TMI Blog1994 (4) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... sum of Rs. 50,000 had already been paid under four cheques. The stages in which the balance shall have to be paid are narrated in the agreement. The following clause is quite relevant : " That under no circumstances, whatsoever, the possession of any portion of the building herein agreed to, be acquired by the purchaser shall be given by the seller until and unless all payments required to be made in terms of this agreement along with any interest have been fully made to the sellers." Various other clauses as to how the building shall have to be maintained, how the taxes are to be paid and how the increased burden shall have to be borne by the parties are not necessary for us to consider. However, clause 15 of the agreement stated that the portion of the building agreed to be acquired by Sunshine Travels shall be transferred in their favour or in favour of their nominees within a period of three years from the date of the agreement on payment of the balance sum of Rs. 1 lakh agreed to be paid to the sellers under the agreement at the time of transfer. According to the Revenue, the transfer of the building in favour of Sunshine Travels could take place only when this clause i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilding agreed to be sold to the purchaser on payment of the entire sums referred in the agreement. In other words, the agreement created a right in the purchaser with respect to the building put up and this right had the effect of enabling the enjoyment of the property. At any rate the agreement certainly has the effect of transferring or enabling the enjoyment of the right with respect to the building to be put up. This aspect shall have to be borne in mind while considering the various provisions of Chapters XX-A and XX-C. In the writ petition filed by P. P. Singh and others there was an agreement dated August 9, 1985. P. P. Singh was the vendor under the agreement, Sushil Kumar Vohra and others were collectively called the "vendee", The vendor agreed to convey the perpetual leasehold rights in the plot of land in question along with the ownership rights in the super-structure constructed thereon. Vacant physical possession of the property was to be handed over to the vendee at the time of execution and registration of the sale deed. Thirdly, thereafter the entire consideration was paid by the vendee to the vendor and possession was handed over to the vendee. A supplementary ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etitions on the facts, we are of the view that the agreements in question have enabled the vendees to enjoy the respective properties or at any rate they have enabled the vendees to enjoy certain rights with respect to the properties in question and those rights are deemed to be immovable properties both under Chapters XX-A and XX-C. To understand the concept of immovable property as well as the concept of transfer it is necessary to refer to a few provisions. However, we have confined our discussions to one aspect of the right created under a transaction referred in section 269AB(1)(b). Section 269A(e) defines the term "immovable properties". Its sub-clause (i) refers to the tangible immovable properties such as land or building. Sub-clause (ii) refers to certain rights which are brought into the scope of the term "immovable properties" ; in other words, the rights referred to in sub-clause (ii) are also immovable properties for purposes of Chapter XX-A of the Act. To understand the said rights referred to in sub-clause (ii), one has to refer to section 269AB(1)(b) as the section is worded. In other words, certain rights are to be considered as immovable properties by reading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... attached to such a transaction. The very transaction of that nature incurs the liability, which any other transfer incurs under Chapter XX-A. Thus, the transaction which involves transfer of a right enabling the transferee to enjoy the building to be constructed becomes a statutory transfer for purposes of Chapter XX-A and such a "transfer" is exposed to the statutory steps contemplated by section 269C. If there has been an undervaluation of the apparent consideration, the competent authority may initiate proceedings; for the acquisition of the property under Chapter XX-A. Section 269D provides for issuance of a preliminary notice, within nine months of the registration of the instrument of transfer under the Registration Act or under section 269AB. After this period of nine months, power to initiate proceedings under Chapter XX-A ceases. Other provisions provide for the filing of objections to the notice and hearing of objections, making an order of acquisition, filing of an appeal and further appeal against the order, vesting of property in Central Government, etc. Chapter XX-A is a self-contained code governing these "transfers" as defined in section 269A(e). The difficulty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as defined in Chapter XX-A, then the provisions of the said Chapter would have already operated on the two agreements, leaving nothing for the application of the provisions of Chapter XX-C. The main contention of the Revenue is that, there were no "transfers" earlier to the bringing into force of Chapter XX-C and the provisions of Chapter XX-C would govern all "transfers" that take place after the said Chapter came into force ; on this there should not and cannot be any doubt, because section 269UC says that no "transfer" shall be effected except, as stated in the said provision. But, if the "transfer" has already been effected, this provision cannot operate on it. As already found by us, the term "transfer" and referred to here, is not a transfer as ordinarily understood and this term is not confined to the "transfers" referred to in the Transfer of Property Act. The term has a wider connotation-both under section 269UA(f) and section 269A(h), read with the relevant definitions. The broader proposition advanced by learned counsel for the petitioners finds support from some of the observations made by a Bench of this court in Capt. Sanjeev Sethi v. Union of India [1992] 195 ITR 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... C). In the said case, the owner of the property had entered into an agreement to transfer the leasehold rights on February 4, 1985 (prior to Chapter XX-C) ; a sum of Rs. 4.5 lakhs was paid as the advance price. There was also an agreement for the construction of a structure on the plot. On July 9, 1986, a fresh agreement to sell the residential house put up on the plot was executed between the parties, wherein the owner agreed to transfer to Gautam his leasehold rights along with the ownership of the construction ; on October 1, 1986, Chapter XX-C was brought into force, and an order for purchase by the Central Government came to be passed under the said Chapter. This was challenged on many grounds, but at the time of the arguments, learned counsel confined the ground to attack based on the principles of natural justice. The Supreme Court held that before an order of purchase is made under Chapter XX-C, it was necessary to hear the affected persons and the principles of natural justice are to be read into the procedural requirements. There was also an argument that the provisions of Chapter XX-C were invalid as they confer unfettered discretion on the authorities. This challenge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conferring a right to take or retain possession of the immovable property or whereby a person acquires any rights therein is also governed by Chapter XX-A." These observations bring out the wide scope of section 269AB. The creation of any right enabling the taking of possession for enjoyment of a building to be put up, under a transaction, would, therefore, attract the application of Chapter XX-A, just like any other "transfer", including, a transfer involved in an agreement referred to in section 53A of the Transfer of Property Act. Mr. Rajendra relied on a decision of a Division Bench of the Gujarat High Court in Shantivan Corporation v. Sub-Registrar [1991] 189 ITR 583. There, Chapter XX-C was made applicable with effect from June 1, 1989. The sale deed was executed on May 29, 1989, and it was lodged for registration on May 30, 1989. In spite of these facts, the court held that the transfer took place after June 1, 1989, as there was no registration of the site deed till that date and, therefore, Chapter XX-C governed the transaction. It is necessary to note here that the notification applying Chapter XX-C to the area in question had been issued on May 8, 1989, itself. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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