TaxTMI 
TaxTMI 
1994 (5) TMI 11
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....dential purposes ; the suit was adjourned pending a decision by the Rent Controller as to whether the lease in question was for residential or non-residential purposes. There were also several other proceedings between the petitioner and the said tenant. The condition of the perpetual lease under which the petitioner obtained the land from the President required that the land should be used only for residential purposes. Since the tenant of the petitioner used the premises for a different purpose, the land and development office levied penalty/charges for the misuse amounting to Rs. 1,97,85,963 for the period 1976 to July 14, 1991. The petitioner states that the charges for the subsequent period are yet to be communicated. The petitioner estimated the said charges to be about Rs. 35 lakhs. There was a threat of re-entry on behalf of the President. In view of the peculiar predicament, she agreed to sell the properties to the fourth respondent for a consideration of Rs. 80.21 lakhs ; the purchaser agreed to take over all other liabilities including the liability for the penalty/charges and unearned increase of about Rs. 65 lakhs. According to the petitioner, she is an old lady age....
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....ight to re-enter notwithstanding the liability on account of misuse charges amounting to Rs. 1,96,85,963 which is outstanding and for which notice has already been given by the land and development office. For all these reasons and in view of the foregoing it is not possible to transfer the subject property without the express permission of the Land and Development Office, New Delhi. Therefore, your request for issue of a no objection certificate under section 269UL(3) read with section 269UC of the Income-tax Act, 1961, is premature and cannot be acceded to at this stage. You may file a fresh statement in Form No. 37-I after obtaining permission for transfer from the land and development office, New Delhi, so that your request can be considered at this end. The statement filed on August 20, 1993, is being filed as infructuous, defective and inconsequential." In other words, the permission sought for by the petitioner for filing the statement in Form No. 37-I was rejected on the assumption that the agreement between the petitioner and the fourth respondent was not a valid agreement, because the land and development office is free to exercise the right of re-entry. The p....
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....rovisions of Chapter XX-C can be resorted to only where there is a significant undervaluation of the property to the extent of 15 per cent, or more in the agreement of sale as evidenced by the apparent consideration being lower than the fair market value by 15 per cent. or more. The court also pointed out that the intending seller and the intending purchaser should be given an opportunity to show cause against the compulsory purchase order to be made. The court also held that only because the apparent consideration for the sale is below 15 per cent. of the fair market value, it cannot be conclusively held that there is an undervaluation and the parties should be given an opportunity to show the circumstances leading to the alleged undervaluation, such as the owner's immediate need of money or dispute as to title to the property as a result of which the property might have to be sold at a lower price or there might be a subsisting lease in favour of the intending purchaser. There may be other valid reasons also for the particular sale price agreed upon. In Tanvi Trading and Credits P. Ltd. v. Appropriate Authority [1991] 188 ITR 623, a Bench of this court had occasion to consider....
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....ntitled to see materials and documents like documents of title agreements, etc., in order to satisfy itself whether the apparent consideration is proper or not in order to come to the conclusion whether to purchase the property or not. The investigation which will be undertaken by the appropriate authority is only with a view to determine whether the pre emptive right of purchase should be exercised or not. If the appropriate authority has reservations or doubts with regard to the legality of the proposed sale, it is open to the authority not to exercise its right to purchase. Section 269UD, however, does not contemplate the rejection of any statement by the appropriate authority. Section 269UD speaks of only one type of order which can be passed by the appropriate authority and that is an order of purchase. If the appropriate authority chooses not to purchase the property in question, then section 269UD does not contemplate the passing of any order similar to the order which has been passed by respondent No. 1 in the present case. In fact, the proviso to section 269UD says that if no such order, meaning an order referred to under section 269UD(1) for purchase, is passed and the....
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....s connection, the Bench observed at page 664 : " We are not impressed by this submission. The agreement under reference is dated October 9, 1989. The petitioner moved the appropriate authority by filing the statement in Form No. 37-I on October 20, 1989. Thereafter, the Act lays down a very tight schedule for the appropriate authority to make up its mind to purchase or not to purchase the property. There is no provision for extension of time. The respondents have missed the bus and have passed the impugned order on December 15, 1989, rejecting the permission on quite irrelevant considerations. This court would not like to extend the period and frame a fresh time schedule for the Department specially when the statute does not give any such power to the court. There is no worthwhile explanation as to why, at this point of time, the Department wants to purchase the property except the only consideration that the prices have gone up. This will then be a case of unjust enrichment. In our opinion, there is no equity in their favour for allowing them another opportunity to make up their mind." A reading of the proviso to section 269UD(1) itself shows that the order for purchase unde....