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TMI Blog2011 (3) TMI 1234X X X X Extracts X X X X X X X X Extracts X X X X ..... 1986, pursuant to Notification No. S. O. 480(E), dated August 7, 1986 (See [1986] 162 ITR (St.) 1). 4. The relevant provisions of Chapter XX-C of the Income-tax Act relevant for deciding issues involved in this writ application are set out hereinbelow for convenience : "269UA. In this Chapter, unless the context otherwise requires,- (a) 'agreement for transfer' means an agreement, whether registered under the Registration Act, 1908 (16 of 1908), or not, for the transfer of any immovable property ; (b) 'apparent consideration',- (1) in relation to any immovable property in respect of which an agreement for transfer is made, being immovable property of the nature referred to in sub-clause (i) of clause (d) means,- (i) if the immovable property is to be transferred by way of sale, the consideration for such transfer as specified in the agreement for transfer ; (ii) if the immovable property is to be transferred by way of exchange,- (A) in a case where the consideration for the transfer consists of a thing or things only, the price that such thing or things would ordinarily fetch on sale in the open market on the date on which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9UC.(1) Notwithstanding anything contained in the Transfer of Property Act, 1882 (4 of 1882), or any other law for the time being in force, no transfer of any immovable property in such area and of such value exceeding five lakhs rupees, as may be prescribed, shall be effected except after an agreement for transfer is entered into between the person who intends transferring the immovable property (hereinafter referred to as the transferor) and the person to whom it is proposed to be transferred (hereinafter referred to as the transferee) in accordance with the provisions of sub-section (2) at least four months before the intended date of transfer. (2) The agreement referred to in sub-section (1) shall be reduced to writing in the form of a statement by each of the parties to such transfer or by any of the parties to such transfer acting on behalf of himself and on behalf of the other parties. (3) Every statement referred to in sub-section (2) shall,- (i) be in the prescribed form ; (ii) set forth such particulars as may be prescribed ; and (iii) be verified in the prescribed manner, and shall be furnished to the Appropriate Authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her person duly authorised by it under that sub-section may take possession of the immovable property and may, for that purpose, use such force as may be necessary . . . 269UF.(1) Where an order for the purchase of any immovable property by the Central Government is made under subA-section (1) of section 269UD, . . . the amount equal to the amount of the apparent consideration . . . 269UG.(1) The amount of consideration payable in accordance with the provisions of section 269UF shall be tendered to the person or persons entitled thereto, within a period of one month from the end of the month in which the immovable property concerned becomes vested in the Central Government under sub-section (1), or, as the case may be, sub-section (6), of section 269UE : Provided that if any liability for any tax or any other sum remaining payable under this Act, the Wealth-tax Act, 1957 (27 of 1957), the Gift-tax Act, 1958 (18 of 1958), the Estate Duty Act, 1953 (34 of 1953), or the Companies (Profits) Surtax Act, 1964 (7 of 1964), by any person entitled to the consideration payable under section 269UF, the Appropriate Authority may, in lieu of the payment of the amount of conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f being heard : Provided further that no amendment shall be made under this section after the expiry of six months from the end of the month in which the order sought to be amended was made. . . 269UM. Notwithstanding anything contained in any other law or in any instrument or any agreement for the time being in force, when an order for the purchase of any immovable property by the Central Government is made under this Chapter, no claim by the transferee shall lie against the transferor by reason of such transfer being not in accordance with the agreement for the transfer of the immovable property entered into between the transferor and transferee : Provided that nothing contained in this section shall apply if the order for the purchase of the immovable property by the Central Government is abrogated under sub-section (1) of section 269UH. 269UN. Save as otherwise provided in this Chapter, any order made under sub-section (1) of section 269UD or any order made under sub-section (2) of section 269UF shall be final and conclusive and shall not be called in question in any proceeding under this Act or under any other law for the time being in force." & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said property, for the reasons recorded in the said order. 10. Petitioner No. 1 filed a writ petition being W. P. No. 2284 of 1986, whereupon the order of pre-emptive purchase was set aside and the matter remitted to the Appropriate Authority for a fresh decision, upon opportunity of hearing to the concerned parties. 11.By a reasoned order dated August 14, 2000, the Appropriate Authority again directed pre-emptive purchase of the property under section 269UD of the Income-tax Act, 1961. 12. Challenging the order dated August 14, 2001, and subsequent notices for auction of the property, the petitioner filed the writ petition being W. P. No. 2016 of 2003, hereinafter referred to as the first writ petition. 13. The first writ petition, in which an interim order was passed, was dismissed on August 23, 2009. The writ petition was restored on February 3, 2011. In the mean while, on January 14, 2011, fresh notices were issued for auction of the said premises. The auction took place on February 4, 2011. 14. The second writ petition, being W. P. No. 128 of 2011, has been filed challenging the said notices issued on January 14, 2011. On February 4, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 20. Mr. Abhrajit Mitra, learned counsel appearing on behalf of the petitioner, emphatically argued that the impugned order of compulsory acquisition dated August 14, 2001, stood abrogated and the said premises had revested in petitioner No. 1, by reason of the failure of the Central Government to tender the consideration to petitioner No. 1, within the time stipulated in section 269UG of the Income-tax Act. 21. Mr. Mitra submitted that the consideration had not been tendered to petitioner No. 1, within the time stipulated in section 269UG. Moreover, the Appropriate Authority had incorrectly calculated the area of the said premises at 6000 sq. ft. and had accordingly determined the consideration for the said premises at Rs. 18 lakhs at the rate of Rs. 300 per square feet. 22. Mr. Mitra submitted that in the newspaper publications on October 8, 2003, and October 12, 2003, for auction of the said premises, the total area had been specified as 6692.19 sq. ft. excluding common areas. 23. Mr. Mitra submitted that the total floor area was actually 7581 sq. ft. Reliance has in this context been placed on the report of a private approved valuer, a copy whereof has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p; 29. In support of his submission that the order of compulsory acquisition had lapsed and or stood abrogated, Mr. Mitra cited the judgments of the Supreme Court in Chand V. Raheja v. Union of India reported in [1996] 7 SCC 175 and in Union of India v. Dr. A. K. Garg [2002] 256 ITR 660 (SC); [2002] 10 SCC 392. 30. In Chand V. Raheja [1996] 7 SCC 175, cited by Mr. Mitra, a sum of Rs.50 lakhs out of the total consideration had been retained. The purchase under Chapter XX-C was set aside, rejecting the argument of the Revenue that since the agreement between the transferor and transferee enabled the transferee to retain Rs. 50 lakhs out of the total consideration, till delivery of vacant possession of the out houses, the Central Government could withhold Rs. 50 lakhs till it got vacant possession of those out houses. 31. The Supreme Court held as follows (page 177) : "The plain language of section 269UG(1) leaves no doubt that in the facts and circumstances of the case, as a result of non-payment of the balance amount of Rs. 50 lakhs in terms of the express requirement of section 269UG(1), the failure of the Central Government has resulted in attracting section 269U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... statement filed by petitioner No. 1 and/or its authorised representative. On the other hand, the concerned authorities were obliged to accept the consideration shown in the statement in Form 37-I as the apparent consideration. 37. The records produced reveal that a cheque of Rs. 34,80,750 was forwarded to Karnani Finance Enterprises Ltd. under cover of a letter dated September 28, 2001. The said Karnani Finance Enterprises Ltd. accepted and acknowledged payment. A cheque of Rs. 3 lakhs dated September 28, 2001, was also forwarded to the petitioner under cover of a letter dated September 28, 2001. Photocopies of the cheque and the covering letter were produced in court. The records reveal that the cheque was not accepted. 38. Mr. Mitra initially submitted, perhaps on instructions, that the cheque dated September 28, 2001, was not tendered to the petitioner. It was suggested that normally communications from the Income-tax Department are by registered post with acknowledgment due and not by messenger. Mr. Mitra argued that there was no reason why an exception should have been made in this case and personal service should have been attempted. It was insinuated that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, obviously because the entire amount had been deposited with the Appropriate Authority. 44. Under section 269UG(1), the full consideration has to be tendered within a period of one month from the end of the month in which the immovable property vests in the Central Government, and not within one month from the date of vesting, as argued by Mr. Mitra. The consideration thus had to be tendered within one month from August 31, 2001, that is, within September 30, 2001. The cheque was apparently tendered on September 28, 2001, that is, within a period of one month from the end of the month in which the said premises vested in the Central Government as required under section 269UG(1). 45. Section 269UG(1) provides that the amount of consideration payable in accordance with the provisions of section 269UF shall be tendered to the person or persons entitled thereto, within the time stipulated in the said section. The section does not provide that the Central Government should itself tender the requisite amount to the persons entitled. It is open to the Central Government to tender payment through the Appropriate Authority. 46. Sub-section (3) of section 269UG prov ..... X X X X Extracts X X X X X X X X Extracts X X X X
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