9911796707
TMI Blog1994 (3) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... er sq. ft. Under the said agreement, it is recited that the petitioners paid the entire amount of Rs. 14,06,000, prior to the agreement dated July 12, 1993. The said amount was paid during the period commencing from June 24, 1993, up to July 8, 1993. The amount was paid without obtaining a no objection certificate under Chapter XX-C of the said Act, 1961. Even possession of the flat was handed over by respondent No. 5 to the petitioners. However, the date of possession has not been given in the agreement. The said date is not mentioned in the writ petition also. Under the said agreement, it was agreed that the parties shall sign the requisite Form No. 37-I under section 269UC of the Income-tax Act, 1961. At this stage, it may be mentioned that a bare perusal of the said agreement does not indicate that the vendor agreed to sell to each of the petitioners an undivided 1/3rd interest in the property. The said agreement does not show that the petitioners individually agreed to buy an undivided 1/3rd share in the property from the vendor. The entire agreement is one composite transaction. At this stage, it may be mentioned that, according to the petitioners, respondent No. 5 had decide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the rate of Rs. 1,093 per sq. ft. which is the rate under the agreement in question was less than the market rate of the property prevailing in that area as indicated by the above two sale instances. The appropriate authority accordingly came to the conclusion that the market rate of the property was Rs. 1,616 per sq. ft. and when compared to the rate under the agreement in question being Rs. 1,093 per sq. ft., there is undervaluation by more than 15 per cent. Before coming to the contentions advanced on behalf of the petitioners, we may mention that we are not inclined to interfere under article 226 of the Constitution in this matter. Firstly, the facts mentioned hereinabove indicate that even prior to the agreement in question, which is executed on July 12, 1993, the petitioners paid the entire consideration amount to the vendor. The petitioners were in fact put in possession by the vendor. However, they have not disclosed the date on which they were put in possession by the vendor. The petitioners, therefore, paid the consideration amount and got possession without obtaining a no objection certificate under Chapter XX-C of the Act. Moreover, Form No. 37-I was executed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, therefore, the appropriate authority erred in drawing the said conclusion, by placing reliance on the auction sale held on September 8, 1993. We do not see any merit in the said contention. The agreement in question was executed on July 12, 1993. The auction sale of flat No. 4 took place on September 8, 1993. The agreement covered by the auction sale was prior to the auction sale. At the auction sale, the rate which the Department could take in respect of the flat No. 4 was Rs. 1,585 sq. ft. In the circumstances, it is clear that the auction sale which took place on September 8, 1993, clearly indicated the market rate of the property. Mr. Mistry vehemently urged that in the present case in a rising market, prices will rise in steps. In the present case, there is no evidence to show that prices in Pune have increased by more than 30 per cent. in two months as is contended by the petitioner. Although the petitioners have filed their valuation reports, no sale instances have been furnished in support of the petitioners' contention that prices have increased by more than 30 per cent. between July, 1993, and September 8, 1993. Moreover, the second sale instance on which the approp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated hereinabove, the agreement in question dated July 12, 1993, is a composite agreement in respect of flat No. 10. There is nothing in the agreement in question which indicated that the petitioners-purchasers agreed to buy individually, an undivided 1/3rd share in the property from the vendor. Further, pursuant to the agreement in question, all the concerned parties themselves filed Form No. 37-I on July 27, 1993. In the circumstances, it is not open to the petitioners now to contend that section 269UD of the Income-tax Act has no application and that the appropriate authority had no jurisdiction. Moreover, there is nothing on record to indicate that the consideration for the purchase of each of their interests in the property was Rs. 4,68,667 as alleged. The valuation report dated June 20, 1993, does not support the petitioners' factual contention. On the contrary, a bare reading of the valuation report dated June 2, 1 submitted on behalf of the petitioners (page 62 of the writ petition) which contains a pro forma of the questionnaire in Form No. O-1, clearly shows that the petitioners purchased the property in joint-ownership and that their shares are undivided. In fact, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... below Rs. 10,00,000 and, therefore, it was held that Chapter XX-C of the Income-tax Act would not be attracted. In the circumstances, the ratio of the judgment of the Madras High Court in the case of K V. Kishore [1991] 189 ITR 264 does not apply to the facts of the present case. Similarly, the ratio of the judgment of the Madras High Court in the case of N. C. Rangesh [1991] 189 ITR 270 also does not apply to the facts of the present case. In the case of N. C. Rangesh A [1991) 189 ITR 270 (Mad), the petitioners challenged the constitutional validity of two circulars dated February 11, 1977 and May 29, 1989, issued by the Inspector-General of Registration to the effect that in cases where undivided interest in immovable property is sold, a certificate under section 230A of the Income-tax Act, 1961 or a no objection certificate under Chapter XX-C will have to be obtained if the value of the entire property happens to be more than Rs. 2,00,000 or Rs. 10,00,000, as the case may be. It was in this context that the Madras High Court ruled that when an undivided share is sold under a valid sale deed or under a valid agreement of sale for a consideration which is below the limit prescribe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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