Completed compulsory purchase and intervening third-party rights bar writ interference despite alleged natural justice defects.

A completed compulsory purchase under section 269UD was not disturbed in writ jurisdiction despite complaints of natural justice, because possession had been delivered, consideration accepted, and the petitioners had withdrawn the deposited amount. The Court applied the settled exception that completed transactions and properties already dealt with through public auction or by third parties should not ordinarily be unsettled under article 226. As third parties had acquired and developed the property and the petitioners had not effectively protected their position, relief was refused and the impugned purchase order was left undisturbed.

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Issues: (i) Whether the order of compulsory purchase under section 269UD of the Income-tax Act, 1961 was liable to be quashed for non-compliance with the principles of natural justice. (ii) Whether relief under article 226 of the Constitution of India should be refused on the ground that the transaction had become completed and third-party rights had intervened.

Issue (i): Whether the order of compulsory purchase under section 269UD of the Income-tax Act, 1961 was liable to be quashed for non-compliance with the principles of natural justice.

Analysis: The challenge was founded on the absence of hearing before the purchase order and the absence of communication of a reasoned order. The Court, however, treated the matter as one in which subsequent events had materially altered the position: possession had been delivered, consideration had been accepted, the petitioners had withdrawn the amount deposited by them, and the property had later been auctioned and substantially dealt with by third parties. In that setting, the Court declined to disturb the purchase order in exercise of writ jurisdiction.

Conclusion: The challenge to the purchase order was not accepted.

Issue (ii): Whether relief under article 226 of the Constitution of India should be refused on the ground that the transaction had become completed and third-party rights had intervened.

Analysis: The Court applied the qualification stated in the governing precedent that completed transactions and properties already sold in public auction are not to be unsettled. It found that the transferor had voluntarily handed over possession, accepted the apparent consideration without protest, the petitioners had not complied with the conditions for continuing interim protection, and third parties had acquired and developed the property. These facts brought the case within the exceptions where interference was not warranted, particularly when the petitioners had pursued the litigation without effectively protecting their own position.

Conclusion: Relief under article 226 was refused because the matter involved a completed transaction with intervening third-party rights.

Final Conclusion: The impugned compulsory purchase was left undisturbed, and the writ petition failed for want of a fit case for writ intervention.

Ratio Decidendi: Where a compulsory purchase transaction has been substantially completed, possession and consideration have passed without protest, and third parties have acquired interests or developed the property, writ jurisdiction will ordinarily not be exercised to unsettle the transaction notwithstanding complaints of procedural infirmity.

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