9911796707
TMI Blog2002 (6) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... ouse No. 38 (new), situated at Cement Road, Dharampeth Extension, Shivaji Nagar, Nagpur, within the municipal limits in Ward No. 73. The petitioners claim to be the owners of the property which was originally belonging to Mr. Manohar K. Deshpande, who had acquired the same on leasehold rights and subsequently constructed a residential house thereon. The present petitioners Nos. 1 to 5 are the sons and daughters of the late Mr. Manohar K. Deshpande. Mr. M.K. Deshpande, the father of petitioners Nos. 1 to 5, expired on January 3, 1982, and their mother expired on October 31, 1991. Prior to his death, as is clear from the record, Mr. M.K. Deshpande, along with his son-petitioner No. 2, Rajaram, sold certain portion of the property in question, to one Vasudeo Shivankar. That was on December 30, 1957. Since it was a benami transaction in the name of Vasudeo, he relinquished his rights in the property in question in favour of his brother, Baliram Shivankar, who was the original petitioner No. 6 in this petition. In short, along with Deshpande, Baliram has also become a owner of certain portion of the property, sold in the property in his favour. Because of certain differences and disput ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en the parties to which detailed reference is made by the petitioners in paragraph 11 of the petition. For the purpose of the present decision, suffice it is to observe that the property is not free from any encumbrances in all respects and that the property is not further free from various types of litigations. These are the aspects which no doubt would carry importance in the present type of matter, wherein the respondents are taking action under section 269UD of the Act. Admittedly, the petitioners including Mr. Shivankar entered into an agreement of development and sale of the entire plot with Mr. Mohanlal Raojibhai Kothari and Mr. Mahesh Purshottam Kothari vide agreement dated October 27, 1994. The agreement was based on very many terms and conditions and the relevant contents thereof will be referred to at the appropriate stage in the subsequent paragraphs. In view of the abovesaid agreement, naturally, the petitioners are required to fill in Form No. 37-I under rule 48, intimating the Income-tax Department about the transaction and seeking necessary sanction for the deal. Details about the property have been mentioned in the form. This naturally indicated the apparent cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... edabad by some mode available and which was not to take time, less than two days for the petitioners to reach at Ahmedabad i.e., at least a day in advance. Thus, factually, there remained two days at the disposal of the petitioners to prepare all these things, to collect the documents and other evidence and papers including that of instructing legal advisor, getting things drafted, etc. On February 21, 1995, however, 'the petitioners presented themselves' before respondent No.1 through their power of attorney holder one Mr. Ramesh Nagorao Pise. On the same day, reply to the notice under section 269UD(1) of the Act was submitted on behalf of the petitioners, giving as far as possible details as to why it was not a fit case wherein an action under section 269UD could be taken. In the reply, which was no doubt filed on behalf of the transferors only, it was specifically pointed out that the authority concerned was absolutely wrong in equating the value of the present property with the value of the property which was situated in civil lines area of Nagpur. Most of the points, which were referred to in the notice of respondent No. 1, are denied throughout the reply to the notice giving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to have been left unconsidered. Since the representative of the petitioners Mr. Bhise was present, he was heard and the authority concerned passed an order which is dated February 24, 1995, whereby respondent No. 1 reached the conclusion that the apparent consideration/discounted consideration was below the market value, and considered the value of the property at the relevant time. As was indicated in the show cause notice, the apparent price is understated by more than 17 per cent. and, therefore, the authority considered it to be a fit case wherein an order of pre-emptive purchase under section 269UD(1) of the Act was called for. The net consideration to be paid to the Central Government was determined at Rs. 64,02,234 including Rs. 14,99,996 paid by the transferee up to the date of the agreement. It is this order which is under challenge before this court. While passing the order, the learned Members-Appropriate Authority, on the basis of the inspection made by the Members-Appropriate Authority, Ahmedabad, reached the conclusion that the apparent and discounted consideration appeared to have been understated by 15 per cent. and more and certain sale instances were taken into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned, it was the responsibility of the authorities themselves to settle the matter with the tenants and so far as regards the nature of the litigation was concerned, the authorities concerned observed that the same was only as regards recovery of rent and, therefore, both these points, according to the authorities concerned, did not adversely affect the price of the property in question. So far as regards the point raised by the petitioners before the authority concerned as regards the financial position of the petitioners is concerned and the need of the petitioners, the appropriate authority observed that it was simply an argument without any evidence to that effect on the record. So far as regards jurisdiction points were concerned, the same authority observed saying that the appropriate authority had no doubt jurisdiction to invoke the provisions of Chapter XX-C of the Act. It is this order which has adversely affected the petitioners and prompted them to challenge the same. We heard Mr. K.H. Deshpande, the senior advocate for the petitioners, at length. Mr. Deshpande, while scathingly assailing the order of respondent No. 1, contended that the whole approach of the authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in civil lines area. However, we wish not to dilate on this point for the very simple reason that these two areas, by no stretch of imagination, can be compared in any manner, so far as regards valuation of the property is concerned. Civil lines area is a vast locality very widely spread having High Court, District Court, Offices of All India Radio, Air Lines and Sales Tax and majority of Central Government offices. Such is not the position so far as regards the area in question, i.e., Shivaji Nagar. It appears that the appropriate authority was much impressed by the 80 ft. wide cement road in Dharampeth extension. However, that cannot be a thing which should have so much impressed the authority concerned for reaching the conclusions that, the apparent consideration shown, was definitely understated and that too more than 15 per cent. It is really surprising that the sale instances, which were considered by the authority concerned from Dharampeth Extension area while dealing with the matter, did not form part and parcel of the notice under section 269UD(1) of the Act. These sale instances to which reference is made, are referred to in sub-para. (9) of paragraph 3 of the order. How ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n." We are really surprised to note such type of observation in the order, the cognizance of which, much less judicial cognizance cannot be taken unless documents and evidence to that effect is produced on the record. Even assuming for the sake of argument that there may be some escalation, but, unless and Until it is brought on record as to what was the rate of escalation, what was the percentage thereof and if at all there was any escalation, what was the reason for a sudden shoot up in the prices, decision based on gathered knowledge by the authority concerned from other sources cannot be used while deciding the matter judicially or in a quasi-judicial decision. This conclusion drawn by the appropriate authority, therefore, in our opinion, cannot be sustained in the eye of law. Merely because it was said that prices were increased, it would not mean that the judicial authorities and the quasi-judicial authorities could straightaway accept the same, without there being any proof to that effect on the record. Mr. A.S. Jaiswal, the learned advocate appearing on behalf of the respondents, contended that the decision arrived at by the appropriate authority was just and proper and j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r which Chapter XX-C of the Act has been introduced. After having considered all the arguments and the points raised on behalf of both the parties, we see that the notice issued by respondent No. 1 under section 269UD does not disclose all the material on the basis of which it could be said to have been issued, much less the details thereof and, therefore, the interest of the petitioners could be said to have been totally prejudiced. If the authority concerned reached the conclusion that there was concealment or understating on the part of the petitioners on the basis of the sale deed, then, in that case, it was very much incumbent on the part of the authority concerned to have annexed all the relevant documents giving details of the property, such as sale transactions and the details thereof including the size and otherwise, so as to give appropriate opportunity to the petitioners to defend themselves. We also see that the time which was taken by the authority concerned for issuing notice under section 269UD, was much more, thereby leaving a short period at the disposal of the petitioners to defend themselves. We have already pointed out in the foregoing paragraphs that there wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riage of justice. It is also well known that these rules of natural justice can operate only in the areas not covered by any law validly made. In short, these rules can be said to be supplement to law and not supplant the law." In the instant matter, we have already observed that, though it is the decision of the authority concerned which prompted the authority to initiate the action under section 269UD, however, this satisfaction of the authority concerned for initiating action for pre-emptive acquisition has to be a subjective satisfaction of objective facts. We see that respondent No. 1--appropriate authority is totally lacking in this respect, much less when it did not take into consideration even the application made by the petitioners for permission to lead evidence. We asked learned counsel for the respondents as to whether any order was passed by the authority concerned on that application, Mr. Jaiswal, learned counsel, expressed that there appeared to be no order passed on that application. We even do not find reference to that application in the impugned order. We have to observe that the authority concerned totally failed to act within the ambit of the principles of na ..... X X X X Extracts X X X X X X X X Extracts X X X X
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