S.L. Saraf, J. - (1.) BY this writ petition, the petitioner seeks a writ of certiorari praying for quashing of the order dated September 12, 1994, passed under Section 269UD of the Income-tax Act, 1961, whereby the appropriate authority had passed an order for pre-emptive sale of the property being Plot No. 404, Sector-XVA, Noida district, Ghaziabad. The petitioner further prays that the respondents be directed not to take possession of the property in question.
(2.) THE writ petitioners jointly agreed to purchase the aforesaid property on July 25, 1991, for Rs. 14,50,000. A sum of Rs. 4,35,000 was paid by the petitioners to the said respondent No. 3 and it was agreed that balance of Rs. 10,15,000 will be paid on execution and registration of the sale deed by the buyer to the seller. THEreafter, the petitioner sought permission for transfer of the land under Section 269UD of the Income-tax Act in the prescribed form from the appropriate authority. On October 28, 1991, the valuer of the Income-tax Department had directed the petitioners to produce certain documents relating to the property in question. THE said direction of the Valuation Officer was complied with by the petitioner. On December 17, 1991, the petitioners received an order from the appropriate authority informing the petitioners that their property had been acquired for purchase by the Central Government under Section 269UD(1) of the Income-tax Act, 1961, and had become vested in the Central Government from that date. Another order was passed on December 16, 1991, and was also sent to the seller, Sri Manoj Lal, respondent No. 3, calling upon him to deliver possession of the aforesaid property within 15 days to the Central Government. The Valuation Officer, Meerut, was directed to take over the aforesaid property, i.e., Plot No. 404, Sector-XVA, Noida, vide letter dated December 17, 1991. As no opportunity was afforded to the petitioner before acquiring the said property, the petitioners moved this court, This court, vide its judgment and order dated July 19, 1994, was pleased to direct the authorities concerned to decide the case of the petitioners after affording an opportunity of hearing to the petitioners. Pursuant to the orders of this court, the respondents issued a show-cause notice as to why Plot No. 404, Sector XV-A, Noida, be not acquired by the Central Government under the provisions of Chapter XX-C of the Income-tax Act, 1961. Along with the said show-cause notice, the valuation report was also furnished to the petitioners. In reply to the said show-cause notice the petitioners made representations before the authorities on September 6, 1994. The petitioners challenged the vesting of the said property under the provisions of Section 269UD, inter alia, on several grounds. It was stated that the basis of the prevailing market price was totally incorrect and illogical. The said property was valued at a very high rate instead of the actual market price. The Valuation Officer wrongly and arbitrarily took the date of valuation as the 31st December, 1991, i.e., five months after the date of agreement between the parties in the instant case. Secondly, it was urged that no copy of the survey report and/or inquiry report of any property dealers were ever served upon the petitioners. Neither the name nor the addresses nor eligibility or competence of such dealers were disclosed to the petitioners making it impossible for the petitioners to make proper representations. The allegations contained in the inquiry report were too vague to be answered. The respondents did not disclose the rate provided by the property dealers for similarly situated plots of the said area. It was further contended that no factual evidence was adduced by the Valuation Officer in the report which could determine such a major decision. Thirdly, it was contended that Plot No. 241 which was sold at the same time and was of the same size was not comparable to plot No. 404 of the petitioners particularly in view of the fact that Plot No. 241 was on an 18 metre wide road and a number of properties has already been developed in that locality. It was better placed whereas Plot No. 404 of the petitioners was on a non-developed area of the said block and was on a very narrow road. According to the petitioners, the comparable plots which were sold during the said period were Plot Nos. 238, 80, 146 and 379. All the aforesaid plots were of the same size and in the said block. None of the plots sold during the said period fetched a better price than that at which the petitioners agreed to purchase the said property. According to the petitioners, the rate prevailing for the said plots ranged between Rs. 1,800 and Rs. 2,700, whereas the petitioners finalised the negotiation at Rs. 3,200 per sq. mtr. The valuation report was biased and based on hearsay without any relation and nexus with the prevailing market rate. The report as such was arbitrary and based on erroneous and irrelevant considerations. For better appreciation of the case, the petitioners submitted as annexure "4" the details of registrations done of several plots during the said period. The same are set out hereinbelow : The details of registrations done at the office of the Sub-Registrar, Noida, of residential plots in Sector-XV-A., Noida, during the year 1991 : JUDGEMENT_330_ITR226_1997Html1.htm
(3.) THE appropriate authority subsequently heard the matter and disposed of the representations of the petitioners by confirming the order of preemptive purchase of Plot No. 404 and rejecting the representations of the petitioners primarily holding that for arriving at the fair market value of land/building rates prevailing at a particular time, the officials do make enquiries from various property dealers and other connected persons before coming to their decision. This is not an unusual methodology. However, in this case the Valuation Officer had cited a definite case of sale transaction of a similar sized plot in the same sector. He had then arrived at the fair market value of the instant property. THE cases cited by the transferor are not for comparable areas/cost indicated therein and as such the appropriate authority did not have any chance to examine these cases. Further, one of the cases cited by the petitioners being Plot No. 238 having a better location was not considered as a comparable case in view of the fact that the transaction was prior to the jurisdiction having come under the purview of the appropriate authority. The date on which the jurisdiction and powers were conferred upon the appropriate authority was April 1, 1991, whereas the said sale took place on February 4, 1991.;