TaxTMI 
TaxTMI 
1976 (9) TMI 93
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....shwar Jha (11) Sri Binod Kumar Mishra (12) Smt. Malti Sah and (13) Miss Sumitra Kumari, the appellants before us in parts a plot of land at Exhibition Road, Patna, bearing no. 567/401 (New) and 316 (old) Circle No. 6, Ward No. 2, Sheet No. 31, Plot No. 762 with building (hereinafter referred to as the disputed property) for an aggregate apparent consideration of Rs. 1,85,000 on 5th Sept., 1973. The information relating to the aforesaid transfers was furnished to the Competent Authority under s. 269 P of the said Act by the Registering Officer, Bombay, in form No. 37G. The information in possession of the Competent Authority revealed that the property transferred consisted of a plot of land measuring about 17.85 kathas located at one corner of the crossing of Dak Bungalow Road and Exhibition Road having a frontage about 111 ft. 6" towards Dak Bungalow Road and 151 ft. towards Exhibition Road. This disputed property was sub-divided into 10 small plots of varying sizes leaving a proposed common lane in between the plots. These small plots were transferred to the different parties through different deeds. The Competent Authority has pointed out that this area is one of the best commerc....
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....eof by more than 15 per cent. The Competent Authority found that in case of each transfer the fair market value of the property was more than Rs. 25,000 and that the fair market value of the property exceeded the apparent consideration not only by more than 15 per cent or 25 per cent but by more than 3 to 5 times in different cases and that the gap between the apparent consideration and the fair market value in each case was very wide. The Competent Authority held that the conditions precedent imposed by s. 269C(1) of the said Act fully applied to the transactions in question. 5. The next objection raised by the transferees was that the proceedings are illegal and void as the mandatory provisions of s. 269D (2) of the said Act were not complied with. The competent authority held that the facts of the case do not support this contention as the notices were duly published in the Gazette of India and were also served on the parties and affixed in accordance with the manner prescribed in the said Act. 6. The next contention made by the transferees as well as the transferors was that the property was purchased at the most fair market price considering various factors applicable to thi....
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....ruly stated in the instrument of transfer with the object as referred to in cl. (a) or cl. (b) of sub-s. (1) of s. 269c. 11. The Competent Authority held that the fair market value of the disputed property exceeds the apparent consideration therefore by more than 25 per cent of such apparent consideration and so in accordance with the provisions of s. 269C(a) of the said Act he treated it as conclusive proof that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer. The Competent Authority also held that as the disputed property was transferred for an apparent consideration which is less than its fair market value, in view of the provisions of s. 269C(a) and (b) of the said Act, he presumed that this consideration for such transfer as agreed to between the parties was not truly stated in the instrument of transfer with such object as is referred to in cl. (a) or (b) of s. 269C. The Competent Authority, therefore, after obtaining the approval of the Commissioner of Income Tax, Bihar-I, Patna, as required by s. 269F, (6) (c) of the said Act passed the order for acquisition of the disputed property under Chapter ....
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....s of the Gazette India relating to Jan., March, 1974 and April-June, 1974. We find the notification under s. 269D(1) of the said Act at page 1045 of the Gazette of India dt. 2nd March, 1974 in Part-III, s.I which relates to the sale deed of Sardar Bahadur Singh, Appellant. The Gazette notification relating to the other transferees are to be found in Part-III s. I of the Gazette of India dt. 1st June, 1974 at pages 3452 which is in English and at pages 3397 to 3404 which is in Hindi. 15. The learned Counsel for the appellants has pointed out that in the Gazette of India notification dt. 2nd March,1974 relating to Sardar Bahadur Singh which is at page 1045 there are mistakes relating to the transferors as the name of only Sri Vijay Kumar and Smt. Urmila Devi have been mentioned although the other transferors are Sri Sanjay Kumar and Sri Vinay Kumar who are minor sons of Sri Vijay Kumar. The copy of the sale deed executed in favour of Sardar Bahadur Singh is on the record which was executed by Sri Vijay Kumar, son of Sri Newas Ram, Smt. Urmila Devi, wife of Sri Vijay Kumar and Sanjay Kumar and Sri Vinay Kumar were minors who, executed the sale deed through Vijay kumar, their father a....
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....as Ram instead of Newas Ram. However, we find that there is no mistake in the notification at page 3456. 20. The learned Counsel for the appellants has also referred to the notification at page 3457 relating to the sale deed in favour of Sri Kusheshwar Jha and Sri Vinod Kumar Mishra. In this case instead of Vinay Kumar son of Vijay Kumar it is printed as Vijay Kumar, son of Vijay Kumar. Thus, the mistake is there. 21. The learned Counsel for the appellants has also referred to the notification at page 3458 and he has pointed out that in this notification relating to the transferors the percentage of Sanjay Kumar and Vinay kumar has not been mentioned. We find that this defect is there. 22. The learned Counsel for the appellants has also referred to the notification at page 3480 relating to the transfer in favour of Smt. Jogendra Kaur. He has pointed out that in this case Smt. Jogendra Kaur is the transferee, but she has been shown as transferor and in the transferees Sri Vijay Kumar has been shown as son of Late Niwar Ram instead of Newas Ram and Sanjay Kumar and Vinay Kumar have been shown as sons of Vipay Kumar instead of Vijay Kumar and the transferors have been shown as tran....
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....eld that the purposes of notifications under s. 4 is to carry on a preliminary investigations with a view to finding out after necessary survey and taking of levels, and, if necessary, digging or boring into the sub-soil whether the land was adapted for the purpose for which it was sought to be acquired and that it is only under s. 6 that a firm declaration has to be made by Government that land with proper description and area so as to be identifiable is needed for a public purpose or for a company and that what was a mere proposal for acquisition under s.4 becomes the subject matter of a definite proceeding for acquisition under the Land Acquisition Act 1894. Their Lordships held that a defect in the notification under s. 4 is not fatal to the validity of the proceedings, particularly when the acquisition is for a company and the purpose has to be investigated under s. 5A or s. 40 necessarily after the notification under s. 4. The learned counsel for the appellants has submitted that in this case only the defect in the notification under s.4 was held not to be fatal to the validity of the proceedings and that this ruling does not refer to the notification under s. 6 of the Act wh....
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.... 27. Sri Rajgarhia also relied on the ruling reports in A.I.R.1970 Supreme Court at page 1188. From this ruling also it is evident that defects in the notifications under ss. 4 and 6 will not invalidate the proceedings. 28. We have pointed out the defects in the Gazette notifications which go to show that the mistakes are minor mistakes of printing and that only in the case of Smt. Jogindra Kaur she was shown as transferor instead of transferee. However, Sri Rajgarhia arguedthat when the original notice were sent for publication in the Gazette, the copies of those notifications were also sent to the transferors and the transferee and that there were not mistakes in the original notices and that the mistakes have taken place only in the Gazette notifications. This point was never challenged by the learned counsel for the appellants. Thus, we have to hold that the notices which were issued to the transferees and the transferors were correct notice giving correct details, but the mistakes have occurred in the Gazette notifications and thus the parties knew the correct state of affairs. Under such circumstances, we hold that the appellants were not prejudiced or misled by the Gazette....
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.... relating to the defects in the notifications which clearly goes to established that the proceedings had been initiated on the basis of the notices issued to them and which were published in the Gazette of India. Thus, we have to hold that the appellants were not prejudiced or misled by the notifications in the Gazette of India. 31. Sri B.P.Rajgarhia submitted that in two of the notifications the transferors have been shown as Vijay Kumar and Smt. Urmila Devi, But it cannot be doubted that Sri Vijay Kumar executed the sale deed on behalf his minor sons Sanjay Kumar and Vinay Kumarand so although the minors were not described in two of the notifications that cannot be a ground to hold that the notification were invalid. 32. Sri B.P.Rajgarhia relied on the case of Ram Pyari Devi saraogi vs. Commissioner of Income Tax, West Bengal & others (1) where their Lordships of the Supreme Court have held that the assessee had not in any way suffered from the failure of the Commissioner to indicate the results of the enquires the assessee would have full opportunity of showing to the Income-tax Officer whether the income assessed in the assessment orders which were originally passed was corre....
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....ompetent Authority and so the portions transferred to these two ladies cannot be acquired by the Competent Authority. We also find from the valuation report of the Executive Engineer (Valuation cell) of the IAC, Acquisition, Patna, that he also found this defect and he has pointed out that no reference was made to the Competent Authority by the Registration office relating to transferees Miss. Sumitra Kumari and Smt. Malti Sah. As the registrations amount was less than Rs. 10,000. But according to the valuation of the above plots comes to Rs. 27,500 each and so he suggested that necessary notices under s.269D may be served against these two transferees, if necessary. From the orders of the Competent Authority, it appears that the report was received on 11th Jan., 1974. However, in spite of it no action under s. 269D appears to have been taken against these two ladies. Hence, we hold that the plots sold to them separately by two sale deeds cannot be acquired as no valid initiations of proceeding took place against these two ladies. 36. The next argument which was advanced by the learned counsel for the appellants was to the effect that the notice was served against the appellants b....
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....Authority to clothe himself with jurisdiction thereunder. He contended that strict compliance of the provisions of the section is necessary to acquire jurisdiction thereunder. It was argued on behalf of the appellants that sub-s. (1) s. 269D provides for publication of a notice in the Official Gazette and sub-s. (2) provides for services of notice published under s.(1) on the transfer, transferee, etc. According the learned counsel for the appellants the publications of the notice under sub-s. (1) must necessarily proceed the service of the notice under sub-s. (2) as there can be no question of serving notice under sub-s. (2) so long as there does not exist a notice under sub-s. (1) published in official Gazette. The learned counsel for the Appellants argued that so long as a notice is not published in accordance with the provisions of sub-s. (1), the question of serving such a notice, which law does not exist, cannot simply arise. He further, contended that the procedure laid down in the section cannot be reversed and the premature service of notice under sub-s. (2), which is ab initio viod, cannot become valid on the subsequent publication of the notice under-sub-s. (1). He submi....
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....2) of the said Act was complied with. He has also submitted that as regards cl. (d) aforesaid the appellants cannot take a vague plea at the time of argument when no such plea was taken in the grounds of appeal. We hold that the publication as required under cl.(b) of s. 269D(2) was complied with and the learned counsel for the appellant is not entitled to take a vague plea at this stage when no such plea was taken earlier before the Competent Authority. 42. The learned counsel for the appellant has relied on the consolidated order dt. 2nd Dec.,1974 of the Income-tax Appellate Tribunal, Bombay Bench 'D' in I.T.A. Nos. 231 to 235 (Bom) of 1974-75. The learned Members of the aforesaid Tribunal have discussed this issue in paras 11 to 14 of the order which is to be found at pages 92 to 99 of the paper book. The learned Member of the Bombay Bench held that as sub-s.(2) provides for services of a notice under sub-s.(1) of s. 269D of the said Act, it necessarily follows that the service must be after publication of the Official Gazette and that the notice does not come into existence in the eye of law and there cannot therefore, be any question of serving a notice which does not exist a....
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....th the publications can be done simultaneously. For this purpose he has relied on the ruling reported in A.I.R 1962 Supreme Court at page 151 where there Lordships of the Supreme Court have held that a notification under sub.s.(1) of s.4 of the land Acquisition Act, 1894 in condition precedent to the making of notification under subs-s (1) of s.6 and that if the Govt takes a decision to make such a notification and thereafter takes two further decisions that is to dispense dispute which compliance with the provisions of s.5A and also to declare that the land comprised in the notification is in fact needed for a public purpose there is no departure from any provision of the law even though the two notifications are published on the same day. Their Lordships held that the preliminary declaration as well as the subsequent declarations are both required by law to be published in the official Gazette. But the law does not make the prior publications of notifications under sub-s.(1) of s. 4a condition precedent to the publication of a notification under sub-s.(1) of s.6 and that where s.5A is not in the way there is no irregularity in publishing those notification on the same day. 44. S....
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....sons who clearly have an interest in the property, the transferor, transferee, and the person in occupation and (b) on persons who, to the knowledge of the Competent Authority, are interest in the property; (iii) Publication of the notice on the notice board or other conspicuous place in the office; (iv) Publication of the notice by affixture of the notice on a conspicuous part of the property; (v) Publication of the substance of notice in the prescribed manner at convenient place in the locality. It has been pointed out in this order that every one of these modes of publication of intention to acquire is compulsory. The learned Vice President considered the question whether the statute contained a mandatory requirement that publication in the Official Gazette should come first and that, only after there is an actual publication in the Gazette, can further steps be validly taken. The learned vice president for the detailed reasons mentioned in the order came to a finding that the statute does not require that notice under s. 269D (2) must be issued only after the publications of the notice under s.269D (1) in the Gazette and that the mandatory requirements of the sections is th....
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....cause replies dt.1st Dec.,1973 which was received in the office of the competent Authority on 10th Dec.,1973. It was after this that the Competent Authority recorded his satisfaction on 31st Jan.,1974 and thereon 31st Jan.,1974 he ordered for issue of notices in English and Hindi for publication in the Gazette of India under s.269D(1)of the said Act. It appears that the copies of the notices were also forwarded to the transferors, transferees and the lady who was in possession of the building of the disputed property and then by order dt.18th April, 74 the case was ordered to be fixed on 2nd May, 74 for hearing and then on 2nd May, 74 Sri S.N. Khetan, Advocate, appeared for the transferees and transferees with written statement and he was heard and then by order dt.29th Aug., 74 Sri Khetan was ordered to be furnished with a copy of the Valuation Officer's report and the case was fixed on 16th Sept., 74 for hearing and then it was adjourned to 26th Sept.,74 on which date Sri S.N.Khetan, Advocate, appeared on behalf of the transferors and the transferees with written reply. This will be evident from the copy of the order sheet which has been filed by Sri B.P.Rajgarhia. We have also p....
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....ordinate Judge, Patna and the entire disputed holding was in the possession of a tenant since more than 25 years on a meagre monthly rent of Rs. 116 and this return was uneconomic. The entire disputed holding was under Patna Development Expansion Scheme resulting in the reduction of the area of the holding by about 10 per cent.The purchasers could not receive vacant physical possession of the properties or any part thereof. Even the written objections filed on behalf of the transferees before the Competent Authority by Sri.S.N.Khetan were also to the same effect. The transferees also pleaded that there was no basis for the assumption that the fair market value of any of the properties exceeded the consideration thereof by more than 15 per cent of such consideration. The transferees also contended that the properties in question were purchased on the most fair market price considering the nature of the encumbrance conditions, Govt.' s future planning and other aspects of the property and under the prevailing situation and present position of the property it could not have fetched a higher price. It was pointed out that the properties in question were parts of a big plot of land havi....
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.... Competent Authority for a copy of the Departmental Valuation Officer which was furnished to him and then on 26th Sept., 1974 Sri Khetan on behalf of the transferees and the transferors appeared and filed a common written reply and he also furnished a valuation report from an approved and registered valuer, namely, Sri A.K.Mitra. In this written reply it was contended that the method of valuation adopted by the Valuation Officer of the Department was most unscientific and did not give a correct assessment of the property. It was pleaded that the Valuation Officer overlooked the fact that the entire plot was purchased by different persons of different castes and of different religions and trade and it was wrong to imagine a hypothetical plan treating the property as a single unit. It was also pleaded before the Competent Authority that the valuation of land at Rs. 36,000 per katha had no bearing with the reality as construction of a multi-storeyed building may take at least 10years an so the ultimate cost of the property was not determinable at this stage. It was also submitted that in determining the price of the land all relevant factors should be considered. It was also submitted....
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....the sale deed executed by Smt. Champa Devi and her family members in favour of Sri.S. Mehta is to be found in the file of the Competent Authority relating to Sri S.J. Mehta. As regards Smt. Malti Sah, the learned counsel for the appellants has filed the sale deed executed by Sri Vijay Kumar and his family members. However, the sale deed executed by Smt. Champa Devi and her family member is to be found in the file of the Competent Authority relating to Smt. Lalita Todi. As regards Miss Sumitra Kumari and Sardar Harbhajan Singh, the learned counsel for the appellants has filed only the sale deed executed by Smt.Champa Devi and her family members. The sale deeds executed by Sri Vijay Kumar and his family members relating to Miss. Sumitra Kumari & Sardar Harbhajan Singh are not to be found even in the files of the Competent Authority. However, it is conceded by both the parties that both the sets of vendors have executed the sale deeds in favour of each set of transferees It is also conceded by both the parties that another sale deed was executed jointly in favour of all the 12 transferees. This will be evident from page 33 of the paper book filed by the learned counsel for the appella....
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....ar Jha and Binod Kumar Mishra which shows that before the competent Authority they took the plea as mentioned by the Competent authority. This copy of the petition is at pages 25 to 30 of the paper book. In this petition in para 4 it has been clearly mentioned that all the 13 appellants purchased the property from Vijay Kumar, his wife and sons at Rs. 1,85,000 which included the amount of Rs. 15,000 for the damaged house. The learned counsel for the appellants has also filed a copy of the petition which was filed by 11 of the appellants jointly on 1st Dec., 73 before the Competent Authority which is at pages 31 to 33 of the paper book and in this petition it has been pointed out that the petitioners have paid altogether Rs. 2,85,000 to the two sets of the purchasers as the sale price of the disputed property. It has also been pleaded in it that the appellants had purchased the property in question with an incumbrance of litigation brought by Smt. Champa Devi and others alleged to be a widow of late Sri Newas Ram who claimed their right and title in the property and so the appellants settled their issues and in order to have peaceful and quick enjoyment of the property and so a cons....
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....nd Exhibition Road having a frontage of 111 ft.6" towards Dak Bungalow Road and 151 ft. towards Exhibition Road. He has also pointed out that this entire plot has been sub-divided in 10 small plots of verying sizes leaving a proposed common lane in between the plots. He has also mentioned that these small plots have been transferred to 10 different parties in 10 separate sale deeds. He has also pointed out that this area is one of the most busy commercial areas of Patna having a flourishing market of machineries, hardware stores, automobile parts, other heavy machineries etc. He has also pointed out the one single storeyed residential building with a detached servant block with asbestos roof is located at the centre of the plot. He has also pointed out that though the building is of old specification and about 40 to 45 years old, but due to proper maintenance its condition is not bad as far as age is concerned. He has also pointed out that this building was rented out long back at a normal rent of Rs. 116 per month and at the time of the transfer to the transferees no vacant possession could be given to them. He has also pointed out that the salvaged value of the building will not ....
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....sessee. He has estimated the value of the land at Rs. 3,83,740.He has also pointed out that the building on the disputed plot i sin good normal condition. He has described the position of the building and has held that considering the depreciated value the market value of the disputed properties on 30th June,73 would be Rs. 2,37,500.The Tribunal has mentioned in the order sheet dt.11th Nov., 75 that the Valuation Officer was to explain report particularly that effect of the development plan which affects a few of the demarcated plots. It was after this that the Valuation Officer submitted a report which is to be found in the documents of the Department. The objection of the learned counsel for the appellants was that the Valuation Officer was not justified in valuing the disputed, property on hypothetical basis. The Valuation Officer has pointed out that the valuation report contemplated a multistoreyed building (5 storeyed)over the plot for arriving at average price per katha of land on the principle of "Development Method". He has also pointed out that this plot of 17.84 kathas was sub-divided into 10plots and separate agreements were entered into amongst 10 purchasers. The Valua....
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....es to Rs. 6,58,000. He has given cogent reason for calculating the value at Rs. 36,300 per kathas. The Valuation Officer has considered the valuation according to the "Development Method" He has shown in Annexure 'A' the area of each plot as shown in each sale deed. He has pointed out that 0.15 per cent less area is shown in the sale deed. He has also shown the area of common road of 1.42 kathas and total area excluding road which is 16.42 kathas. In Annexure 'B' he ha shown in each plot taken for construction of 5storeyed building for development purposes. He has pointed out that ultimately 13,840 Sq.ft. out of 22,351 sq.ft.(excluding 12 ft. wide centrally common road) is considered for built up areas for development purposes which is only 60 per cent coverage over net area of land. He has pointed that Annexure 'C' explains the proposed cost of construction for 5 storeyed building over all the 10 plots which works out to Rs. 32,78,700 as on 5th Sept., 73. The Valuation Officer has explained in Annexure 'D' the expected rent on the proposed 5 storeyed building. He has shown in Annexure 'E' the land rate per katha worked out for individual plot as per "Development Method" and total ....
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....the worse possible case that acquisition threat is there. He calculated the threat only to an extent of 1.987 kathas, the details of which has been given in Annexure 'D' and he also calculated the area of the common road at 1.42 kathas and thus the total area works out to 3.407 kathas which is only 19 per cent of the total area and thus the new area works out to 14,433 kathas. The Valuation Officer considered the value of 14.433 kathas at the rate of Rs. 36,300 per katha which works out to Rs. 5,23,900. He calculated the cost of land under threat of acquisition of 1.987 kathas at Rs. 30,000 per katha which works out to Rs. 59,600 and thus the total amount came to Rs. 5,83,500 which is 104 per cent above the registered amount if the registered amount is taken at Rs. 2,85,000 instead of Rs.1,85,000. The Valuation Officer considered the rate of acquisition at Rs. 30,000 per katha on the basis of the rates of Rs. 20,000 per katha relating to R.K. Bhattacharjee Road. He has also considered that if the minimum rate of price for land for the net area of land in question is taken at the rate of Rs. 30,000 per katha and the land under threat of acquisition is taken at the rate of Rs. 20,000....
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.... cannot be accepted. The Valuation Officer has cited various authorities in Annexure 'M' to show that the hypothetical building schemes are the usual basis of valuation in the case of building land. We have to accept the valuation report of the Valuation Officer under such circumstances. The Competent Authority has discussed the objections of the transferors and the transferees relating to valuation in paras 6 to 18 of his order. From this order it is evident that the price as paid by the appellants to Sri Vjay Kumar and his wife and sons and the price as valued by the Valuation Officer for each plot show that in case of each transfer the fair market value of the property was more than Rs. 25,000.He has given the following details relating to the various areas transferred, the apparent consideration paid by the transferees and the fair market value according to the Valuation Officer which is as follows: Name of the Transferees Registration area in Sq. ft. as mentioned by the transferees in their written objection Apparent consideration. Fair market value according to the Valuation Officer Sri S.Kusheshwar Jha 3368 45,000 1,10,000 Sri Binod Kr.Mishra . . . Smt.Hemalata ....
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....atna Development Expansion Scheme which affected the value of the disputed property. The Competent Authority took the view that there was no mention of such a risk in the deeds of transfer. The deeds clearly show that the property was not affected by any scheme. The Competent Authority held that no evidence was produced before him to show that any notice in this connection was served by any authority. The appellants also pleaded before the Competent Authority that there were difficulties in evicting the tenants who was paying monthly rent of Rs. 116 only. The Competent Authority took the view that the transferees can get the tenant evicted, but the appellants did not file any eviction suit as the tenant did not refuse to evict rather she needed time to find out another house. The Competent Authority took the view that the possession of the property did not present any problem and this did not effect in any way the value of the property. He also took the view that the big size of the plot did not create any difficulty in getting purchasers. The Competent Authority took the view that the sale was to 13 persons which must have helped the vendors to get the maximum price for the land ....
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....th bldg. 64. The Competent Authority has pointed out that none of the plots mentioned above enjoyed better location than the property purchased by the transferees. He has also pointed out that the land was sold even in an area like Kajipur which is at Patna City at Rs.50,000 per katha and at Fraser Road at about Rs. 35,000 per katha. The Competent Authority has given reasons for holding that the market value of the disputed property cannot be less than Rs. 40,000 per katha. 65. The transferees challenged the method of valuation adopted by the Valuation Officer. The Competent Authority took the view that the Valuation Officer was fully justified in adopting a well recognised development method for Valuation of the property and there was nothing wrong in treating the entire plots one unit as common set of circumstances governed the value of the plots. The Competent Authority has pointed out that the Valuation Office valued the entire disputed property at Rs. 58,000 and the average price per katha comes to Rs. 37,000.The Competent Authority has also pointed out that the Valuation Officer has given due consideration to the loss of area, if any, under road expansion scheme. The Compet....
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....case of Controller of Estate Duty, West Bengal vs. Radha Devi Jalan(5).In both these case it was held that in the case of building with compounds in a city, which are in the possession of tenants and the tenants cannot be either evicted or the rent payable by them enhanced except in according with the provision of the Rent Control Act, the only appropriate method of valuation is to capitalise the annual rent by certain number of years' purchase and that the method of valuing the site and the building separately and adding up the values would be improper in such cases. The Competent Authority took the view that the property was fetching a monthly rent of Rs. 116 per month since long and the transferors were residing at Bombay and they did not care to take proper steps to get proper rent for the property. He has also pointed out that the annual value of the property according to the valuer's calculation is Rs. 928 only and even at 15 times of this the capitalised value comes to Rs. 13,920.The Competent Authority pointed out that this cannot be the value of the property and even apparent consideration of Rs. 1,85,000 is about 14 times and the reduced valuation by the transferees' valu....
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....disputed property is not the correct price and that the fair market value has to be taken at Rs. 6,58,000 as given by the Valuation Officer. He has given the details as pointed by the Competent Authority as well as Valuation Officer in his subsequent detailed reasons before the Appellate Tribunal. Sri Rajgarhia has relied on the ruling reported on 1952 India Law Reports, Calcutta, Series at page 40 where it has been held that compensation under Defence of India Act is to be awarded on the basis of s.23(1) of the Land Acquisition Act and that the true test for determining the market value is not what the owner was doing with the land at the relevant time, but what he could have done that the basis of compensation, where possession has been taken by requisition under the Defence of India Rules, is the fair rent payable for the land. Thus, it is evident that only the rental paid by the tenant Smt. Sushila Sinha which is being paid since long cannot be taken for the purpose of valuation of the disputed property. Sri Rajgarhia has fully relied on the reasoning given by the Competent Authority relating to the valuation. He has also relied on the ruling reported in 1966 B.L.J.R. at page 8....
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....tion, the requirement being always to arrive as near as possible on estimate of the market value. Their Lordships have also pointed out that annual rental value of the land acquired, namely Rs. 7,200 will also not furnish a proper method of computation because that was a rent in 1944 when that land was not of such great value as it has acquired at the time when s.4 of the notification was issued. Their Lordships have also pointed out that smaller area on a main road would certainly fetch a higher price compared to a larger undeveloped areas even though it may have a frontage on the main road. Thus, it is evident that the Competent Authority was justified in not accepting the claim of the appellants that the rental method should be adopted. 70. Sri Rajgarhia has also relied on the ruling reported in AIR 1969 Kerala at page 265. In this case their Lordships have held that the best way to determine the true market value in the case of land is to ascertain the prices paid for similar land in the vicinity in the course of normal sales at or about the same time. Their Lordships have also held that whichever method is adopted for determining the market value of the land acquired, the opi....
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.... by the transferee for the purposes of the Indian IT Act, 1922,of this Act or the Wealth Tax Act,1957,the Competent Authority may, subject to the provisions of Chapter-XXA, initiate proceedings for the acquisition of such property under this Chapter; Provided that before initiating such proceedings, the Competent Authority shall record his reasons for doing so; Provided further that no such proceedings shall be initiated unless the Competent Authority has reason to believe that the fair market value of the property exceeds the apparent consideration therefor by more than fifteen percent, of such apparent consideration. (2) In any proceedings under this chapter in respect of any immovable property: (c) where the fair market value of such property exceeds the apparent consideration therefor by more than twenty five percent of such apparent consideration, it shall be conclusive proof that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer: (d) where the property has been transferred for an apparent consideration which is less than of it fair market value, it shall be presumed, unless the contrary is proved,....
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....the fair market value of each such property exceeds the apparent consideration therefor by more than 15 per cent of the apparent consideration and that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer with the object as referred to in cl. (a) of cl. (b) of s.269C.He has submitted that these findings of the Competent Authority are not supported by reasons. For this purpose, the learned counsel for the appellants has relied on the ruling reported in AIR 1970 Supreme Court at page 1302 where it has been held in para 7 of the other that recording of reasons in support of a decision on a disputed claim by a quasi judicial authority ensures that the decision is reached according to law and is not the result of caprice, whim or fancy or reached on grounds of policy or expediency. In view of this ruling it cannot be doubted that the Competent Authority is bound to give reasons. The learned counsel for the appellants has submitted that the Competent Authority has not given any reason for holding that the intention by the deed of transfer was to evade tax. The learned counsel for the appellants has submitted that if ....
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....r requires to be made, when the law says that a particular kind of evidence would be conclusive as to the existence of a particular fact it implies that that fact can be proved either by that evidence or by some other evidence which the Court permits or requires to be advanced and that where such other evidence is adduced it would be open to the Court to consider whether, upon that evidence, the fact exists or not. Their Lordships have also held that where, on the other hand, evidence which is made conclusive is adduced, the Court has no option but to hold that the fact exists and that the statutes may use the expression 'conclusive proof' where the object is to make a fact non-justifiable. Their Lordships have also held that the legislature may use some other expression such as 'conclusive evidence, for achieving the same result and that there is thus no difference between the effect of the expression conclusive evidence from that of conclusive proof, the aim of both being to give finality to the establishment of the existence of a fact from the proof of another. Sri Rajgarhia has submit that in view of the findings of the Competent Authority the fair market value of the disputed ....
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....only by more than 15 per cent or 25 per cent but by more than 3 to 5 times in different cases. The Competent Authority in view of the discussions in his order came to the findings as summarised in para 19 of his order. Para 19 of the order is the finding after taking into account all the relevant materials on record and so it cannot be said that the Competent Authority has not recorded reasons for the findings. Even in para 20 he has given very detailed reasons for his findings. Sri Rajgarhia has also referred to s.269C(b)where also it has been clearly laid down that where the property has been transferred for an apparent consideration which is less than its fair market value, it shall be presumed, unless the contrary is proved that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer with such object as is referred to in cl.(a) or cl.(b) of sub-s.(1).Thus, the Competent Authority was competent to presume that the transfer was with the objects as mentioned in cls.(a) and (b) of s.269C(1) of the said Act. The appellants have not placed any materials in rebuttal of the presumptions laid down in s.269(2)(b) of the....
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.... be the heirs of the owner's father, and the purchasers had jointly undertaken the risk arising therefrom and considering these factors the price paid represented the most fair market value of the property. It was also pointed out to the Competent Authority that after a few months after the purchase the transferees approached the local claimants and made a further payment of Rs. 1,01,000 to them on 22nd Nov., 73. This will be evident from paras 3 and 4 of the order of the Competent Authority. The order of the Competent Authority in para 8 shows that Vijay Kumar and his wife and minor sons executed registered documents through which the property was transferred by the transferees and they described it as deed of absolute sale and regarding the title of the property it was clearly mentioned that the present vendors being the surviving heirs took the said property as full owners thereof and got their names entered in the records of the Patna Municipal Corporation and in the Anchal Office and were paying taxes and land revenue respectively for the said property. The vendors also assured the vendees that the vendors were the full and absolute owners of the said property and had got a cl....
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.... natural and adoptive families. In the plaint it was also asserted that Title Suit No. 36 of 1932 was filed in the Court of Subordinate Judge at Patna for partition of the joint family properties and the plaintiff No. 1's husband was defendant No.2 in that suit and the final decree in the said suit was signed and sealed on 2nd June, 1961 and then several miscellaneous proceedings arose out of the aforesaid Title Suit No. 36 of 1932 and moreover there were several other proceedings and suits filed by or against the deceased in Patna. It has also been pointed out in the plaint that the plaintiffs got themselves substituted and were substituted as the only heirs of the deceased in several proceedings in the Hon'ble High Court of Judicature at Patna and in the Subordinate Courts at Patna. The plaint also shows that in some of those proceedings in Jan., 1961, petitions were filed by defendant No. 1 where in it was claimed that defendant No. 1 was the second wife of the deceased and defendant Nos. 2 and 3 were begotten and born to her from the deceased. It was also claimed by defendant No. 1 that defendant No. 4 was also begotten and born to her from the deceased. Defendant No. 1 is Cham....
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.... Sub-Judge-VIII, Patna which shows that the compromise dt. 10th April, 1975 was filed in the Court and the parties admitted the compromise and the suit was decreed in terms of compromise and the compromise petition was directed to form part of the decree. 89. The learned counsel for appellants has filed a copy of the agreement of sale dt. 19th Dec., 1972 between Sri Vijay Kumar, his wife and his minor sons with the appellants which it was contracted that the disputed land was to be sold to them for a consideration of Rs. 1,85,000 and the considerations were to be paid for various areas by various purchasers and that he Bungalow and out-houses was to be sold for Rs. 15,000 to all the purchasers jointly. Para 4 of the deed of agreement shows that the bungalow and outhouses, being a part of the said property, shall become the joint property of all the purchasers together and shall be jointly conveyed to them by a separate and single sale deed it was also agreed that separate sale deed was to be executed by the vendors in favour of each individual purchaser for the portion of land purchased by each such purchaser Asstt. shown in cl. (3). It was on the basis of this deed of agreement t....
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....e sale deed there is mention about the deed of agreement and so the agreement has to be held to be genuine. However we are of the view that if the agreement dt. 15th July, 73 had been in existence, then the appellants would not have agreed to the recital in the sale deeds executed by Vijay Kumar & Ors. On 30th Aug., 73 that the property belonged exclusively to them. This is clearly a circumstance to show that the deed of agreement dt. 15th July, 73 was not in existence and that it was brought into existence sometimes after the execution of the sale deeds by Sri Vijay Kumar and others and before the execution of the sale deed by Smt. Champa Devi and others. Under these circumstances, it is difficult for us to place reliance on the deed of agreement dt. 15th July, 73 executed by Smt. Champa Devi. If really the document was in existence, then the transferees could have taken the sale deed from Smt. Champa Devi also on, 30th Aug., 73 when Sri Vijay kumar executed the sale deeds. The transferees would not have taken a long time in taking the sale deeds from Smt. Champa Devi on 22nd Nov., 73. Hence, we cannot placed any reliance on the deed of agreement executed by Smt. Champa Devi and w....
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....the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such additional evidence or document to be produced, or witness to be examined. R. 27 also lays down that wherever additional evidence is allowed to be produced by the Appellate Court, the Court shall record the reasons for admission. It cannot be doubted that the Tribunal is not governed by the civil Procedure Code when the Income-tax (Appellate Tribunal) Rules, 1963, is already on this point. However, we find that both the provisions are similar. Sri Rajgarhia has submitted that these documents were filed for the first time before the Tribunal without showing sufficient cause. Sri Rajgarhia has submitted that before the Competent Authority there was only mention about the litigation, but the appellants failed to support the case before the Competent Authority. He has also submitted that the recital of fact is no evidence. Sri Rajgarhia has relied on the ruling reported in A.I.R. 1968 Supreme Court at page 406. In this case the Supreme Court held that it did not require additional evidence to be....
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....he order. Considering the provisions of law and the facts of this case, we are of the view that this document of compromise should not be admitted at this stage of the appeal before the Tribunal. 94. Sri Rajgarhia has submitted that the disputed property in these acquisition proceedings was not in dispute as such before the Civil Court. He also submitted that if any document was to be admitted only certified copies should be considered. It was further submitted by him that any subsequent Act by persons, who are not parties to the present appeals, should not be considered and was not binding on the Department. According to the learned counsel the Tribunal cannot adjudicate regarding the title of Smt. Champa Devi in the disputed property. We need not consider these submissions in detail as we have held the documents relating to the plaint, the written statement, the compromise and the compromise decree were not admissible as additional evidence before he Tribunal. 95. Though we have not admitted the above documents, it would be fair to state the arguments of the appellants' counsel though they referred to these documents. Some of these points were argued by Sri Basudeo Prasad who s....
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.... argued that in proper context "immovable property" would not include only a partial interest in that property. According to the learned counsel land would mean the entire 16 annas interest in the land and not a part share in that land. He pointed out that after an order of acquisition the possession of immovable property has to be delivered to the Government. Such delivery is not possible if action is only in respect of a part of interest. It was further submitted that the law contemplates action against the whole property and not against a part of it or any interest in it and on this basis it was submitted that the acquisition proceedings were not valid. The learned counsel submitted that though the second set of sale deeds were in the knowledge of the Competent Authority, he did not initiated proceedings by issuing notices to the second set of transferors. In the absence of such action the property as a whole could not be acquired. 98. Replying to these points raised by the appellants, Sri Rajgarhia pointed out that the second set of sale deeds should not be considered as they were obtained after the preliminary notice was issued by the Competent Authority on 29th Sept., 73. He....
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....oduced by the appellants and which has been relied upon by the learned counsel for the appellants. On the basis of the materials which were before the Competent Authority, Sri Vijay Kumar and others had transferred the whole property to the transferees by writing separate deeds in respect of small portions. At the time of acquisition no other person had been shown to have any title to the above property. The transferors Sri Vijay Kumar and others stood in the Municipal records as the legal owners of the property which had formerly belonged to the father of Sri Vijay Kumar. In the transfer deeds this fact had been clearly stated that the property as a whole was being transferred and there were no other tile holders. It was also stated that the transferors were fully responsible for any consequence if any future defect in title was found. Before the Competent Authority it was no doubt pointed out that there was a dispute as to who were the heirs of late Sri Newaas Ram and that matter was pending in the Court. No evidence was ever led to show that there was any specific litigation in respect of this property. We are of the view that merely because there was a dispute about the heirshi....
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....ansfer regarding the Interest or the title of the transferred had not been rebutted before the competent authority. A mere suggestion of a dispute was made. There was no evidence of any other established title in respect of the property. In such circumstance when the property validly stood in the name of Shri Vjay Kumar and others who were in exclusive possession of the property and when Smt. Champa Devi and others were neither shown as the owners in any of the relevant records nor were they in possession of the property, there was no doubt that the property as such had been transferred by the transferors to the transferees. It appears that the transferees realised that the consideration shown by them in the first set of the sale deeds was not the correct consideration and, therefore, they entered into the second set of sale deeds so that the consideration paid by them goes up by more then Rs. 1 lakh. The facts remains that the transferees came in possession of the entire disputed property on the basis of the sale deeds executed by Sri Vijay Kumar and his family members who were in the possession of the entire disputed property. At the time of acquisition the transferees held the p....