TMI Blog1997 (11) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... 1996 (Government of India v. Jagadish A. Sadarangani [1996] 221 ITR 338), relates to the interpretation of the provisions of sub-section (4) of section 269UC of the Income-tax Act, 1961 (hereinafter referred to as "the Income-tax Act"). Section 269UC is contained in Chapter XXC relating to purchase by the Central Government of immovable properties in certain cases of transfer. On September 7, 1995, the appellant entered into an agreement with the executors of Shri S. R. Unger for the purchase of urban property in the City of Madras (now Chennai) for a sum of Rs. 5,50,00,000. The extent of the property is 23.5 grounds comprising 5,239 sq. mts. of vacant land and 954 sq. mts. of built up area. On the same date, i.e., September 7, 1995, an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed, may file a fresh Form No. 37-I for transfer of the balance land or after finality was reached with regard to the excess vacant land. Feeling aggrieved by the said order, the appellant filed a writ petition (W. P. No. 17773 of 1995) in the Madras High Court which was allowed by a learned single judge by his judgment dated April 3, 1996. The learned single judge directed the respondents to reconsider the matter and pass appropriate orders keeping in view the said judgment. The respondent filed an appeal (W. A. No. 429 of 1996 ; Government of India v. Jagadish A. Sadarangani [1996] 221 ITR 338 (Mad)), against the said judgment of the learned single judge which has been allowed by the Division Bench of the High Court by the impugned judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rm ; (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 in such manner and within such time as may be prescribed, by each of the parties to such transaction or by any of the parties to such transaction acting on behalf of himself and on behalf of the other parties. (4) Where it is found that the statement referred to in sub-section (2) is defective, the appropriate authority may intimate the defect to the parties concerned and give them an opportunity to rectify the defect within a period of fifteen days from the date of such intimation or within such further period which, on an application made in this behalf, the appropriate aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity to issue the certificate of no objection under section 269UL(3). The said decision of the Delhi High Court came up for consideration before this court in Appropriate Authority v. Tanvi Trading and Credits P. Ltd. [1991] 191 ITR 307. This court, while dismissing the special leave petition against the said judgment of the Delhi High Court, has said : "We agree that two alternatives are open under the scheme of the legislation.--(i) The Union of India through the appropriate authority could buy the property, or (ii) in the event of its decision not to buy, it has to issue a 'no objection certificate' leaving it open to the parties to deal with the property. In that view of the matter the High Court was right in its conclusion." In the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e appropriate authority cannot be compelled to act upon an unenforceable, illegal and void agreement. The function of the appropriate authority is not merely confined to issuing 'No Objection Certificate', it is coupled with a duty to make a decision as to pre-emptive purchase, if the real market value of the immovable property concerned in the proceeding demands it. . . . . A statutory authority exercising statutory power cannot be compelled to ignore the basic defect in the agreement, which also disables the appropriate authority to make its decision as to pre-emptive purchase, on determining the real market value, which will be the basis for taking a decision regarding pre-emptive purchase. As in the instant case, until the proceeding is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 269UC(2), which must comply with the requirements of sub-section (3), then the appropriate authority may intimate to the parties concerned about the said defect and give them the opportunity to rectify the defect within a period of fifteen days from the date of such intimation or within such further period as may be allowed by the appropriate authority on an application made in this behalf. The said provision in sub-section (4) of section 269UC envisages a defect which can be removed/rectified within the period of fifteen days or the further period which is given by the appropriate authority. A defect regarding the legality and validity of the agreement which renders the agreement void and unenforceable cannot be rectified. Since a defect ..... X X X X Extracts X X X X X X X X Extracts X X X X
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