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TMI Blog1996 (6) TMI 39X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961 (hereinafter referred to as " the Act "), with the Appropriate Authority and that if no order for the purchase of the said land by the Central Government is made by the Appropriate Authority, then Crawford Bayley and Co., Advocates and Solicitors, would pay the said sum of Rs. 50 lakhs to the owners. The agreement also provided that if such an order for purchase of the said land is made by the Appropriate Authority, then Crawford Bayley and Co., shall pay the said sum of Rs. 50 lakhs to the developers/purchaser. The agreement also mentions that the owners have filed a declaration under section 6 of the Urban Land (Ceiling and Regulation) Act, 1976, and have applied to the Government of Maharashtra under section 20 of the said Act for exemption of the said land from the provisions of Chapter III of the said Act and will also apply under section 21 for permission of the competent authority to enable the owners to develop the said land for weaker sections of the society. It is also stated that the owners filled in Form No. 37-I under the Act and finally on November 29, 1989, by the impugned order (exhibit " C ") the Appropriate Authority decided that the said property be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en out by the petitioners and by an order dated February 19, 1993, the petitioners were allowed to add respondents Nos. 7 to 13 as party respondents to the writ petition. In August, 1993, the petitioners took out Notice of Motion No. 426 of 1993, for restraining the auction purchaser-respondent No. 7--from constructing and/or developing the said land and/or from creating third party rights. That notice of motion was heard by a Division Bench and oh November 26, 1993, after considering the various contentions raised therein, the court ordered as under : " 12. After hearing counsel for the parties we are of the opinion that having regard to the amended prayers in the writ petition which are required to be examined in the light of the decision of the Supreme Court in Gautam's case [1993] 199 ITR 530, it would be appropriate to maintain status quo as of today. But, however, the petitioners-applicants cannot be granted interim relief and status quo order without any condition. We accordingly grant reliefs in terms of prayers (a) and (b), on condition that the applicants/writ petitioners deposit in this court with the prothonotary and senior master a sum of Rs. 75,00,000 (seventy fiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... void as it violates principles of natural justice, it is required to be quashed and set aside and respondents Nos. 1 to 5 be directed to follow the prescribed procedure. As against this, learned counsel for the respondents submitted that this would not be a fit case for exercise of writ jurisdiction under article 226 of the Constitution, especially looking to the conduct of the petitioners and taking into consideration the fact that it is a completed transaction as observed by the Supreme Court in C. B. Gautam's case [1993] 199 ITR 530. In our view, the contention raised by learned counsel for the respondents requires to be accepted considering the following facts : (a) On December 15, 1989, respondent No. 6 voluntarily handed over possession of the land in dispute in question to respondents Nos. 3 to 5 ; (b) On February 2, 1990, respondent No. 6 accepted the amount of apparent consideration without any protest ; the payment of the amount was delayed by one month or thereabout because the court had granted ad interim relief restraining respondents Nos. 1 to 5 from making any payment of the apparent consideration to respondent No. 6 by order dated December 29, 1989; (c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s raised in the petition. As stated earlier, that order was challenged by filing a special leave petition before the Supreme Court which was dismissed. (g) Thereafter, the petitioners took out Notice of Motion No. 426 of 1993. That notice of motion came up for hearing before a Division Bench of this court. In its order dated November 26, 1993, the court has noted the decision rendered by the Supreme Court in the case of C. B. Gautam v. Union of India [1993] 199 ITR 530 as also the decision rendered by the High Court of Karnataka in Appropriate Authority v. Mass Traders Pvt. Ltd. [1993] 202 ITR 741 and after considering the same the court directed the petitioners to deposit a sum of Rs. 1,42,50,000 as a condition precedent for grant of interim stay as prayed for in paragraphs (a) and (b) of the notice of motion. (h) Even though time was, given to the petitioners to deposit the amount, they did not deposit the amount and, therefore, interim order stood vacated. Against that order, the petitioners preferred Special Leave Petition (Civil) No. 21932 of 1993, before the Supreme Court which was also dismissed. However, we would note at this stage that before the Supreme Court, an affi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 530 (SC), with regard to a completed transaction, the Supreme Court has clarified as under : " We may clarify that, as far as completed transactions are concerned, namely, where after the order of compulsory purchase under section 269UD of the Income-tax Act was made and possession has been taken over ; compensation was paid to the owner of the property and accepted without protest, we see no reason to upset those transactions and hence, nothing we have said in the judgment will invalidate such purchases. The same will be the position where public auctions have been held of the properties concerned and they are purchased by third parties. In those cases also, nothing which we have stated in this judgment will invalidate the purchase. " In the present case, admittedly, the agreement was executed on September 5, 1989 the order of compulsory purchase was passed on November 29, 1989 the possession was handed over by vendor-respondent No. 6 on December 15, 1989, without any protest ; thereafter on December 27, 1989, this petition was filed challenging the validity of the order of compulsory purchase ; on December 27, 1989, ad interim relief was granted by the court ; further on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, it cannot be said to be a completed transaction covered by the clarification made by the Supreme Court in C. B. Gautam's case [1993] 199 ITR 530. This submission is required to be rejected even by taking into consideration the fact that the petitioners themselves had on February 13, 1990, withdrawn the amount of Rs. 50 lakhs deposited by them with the solicitors for respondent No. 6. Learned counsel for the petitioners further contended that in the present case the court has specifically directed that the purchasers should be informed that a writ petition challenging the order of compulsory purchase was pending before the court and, therefore, purchase by the purchasers at the time of auction would be subject to the result of the petition. It is, true that in normal circumstances when a person knowing about the pending litigation enters into a sale transaction, then it must be subject to the consequences and the result of the petition. But in the present case, there is no question of applying that normal rule because it falls within the exceptions carved out by the Supreme Court in C. B. Gautam's case [1993] 199 ITR 530, for not giving the benefit of the law laid down by the c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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