Judgement

BHAGWATI J.- These petitions under Art. 32 of the Constitution raise a common question of law whether S.5 (7.A) of the Indian Income-tax Act, hereinafter called the Act, it ultra vires the Constitution as infringing the fundamental rights enshrined in Art.14 and Art.19 (1) (g).

2. The facts which led to the filing of the petitions may be shortly stated.

3. Petitions Nos. 97 & 97 A of 1956:- The petitioners are Messrs Pannalal Binjraj, Oilmill owners, merchants and Commission Agents, carrying on business at Sahibganj in the district of Santhal Parganas, having their branch at 94, Lower Chitpur Road, Calcutta, petitioner No.1 and R.B. Jamuna Das Chowdhury, resident of the same place and erstwhile karta of the Hindu undivided family, which carried on business in the name and style of Messrs Pannalal Binjraj, petitioner No. 2. Before September 28, 1954, they were being assessed by the Income-tax Officer Special Circle, Patna. On September 28, 1954, the Central Board of Revenue made an order transferring their cases to the Income-tax Officer Central Circle XI, Calcutta. On January 22, 1955, the Central Board of Revenue transferred the cases of petitioner No.2 to the Income-tax Officer Central Circle VI, Delhi, and on July 12, 1955 it similarly transferred the cases of petitioner No. 1 to the same officer. After the dates of such transfer to the Income tax Officer Central Circle VI, Delhi, the said officer instituted several proceedings against them and the petitioners challenged in these petitions the validity of the said orders of transfer and all the subsequent proceedings including the assessment orders as well as the orderlevying penalty for non-payment of the income tax which had been already assessed prior thereto, on the ground that S.5 (7A) of the Act was ultra vires the Constitution and all the proceedings which were entertained against the petitioners by the Income-Tax Officer Central Circle, XI, Culcatta, and by the Income-Tax Officer Central Circle VI, Delhi, were without jurisdiction and void.

4. Petitions Nos. 44/56 and 85/86 :- The petitioner in petition No. 44/56 is Shri A.L Sud, the sole proprietor of Messrs Amritlal Sud (Construction) who originally belonged to Hoshiarpur district in the State of Punjab but has since 1948 been residing and carrying on business in Calcutta. Prior to June 29,1955 he had been assessed to income-tax by the Income tax Officer Special Survey Circle VII, Calcutta. On June 29, 1955, the Central Board of Revenue transferred his case to the Income Tax-Officer Special Circle, Ambala and the said officer continued the proceedings in the transferred cast and also instituted further proceedings against the petitioner and assessed him under S.23(4) of the Act for the assessment years 1946-47 and 1947-48. Demands were made upon the Petitioner for payment of the amount of income tax thus assessed whereupon he filed this petition impeaching the validity of the order of the Central Board of Revenue dated June 29,1955 and the proceedings entertained by the Income-tax Officer Special Circle, Ambala, on the ground that S.5(7A) of the Act was ultra vires the Constitution.

5. Petition No. 85/56 was filed by Messrs Bhagwan Das Sud & Sons, merchants, Hoshiarpur, carrying on business in rosin and turpentine there. Before October 20, 1953 they were being assessed by the Income-tax Officer, Hoshiarpur but on that date their case was transferred under S.5(7A) of the Act by the Commissioner of the Income tax to the Income tax Officer Special Circle, Ambala. The said officer continued the said case and reopened the assessment for the years 1944-45 to 1950-51 and completed the assessment for the assessment years 1947-48, 1950-51 and 1951-52. These petitioners also thereupon filed the petition challenging the validity of the order of transfer made by the Commissioner of Income-tax on October 20,1953 and the proceedings entertained by the Income tax Officer Special Circle, Ambala, thereafter, on the same grou