TaxTMI 
TaxTMI 
2001 (8) TMI 7
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.... this court in C. B. Gautam v. Union of India [1993] 199 ITR 530. Subsequent to the decision in the said writ petition decided by the High Court (see [1998] 231 ITR 318) a show-cause notice had been issued disclosing the following facts : " In the case of subject property, the apparent consideration is Rs. 1,75,00,000. The plot area is 3595.32 sq. mts. including 830.95 sq. mtrs. declared as excess land under ULCR Act. The net plot area comes to 3595.32-830.95=2764.37 sq. mtrs. If salvage value of Rs. 1,64,445 is considered, the achieved land rate works out to Rs. 1,75,00,000-1,64,445 = 1,73,35,555 divided by 2764.37 = Rs. 6,271 per sq. mtr. We may compare the sale instance of property at 60, Friends Colony (East) which was agreed to be sold on December 5, 1990, for apparent consideration of Rs. 2.65 crores. If the depreciated value of structure of sale instance is taken at Rs. 11,60,000 the land rate per sq. mtr. works out to Rs. 2,65,00,000 (-) 11,60,000 = 2,53,40,000 divided by 1173.91 = Rs. 21,586. If adjustment on account of time gap of +2%, side open +10%, potential for basement +10% in the sale instance and nearness to railway track -5% and size of plot -5% is taken into a....
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....sale instances cited in the notice arc not comparable properties because the property comprised in 60, Friends Colony, is a vacant property and the actual physical and vacant possession of the property was handed over and delivered to the purchaser while the subject property is a tenanted property occupied by a person who cannot be easily evicted. There were dissimilarities between the subject property and the property comprised in 60, Friends Colony, and, therefore, the Department ought not to have compared the same. Thereafter, they set out a dozen instances where the method of valuation adopted was different. It was also contended that the valuation report prepared by the Departmental Valuer is not a bona fide one. Thus, it is ultimately submitted that the conclusions of the Department are mala fide, arbitrary and discriminatory resulting in deliberate adoption of a wrong method of determining fair market value of the subject property. It was also contended that in the previous purchase order made :on April 18, 1991, it was noticed that one Vinod jain had offered Rs. 4.5 crores and it was made clear that the offer of Bishwanath Traders and Investment Ltd. in the case of the prev....
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....as having become infructuous in view of the auction sale held and confirmation thereof by this court. One of the learned judges of the High Court (K. Ramamoorthy J.), apart from referring to the various facts arising in the case, the pleadings, the contentions put forth before the court, some of the decisions of different High Courts and of this court on the matter of law, did not specifically deal with the contentions arising in the case on analysis of the facts arising in the matter. As regards the contentions of the impact of the sale that had taken place pursuant to the permission granted by this court, which stood confirmed by an order of this court, the learned judge stated that the same could not come in the way of deciding the writ petition as the order of this court, was made only in proceedings arising in an interlocutory matter. In the other judgment rendered by Sabharwal J., the f acts stated earlier have been noticed but the learned judge does not deal with the matter in the perspective in which the Department has proceeded and, on the other hand, sits in judgment over the same to find out whether the method of valuation adopted by the Department one way or the othe....
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....r income or rent or developer's approach should have been adopted. The High Court, in fact, examined the facts, materials and the valuation report of the Appropriate Authority to come to the conclusion that the comparisons made were wrong or otherwise but that was not the procedure to be adopted as indicated in Sudha Patil's case [1999] 235 ITR 118 (SC). Thus, the order made by the High Court needs to be set aside. Though serious arguments have been advanced by learned counsel appearing for the parties in this court as to the mode of valuation, the nature of the power under Chapter XX-C of the Act, the scope of judicial review, the requirements to be taken note of in the valuation and a large number of decisions are referred to, we do not think there is any need for us to advert to the same for the principles stated therein are identical to what we have stated in the course of this order. There is one other factor which is very significant, namely, that this court having allowed the auction of the property in question ending confirmation of the same and that order having become final, now to allow the order made by the Appropriate Authority to be set aside and to perm....