Court quashes property valuation order, emphasizes reasons for decisions and proper valuation considerations.

The court quashed the order rejecting the property valuation and applying a specific pricing formula, directing authorities to reconsider the valuation with the engineers' report within three months. The court found the undervaluation to be marginal, not for tax evasion, emphasizing the importance of reasons supporting orders and preventing misapplication of the law. The petitioner's objection regarding non-disclosure of the market value assessed by engineers was upheld, highlighting the need for proper consideration in valuation exercises. The writ petition was disposed of with instructions to provide a certified copy of the order to the petitioner's counsel.

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Issues:
Challenge to the order rejecting property valuation and applying a specific formula for pricing.

Analysis:
The petitioner sought to quash an order rejecting their property valuation and applying a formula for pricing. The petitioner entered an agreement to purchase a residential plot, but the authorities alleged undervaluation. The contention was that the exercise of pre-emptive purchase was illegal and should be set aside. A preliminary objection was raised regarding the petitioner's locus standi, citing relevant case law. The court noted that the petitioner was given an opportunity to respond before the order was passed. The key issue was the validity of the impugned order, which relied on exemplars to determine the property's market value. The petitioner argued that the situation of the plots should also be considered, not just exemplars. Case law was cited to support the presumption of tax evasion in cases of significant undervaluation.

The court emphasized that the order must be supported by reasons and must not be perverse. It was crucial to consider if there was non-consideration of material, misreading of documents, or a wrong application of the law. The petitioner alleged that the authorities did not disclose the market value assessed by their engineers. The court found this to be a case of non-application of mind. A distinction was made between market value determination under the Land Acquisition Act and the Income-tax Act. The latter requires scrutiny to prevent tax evasion. The court reiterated the rebuttable presumption of tax evasion in cases of significant undervaluation.

Based on the Supreme Court's principles and the specific facts of the case, the court concluded that the authorities had not considered their own engineers' valuation. The court found the undervaluation to be marginal and not for tax evasion purposes. Consequently, the impugned order was quashed, and the authorities were directed to reconsider the valuation with the engineers' report within three months. The writ petition was disposed of accordingly, with directions for supplying a certified copy of the order to the petitioner's counsel.

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