9911796707
TMI Blog2008 (6) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... scertained whether the consideration in reality flowed from the intending transferee to the intending transferor." This finding is so grossly erroneous that it borders on perversity. The more serious error in appreciation of the factual aspect of the case is the Appropriate Authority' s reliance on their own guess work while determining the probable market value of the flat. Thus quash and set aside the impugned order passed under section 269UD(1) of the Act. X X X X Extracts X X X X X X X X Extracts X X X X ..... y said they had received the amount of Rs. 46,00,000 earlier and used it and thereby interest at 18 per cent. per annum on the said sum was incurred. They stated that the amount of interest would be Rs. 19,17,258. However, on March 23, 1988, the Appropriate Authority passed the order under section 269UD(1) of the Act and directed purchase of the flat for apparent consideration of Rs. 65,00,000. The petitioner filed a writ petition bearing No. 1007 of 1988 in March, 1988. This court disposed of the writ petition on December 16, 1988, in the light of the judgment of the Supreme Court in C. B. Gautam v. Union of India [1993] 199 ITR 530 and directed the Appropriate Authority to treat the application filed under Form No. 37A as filed on that day. In December, 1992, the Appropriate Authority issued a show-cause notice directing the petitioner and respondent No. 3 to show cause as to why the order of purchase should not be passed against them. Along with this notice, reasons recorded on March 23, 1988, in support of the earlier order of acquisition were also enclosed and the petitioner was asked to deal with them. The petitioner filed a detailed reply on January 19, 1993, but, on Februar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r' s report, one sale instance of the adjoining property, namely, flat No. 3 of Taragni Apts and certain notings of the Inspecting Assistant Commissioner of Income-tax. On utilising this material or by resorting to any other method such as obtaining valuation report from the District Valuation Officer, respondent No. 1 could have certainly first determined the fair market value of the flat at the relevant date. Then they could have compared the price the petitioner paid for the flat. Had the price been less by 15 per cent. or more than the fair market value, then probably they could have taken further steps in the matter, there would have been rebuttable presumption of attempt to evade tax, etc. This important exercise, as said above, was essential but was not resorted to and is conspicuously absent. Mr. Asokan' s submission noted earlier that earlier to the decision in the case of Vimal Agarwal [1994] 210 ITR 16 (Bom) there was no such practice is a lame excuse. We have mentioned above as to why the determination of the " fair market value" was necessary. It was necessary in the light of the judgment of the Supreme Court in the case of C. B. Gautam [1993] 199 ITR 530. So failure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is an admitted fact that the flat in question was acquired by respondent No. 3 as late as in March, 1985, for a consideration of Rs. 44,00,000. The vendor's application in Form No. 37EE was allowed and the Appropriate Authority did not take any steps and thereby indicated that they did not find the price lower than the " fair market value" . A few months thereafter, i.e., in October/November, 1985, the transaction in question took place. The petitioner showed in their books of account that they purchased the property for a sum of Rs. 46,00,000 then and took possession of the same also. The parties, however, did not complete the formality of the sale. The question is whether the transaction that took place till then showed an unusually lower price for the flat in question. The answer is in the negative. There was nothing on the record of the Appropriate Authority to draw a conclusion that within six months the market value of the property went up drastically. The parties probably out of abundant precaution and due to passage of time between October, 1985, till January 25, 1988, thought it fit to increase the consideration for the flat to Rs. 65,00,000. In addition to this apparent ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
