- (1.)This appeal has been preferred from an order passed by the High Court rejecting the writ application of the appellants in which the appellants had inter alia sought for a declaration that an order of purchase passed under section 269-UD of the Income tax Act, 1961 had stood abrogated by reason of the failure of the central government to pay or deposit the amount of consideration in terms of section 269-UG of the Act.
(2.)An agreement has been entered into between appellant no. 4 and the appellants 1 to 3 of whereby appellant no. 4 was to sell the property to the first three appellants for a consideration of Rs. 61 lakhs. The agreement to sell insofar as it is relevant reads thus: at present the vendor has kept a security person to maintain and guard the said property. The vendor undertake that, at the time of vacant and peaceful possession, the said security guard should be removed by the vendor at her own cost and responsibility. The vendor will handover the vacant and peaceful possession of the said property only after receiving the entire consideration of Rs. 61. 00. 000/ -.
(3.)Proceedings for pre-emptive purchase of the property were initiated under chapter-XX C of the Act by the respondents in respect of the transaction in question. The appellants were given an opportunity of being heard. They sought to justify the consideration at which the property had been sold before the appropriate authority. It was also drawn to the notice of the appropriate authority that the caretaker of the property was one Mr. Mohan K. Advani who was in possession of the property. In view of this statement, a copy of the show cause notice was issued under section 269-UD-1a of the Act to the said Advani. In response to the notice Advani claimed to be a tenant in respect of the property. However, when he was called upon to substantiate his claim before the appropriate authority, the said advani did not reply nor did he seek to produce any evidence whatsoever in support of his claim. A further notice was issued to the said Advani by the appropriate authority informing him that the authority proposed to hold that he (Advani) had no right/interest in the property and that the property would vest in the central government free from any encumbrances as far as Advani's claim was concerned after an order under section 269 UD (1) of the Act was passed for pre-emptive purchase of the property. There was no response to this letter by advani. Accordingly, an order was passed by the appropriate authority under section 269 UD (1) of the Act in which it was clearly recorded that Advani did not have any tenancy right in the property and that his claim of being appointed as a caretaker, or that his salary was being adjusted towards the rent of the property was ill-founded and not backed by any evidence. It was stated that it was beyond any "shadow of doubt" that advani had no legal right in the property. The appropriate authority ordered preemptive purchase of the property on 17. 05.2000 and directed;
"The central government shall pay, by way of consideration an amount of Rs. 58,45,441/ - (Rs. 50,000/- being share of the transferor in society's transfer fees) in accordance with the provisions of section 269 UF (1) of the income Tax Act, 1961 The said amount of consideration is to be paid to the transferor as she has been shown as the only person interested in consideration (ref. col. 13 of annexure to 37-1) while rendering the payment, the central government shall insist upon, among others, fulfilment of conditions contained in the agreement dated 31.10. 1999, particularly clause 3 of the agreement whereby the vendor is bound to handover peaceful and vacant possession to the purchaser. From today onwards the said P. U. C. shall vest in the central government free from all encumbrances. "