Karnataka High Court
Bhoruka Finance Corporation vs Union Of India And Others on 18 December, 1992
Equivalent citations: ILR1993KAR344, [1993]202ITR723(KAR), [1993]202ITR723(KARN)
JUDGMENT S. Rajendra Babu, J.
1. The petitioner which is a partnership firm agreed to sell to the fourth respondent the property comprised in No. 7, HAL II Stage, Indiranagar, Bangalore, for a sum of Rs. 12.96 lakhs on July 29, 1987, Chapter XX-C of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), was extended to apply to the Bangalore Metropolitan Region, with effect from October 1, 1987. The petitioner and respondent No. 4 furnished to the appropriate authority a statement in Form No. 37-I on October 30, 1987. The appropriate authority a statement in Form No. 37-I on October 30, 1987. The appropriate authority sent on order dated December 16, 1987, as at annexure 'E', exercising power under section 269UD(1) of the Act purporting to make a pre-emptive purchase for the apparent consideration shown in the agreement with other statutory benefits. The petitioner being aggrieved by the action of respondent No. 2 is calling in question the constitutional validity of Chapter XX-C of the Act and the order made under section 269UD(1) of the Act.
2. The constitutional validity of Chapter XX-C of the Act has been upheld by the Supreme Court in Transferred Case No. 26 of 1987 (C. B. Gautam v. Union of India disposed of on November 27, 1992. Thus, it is no longer open to the petitioner to challenge the validity of Chapter XX-C of the Act and that contention is rejected.
3. Pursuant of section 269UC(3) of the Act, rule 48L is prescribed which provides for furnishing a statement in Form No. 37-I and requires where an agreement for transfer is entered into before October 1, 1987 (date on which Chapter XX-C was extended of Bangalore), the statement in Form No. 37-I should be furnished to the appropriate authority before October 30, 1987. The agreement for transfer, in this case, is entered into on July 29, 1987, prior to the coming into force of Chapter XX-C in Bangalore Region and statement in Form No. 37-I is furnished to the appropriate authority on October 30, 1987. It is contended on behalf of the petitioner that the statement filed on October 30, 1987, is not a statement filed before October 30, 1987, as provided under rule 48L and the appropriate authority could not have proceeded to make an order on such statement filed beyond the date prescribed under the rule. Thus, it is submitted that the entire proceeding culminating in annexure 'E' is non est.
4. On behalf of the Department, it is contended that the expression "before 30th October, 1987", would include the "entire day of 30th October, 1987", and hence the appropriate authority could have acted upon the statement filed on October 30, 1987, and relied upon Premchand Nathmal Kothari v. Kisanlal Bachharaj Vyas, and D. M. Thippaswamy v. Mysore Revenue Appellate Tribunal [1971] 2 Mys L. J. 392; AIR 1972 Mys 50, in support thereof.
5. Under the scheme of Chapter XX-C of the Act, unless a no objection certificate is produced, the officers under the Registration Act cannot register documents purporting to transfer immovable properties exceeding Rs. 10 lakhs. In order to enable a party to obtain such a certificate, statement in Form No. 37-I is required to be furnished. On perusal of such form and such investigation as is needed, the appropriate authority may grant a no objection certificate or pass an order under section 269UD(1) of the act for purchase by the Central Government of the immovable property within a period of two months subject to the conditions mentioned in the proviso thereto.
6. Precedents on the interpretation of the effect of a prescription of an act being done before a specified date is not uniform. Having regard to the objects of he enactment in certain cases, it had been held that the word "before" would mean "up to" and in others "previous to the specified date". In certain decisions, it is held that, when the relevant provision requires the performance of an act before a specified date, the same shall be done at some time preceding the said date so as to delimit the period inside which the event may occur.
7. A distinction is sought to be maintained between an act to be done before any stated time a state date on the hand and where an act is to be done within a particular period on the other. Even when a period is mentioned for purposes of computation, a day gets extended either at the beginning or at the end to arrive at the specific date before which an act is to be done. The expression "before a specified date" has received an interpretation as "before expire of", or "within but not later than". This view receives support from the decisions in Premchand's case, , and D. M. Thippaswamy's case, AIR 1972 50, referred to above.
8. Learned counsel for the petitioner, however, submitted that on the language or rule 48L(2) (a), there is no scope for interpretation as there is no ambiguity. I cannot concur. The statement in Form No. 37-I has to be furnished before October 30, 1987, and it can mean either up to or end of October 30, 1987, or before the Commencement of 30th day of October, 1987. If two interpretations are possible, that which advances the object of the enactment must be adopted. When performing its cognitive function of ascertaining what a statute means, the court would temper its reading by taking into account the proper context of the statute. The meaning of a word in a statute may be enlarged or restricted in order to harmonise with the legislative intent of the entire statute. It is the spirit of the statute that governs over the literary meaning. Every word takes its colour or meaning from the context in which it is used. Interpretation by definition is concerned with the ascertainment of the true meaning, and because true the meaning often differs from the literal meaning, reliance on either without reference to proper context is likely to subvert effective communication.
9. The provisions of Chapter XX-C enables the obtaining of no objection certificate for sale of immovable property the value of which is more than Rs. 10 lakhs or to enable the Department to make pre-emptive purchase of the same. Unless the statement in Form No. 37-I is furnished, such proceedings cannot take place. If the statement in Form No. 37-I is allowed to stand even if filed on October 30, 1987, as, in the present case, it would avoid further complications of making another application again by asking the parties to enter into a fresh agreement although an agreement is already in existence. Rule 48L(2) (a) is attracted to cases where the agreement to transfer has been made prior to commencement of Chapter XX-C of the Act. That Chapter came into force on October 1, 1987, and normally a period of 30 days is given to parties to comply with the provisions thereof. There is no reason to think that, in this case, the Legislature intended that the period should be less than 30 days. On that basis also, the above interpretation holds good. Any other interpretation would lead to anomalous results. Hence I am inclined to take the view that, in the context of the rule in question, it would be more appropriate and reflect the true position if the expression "before 30th day of October, 1987", is interpreted as meaning before the end of that day. Hence, I held that it is open to the Department to act upon statement in Form No. 37-I filed by the petitioner and respondent No. 4 on October 30, 1987.
10. It is contended that, before making the order under section 269UD neither the petitioner nor respondent No. 4 had been given a reasonable opportunity of showing cause against the order being made by the appropriate authority. This contention is not contradicted. Hence the order under section 269UD impugned herein shall stand quashed. The statement in Form No. 37-I filed by the petitioner and respondent No. 4 on October 30, 1987, shall be treated as if it were field to day and the appropriate authority shall proceed to consider the same in the light of the order made in Transferred Case No. 26 of 1987 see by the Supreme Court referred to earlier and in accordance with law. Rule made absolute accordingly.