Discounting deferred sale consideration under Chapter XX-C is mandatory when payment is postponed beyond the agreement date.

Where an agreement for transfer defers part of the sale consideration beyond the date of the agreement, section 269UA(b) requires that deferred amount to be discounted for determining the apparent consideration under Chapter XX-C. The statutory scheme allows the Central Government to purchase the property only for the apparent consideration, and the timing of actual payment by the Government does not alter the discounting exercise. The analysis follows earlier decisions upholding discounting of deferred consideration, and the challenge to the constitutional validity of Chapter XX-C was not entertained in view of binding Supreme Court authority. The writ petition was rejected.

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Issues: Whether the appropriate authority was justified in discounting the deferred balance of sale consideration while determining the apparent consideration under Chapter XX-C of the Income-tax Act, 1961.

Analysis: The agreement provided for part payment on execution and the balance after receipt of the no-objection or approval under Chapter XX-C. Under section 269UD, the Central Government could purchase the property only for the amount of apparent consideration, and section 269UA(b) required that where any part of the consideration was payable after the date of the agreement, its value be taken at the discounted value as on the date of the agreement. The agreed postponement of payment attracted the statutory discounting mechanism, and the timing of actual payment by the Government was irrelevant. The reasoning applied in earlier decisions upholding discounting of deferred consideration was followed, and the challenge to the constitutional validity of Chapter XX-C could not be entertained in view of binding Supreme Court authority.

Conclusion: The discounting of the deferred amount was valid and in accordance with law, and the petitioner's challenge failed.

Final Conclusion: The writ petition was rejected because the impugned order correctly determined the apparent consideration by discounting the deferred contractual payment under the statutory scheme.

Ratio Decidendi: Where an agreement for transfer stipulates that part of the sale consideration is payable after the date of the agreement, section 269UA(b) mandates discounting of that deferred amount for determining apparent consideration under Chapter XX-C.

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