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Issues: Jurisdiction of competent authority under Section 269C of the Income Tax Act, 1961; Interpretation of Section 47 of the Indian Registration Act; Completion of sale deed and applicability of Chapter XX-A of the Act.
Analysis: The judgment pertains to an appeal against the dismissal of a writ petition challenging the initiation of proceedings by the competent authority under Section 269C of the Income Tax Act, 1961. The case involved a sale deed executed on October 28, 1972, and registered on November 16, 1972, after the introduction of Chapter XX-A of the Act on November 15, 1972. The appellant contended that the sale deed should be deemed to operate from the date of its execution, thereby excluding it from the application of Chapter XX-A. The single judge dismissed the petition, citing the Supreme Court ruling in Ram Saran Lall v. Mst. Domini Kuer, AIR 1961 SC 1747, which held that the completion of a sale occurs upon registration. The judge also noted that Section 269C applies to transfers completed after November 15, 1972, through registration of the instrument. Consequently, the appeal was filed challenging this decision. In the appeal, the appellant reiterated the argument based on Section 47 of the Indian Registration Act, emphasizing that the sale deed should be considered completed on the date of execution, not registration. Despite relying on various rulings supporting this view, the court upheld the principle from the Ram Saran case, emphasizing that a sale is completed only upon registration. The court further analyzed the provisions of Chapter XX-A, Section 54 of the Transfer of Property Act, and the definitions of "instrument of transfer" and "transfer" under Section 269A of the Act. It concluded that a sale deed is completed only through registration, aligning with the legislative intent and procedural requirements outlined in the Act. The court highlighted the significance of the proviso to Section 269D, which sets a timeframe for initiating proceedings post-registration. It emphasized that the initiation of proceedings under Section 269C is contingent upon the registration of the instrument of transfer under the Indian Registration Act. The court rejected the applicability of Section 47 of the Indian Registration Act in this context, reiterating that the completion of a sale is tied to registration. The decision was further supported by the judgment in Mahavir Metal Works P. Ltd. v. Union of India [1974] 95 ITR 197, reinforcing the understanding that a sale is finalized through registration under the Registration Act. Ultimately, the court found no merit in the appeal and dismissed it with costs, affirming the completion of the sale deed upon registration and upholding the application of Chapter XX-A of the Act to the transaction in question.
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