TMI Blog2007 (6) TMI 153X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 269UD(1) of the Income Tax,1961 (hereinafter referred to as "the Act"). The Petitioners have also prayed for a direction to the Respondent No.1 for grant of 'No Objection Certificate' in respect of the transaction in question, and for a further direction that the Respondent No.1 should determine the consideration payable by the Government including the reduced amount of Rs.1,04,905 and Rs.13,75,000/- being the consideration for the transfer of furniture, fittings and fixtures. The Petitioners have further prayed that the Central Government be directed to make good the loss caused to the Petitioners and pay the amount with interest. It is further prayed by the Petitioners for an injunction restraining the Respondents from proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation for the said furniture, fixtures and fittings would be separately fixed by the parties. 4. It is further submitted by the Petitioners that, as required under the provisions of Chapter XXC of the Act, the Petitioners had filed Form No.37-I in the office of the First Respondent on 19 th June,1992. Thereafter, the Respondent No.1 had sought further information and clarification regarding the agreement between the Petitioners. Therefore on 22 nd July,1992, the Petitioners had furnished necessary information and clarification including a copy of the proposed agreement for transfer of furniture to the Respondent No.1. 5. It appears that on 27 th August,1992, the Respondent No.1 had passed an order under Section 269UD(1) of the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1 had passed an order of purchase under Section 269UD(1) of the Income Tax Act on 24 th February,1993. Hence, the present Petition has been filed by the Petitioners inter alia praying for quashing and setting aside the impugned order dated 24 th February,1993. 8. Mr. Bhujale the learned Counsel for the Petitioners pointed out that the Respondents' show cause notice dated 4 th January,1993 was not a show cause notice at all, but an order under Section 269UD(1) of the Act, as the following part makes it clear: "Consequently, we are satisfied that this is a fit case for exercising the pre-emptive right of purchase by the Central Government under Section 269UD(1) of the Chapter XXC of the Income Tax Act,1961 and an order under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is, as the first transaction of sale referred to in paragraph No.4 of the recorded reasons in respect of Flat No.21 of B-Wing, Gazdar Apartment, was not in existence, and as regards the other two transactions, those were prima facie not comparable, as is apparent from the facts regarding Flat No.103. The learned Counsel for the Petitioners contended that even if the rate of Rs.3325/- per sq.ft. is taken into account, there would be difference of less than 15%. It is also contended that for comparison, Rs.3386/- per sq.ft. should be taken as the rates of the three instances relied on by Appropriate Authority seems to be basic rates. 13. It is further submitted by the learned Counsel for the Petitioners that the comparable transactions in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inding that there was an attempt to evade tax, and accordingly, the impugned order is liable to be quashed and set aside. 15. In reply to the contentions of the petitioners, the learned Counsel for the Respondents Mr. Ashokan, relied on the affidavit-in-reply stating that all the procedural as well as material formalities, which were required to be carried out, were so carried out by the Appropriate Authority and thereafter, a speaking order was passed, wherein the Respondents have recorded reasons for passing such an order. It is the case of the Respondents that while passing the impugned order, adequate care was taken after giving a reasonable opportunity of hearing. Mr. Ashokan contended that the Respondents had personally visited t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt had further observed that it was necessary to see that issuing a show cause notice is not merely an empty formality. The conclusions of the Authority at the stage of giving a show cause notice are always prima facie or tentative conclusions and if it is not so, its ultimate order would suffer from its bias i.e. pre-determined mind. 17. In the present case, we are fully convinced that it was not a show cause notice, but a pre-determined order, over and above all relevant materials were never furnished to the Petitioners, thereby violating the principles of natural justice. 18. The aforesaid judgment of this Court is squarely applicable in the present case. Under these facts and circumstances of the case and in view of the above r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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