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Issues: Challenge to constitutional validity of Chapter XX-C of the Income-tax Act, 1961 and order passed by the Appropriate Authority under section 269UD(1); Compliance with statutory provisions under sections 269UG and 269UH; Affording reasonable opportunity of hearing to affected parties; Interpretation of limitation period under section 269UD(1) of the Act.
Analysis: 1. The petitioner challenged the constitutional validity of Chapter XX-C of the Income-tax Act, 1961, and the order passed by the Appropriate Authority under section 269UD(1) on the grounds of lack of opportunity of hearing to the affected parties. The petitioner contended that non-compliance with section 269UG regarding consideration money tendering revested the property in question. The High Court initially stayed the operation of the order and later modified the stay order based on the pending case challenging similar provisions before the apex court. 2. The Supreme Court, in a related case, held the provisions of Chapter XX-C valid but emphasized the necessity of affording reasonable opportunity to the concerned parties before making a compulsory purchase order under section 269UD. As no such opportunity was provided in the present case, the High Court held the impugned order to be vitiated. The Revenue counsel agreed that the matter should be reconsidered by the appropriate authority in compliance with the law. 3. The transferee argued that failure to take action within the specified timeframes as per the Act should prevent the appropriate authority from passing a fresh order under section 269UD(1). However, the Court rejected this argument, noting that the consideration money had been paid to the transferor, and the property had not revested due to compliance with statutory provisions. 4. The Court considered the interpretation of the limitation period under section 269UD(1) regarding the affording of a reasonable opportunity of hearing to affected parties. The Court held that the limitation period should be reckoned from the date of the High Court's judgment, not from the vacation of the stay order or the Supreme Court's judgment in the related case. The Court referred to previous judgments and dismissed the petitioner's contention regarding the reckoning of the limitation period. 5. Consequently, the Court quashed the impugned order of the appropriate authority for lack of affording reasonable opportunity to the affected parties. The statement submitted by the petitioner was to be treated as submitted on the date of the judgment. The appropriate authority was directed to reconsider the matter in accordance with the law and the directions given in the related Supreme Court case. 6. Both applications were disposed of with no order as to costs, and the concurring judge agreed with the decision.
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