurisdiction of the Income-tax Officer, Tinsukia (Ward-I), to respondent No. 1 under Section 127 of the Income-tax Act, 1961 (for short 'the Act'). The petitioners submitted their reply indicating about the inconvenience that would ensue on such transfer. According to the petitioners, neither sanction thereafter was taken by the respondents, nor the respondents responded to the show-cause reply of the petitioners. Subsequently, the Assistant Commissioner, respondent No. 1, issued notices on the petitioners from time to time under Section 142 of the Act for submitting their return and production of accounts. The very assumption of jurisdiction of respondent No. 1 is, therefore, assailed in these petitions. The respondents filed their affidavits-in-opposition and submitted that in exercise of power under Section 120 of the Act the Assistant Commissioner of Income-tax (Investigation Circle), Dibrugarh, had been vested with the power and jurisdiction over all 'search and seizure' cases of Dibrugarh District of the State of Assam, the Districts of Lohit, Tirap, East Siang, West Siang, and Dibong Valley of Arunachal Pradesh. The case of the petitioner is, being a case of search and seizure, the jurisdiction over such cases automatically vested in the Assistant Commissioner of Income-tax (Investigation Circle) with effect from April 8, 1992, vide Notification No. 2 of 1992-93, dated April 8, 1992. On the strength of the notification aforementioned, respondent No. 1 assumed jurisdiction on the subject-matter. Consequently, the Income-tax Officer (Ward-I), Tinsukia, ceased to exercise jurisdiction since April 8, 1992. Accordingly, the returns submitted by the petitioners-assessees were transferred to respondent No. 1. As regards the notice bearing No. E-18 of 1991/TSK/B & S/Pt. II, dated March 13, 1992, the respondents stated that the said notice was initially issued accepting the case of the petitioner for transfer to the jurisdiction of respondent No. 1, but subsequently when it was discovered that the case was already covered by the notification dated April 8, 1992, no further order was thereafter passed under Section 127 of the Act. The respondent also asserted that in view of the aforesaid notification dated April 8, 1992, there was no necessity for issuance of individual notices to each and every person of the category of those who came under search and seizure. According to the respondents, the cases were lawfully transferred to the Assistant Commissioner in question and, therefore, there was no illegality in assumption of jurisdiction.
3. Dr. A. K. Saraf, learned counsel appearing for the petitioner, firstly submitted that respondent No. 1 exceeded his jurisdiction in assuming
jurisdiction over the matter which was not lawfully conferred. Dr. Saraf in the course of his argument pointed out that the same Commissioner of Income-tax in exercise of his power under Section 127 of the Act initiated process for transfer and accordingly notices were issued upon the petitioners to which the petitioners responded by submitting their show-cause reply. The power under Section 127 of the Act is distinct from that under Section 120 and, therefore, the action of respondent No. 1 is seemingly arbitrary. Dr. Saraf further submitted that assuming the notification dated April 8, 1992, under Section 120 of the Act is a valid exercise of power, in that event, the notification would be operative from May 1, 1992, and the said notification would cover the search and seizure cases of the Dibru-garh and Tinsukia Districts in the State of Assam and Tirap, Lohit, East Siang, West Siang and Dibang Valley of the State of Arunachal Pradesh which took place after May 1, 1992. Learned counsel further submitted that the notification under Section 120 of the Act under no circumstances can cover the petitioners in whose cases search and seizure took place on May 29, 1992. In support of his contention, learned counsel refers to a decision of the Supreme Court in Ajantha Industries v. CBDT : [1976]102ITR281(SC) . Dr. Saraf also refers to a decision of the Supreme Court in Raza Textiles. Ltd. v. ITO : [1973]87ITR539(SC) . Mr. G. K. Joshi, learned counsel appearing for the Revenue, on the other hand, submitted that the impugned notice dated April 8, 1992, was lawfully issued by the Commissioner of Income-tax and by virtue of the said notification all the cases as set down therein stood transferred, including the case of the petitioners. The notices issued under Section 127 of the Act by the Commissioner can in no way affect the statutory force of the notification dated April 8, 1992, which was issued in exercise of power under Section 120 of the Act. Learned standing counsel for the Revenue has further submitted that if a power is lawfully exercised within the parameters of the statute, a wrong reference to the power cannot invalidate an action.
5. Mr. Joshi lastly submitted that as it is a case of exercise of discretion by the statutory authority in the fact situation, unless the said exercise of discretion can be said to be without authority of law or otherwise, the same cannot be held to be arbitrary and unreasonable and this court will undoubtedly be slow in such matters in exercising its powers under article 226 of the Constitution of India. Learned counsel for the Revenue also submitted that in the instant case not completing the process initiated under Section 127 of the Act, did not in any way cause any prejudice to the petitioners, requiring interference from this court.
6. Chapter XIII of the Income-tax Act relates to the appointment and control of income-tax authorities, jurisdiction, respective power of officers and disclosure of information of respective assessees. Sections 116 to 119 contain the provisions relating to income-tax authorities and Sections 120 to 129 of the Act relate to provisions of jurisdiction. The relevant provisions of Sections 120 and 127 of the Act are quoted below ;
'120. Jurisdiction of Directors of Inspection. -- Directors of Inspection shall perform such functions of any other income-tax authority as may be assigned to them by the Board.
127. Power to transfer cases.--(1) The Commissioner may, after giving the assessee a reasonable opportunity of being heard in the matter, wherever it is possible to do so, and after recording his reasons for doing so, transfer any case from one or more of the following officers subordinate to him, namely :--
(a) any Income-tax Officer or Income-tax Officers ;
(b) any Income-tax Officer or Income-tax Officers having concurrent jurisdiction with the Inspecting Assistant Commissioner,
to any other Income-tax Officer or Income-tax Officers (whether with or without concurrent jurisdiction with the Inspecting Assistant Commissioner) also subordinate to him and the Board may similarly transfer any case from-
(i) any Income-tax Officer or Income-tax Officers, or
(ii) any Income-tax Officer or Income-tax Officers having concurrent jurisdiction with the Inspecting Assistant Commissioner,
to any other Income-tax Officer or Income-tax Officers (whether with or without concurrent jurisdiction with the Inspecting Assistant Commissioner) :
Provided that nothing in this sub-section shall be deemed to require any such opportunity to be given where the transfer is from any Income-tax Officer or Income-tax Officers (whether with or without concurrent jurisdiction with the Inspecting Assistant Commissioner) to any other Income-tax Officer or Income-tax Officers (whether with or without concurrent jurisdiction with the Inspecting Assistant Commissioner) and the offices of all such officers are situated in the same city, locality or place :
Provided further that-
(a) where any case has been transferred from any Income-tax Officer or Income-tax Officers to two or more Income-tax Officers, the Income-tax Officers to whom the case is so transferred shall have concurrent jurisdiction over such case and shall perform their functions in accordance with such general or special orders in writing as the Board or the Commissioner or the Inspecting Assistant Commissioner authorised by the Commissioner in this behalf, may make for the purpose of facilitating the performance of such functions ;
(b) where any case has been transferred from any Income-tax Officer or Income-tax Officers (whether with or without concurrent jurisdiction with the Inspecting Assistant Commissioner) to two or more Income-tax Officers with concurrent jurisdiction with the Inspecting Assistant Commissioner, the Officers (including the Inspecting Assistant Commissioner) to whom the case is so transferred shall have concurrent jurisdiction over such case and shall perform their functions in accordance with such general or special orders in writing as the Board or the Commissioner may make for the purpose of facilitating the performance of such functions, and the Income-tax Officers shall perform their functions also in accordance with such orders or directions as the Inspecting Assistant Commissioner may make under Sub-section (2) of Section 124 or, as the case may he, under Sub-section (2) of Section 125A.
(2) The transfer of a case under Sub-section (1) may be made at any stage of the proceedings, and shall not render necessary the re-issue of any notice already issued by the Income-tax Officer or Income-tax Officers from whom the case is transferred.'
7. Section 120 of the Act empowers the income-tax authorities to perform the functions of any other Income-tax Officer that may be assigned to them by the Board and when a statutory power is conferred on a statutory authority, the said authority is competent to exercise such power fully and effectively. It is in-built in the section itself. The income-tax authorities under the scheme of the Act are authorised to exercise their power and to give full effect to the provisions of the Act and to make the Act fully operative. The Commissioner as the superior authority may transfer a case to any of the Income-tax Officer or Officers having concurrent jurisdiction, who are subordinate to him. While exercising such powers the authority is to take note of the criteria specified in Section 127. In the instant case, as alluded to earlier, no further action was so far taken after the notice issued under Section 127, but it, however, appears that the authority in the instant case exercised his power under Section 120
of the Act, that too prior to issuance of the notification under Section 127. The notice dated April 8, 1992, speaks categorically of the cases which were transferred from the respective officer to the Assistant Commissioner. The notification speaks of transfer of cases relating to all searches in the Dibrugarh and Tinsukia Districts of Assam and some of the districts of Arunachal Pradesh to the Assistant Commissioner of Income-tax (Investigation Circle). The said notification did not limit the case of search and seizure which took place after the coming into force of the notification. The Commissioner of Income-tax in the notification dated March 2, 1993, notified that the notification came into force on and from April 1, 1992, i.e., the Assistant Commissioner of Income-tax, Investigation Circle, Dibrugarh, and so far as these cases are concerned was invested with the power of the Assistant Commissioner. The powers and functions which were exercised by the respective Income-tax Officers were transferred to the Assistant Commissioner of Income-tax (Investigation Circle), Dibrugarh. Assumption of jurisdiction, therefore, by the Assistant Commissioner of Income-tax (Investigation Circle) cannot be faulted on the ground of lack of jurisdiction.
8. Considering the fact situation of the case, I do not find merit in the writ petitions. The writ petitions accordingly stand dismissed. The interim orders, if there be any, stand automatically vacated. No costs.