The power under section 142(2a) of the Income Tax Act, 1961 cannot be exercised without the conditions as mentioned below are satisfied: (i) the Assessing Officer must form an opinion having regard to the nature and complexity of the accounts of the assessee and secondly, in the interest of revenue that it is necessary to appoint a Special Auditor, (ii) thereafter he must have a previous approval of the Chief Commissioner/commissioner of Income Tax.

K. J. SENGUTPA, J.

( 1 ) BY the instant writ application the petitioner has basically challenged an order dated 13th June 2003 passed by the Commissioner of Income Tax, Calcutta 700 021 appointing Shri P. K. Agarwala as a Special Auditor under section 142 (2a) of the Income Tax Act, 1961 (hereinafter referred to as the said Act) and also incidentally the vires of section 142 (2a) of the said Act in so far as it covers the same field as section 44 (AB) of the said Act as regard its constitutionality. However, at the time of argument the question of vires was not pressed by the learned senior counsel Dr. Pal. The direction for filing of affidavits was given on two occasions, to understand case of Revenue, however, no affidavit was filed, so it was decided the matter should be heard without any affidavit-in-opposition.

( 2 ) THE short fact of the case is that the petitioner is carrying on banking business after having been formed under the Co-operative Societies Act, 1912. The members and/or shareholders of the petitioner are the Government of West Bengal, holding about 38 per cent shares and balance are being held by the different District Central Co-operative Banks and other co-operative societies. The petitioner is also a scheduled bank within the relevant provisions of the Banking Regulations Act and is being directly controlled by Reserve Bank of India and also by National Bank for Agriculture and Rural Development (NABARD ). The books of accounts and documents of the petitioner are regularly and systematically audited by both the Co-operative Audit Directorate, Government of West Bengal as well as by the Auditor under section 44 (AB) of the said Act.

( 3 ) IN almost all the relevant assessment years the petitioner has been enjoying exemption from paying tax to the income under the provision of 14 (3) (i) (a) of the Income Tax Act, 1922 then prevailing, now under section 81 (i) (a) of the present Act. When the petitioner was reasonably expecting of refund of a sum of Rs. 1,40,27,398/-, Rs. 1,45,31,755/-, Rs. 92,26,412/-, Rs. 1,01,94,817/- and Rs. 1,59,24,661/- respectively for the assessment years of 1996-97 to 2001-01, which were duly and appropriately adjudged to be refunded, by the appropriate Income Tax official, the Assessing Officer all of a sudden decided to reopen the aforesaid assessments of the relevant periods. The petitioners duly replied to the notices under Section 148 of the aforesaid Act and met quarries and requisitions made by him in connection with the reopening of assessment under section 147 of the said Act.

( 4 ) WHILE the petitioners were exchanging correspondences, meeting queries and supplying information, they received a copy of the letter dated 29th May 2003 addressed by the Income Tax Officer, Technical-21, for the respondent No. 3 to M/s. P. K. Agarwala wherefrom it transpired that the respondent No. 3 wanted special audit to be done under Section 142 (2a) of the said Act of the accounts of the petitioner for the assessment years 1996-97 to 2002-2003 and for the said purpose M/s. P. K. Agarwala had been nominated as Chartered Accountant for conducting audit. The petitioner duly protested against the aforesaid proposal for special audit contending amongst others that it was not necessary in this case as the accounts of the petitioner has been audited not only under section 44 (AB) of the said Act but also by the other agencies.

( 5 ) ON 13th June 2003, the respondent No. 3 passed an order approving the proposal of Assessing Officer for special audit under the aforesaid Section for the aforesaid assessment years. The said order, however, was passed considering the petitioner's objection filed on 4th June 2003. No affidavit-in-opposition was filed but I directed production of the relevant records, so I had the benefit of going through the same.

( 6 ) DR. Pal senior advocate appearing for the petitioner contends that the impugned order the Commissioner is bad in law for two broad reasons, No. (

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