TMI Blog2018 (12) TMI 564X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee and the assessing officer as on 01.04.1981. Under these observations from Hon’ble High Courts including from Hon’ble Apex Court, we deem it appropriate to adopt the value as suggested from both sides - it will meet the ends of justice, if the fair market value of the property is adopted at ₹ 3,50,000/- as against ₹ 5,00,000/-, per ground, as on 01.04.1981,suggested by the ld.Counsel for the assessee and ₹ 50,000/-,per ground, adopted by the ld.CIT(A). Thus, the appeal of the assessee is partly allowed. - I.T.A.No.1602/Chny/2018 - - - Dated:- 5-12-2018 - Shri Joginder Singh, Vice President And Shri A. Mohan Alankamony, Accountant Member For the Appellant : Mr.S.Sridhar,Advocate For the Respondent : Mr.B.Sagadevan,JCIT,D.R ORDER PER JOGINDER SINGH, VICE PRESIDENT: This is an appeal filed by the assessee against the order of the Commissioner of Income-tax (Appeals)-12,Chennai dated 15.03.2018 for the assessment year 2009-10, on the ground that the rate of properties, maintained by the Registration Authorities, for the purposes of checking evasion of stamp duty upon transfer deeds are not pursuant to the provisions in any statute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A(b) of the Act, would contend that in respect of an exchange, the apparent consideration of the property which is sought to be transferred, would represent the market value of the property that is taken in exchange plus the money, if any, paid in addition to the property. Thus, according to him, applying the said definition, the apparent consideration for the property at Harrington Road belonging to the petitioner would represent the market value of the property at Adyar. It is also stated that in terms of Section 269UD(1), if the Government desires to purchase the property which is the subject-matter of an exchange, it should pay to the owner the market value of the property which is taken in exchange. Accordingly, it is further stated that the appropriate authority ought to have valued the Adyar property to determine the actual consideration that should be paid by the Government to the petitioner. It is argued that in the absence of valuation of the Adyar property by the appropriate authority, it is impossible for the appropriate authority to actually determine the consideration payable to the petitioner for the purchase of the petitioner's property at Harrington Road. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the registering authorities for the purposes of collection of stamp duty and that guideline values of land for the purposes of registration of an immovable property can have no application for determining the market value under Chapter XX-C of the Act. The appropriate authority has relied on a decision of the Rajasthan High Court in Krishna Kuntar Rini'dl v. Union of India [1995] 214 1TR 610, wherein it was held that the market rates for the purpose of registration of an immovable properly as notified by the Sub-Registrar can have no application for determining the market value under Chapter XX-C of the Act. It is further stated that it is limited only for payment of stamp duty. I am in agreement with the view expressed by the Rajasthan High Court. Further, the principles for valuation in respect of an immovable property under the Wealth-tax Act or other tax ation laws arc different from the principles which are applicable to acquisition proceedings. The proceedings under Chapter XX-C are akin to the acquisition proceedings and not to the valuation principles which are applicable for assessing the tax on the basis of the valuation of the property. A certain element of guess ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 000 per sq. ft. ₹ 50,00,000 ₹ 1,18,60,000 Total ₹ 1,68,00,000 Discounted consideration ₹ 1,61,36,000. 19. Though learned senior counsel for the petitioner would state that in both the sale instances the properties situate in Second Avenue whereas the property in question is in First Avenue hence the same cannot be compared, I am unable to accept the said contention in the light of the discussions by the appropriate authority. It is clear that both the sale instances relate to properties proximate in location to the subject property and arc in the residential zone of development as per M.M.D.A. Development Control Rules. In respect of the property at Serial No. 1, taking note of. efflux of time, the appropriate authority has allowed appreciation at 1 per cent. p.m. and worked out the fair market value of the subject property. The fair market value in this case works out to ₹ 2,61,66,000 as against the apparent consideration of ₹ 1,87,00,000. Accordingly, the appropriate authority has concluded that there is significant undervaluation of the subject property by 39.92 per cent. Likewise, if the sale instance at Sl. No. 2 is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elating to the property at door No. 8, II Avenue, Harrington Road, is not registered, after considering all the relevant materials, the appropriate authority has issued no objection certificate and it reflects the market rate of the land as on the date of that agreement on October 24, 1996. On the other hand, the value furnished by Prashanth Engineers merely on the basis of materials supplied by the Sub-Registrar here again cannot be accepted. As rightly observed by the appropriate authority, there was appreciation in land rate in Chetput locality where the subject property is situated. In fact, Adyar area where the property being exchanged is situated, has also shown appreciation in land rate. Though reliance was placed about the statement in the newspapers regarding slump in the prices of land, as rightly observed, the rise or slump in the prices of land reported in the newspapers cannot be generalised as applicable to all areas. The appropriate authority has also considered the documents in respect of few cases of property transactions in Harrington Road filed by the petitioner, and after giving adequate reasons, rejected those documents. The desire of the fifth responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to in Chapter XX-C of the Act as well as power of this court under Article 226 of the Constitution of India, the Supreme Court has observed that at (page 128) : ... we are of the considered opinion that merely because no appeal is provided for against the order of the appropriate authority, directing compulsory acquisition by the Government, the supervisory power of the High Court docs not get enlarged nor the High Court can exercise an appellate power. 23. In the light of the law laid down by the apex court, after examining the order of the appropriate authority, in detail, I do not find any good reason to interfere with the said order. Further, the appropriate authority considered all the aspects and afforded adequate opportunity to the parties concerned. Accordingly, both the writ petitions fait and the same are dismissed. No costs. Consequently, both the writ miscellaneous petitions are closed. 3.1 It is noted that Hon ble BombayHigh Court in the case of Lakshmi Naryan Grover (supra) held /observed as under:- Accordingly, the petitioner submitted her reply on 13th Feb., 1993, contending that there was no undervaluation in the sale transaction in ques ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s order dt. 23rd Feb., 1993, passed an order for compulsory purchase of the suit land for a net consideration of ₹ 13,25,343 payable to respondent No. 3 by the Central Government including a sum of ₹ 44,178 ordered to be deposited in the Appropriate Authority's account as per its finding in para 7 of its order relating to the question of vacant possession regarding encroachment of about 200 sq. ft. upon the suit land by the owner of the adjoining plot. The reasons for compulsory acquisition were recorded by the Appropriate Authority separately on the same date, i. e., 23rd Feb., 1993. A perusal of the reasons recorded by the Appropriate Authority would show that the suit land was situated in the Civil Lines area which was purely a residential locality of the people belonging to the upper middle class. The permissible FSI for the suit land was one and its permissible user was for residential purpose. After considering the question of its location, the Appropriate Authority determined the discounted value of the apparent consideration of ₹ 13,50,000 shown in the agreement of sale dt. 24th May, 1992, in accordance with the provisions of s. 269UA(b) r/w r. 48 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us rejected both the sale instances relied upon before it by the petitioner. The Appropriate Authority thus passed an order for compulsory purchase of the suit land for a net consideration of ₹ 13,25,343 payable by the Central Government to respondent No. 3 including the sum of ₹ 44,178 which was directed to be deposited in the account of the Appropriate Authority in view of the dispute about encroachment upon the said land by the owner of the adjoining land in the light of the findings of the Appropriate Authority in para 7 of its order dt. 23rd Feb., 1993. Feeling aggrieved by the order dt. 23rd Feb., 1993, passed by the Appropriate Authority, the petitioner has preferred the instant writ petition in this Court. 5. Originally there were only two respondents to this writ petition viz., the Appropriate Authority and the Union of India, who filed the return opposing the writ petition. However, by the order dt. 11th March, 1993, the transferor of the suit land was added as a party respondent, i. e., respondent No. 3 in the instant writ petition. In her written submissions respondent No. 3 has stated that she is not concerned with the challenge of the petitioner to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which it could be held that there was undervaluation of the suit property and that the consideration of ₹ 13,50,000 agreed to between the parties in the instant case did not represent the true and fair market value of the suit land. (iv) The Appropriate Authority did not properly consider the material placed by the petitioner before it to show that the consideration agreed to between the parties represented the true and fair market value of the suit land, viz., the two sale instances from the Civil Lines area itself and the rates of valuation fixed and maintained by the Nagpur Corporation and the Registering Officers of the Government. 7. We shall first consider the contention raised on behalf of the petitioner on the merits, viz., whether the sale instance relied upon by the Appropriate Authority would show that the suit land is grossly undervalued and whether it is a comparable sale instance or not. As regards this question, the petitioner has urged in para 9-A of the writ petition introduced by the amendment that the land admeasuring 4,839.5 sq. ft. out of the plot No. 2 in Shri Vallabh Co-operative Housing Society, Civil Lines, Nagpur, was purchased by Shri Sati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a period of one year and two months, the market value of the land in the Civil Lines area would appreciate and that too to the extent of 12 per cent per annum. Even the Appropriate Authority has not followed uniformity in giving such appreciation in land rates in the Civil Lines area itself as in other cases in this group of writ petitions, i.e., Writ Petition No. 715 of 1993, Writ Petition No. 1260 of 1993 and 1264 of 1993 with 2088 of 1993, the appreciation given by it without there being any material on record is 10 per cent per annum. In fact, in the order passed by the Appropriate Authority, which is the subject-matter of challenge in Writ Petition No. 1264 of 1993 and the connected Writ Petition No. 2088 of 1993 decided today, the same sale instance which is relied upon by it in the instant case is taken as a comparable sale instance for the suit land in the said case which is also situated in Civil Lines, Nagpur. The rate of appreciation, however, given to the same sale instance is at the rate of 10 per cent per annum and not 12 per cent. 8. It may be seen that r. 48-I of the IT Rules, 1962, has prescribed the rate of interest of eight per cent per annum for calc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ructions of the CBDT referred to in para 14 of the judgment of the Supreme Court in C. B. Gautam's case (supra), are kept in view, it is difficult to hold that the Department has made out good reason for compulsory purchase of the suit property and to show that the sale transaction in question is not a bona fide transaction between the parties. 9. It is also difficult to appreciate how the Appropriate Authority while considering the question of gross undervaluation works out the land rate by discounting the land rate agreed to between the parties, particularly where the rate of the land in the sale instance is not determined on the basis of its discounted value. So far as the payment of consideration by the Central Government for its compulsory purchase of immovable property is concerned, the Central Government may pay the apparent consideration as determined by calculating the discounted value of the consideration agreed to between the parties, i. e., in accordance with s. 269UA(b) of the Act r/w r. 48-I of the IT Rules, 1962, as it is statutory. But then it has to be seen that as per the agreement between the transferor and the transferee, even though the balance of cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luation report has observed that the plot therein has a prime location, i. e., it is on the main road whereas the suit plot is in an inner lane. The plot rate, according to him, is ₹ 175 per sq. ft. For the time factor, he added 25 per cent (i. e., more than 12 per cent increase granted by the Appropriate Authority to sale instance relied upon by it) to the above value of ₹ 175 per sq. ft. of the plot and the rate thus worked out by him for the land in the said sale instance dt. 23rd Nov., 1989, is ₹ 219 per sq. ft. on the date of the agreement of sale of the suit plot, i. e. 24th Jan., 1992. In fact if 12 per cent increase per year which is made applicable by the Appropriate Authority to the sale instance relied upon by it is given, the rate of the above sale instance relied upon by the petitioner would work out to a rate lower than the rate of ₹ 219 per sq. ft. It may then be seen that if the allowance is made for the prime location of the land in the said sale instance dt. 23rd Nov., 1989, the market rate for the suit land should be still less than the rate for the land in the said sale instance dt. 23rd Nov., 1989. However, the discounted rate which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er has taken into consideration the disadvantageous factor of the tenant in occupation offering a lower rate for the land in the above sale instance dt. 23rd Nov., 1991, which is close to the suit transaction time-wise and vicinity-wise, the Appropriate Authority did not at all take into consideration the advantageous factor of the land purchased by the owner of the adjoining land in the sale instance relied upon by it by giving to the transaction therein, the appropriate discount in comparing its rate with the rate of the suit land. Even otherwise excluding the aforesaid second sale instance dt. 23rd Nov., 1991, on the ground that the land therein is purchased by the tenant in occupation, the first sale instance dt. 23rd Nov., 1989, cited by the petitioner clearly shows that the rate of the suit land is not grossly understated. It may be seen that in determining the rate of ₹ 210 per sq. ft., the valuer of the petitioner had taken into consideration the above two sale instances referred to by him and the location, size, shape and the permissible FSI (FSI allowed is only one). The valuation report of her valuer submitted by the petitioner to the Appropriate Authority thu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in vacant possession of the suit land, she could not have done so about the encroached land unless her dispute about the same with the owner of the adjoining land was resolved. In view of the above factor, about the encroachment upon the suit land, which would cause delay in giving possession of the said land to the petitioner, if not total loss of the same, if the owner of the adjoining land were to succeed, the consideration agreed to between the parties may not reflect the true market value of the suit land. But then this factor has to be borne in mind while considering the question whether the suit land is grossly undervalued because it would give a good reason why the suit land has not fetched its proper market value, if at all, as held by the Appropriate Authority, its value is understated. A perusal of the finding of the Appropriate Authority in para 7 of the order shows that it has not considered the question from this angle but has considered it only for the purpose of withholding the payment of the value of the encroached land to respondent No. 3 till the said dispute was resolved and the Central Government through its appropriate department was put in possession of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and. 15. However, as regards the contention raised on behalf of the petitioner that the market rate fixed for the area in question at the relevant time in the land rates fixed by the Nagpur Municipal Corporation, Nagpur, as well as by the stamp authority for the purposes of levy of stamp duty on registration of the documents was ₹ 1,500 per sq. metre, i. e., ₹ 145 per sq. ft. and, therefore, the rate of ₹ 225 per sq. ft. agreed to between the parties for purchase of the suit land was more than the market rate for such land, it may be seen that the rates of properties maintained by the above authority or officers for the purpose of checking evasion of stamp duty upon transfer deeds are not pursuant to the provision in any statute, relating even to stamp duty. At any rate it cannot be a basis for determination of the market value for acquisition of or for compulsory purchase of any land where the usual test is of a prudent buyer and a prudent seller determined by the evidence of sale transaction, if available in the vicinity of the land in question whose market rate is to be determined possessing the same or more or less similar advantageous features. This is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inst him and (ii) he must have an opportunity to set forth his own case to show why an order adverse to him should not be passed. In this regard, de Smith in his Judicial Review of Administrative Action (Fourth Edn.) has observed at page 196 as follows : Natural justice generally requires that persons liable to be directly affected by proposed administrative acts, decisions or proceedings be given adequate noticee of what is proposed, so that they may be in a position - (a) to make representations on their own behalf; or (b) to appear at a hearing or inquiry (if one is to be held); and (c) effectively to prepare their own case and to answer the case (if any) they have to meet . It must be then seen that the conclusions of the authority at the stage of giving a show-cause notice are always prima facie or tentative conclusions for if it is not so, its ultimate order would suffer from its bias, i. e., its pre-determined mind. However, because its conclusions at the stage of show-cause notice are only prima facie or tentative conclusions, it would not mean that they are not required to be disclosed in the show-cause notice. The above stand taken by the respondents in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y in nature in the sense that no elaborate procedure of enquiry, i. e., leading elaborate evidence, etc., is contemplated by it. However, surely it cannot mean that because the enquiry is summary in nature its very basic requirement, viz., the observance of the minimal principles of natural justice referred to above is dispensed with. Otherwise, such an enquiry would become an empty formality and would not be meaningful and effective. 19. It may be seen that as pointed out hereinbefore in regard to the reasons of time restraint even in a summary or limited inquiry, the Appropriate Authority or the concerned IT Department has to make and in fact makes an enquiry and collects material on the basis of which it comes to a tentative conclusion on the question whether the property in question is grossly undervalued or not. If such an enquiry is essential even in a summary or limited enquiry, there is no reason why the material collected through such an enquiry should not be disclosed to the transferor and the transferee before taking a final view in the matter. Since the material on the basis of which the Appropriate Authority holds the prima facie view that the property in question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an be taken of the fact that by passage of time prices of land appreciate and it would be unjust to the vendor to peg him down to a price to which he has agreed at the time of the agreement of sale dt. 3rd June, 1992. That is also the reason why s. 269UD(1)of the Act requires the Appropriate Authority to pass an order within two months (after amendment three months) from the end of the month, in which the statement of particulars are submitted by the parties concerned in the prescribed Form No. 37-I as required under s. 269UC of the Act r/w r. 48L of the IT Rules, 1962. Moreover, on the merits, we have shown how the land rate of ₹ 225 per sq. ft. (or its discounted rate of ₹ 221 per sq. ft.) for the suit land is not grossly understated in the sense that its fair market rate would be more by 15 per cent or above as compared to the said land rate. The above submission made on behalf of the respondents cannot thus be accepted. 3.2 Hon ble Rajasthan High Court in the case of Krishnakumar Rawat (supra) observed /held as under:- The petitioners have entered into an agreement to purchase a plot of 9,500 sq. yards (7,945 sq. metre) with two godowns having an area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion dated March 24, 1994, was given of a plot of 116.13 sq. metres sold at ₹ 861.10 per sq. meter situated in Triveni Nagar Scheme. The market rate fixed by the Sub-Registrar for registration purposes was stated to be ₹ 1,043.05 per sq. metre. A copy of the office order dated November 4, 1992, of the Jaipur Development Authority fixing the reserve price at ₹ 600 per sq. metre was pointed out. The appropriate authority passed the order under section 269UD(1) and exercising the powers vested in it ordered purchase of the property by the Central Government at an amount equal to the apparent consideration shown in the agreement. The appropriate authority directed delivery of possession of the said property to the Departmental Valuation Officer of the Income-tax Department whereupon the petitioner applied for time. The submission of learned counsel for the petitioner is that the total land is 17 bighas 12 biswas having Khasra No. 126 owned by the partnership firm, Messrs. Rajasthan Industrial Company, which submitted a plain for development of an amusement park, commercial complex and residential colony. The Jaipur Development Authority approved the plain for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... few months now to vacate it. The apparent consideration shown is not less than apparent consideration if 15 per cent. is added thereon. The orders have been passed on grounds different than those for which the notice was issued. The copy of the valuation report was not supplied. The comparison with the land situated at Triveni Nagar which is fully developed has wrongly been made. The value of the structure should have been taken as nil. While valuing the godown incorrect facts with regard to the tubular trusses, A. C. sheet roofing having CC floor, electric installations, iron etc., have been taken and it has wrongly been mentioned that commercial use of the property has been allowed by the District Magistrate and the Jaipur Development Authority. The proper norms for valuation of the property have been not been adopted. A single instance cannot be the basis for valuation of the property. The property is near the vegetable factory which is emitting a foul smell and incapable of developing into a residential colony. The instance of sale of plot given by the petitioner has wrongly been ignored. The salable area is only 66 per cent. of the total area and the calculation should h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the petitioner in which the court refused to interfere. The writ petition against the order passed by the appropriate authority is maintainable and, therefore, the preliminary objection having no force is rejected. In the agreement dated December 31, 1993, the sale price of the land has been mentioned as ₹ 1,051 per sq. yard. Possession of the two godowns having Nos. 13 and 14, guard-room, office premises and symbolic possession of 1/4th undivided share of the open land was taken by the petitioner. In clause 12 of the agreement, it was mentioned that the said land is approved and covered for the purpose of construction of commercial and residential units by the Jaipur Development Authority and the dues for conversion have been deposited. if there is any liability in future in respect of such conversion charges, the vendor has to bear it. The show-cause notice which was issued by the appropriate authority on March 8, 1994, has mentioned that the land rate has been shown at ₹ 1,051 per sq. yard in the agreement, whereas the Jaipur Development Authority has shown the land at ₹ 1,781 per sq. metre on November 7, 1992. Certain additions and deductions were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, and, therefore, there is no necessity for demolishing them. The value of the godown was taken at ₹ 42 lakhs and the value of the land was estimated at ₹ 1,37,21,532, at 1,727 per sq. metre. The total value has been taken at ₹ 1,79,21,532 as against ₹ 99,84,500. The contention of the petitioner with regard to the deduction of 40 per cent. for roads and park, etc., was not accepted and for the sake of the argument, it was considered that if the salable area as per rule 11 of the Rajasthan Urban Areas (sub-division) Rules, 1975, is taken to be 66 per cent., then it will come to 5,242.38 sq. meters to which if the sale instance was taken into consideration of ₹ 1,718 per sq. metre on which 12 per cent. for the time-gap is added, it will come to ₹ 1,994.72 per sq. metre. Even on that basis, the value comes to ₹ 1,04,58,548 and ₹ 42 lakhs for the building which is much more then the declared apparent consideration. It was also found that the area of Triveni Nagar is on the interior side of the main Tankroad, whereas the present land is having a better situation. The property being commercial has about 50 per cent. more value, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e akin to the acquisition proceedings and not to the valuation principles which are applicable for assessing the tax on the basis of the valuation of the property. The valuation has no doubt to be made objectively and not on the subjective satisfaction of the appropriate authority. The figure which is arrived at has to be based on the material on record. There may be a certain element of arbitrariness while estimating the market value and it is for that reason alone, that without there being any mandate of the Act, the respondents have issued a circular that the acquisition of the property under Chapter XX-C would be if the difference of the market value and agreed value shown in the instrument is more than 15 per cent. Thus, the 15 per cent. margin covers the estimation part of the valuation, so that no injustice is done while acquiring any property. The right of pre-emptive purchase by the Central Government of immovable property is at an amount equal to the amount of apparent consideration so as to relieve the transferor of any grievance. The order undersection 269UD has to be passed in a time-bound programme. The appropriate authority consists of three persons; two of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll the use that can be made of it by the vendor. Similarly, in U. P. Govt. v. H. S. Gupta, AIR 1957 SC 202, the market price was considered the highest value the property could fetch when laid out in the most advantageous manner. The potentialities or the capacity to use therefore is also an another relevant factor. The instances of comparable cases which are taken into consideration must be of genuine cases. There may be different methods for valuation of the property, i.e., land and building, which depends on multiplicity of situations and one of such principles is comparable transaction which is mainly applicable to valuation of land only, the others use : (i) Return basis : Under this system the value is determined on the basis of the amount of rent which a tenant is ready to pay and that rent is considered a return on the investment of capital which is applicable on the properties which are on lease/rent/easement. (ii) Direct capital comparison : This method is rarely applied for valuing the property, as under this method the two objects, namely, the property and other similar object like shares, etc., are taken into consideration and the price which c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e separately on the basis of comparable instances of sale of other plots and the cost of construction as prevailing is taken from which the depreciation looking to the year of construction is reduced. This method is normally applied in cases of compulsory acquisition. The objection that solitary instance rate cannot be adopted for the purpose of comparison cannot be considered to be an absolute proposition of law. It depends on the facts and circumstances of the case and even where there is no other comparable case available a single solitary instance can be taken into consideration. The objection that the land should be considered to be agricultural land or that the rate of industrial land should be made applicable or that since the value of the building has been taken then the cost of land should be taken as nil cannot be accepted, as factually it could neither be considered as agricultural land nor a industrial land and the potentiality of the land has to be taken into consideration as observed by the apex court in the case of Raghubans Narain Singhs case, AIR 1967 SC 465. The various propositions with regard to the costing of land or restricting the saleable area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... volved in the matter of valuation. The market value of the property is the price which a willing buyer will pay to a willing seller. It will vary from case to case. Valuation is not an exact science. Mathematical calculation is not possible. The money value attributable to the asset should be decided and estimated by the concerned statutory authority in a reasonable and judicial manner on the basis of the facts and circumstances available. The valuation should be made objectively and should be based on some material. The qualitative and quantitative analysis in the matter of valuation will differ from asset to asset, from place to place, and also considering the particular statute for which the valuation and price of the property have to be determined. It could be a wooden rule. Different methods and approaches, necessary in the context of different statutes under which the market value of an asset has got to be determined, pose difficult problems. The market value has got to be fixed with reference to the particular statute. The approach will differ, according to the nature of the statute, between fiscal statutes or non-fiscal statutes. Among the non-fiscal statutes, the Land Acqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property at the relevant time and also special features in respect of the property, if there be any. Taking all these factors into consideration it is, therefore, necessary to determine which one of the various methods will be most suitable to reach as accurate as possible a guess as to the valuation on the valuation date. (v) Another factor that has to be borne in mind is that such a method should be preferred which has more objective and reliable data to rely upon than mere subjective opinions. For instance, if there are more objective data to work out in respect of one method more reliable than another, then that method for a particular land should be preferred. If, however, there is any objective and reliable evidence of any transaction of sale of the land or property similar in quality or of the same type and in approximately same time then that would, however, provide more reliable method to follow. In Tribeni Devi v. Collector of Ranchi, AIR 1972 SC 1417; [1972] 3 SCR 208, it was observed by the apex court that (at page 1419) : the general principles for determining compensation have been set out in sections 23 and 24 of the Act. The compensation payable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ced on the decision of Mathura Prosad Rajgharia v. State of West Bengal, AIR 1971 SC 465, wherein it was observed that (at page 469) : the market value according to the disposition of the land apparently means the value of the land in a hypothetical market which willing purchaser may in the prevailing conditions pay for the land to a willing vendor, taking into consideration its situation and advantages. In determining the disposition the hypothetical purchaser would normally take into consideration the advantages of the situation and the potentialities of the land, for the market value of land, especially in urban areas, depends upon its situation, special adaptability, advantages and inherent potentiality in the light of the demand for land. Where a large area of land in an urban locality is sought to be acquired in determining the market value the method of belting is appropriate. It is common knowledge that lands having frontage on the main roads in urban areas are always more attractive than the lands which have no such frontage. In Sahib Singh Kalha v. Amritsar Improvement Trust [1992] Supp. AILACC 593, it was held by the apex court that where there is a large area of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esidential purposes as part of it is to be left out for facilities and roads are to be developed may affect the market value. The question whether the instance of sale should be relied upon is also a question of fact. It may be the correct depiction of the market value (rate) or may not be so and, therefore, the market value is to be adopted looking to the rates prevailing in the locality, situation of the plot, the potentiality and use of it. The valuation of the land could be on the basis of comparable cases of which one example has been given by the respondent while the other has been given by the petitioner. The total value for which the agreement was entered into was of ₹ 99,84,500. If the value of the godown of ₹ 42 lakhs is reduced therefrom, the value of the land remains only at ₹ 57,84,500 in respect of 9,500 sq. yards. The value comes approximately to ₹ 600 per sq. yard. It may be observed that in the case of Rajendra Giriraj Prasad Tiwari v. Union of India [1995] 212 ITR 158-S. B. Civil Writ Petition No. 3492 of 1993 decided on April 18, 1994, it was observed that judicial review is limited only to the extent of examining as to whether any fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction was also taken that the land is not an identifiable separate piece of land as the other co-owners may object or give another land in lieu of the land shown in the map. This argument is also of no avail to the petitioner, because the other co-owners have not raised any objection when the possession was taken over by the petitioner from the vendor and a number of vehicles must have come to unload his goods and, therefore, it could be a case of implied consent. Even if it is not a case of implied consent, the responsibility has been taken by the seller that the conversion charges of the land have been deposited and the land as shown in the map is to be sold by the vendor. The agreement reciting the obligation of the seller is the complete answer to the argument raised by learned counsel for the petitioner. Shri B. L. Sharma, appearing on behalf of the vendor, has submitted that on account of the stay order the seller could not get the remaining sale consideration and thus in view of the decision in C. Dass v. Appropriate Authority [1993] 199 ITR 9 (SC), at least direction for interest should be given. This matter has also been considered by me. The seller has already receiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50,000/-per square ground. As per the Revenue, the value was only considered for the land and not for the building, therefore, the value of the building was not considered. On appeal, before the ld.CIT(A), the ld. First Appellate Authority affirmed the stand of the ld. Assessing Officer. The assessee is aggrieved and is in appeal before this Tribunal. If the observation made in the assessment order, conclusion drawn in the impugned order, assertions made by the ld. respective counsel and material available on record, if kept in juxtaposition, and analyzed during open hearing we sought the opinion with respect to valuation, from both sides, wherein the ld.DR opined that in any case that the valuation may not be more than ₹ 2,50,000/- however, the ld.Counsel for the assessee asserted that the fair market value as on 01.04.1981 was not less than ₹ 5 lakhs. So far as the other facts are concerned, these are on record. Now the question for our consideration is adoption of value of the impugned property as on 01.04.1981. Hon ble Apex Court in Special Land Acquisition Officer v. T. Adinarayan Setty [1959] Supp. 1 SCR 404; AIR 1959 SC 429, indicated at page 412, the meth ..... X X X X Extracts X X X X X X X X Extracts X X X X
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