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Issues involved: Appeal u/s 269H of the I.T. Act, 1961 against the order of the Income-tax Appellate Tribunal regarding the acquisition of a residential house under Chapter XX-A of the Act.
Summary: The appeal was filed by two brothers who purchased a residential house in Ludhiana, which was later acquired under Chapter XX-A of the Income Tax Act. The Competent Authority issued a notice of acquisition after determining the fair market value of the property to be higher than the apparent consideration. The appellants objected to the acquisition, presenting a valuation report by Shri Chandan Singh Kang. The departmental Valuation Officer valued the property at a higher amount, leading to the acquisition order. The appellants appealed to the Income-tax Appellate Tribunal, which confirmed the acquisition with a slight modification in the valuation. The appellants challenged the Tribunal's decision, arguing that it was based on irrelevant considerations and ignored important evidence. The appellants raised multiple contentions regarding the Tribunal's doubt about the property's location, rejection of sales instances, and valuation methods. They argued that the Tribunal's findings were based on conjectures and surmises, rather than hard realities. The Tribunal's rejection of sales instances based on plot sizes was deemed disadvantageous to the appellants, as smaller plots in urban areas often attract higher prices per square yard. The Tribunal's comparison of sales instances in Gurdev Nagar and Sarabha Nagar was criticized for overlooking relevant factors and arriving at a valuation that was not in line with the actual market value. The High Court analyzed the contentions raised by the appellants and found that the Tribunal's decision was not based on sound legal reasons and overlooked crucial evidence. The Court held that the valuation should have been based on a cumulative assessment of all relevant sales instances, leading to a lower valuation of the property. Consequently, the High Court allowed the appeal, setting aside the orders of the Tribunal and the Competent Authority for the acquisition of the property. The appellants were awarded costs for the proceedings. Separate Judgment by Rajendra Nath Mittal: Justice Rajendra Nath Mittal concurred with the decision of the High Court to allow the appeal and set aside the orders of the Tribunal and the Competent Authority.
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