TMI Blog1988 (2) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... vember 14, 1986, respondents Nos. 4 and 5 agreed to sell for valuable consideration, the rear portion of the said premises measuring about 10 cottahs of land to respondent No. 3 or his nominee, as the case may be, and received a sum of Rs. 10 lakhs as earnest money. The said agreement for sale was filed before the income-tax authority as well as before the competent authority under the Urban Land (Ceiling and Regulation) Act, 1976. The income-tax authority issued a "No objection certificate" in favour of respondents Nos. 4 and 5 for the sale of the said property. Necessary permission was also obtained from the competent authority under the Urban Land (Ceiling and Regulation) Act, 1976, by the owners of the property, namely, respondents Nos. 4 and 5. Respondent No. 3 nominated the writ petitioner as the purchaser and the said nomination was duly accepted by the vendors, namely, respondents Nos. 4 and 5. Respondents Nos. 4 and 5 agreed to convey the said property to the writ petitioner and a formal deed of conveyance was executed by respondents Nos. 4 and 5 in favour of the writ petitioner wherein respondent No. 3 was added as a mere confirming party inasmuch as the said sale was mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 3, by virtue of the agreement for sale, acquired some interest or benefit in the land in question, relying upon the definition of the word "immovable property" as provided in section 2(6) of the Indian Registration Act. It was also pointed out by the Registrar of Assurances, Calcutta, that the agreement for sale that was entered into by and between respondent No. 3 and respondents Nos. 4 and 5 created an interest in land in favour of respondent No. 3 and as such the same should be regarded as a benefit arising out of the land. In order to decide the question whether the contract for sale created an interest in favour of respondent No. 3 within the meaning of section 2(6) of the Registration Act in the land in question and whether respondent No. 3 has to obtain an income-tax clearance certificate from the income-tax authorities under section 230A of the Income-tax Act and has to produce the same before the registering authority along with the owners of the land who are the vendors, namely, respondents Nos. 4 and 5, respectively, it is necessary to set out the provisions of section 2(6) of the Registration Act, section 54 of the Transfer of Property Act and section 230A of the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its) Surtax Act, 1964 (7 of 1964) ; or (b) the registration of the document will not prejudicially affect the recovery of any existing liability under any of the aforesaid Acts. (2) The application for the certificate required under sub-section (1) shall be made by the person referred to in that sub-section and shall be in such form and shall contain such particulars as may be prescribed. (3) The provisions of sub-section (1) shall not apply in a case where the person referred to in that sub-section is any such institution, association or body, or belongs to any such class of institutions, associations or bodies, as the Board may, for reasons to be recorded in writing notify in this behalf in the Official Gazette." The Registrar of Assurances, Calcutta, while refusing to register the sale deed in question, pointed out that the confirming party, respondent No. 3, had acquired an interest in the said immovable property which was also sought to be transferred and as such an income-tax clearance certificate under section 230A of the Income-tax Act was required to be produced and unless the said income-tax clearance certificate is produced, the document could not be register ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of an income-tax clearance certificate is required under the provisions of section 230A of the Income-tax Act in case of a transfer of property within the meaning of the Transfer of Property Act and that the Indian Registration Act does not create or extinguish the right, title and interest in any property and if respondent No. 3 is not the owner and if respondent No. 3 had no occasion to transfer the property in favour of the petitioner, in that event, on a proper construction of the provisions of section 230A of the Income-tax Act, respondent No. 3 was not required to obtain an incometax clearance certificate. In my view, the submission made by Mr. Mitra requires careful consideration. The object of section 230A of the Incometax Act, 1961, is primarily intended to be a safeguard against tax evasion. It provides a total safeguard in the sense that it requires not only the incometax clearance certificate from the Income-tax Officer, but also prescribes an interdict to the registering authority not to register any document which purports to transfer, assign, limit or extinguish the right, title or interest of any person to or in any property including agricultural land the value of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... far as is sought to be done by the Registrar of Assurances. It is a firmly established principle that Language is presumed to be used in its primary ordinary sense unless this stultifies the purpose of the statute or otherwise produces some injustice, absurdity or anomaly or contradiction, in which case, some secondary ordinary sense must be preferred. In the instant case, I have to look to the intention of Parliament for enacting the provision of section 230A of the Income-tax Act and the intention for such provision is clear. The interpretation sought to be given by the Registrar of Assurances would clearly amount to a destructive analysis. The view taken by the Registrar of Assurances is, on the face of it, perverse in view of the provision of the Transfer of Property Act and the provision of the Income-tax Act referred to above. The object of section 230A of the Income-tax Act is clear and it is not difficult to ascertain the mischief which the statute was intended to remedy and under such circumstances, the construction as sought to be made by the Registrar of Assurances would be contrary to the spirit and/or the object of the provision of section 230A of the said Act. Furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... own and well-defined. The scope of the Indian Registration Act is also well -settled, namely, that the purpose of this Act is to provide the provision for registration of document for effecting such transfer within the meaning of the Transfer of Property Act. The scope of the Indian Registration Act is confined only to registration and not to a transaction. The scope of the Transfer of Property Act is confined to a transaction, in other words, to create extinguish right, title or interest in any property and the meaning of transfer of such right, title and interest. When the Transfer of Property Act clearly provides that a contract for sale of immovable property does not create any interest in or charge on property, that should be regarded as the law of the land and the legal effect of a contract for sale of immovable property cannot be enlarged by the provision of the Registration Act as sought to be made by the registering authority. In my view, the Registrar of Assurances proceeded in the matter on an erroneous conception of law regarding the effect of a contract for sale of immovable property. As hereinbefore stated, respondent No. 3 had no manner of right, title or interest in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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