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TMI Blog2002 (11) TMI 61X X X X Extracts X X X X X X X X Extracts X X X X ..... jection certificate by the appropriate authority, and within ninety days of the receipt of all necessary and requisite permissions, no objections and clearances, the balance sale consideration of Rs. 1.95 crores was to be paid and simultaneously peaceful vacant physical possession of the property was to be delivered to the vendee. On the same day, the petitioner and respondents Nos. 2 to 4 filed a statement in Form No. 37-1 along with the agreement to sell, seeking no objection certificate from the appropriate authority. On November 8, 1996, the appropriate authority issued a notice under section 269UD(1A) of the Act to the petitioner and respondents Nos. 2 to 4, stating that the apparent consideration of Rs. 2.76 crores in respect of the subject property is considered low when compared with property No. 20, Road No. 75, Punjabi Bagh, New Delhi, hereinafter referred to as the sale instance". The relevant portion of the notice reads as under : "The apparent consideration so declared appears to be low when compared with the sale instance of property No. 20, Road No. 75, Punjabi Bagh, New Delhi (Case No. R-5086), with date of agreement to sell of July 22, 1996, where the parties ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... None of the pleas of the objectors found favour with the appropriate authority. Upon consideration of the submissions made and noticing that the petitioner's sale instance was not comparable with the subject property, being a sale transaction of August 1995, whereafter there had been substantial increase in the real estate value and located in East Punjabi Bagh, the appropriate authority held that the subject transaction was made for less than the market price and it was done with a view to avoid tax and in that view of the matter, the appropriate authority considered it to be a fit case to make pre-emptive purchase by the Central Government of the subject property under section 269UD of the Act, at a discounted value of Rs. 2,55,14,000. Hence, the present petition by the transferee. The impugned order is challenged as arbitrary and vindictive mainly on the grounds that : (i) the adjustments made in the value of the sale instance and the subject property on account of disadvantages were without any basis; (ii) the comparable petitioner's sale instance, more proximate to the subject property, had been ignored ; (iii) the petitioner was neither confronted with the inspection repor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reiterating the aforenoted grounds urged in the petition, has mainly contended that the subject property having been compared with an incomparable property and the petitioner's sale instance having been ignored, the impugned order is unsustainable. It is also asserted that the basis for determining the fair market value of the property having not been disclosed to the petitioner, the impugned order is otherwise bad in law being violative of the principles of natural justice. In support of the proposition that the impugned order is ab initio illegal because the petitioner's sale instance has been ignored and the sale instance relied upon is not comparable, learned counsel has placed reliance on Ashok Kumar Sood v. Deputy CIT [1995] 216 ITR 193 (All) ; Mrs. N. Santhiyavalli v. Union of India [2001] 247 ITR 430 (Mad), Natvarlal Dayarjibhai Patel v. Union of India [1996] 218 ITR 226 (Guj) ; Vimal Agarwal v. Appropriate Authority [1994] 210 ITR 16 (Bom). Strong reliance is also placed on a recent decision of the Calcutta High Court in I. T. C. Ltd. v. Appropriate Authority [2002] 257 ITR 495 to support the plea that failure to confront the party with the valuation report vitiates the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voked when the ostensible sale consideration of the immovable property is less than its fair market value by 15 per cent. or more. It is also observed that in such a case the appropriate authority is entitled to draw a presumption that the undervaluation has been done with a view to evade tax but the presumption is rebuttable and the intending transferor or the prospective transferee can show that there was a bona fide consideration which induced the former to agree to sell the property at less than the fair market value because of certain peculiar or special circumstances. It is pertinent to note that in the originally enacted provision and prior to the decision of the apex court in C. B. Gautam's case [1993] 199 ITR 530, even the requirement of giving an opportunity of being heard to the parties concerned or recording of reasons for the purchase of the property, was not the requirement in the said Chapter. It was only by virtue of the insertion of sub-section (1A) with effect from November 17, 1992, that a reasonable opportunity of being heard is to be granted to the transferor, the person in occupation of the property, the transferee and to every other person whom the appropriat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to consideration. In Smt. Sudha Patil's case [1999] 235 ITR 118 (SC), dealing with the same provisions and taking note of the aforenoted observations in Mrs. Kailash Suneja's case [1998] 231 ITR 318 (Delhi), their Lordships of the Supreme Court have held that if on the materials on record two views are possible, one which has been given by the inferior Tribunal and the other which the High Court may, on examining the material, itself comes to the conclusion, then also it would not be possible for the High Court to substitute its conclusion for that of the Tribunal. It has been observed that merely because no appeal is provided for against the order of the appropriate authority, directing compulsory purchase by the Government, the supervisory power of the High Court does not get enlarged nor the High Court can exercise the appellate power. In Shri Sitaram Sugar Company Limited v. Union of India [1990] 3 SCC 223, 252 ; AIR 1990 SC 1277, a Constitution Bench of the Supreme Court observed thus : "Whether an order is characterised as legislative or administrative or quasi-judicial, or, whether it is a determination of law or fact, the judgment of the expert body, entrusted with power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner has laid emphasis on two issues, namely, (1) the determination of the fair market value of the subject property being without proper basis inasmuch as it has been compared with an incomparable instance and the comparable instance cited by the petitioner has been ignored, and (2) the valuation report of the subject property prepared by the Valuation Officer was not supplied to the petitioner and thus, violating the principles of natural justice. Taking the second point first, in the light of the affidavit filed by Shri S. K. Ray, Member (Judicial), appropriate authority, to the effect that at no point of time during the proceedings under Chapter XX-C before the appropriate authority, the petitioner or any other party had ever complained about the non-supply of the valuation report, it is now too late in the day for the petitioner to make a complaint on that score. We have carefully scrutinised the written objections filed by the petitioner to the show cause notice. No such request was made therein. Besides, the afore-extracted portion of the show cause notice clearly indicates the basis for arriving at the fair market value of the subject property and the petitioner h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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