B.P. Jeevan Reddy, C.J. - (1.) THIS writ petition is directed against an order dated October 9, 1989, passed by the Commissioner of Income-tax, Meerut, transferring the cases of certain persons including the petitioner from the file of the Assistant Commissioner of Income-tax, Investigation Circle, Muzaffarnagar, to the Assistant Commissioner of Income-tax, Central Circle, Meerut. The cases of as many as 47 persons were transferred under the said order. The petitioner is mentioned under Serial No. 47. The petitioner is a partnership firm engaged in auditing work of other asses-sees, A raid was conducted on the premises of the petitioner and certain documents pertaining to the other assessees mentioned in the transfer order were recovered. We are now concerned only with the justifiability of the order transferring the case of the petitioner. It is not alleged that the petitioner is a partner of any of the firms mentioned at Serial Nos. 1 to 46 in the said transfer order. The reason given for transferring the case of the petitioner is found in paragraph No. 8 of the order. It reads as under : "During the course of search at the premises of the person at Serial No. 47, papers were found which relate to the assessees at Serial Nos. 1, 4 and 12. In connection with a proper investigation of the documents found in the course of search, it is essential that this case is also assigned to the officer with whom other cases at Serial Nos. 1, 4 and 12 are assigned." The order of transfer is challenged by learned counsel for the petitioner on two grounds, namely, (1) that, on the date of the order of the said transfer, no assessment proceeding was pending for any assessment year relating to the petitioner. If so, the very order of transfer is incompetent and misconceived in law, and (2) that the reasons given for the transfer are not relevant or germane.
(2.) SO far as the first contention is concerned, it has to be rejected in the light of the Explanation appended to Section 127 of the Income-tax Act, which defines the expression "case". The Explanation reads as under : "Explanation. -- In Section 120 and this section, the word 'case1, in relation to any person whose name is specified in any order or direction issued thereunder, means all proceedings under this Act in respect of any year which may be pending on the date of such order or direction or which may have been completed on or before such date, and includes also all proceedings under this Act which may be commenced after the date of such order or direction in respect of any year." A reading of the aforesaid Explanation makes it clear that the expression "case" used in Section 127 of the Act comprises not only a pending proceeding but also proceedings which may have been completed on or before the date of transfer. Indeed, it also includes all proceedings which may be commenced after the order of transfer. In this view of the matter, the decision of the Supreme Court relied upon by learned counsel for the petitioner in Bidi Supply Co. v. Union of India [1956] 29 ITR 717, cannot advance the petitioner's case inasmuch as, at the time the order of transfer considered in that case was passed, the Explanation appended to such Section (7A) of Section 6 of the Indian Income tax Act, 1922, was not. there, (The said Explanation corresponding to the Explanation to Section 127 of the 1961 Act was inserted in the year 1956). The first contention is, accordingly, rejected. On the second contention, however, we find that the order of transfer is liable to be set aside. While we do not propose to go into the merits of the case, it may be noticed that, in pursuance of a show-cause notice, the petitioner has submitted an explanation setting out reasons as to why his case should not be transferred. The impugned order does not deal with any of those reasons stated in the said Explanation. In view "Of the fact that the petitioner is merely, what may be broadly called, an auditor, the matter, in our opinion, must be reconsidered. Accordingly, the impugned order is quashed in so far as the petitioner is concerned. The Commissioner of Income-tax shall pass orders afresh in accordance with law taking into consideration all the relevant facts and circumstances including the explanation furnished by the petitioner to the show-cause notice. The writ petition is allowed in the above terms. No costs.;