9911796707
TMI Blog2000 (11) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... by respondents Nos. 4 to 6 to the petitioner at the time of execution and registration of the sale deed. As on September 30, 1986, Chapter XX-A of the Income-tax Act, 1961 (hereinafter referred to as "the Act", for short) held the field. This Chapter titled "Acquisition of immovable properties in certain cases of transfer to counteract evasion of tax" lays down various provisions as per which "certain transactions" relating to immovable property are to be registered with the competent authority and where the competent authority has reason to believe that any immovable property of the fair market value exceeding Rs. 1 lakh has been transferred by any person to another person for an apparent consideration which is less than the fair market value of the property and that the consideration for such transfer as agreed between the parties has not been duly stated in the instrument of transfer with the object of facilitating the reduction or evasion of the liability of the transferor to pay tax, etc., the competent authority may initiate acquisition of such property and the manner in which the property can be acquired is enumerated in different provisions of Chapter XX-A. Significantl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le inasmuch as the provisions of this Chapter came into force only With effect from October 1, 1986, and would not govern the transaction in question which is dated September 30, 1986. The contention raised in the writ petition is that as on September 30, 1986, Chapter XX-A was applicable to transactions regarding the immovable property and therefore the impugned order passed applying the provisions contained in Chapter XX-C is without jurisdiction and a nullity. Learned counsel for the petitioner, during the course of arguments submitted that even the agreement of sale dated August 30, 1986, was a "transfer" of an immovable property as per clause (b) of sub-section (1) of section 269AB which falls in Chapter XX-A. In support of this proposition, reliance was placed on the following judgments: (i) Captain Sanjeev Sethi v. Union of India [1992] 195 ITR 338 (Delhi); (ii) Multi Rise Towers (P.) Ltd. v. Appropriate Authority [1995] 211 ITR 102 (Cal); and (iii) Sunshine Travels and Tours P. Ltd. v. Union of India [1995] 213 ITR 749 (Delhi). The respondent/income-tax authorities filed their counter affidavit in which it is stressed that the provisions of Chapter XX-C would be appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " namely, either to pass an order under section 269UD of the Act for purchase of the property or to issue no objection certificate under Chapter XX-C and the "appropriate authority" had no other option and could not even go into the validity of the agreement. Learned counsel also relied upon the recent judgment of the apex court in the case of DLF Universal Limited v. Appropriate Authority [2000] 243 ITR 730 for the proposition that since the agreement for transfer has to be reduced in writing in Form No. 37-I the date of agreement had to be treated when this form is submitted and therefore the date of agreement for transfer had to be treated as October 13, 1986, when the form was in fact submitted and the provisions of Chapter XX-C thus clearly became applicable in the instant case. It is clear from the aforesaid narration of facts and the submissions made by both the parties that the question to be determined is as to whether the provisions of Chapter XX-C are applicable to the transaction in question and this transaction would be governed by Chapter XX-A of the Act. As noticed above, there is no dispute that the agreement to sell is dated September 30, 1986, and as on that d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er XX-A) which reads as under: "'transfer',-- (i) in relation to any immovable property referred to in sub-clause (i) of clause (e), means transfer of such property by way of sale or exchange or lease for a term of not less than twelve years, and includes allowing the possession of such property to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882). Explanation.--For the purposes of this sub-clause, a lease which provides for the extension of the term thereof by a further term or terms shall be deemed to be a lease for a term of not less than twelve years if the aggregate of the term for which such lease has been granted and the further term or terms for which it can be so extended is not less than twelve years; (ii) in relation to any immovable property of the nature referred to in sub-clause (ii) of clause (e), means the doing of anything (whether by way of transfer of shares in a co-operative society or company or by way of any agreement or arrangement or in any other manner whatsoever) which has the effect of transferring, or enabling the enjoyment of, such property." Sub-claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eries of events, involving litigations took place subsequently. An order also came to be passed under section 269UD(l) under Chapter XX-C ordering the purchase of a flat by the Central Government: this was challenged before this court. This court held that, the sale of the flat leading to the impugned order under section 269UD was in effect, giving effect to the agreements of the year 1979 and, therefore, Chapter XX-C was not applicable to the transaction. All the subsequent events which happened after the year 1979, were traced to the agreement of the year 1979, though another builder had stepped into the shoes of the original builder, but the right to the allotment of the flats under the earlier agreement continued to exist. Further it was held that since Chapter XX-C was not attracted, rule 48L also was not applicable and that the said rule had no retrospective operation and would not govern an agreement entered into prior to October 1, 1986 (the date when Chapter XX-C came into force), "specially to such cases where the provisions of Chapter XX-A were applicable like the present case". This High Court had occasion to deal with the same question in the case of Sunshine Travels ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct or under section 269AB. After this period of nine months, power to initiate proceedings under Chapter XX-A ceases. Other provisions provide for the filing of objections to the notice and hearing of objections, making an order of acquisition, filing of an appeal and further appeal against the order, vesting of property in the Central Government, etc. Chapter XX-A is a self-contained code governing these 'transfers' as defined in section 269A(e). The difficulty of understanding the concept of 'transfer' as defined in section 269A(h), is the difficulty due to the abstract rights covered by the statutory definitions. If the scope of Chapter XX-A becomes clear and a transaction falls within its net, no argument is needed to conclude that Chapter XX-C would not govern such a transaction, provided the transaction is prior to the date of the coming into force of Chapter XK-C. The width of the relevant terms referred to in these two Chapters, is almost the same. The term 'immovable properties' is defined in section 269UA(d); sub-clause. (ii) is on par with section 269A(e) ; similarly, the concept of 'transfer' defined as per section 269UA(f) in Chapter XX-C is broadly similar to the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to here, is not a transfer as ordinarily understood and this term is not confined to the 'transfers' referred to in the Transfer of Property Act. The term has a wider connotation-both under section 269UA(f) and section 269A(h), read with the relevant definitions." To the same effect is the judgment of the Calcutta High Court in the case of Multi Rise Towers [1995] 211 ITR 102. This judgment relies upon the case of Capt. Sanjeev Sethi [1992] 195 ITR 338 decided by this court. In view of the mandate laid down in the aforesaid judgments it is clear that the transaction in question evidenced by an agreement dated September 30, 1986, is the one which is covered by the provisions of section 269AB of the Act which falls under Chapter XX-A and, therefore, the provisions of Chapter XX-A would be attracted in this case. In view of this conclusion, the argument of the Revenue that the transaction falls within the provisions of Chapter XX-C has no merit. Once we arrive at the conclusion that the provisions of Chapter XX-A of the Act would be applicable to the transaction in question, the act of submitting the application in Form No. 37-I of the Act would be inconsequential. If the provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as respondents Nos. 4 to 6 by moving an application under Order I, rule 10 of the Code of Civil Procedure. Their grievance is that in view of the litigation between the petitioner and respondents Nos. 1 to 3, they were deprived of the balance sale consideration of Rs.15 lakhs and therefore, they may be granted interest at the commercial rate either by the petitioner or by the "appropriate authority". It may be stated at this stage that by order dated December 23, 1986, impugned decision dated December 15, 1986, was stayed. Thereafter, on January 27, 1987, further order was passed to maintain status quo in respect of the property as amongst the parties. Respondents Nos. 4 to 6 had moved C. M. No. 1951 of 1999 praying for modification of order dated January 27, 1987, and seeking direction to the petitioners to pay the sum of Rs.15 lakhs as condition of stay. The order dated March 19, 1991, was passed directing the petitioner to deposit the amount of Rs.15 lakhs out of which a sum of Rs.13.50 lakhs was paid to respondents Nos. 4 to 6. This amount was received by respondents Nos. 4 to 6 on November 1, 1991. Therefore, in these circumstances, respondents Nos. 4 to 6 have prayed for paym ..... X X X X Extracts X X X X X X X X Extracts X X X X
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