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TMI Blog2012 (2) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... tes Pvt. Ltd. (the respondents no.3 herein). They had paid Rs.1,25,000/- initially and between the period February, 1994 to December, 1994, they had paid Rs.5,24,000/- towards the sale consideration (inclusive of initial payment of Rs.1,25,000/- to M/s Malibu Estate Pvt. Ltd., respondents no. 3). Rs. 3. The petitioner M/s R. N. Soin & Sons Pvt. Ltd. claims that the said two individuals assigned and transferred their rights in favour of the petitioner. The petitioner made the payment of Rs.18,56,387/- between February, 1995 to May, 1996 to respondent no. 3. On 12.06.1996 the petitioner and the respondent No. 3 entered into a plot buyer agreement. The plot number is mentioned. An annexure to the plot buyer agreement states and gives the details of payments already made. The payments recorded were by account payee instruments. The agreement stipulates that the basic sale price of the plot was Rs.2392 per sq. meter and in addition the petitioner was liable to pay External Development Charges of Rs. 275.80 per sq. meter, preferential location charges of Rs.60 per sq. meter, and a contingency deposit of Rs. 24 per sq. meter. The total cost of the plot after including another amount of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urisdiction in any other manner except based on the Statement in Form 37-I. In the present case, it is admitted fact that the date mentioned on the Form No.37-I is 24.08.2000. Therefore, this was the relevant date for the purpose of determining the fair market value of the subject property as also whether there was any under valuation or not. The fair market value of the subject property as on this date was determined at Rs.57,39,353/- based on which the understatement worked out to +58.55% taking FMV as base. This contention of the AR, thus fails." 6. The aforesaid order was challenged in Writ Petition (C) No.7591/2000 which was disposed of vide order dated 18.10.2010. In this decision, the Division Bench referred to two decisions, DLF Universal Ltd. Vs. Appropriate Authority & Anr. (2000) 243 ITR 730 (SC) and Ansal properties & Industries Ltd. (1999) 236 ITR 793 (Del.). . The High Court reproduced the ratio of decision of the Supreme Court in DLF Universal Ltd. (supra). For the sake of convenience the said findings/ratio is reproduced below:- "To sum up, our findings are: - Rs. (i) Agreement for transfer as defined in clause (a) of section 269 UA refers to an agreement which i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Other agreements if relevant may or looked into by the Appropriate Authority. (viii) A defect contemplated by section 269 UC (4) is one which is capable is being cured. Rs. (ix) The stage for entering into the statutory agreement or proforma agreement in Form 37-I arises when the parties are ready to make available all the particulars contemplated by several clauses of Form 37-I consistently with the nature of the property. The date of entering into the proforma agreement must have proximity of relationship by time with the proposed transfer of property as defined in clause (f) of section 269 UA. The test for determining proximity of relationship is the availability of the property agreed to be transferred in such status in which it is proposed to be transferred. (x) A no objection certificate issued by Appropriate Authority based on an agreement for transfer of property to be constructed cannot be utilised for securing registration of property which has been constructed." 8. The Division Bench also noticed paragraphs 7, 8 and 14 of the judgment of the Supreme Court in DLF Universal Ltd. (supra), which again for the sake of convenience are reproduced below:- "7. Agreement for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreement for transfer." xxxxxxxxxxxxxRs. "14. DLF and Ansal have strong objection to findings of the High Court in sub- paras (ix) and (x) in para 28 of the judgment reproduced above. However, according to the Appropriate Authority keeping in view the principles laid by this court in G. B. Gautam's (supra) case it can exercise its jurisdiction to acquire the property if consideration agreed to is less than 15 per cent of the market value. Mr. Verma, who appeared for the Appropriate Authority, said that the agreement for transfer contains variables and unless all these are known, Appropriate Authority will be handicapped in making an order under section 269UD. The variables which form terms in the agreement for transfer are external development charges that may be levied by the State of Haryana and price escalation up to 20 per cent of the agreed consideration. It is a matter of common knowledge that in course of time, there can be escalation in the prices of various articles like steel, cement, labour etc. One can say with certainty that price escalation would be within the limit of 20 per cent escalation and the external development charges that may be levied by the State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red in the year 1998. The price would be one agreed upon between the parties in the year 1990. The value as shown on the date of proforma agreement in Form 37-1 would appear to be undervalued persuading Appropriate Authority to direct the purchase of the property by the Central Government. This is a misapprehension which has to be dispelled. The proforma agreement of the year 1998 would be accompanied by the private agreement entered into in the year 1990 and that will be a relevant fact to be kept in view by the Appropriate Authority while exercising its jurisdiction under Chapter XX-C." 10. The following observations, made in the order dated 18.10.2010 passed by the Division Bench of this Court in Writ Petition (C) No. 7591/2000, are lucid and appropriate:- Rs. " In view of the aforesaid, we find that there is substantial force in the submission of Mr. Sandeep Sethi inasmuch as the Division Bench in Ansal Properties and Industries Ltd. (supra) has held that a proforma agreement can be looked into by the Appropriate Authority." 11. Pursuant to the order of remit dated 18.10.2010 passed in Writ Petition (C) No. 7591/2000, the Appropriate Authority has passed the impugned order d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case was entered into on 12th June, 1996 and not 24.02.1994 as mentioned in the written submissions. However, even this date is not relevant for the purpose of determining the fair market value as performa agreement in Form No. 37-I was made on 24.08.2000." 12. In other words, the Appropriate Authority has held that the land rate prevalent in the year 2000 is applicable and it is the guiding factor to decide whether or not there was understatement of the sale consideration to justify the acquisition.Rs. 13. The aforesaid observations of the Appropriate Authority and the reasoning given by the Appropriate Authority are contrary to the specific directions given by this Court in the order dated 18.10.2010, by which the order of remit was passed. It is unfortunate that the Appropriate Authority did not appreciate the ratio and the directions given in the said order. The directions given in the said order were to take consideration of past history of the transaction which had culminated in the filing of form no.1 37-I on 25.08.2000 along with the private agreement dated 12.06.1996. The Division Bench in the order dated 18.10.2010 had taken pains to refer to paragraphs 6, 7, 8 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clared by the petitioner was Rs.2392/- per sq. meter plus preferential location charges at Rs.60 per sq. meter and a contingency deposit of Rs.24 per sq. meter. These extra charges once added, disclose an apparent consideration of Rs.2476/- per sq. meter, even if we exclude external development changes. This sale consideration is comparable with other instances in which the Appropriate Authority had granted the permission/No Objection Certificate during the relevant period. 15. Learned counsel for the respondent No. 1 had submitted that a second order of remit should be passed. We are not inclined to accept the said submission. We have already noted the land rates in the same locality wherein Appropriate Authority had granted permission in the year 1994-95 and observed the same are comparable. Section 269UD of the Act stipulated that the compulsory acquisition of immoveable property could be made if there is a difference of more than 15% between the fair market value and the apparent sale consideration. This condition is not satisfied. In this regard we also rely upon the directions/ ratio laid by a Division Bench of this Court in the case of Kailash Suneja versus Appropriate Auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Constitution of India, though the case is not to be examined as an appellate court, but at the same time it has to be kept in view that a citizen has no alternative remedy. It is permissible to examine whether extraneous matters have been considered by the authority and relevant matters have not been taken into consideration. (13) The constitutional validity of Chapter XX-C of the Act cannot be questioned in view of the decision of the Supreme Court in C. B. Gautam's case [1993] 199 ITR 530. (14) The court can also look into the files of the authority to satisfy as to whether the order is perverse or not. (15) Normally such cases where the pre-emptive purchase orders are passed in violation of the principles of natural justice may be remanded for fresh decision by the authority but in cases where reasons given by the authority in the order are found to be erroneous, ordinarily the question of remand would not arise and the said cases would be decided on the basis of the material on record. (16) The mode, manner and method of arriving at a valuation of a property is a part of procedure, which has to be fair, just and reasonable. (17) Ordinarily, for determining the fair marke ..... X X X X Extracts X X X X X X X X Extracts X X X X
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