TMI Blog1981 (10) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... November 7, 1972, in favour of the firm for a consideration of Rs. 1,41,000. At the time of the agreement of sale the purchasers had paid an amount of Rs. 2,000 as part consideration to the transferor. The document was lodged for registration on November 15, 1972. A certificate under s. 230A of the Act was forwarded to the registering authority on November 29, 1972, and ultimately the document came to be registered on September 21, 1977. By the T.L. (Amend.) Act, 1972, the Income-tax Act was amended and Chap. XX-A consisting of ss. 269A to 269S was inserted with effect from November 15, 1972. The chapter purports to deal with acquisition of immovable properties in certain cases of transfer to counteract the evasion of tax. Section 269P demands that no registering officer appointed under the Registration Act, 1908, shall register any document unless a statement in duplicate in respect of such transfer in the prescribed form and in the prescribed manner is furnished to him along with the instrument of transfer. Section 269C is required to be quoted in detail as the challenge in this petition is in respect of powers exercised by the Competent Authority under the provisions of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Competent Authority has reason to believe that any immovable property of a fair market value exceeding Rs. 25,000 has been transferred for an apparent consideration which is less than the fair market value of the property, the Competent Authority may initiate proceedings for the acquisition of such properties. The Powers could be exercised if the instrument does not reflect the true market price with the object of evasion of liability to pay tax or to facilitate the concealment of any income. " Fair market value in relation to an immovable property " means the price which the property would ordinarily fetch on sale in the open market. The expression " instrument of transfer " has been defined under s. 269A(f) as the instrument of transfer registered under the Registration Act. After the registration of the document on September 21, 1977, the Competent Authority served a show-cause notice dated June 26, 1978, on the petitioner and other persons who were in occupation of the property. The notice, inter alia, sets out that the Competent Authority has reason to believe that the fair market value of the property exceeds the apparent consideration by more than 15 per cent. of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, in the case of tangible immovable property of the value of one hundred rupees and upwards, or in the case of a reversion or other intangible thing, can be made only by a registered instrument. Shri Tijoriwala very rightly did not dispute that the transfer of title is completed on the registration of the document. The entire thrust of the submission was that though the sale was completed on the registration of a document, the transfer takes place on the date of execution of the document itself. It would be convenient at this stage to make reference to the provisions of s. 47 of the Registration Act. Section 47 reads as under: "A registered document shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration. " Shri Tijoriwala submits that, in view of the provisions of s. 47 of the Registration Act, it is wholly irrelevant as to when the document is registered, as the transfer operates from the date of execution itself. It was urged that the act of registration is not within the control of the parties and the rights flow from the document of transfer from the date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " We do not think that the learned Attorney-General's contention is well founded. We will assume that the learned Attorney-General's construction of the instrument of sale that the property was intended to pass under it on the date of the instrument is correct. Section 47 of the Registration Act does not, however, say when a sale would be deemed to be complete. It only permits a document when registered, to operate from a certain date which may be earlier than the date when it was registered. The object of this section is to decide which of two or more registered instruments in respect of the same property is to have effect. The section applies to a document only after it has been registered. It has nothing to do with the completion of the registration and, therefore, nothing to do with the completion of a sale when the instrument is one of sale. A sale which is admittedly not completed until the registration of the instrument of sale is completed, cannot be said to have been completed earlier because, by virtue of s. 47, the instrument by which it is effected, after it has been registered, commences to operate from an earlier date. Therefore, we do not think that the sale in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r has no power to revoke the gift prior to the registration of the instrument. " It is difficult to appreciate how the dictum laid down by the Privy Council would have application to the facts of the present case. In my judgment, it is not possible to hold that the transfer is complete on the date of the execution and the registration only makes the sale complete. There is no distinction between the transfer of a title and the completion of the sale, and in view of the decision of the Supreme Court, the title passes only when the document is registered under the provisions of the Registration Act. The mere fact that such transfer operates from the date of execution is not sufficient to conclude that the title itself passes on the date of execution. Shri Pradhan has relied upon the decision of the Andhra Pradesh High Court in the case of Divvi Suryanarayana Murthy v. Competent Authority, IAC [1979] 117 ITR 278, and of the Delhi High Court in the case of Mahavir Metal Works P. Ltd. v. Union of India [1974] 95 ITR 197. Both these decisions have taken the identical view of the provisions of s. 269C of the Act as I am inclined to do. In my judgment, the right of the Competent Autho ..... 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