AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2018 (9) TMI 227
X X X X Extracts X X X X
X X X X Extracts X X X X
....elied upon 2001 Income Tax Reports Volume 248 page 541 (Lytton Hotel Pvt. Ltd. v. Airport Authority & Ors.), 2003 Income Tax Reports Volume 263 page 498 (Airport Authority & Ors. v. Lytton Hotel Pvt. Ltd. & Ors.), 1998 Income Tax Reports Volume 231 page 318 (Mrs. Kailash Suneja v. Airport Authority (Delhi)), 2001 Income Tax Reports Volume 251 page 1 (Airport Authority & Anr. v. Kailash Suneja & Anr.) and 2004 Volume 266 Income Tax Reports page 204 (K.L. Suneja & Anr. v. Union of India & Ors.). He has relied upon 1993 Income Tax Reports Volume 199 page 530 (SC) (C.B. Gautam v. Union of India & Ors.) and submitted that, Section 269UE underwent an amendment subsequent thereto. He has submitted that, the appropriate authority is not entitled to receive the immovable property free from encumbrances any longer. Therefore, the factum of existence of a tenancy had to be taken into consideration by the appropriate authority while valuing it. It had ignored the tenancy. It was not entitled to do so. Since the immovable property was encumbered with a tenancy, the value in respect thereof cannot be same as that of an immovable property which is without a tenancy. The valuation arrived at by th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....consideration in the present writ petition :- (i) Is the impugned order vitiated by breach of principles of natural justice ? (ii) Did the authorities take extraneous materials into consideration while passing the impugned order ? (iii) To what relief or reliefs are the parties entitled to ? The writ petition relates to a flat measuring about 2,100 square feet being flat No. D-113, 58/3 Ballygunge Circular Road, Kolkata - 700 019. The flat is located in a housing complex known as the Saptaparni Cooperative Housing Society. The respondents Nos. 4 and 5 are the owners of such flat. The petitioner is the agreement holder. The respondent no. 6 is the tenant in respect thereof. The petitioner entered into an agreement to purchase the flat on April 21, 1993 with the respondent Nos. 4 and 5. The consideration was for a sum of Rs. 13,00,000/- out of which the petitioner paid a sum of Rs. 12,00,000/- to the respondent Nos. 4 and 5. The petitioner filed the requisite form under Section 269UC of the Act of 1961 on May 4, 1993. A team of valuers visited the flat on May 17, 1993. The appropriate authority raised a query and issued a requisition for clarification to the petitioner on Jul....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ompared with that of the subject flat as the other two flats were not tenanted. The petitioner also highlighted the fact that the entire premises was mortgaged with UCO Bank and that, there was a litigation pending. Moreover, there is tenant at the premises concerned and that, the petitioner has no right or interest of any kind at the flat as the petitioner is neither a tenant nor a sub-tenant. The fact that the transferors, namely, the respondent nos. 4 and 5, were also embroiled in litigation was also highlighted. The impugned order deals with every contentions raised by the petitioner. So far as encumbrance of the entire premises with UCO Bank is concerned, the impugned order finds that, the agreement for purchase contained in the clause that the sale was free from all encumbrances. Therefore, assuming that the properties to the encumbered with the UCO Bank, then also, the petitioner would not be bothered as the liability of such encumbrance will fall upon the transferors being the respondent Nos. 4 and 5. In any event, the encumbrance to UCO Bank was in respect of the entire complex. The right of an individual flat owner will be affected minimally. The subsisting tenancy was a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....at, when the property has an encumbrance of tenancy, the valuation for acquisition of such property has to be considered with the encumbrance. It has also held that when a property is so encumbered, the valuation by the land and building method may not be appropriate unless the question of depression in the value on account of inevitable tenancy is considered. In Mrs. Kailash Suneja (supra), the land and building method deployed for the purpose of valuation of a property encumbered with tenancy was questioned. Such decision of the Delhi High Court was upheld by the Supreme Court. I.T.C. Ltd. (supra) has held that, the appropriate authority had erred in taking into account the built up area in working out the fair market rate. None of the authorities cited with regard to valuation postulates that, the appropriate authority must value a property on rental basis when it doubts the tenancy. In the present case, the tenancy itself has been doubted in the impugned order. There are good reasons for doubting the tenancy. The respondent no. 4 and 5 are the owners. As owners they had entered into an agreement to sell the flat to the petitioner. The petitioner was and still is in possession ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... authority had sufficient reasons not to recognize the tenancy. An impugned order is required to be adjudged on the basis of the reasons contained therein. However, it is permissible to consider the materials placed before the appropriate authority to decide whether the view expressed in the impugned order is sustainable or not. A Writ Court needs not interfere with the view expressed in an impugned order, if such view is plausible on the basis of the materials made available. It is not called upon to be an appellate authority even if there is no provision for appeal against the impugned order. As discussed above, I find no infirmity in the view expressed by the appropriate authority questioning the tenancy. Learned Senior Advocate for the petitioner has contended that Section 269UE was amended by substituting the words "free from all encumbrances" with effect from November 17, 1992. He has submitted that, such amendment was pursuant to C.B. Gautam (supra). Under the amended provisions of Section 269UD, the property vests in the Central Government in terms of the agreement for transfer. In the present case, therefore, the Central Government will, upon exercise of rights under Sect....