Supreme Court rules on discounting consideration: Value from agreement date, transfer fee refund ordered

The Supreme Court ruled in favor of the petitioner in a case challenging the discounting of apparent consideration and retention of transfer fee amount by the respondents. The court held that the discounted value should be calculated from the agreement date, rendering the previous view obsolete. It was determined that unascertained amounts like transfer fees could not be deducted from consideration. The court directed the respondents to refund the transfer fee amount to the petitioner with interest within eight weeks, with no order as to costs.

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Issues Involved:
Challenge to discounting of apparent consideration by respondents, challenge to retention of transfer fee amount by respondents.

Analysis:

*Challenge to Discounting of Apparent Consideration:*
The petitioner challenged the action of respondents in discounting the amount of apparent consideration by Rs. 40,291. The Tribunal noted that the payment was deferred, leading to the discount calculation. The court referred to previous judgments to determine the date for discounting, concluding that the date of the agreement should be considered. The Supreme Court clarified that the discounted value must be calculated from the agreement date. This rendered the previous view obsolete. Therefore, the discounted price should be determined based on the agreement date.

*Challenge to Retention of Transfer Fee Amount:*
The respondents retained Rs. 14,251 towards the vendor's liability for transfer fees. The court referred to a previous case where deductions from apparent consideration were discussed. It was noted that only deductions specified in the definition clause were permissible. The court emphasized that unascertained amounts could not be deducted. The judgment was further supported by a Division Bench ruling. The court concluded that the transfer fee was not statutory and, therefore, could not be deducted. The property vested in the Government free from encumbrances, eliminating the need for transfer fees. Consequently, the retention of the transfer fee amount was deemed unauthorized.

*Judgment:*
The court allowed the petition, directing the respondents to refund Rs. 14,251 to the petitioner with interest. The respondents were instructed to make the payment within eight weeks. The rule was made absolute partly, with no order as to costs.

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