HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Pannalal Binjraj and connected petitioners v. Union of India
Petitions Nos. 97 and 97-A, 44 and 85, 86–88, 111–112 and 158, 211–215, and 225–229 of 1956
[1957] SCR 233 ·
Indian Income-tax Act, 1922, sections 5(7A) and 64 · Constitution, Articles 14, 19(1)(g), 32 and 226
Sources & disclosures includedDownload original judgment / order
5-judge bench · N. H. Bhagwati · B. Jagannadhadas · T. L. Venkatarama Ayyar · B. P. Sinha · S. K. Das
01 · Facts of the case
Several taxpayer groups challenged transfers between assessing officers and consequential proceedings, alleging that section 5(7A) conferred arbitrary power and impaired their right to local assessment. Transfers included Patna–Calcutta–Delhi, Calcutta/Hoshiarpur–Ambala, movements within Amritsar, Raichur–Hyderabad and pre-Constitution Calcutta transfers. The common challenge concerned the statutory transfer power rather than a uniform assessment year or computation issue.
Source: Primary report: SCR 235–243
02 · Discussion by the Hon’ble Court
The statutory right to local assessment under section 64 was qualified by legitimate tax-collection needs. Ordinary assessment procedure and appeal rights remained available after transfer. Administrative discretion was guided by the Act’s assessment and collection purpose; mala fide or discriminatory exercise remained reviewable, and a prima facie case required the authority to explain its action. The Court urged notice, reasonable opportunity and written reasons where feasible. The 1956 explanation expanded “case” to pending and future proceedings for any year; future proceedings still required their proper notices. Specific challenges also failed on pre-Constitution timing, acquiescence, absence of inconvenience, or supported administrative reasons.
Source: Primary report: SCR 249–273, especially 258–265 and 267–272
03 · Judicial decision
Section 5(7A), read with its explanation, was upheld against Articles 14 and 19(1)(g). The challenged wholesale transfers were within the expanded statutory meaning of “case”; the individual orders were not shown to warrant interference on the facts.
04 · Outcome / in whose favour
Revenue/Union succeeded: all petitions dismissed with costs, with one set of costs for the respondents and one set for each petition group as specified.
Source: Primary report: SCR 273
05 · AKHB REVIEW POINT
Separate an attack on statutory power from evidence of discriminatory or mala fide exercise in the particular transfer. Preserve the notice/reasons guidance and the requirement of fresh notices for newly commenced proceedings. This historical 1922 Act ruling must not be used as blanket approval of all transfers or as current-law clearance under later statutes.
Source: Primary report: SCR 258–265, 273
Source & verification
Download original judgment / order · Open cited source rendition
All 41 pages read, single judgment by Bhagwati J. for the five-judge Court. Pannalal ends with dismissal at SCR 273; Ratan Rai criminal case starts below and is excluded.
Statutory scope
Historical legislation expressly identified in this note. This is not a decision under the Income-tax Act, 1961 or the Income-tax Act, 2025. Verify enacted wording, commencement, transition and subsequent judicial treatment independently before modern reliance.
Later treatment
Source checked 2026-10-23. Subsequent treatment and present-law applicability have not been comprehensively checked.
Page references identify the supplied PDF; paragraph references identify the judgment unless stated otherwise.
AI disclosure & professional disclaimer
This AKHB research note uses AI assistance and a preserved full-primary review, with refreshed exact original-byte verification. Independent human review is not represented.
General legal and tax research only; not legal or tax advice. Verify the complete judgment, applicable statutory version and subsequent treatment before reliance. AKHB REVIEW POINT is editorial analysis, not the Court’s holding.