Bombay High Court
Primetime Media Services Pvt. Ltd. vs U.V. Shahadadpuri And Others on 6 June, 1995
Equivalent citations: [1996]217ITR417(BOM)
Author: S.H. Kapadia
Bench: S.H. Kapadia
ORDER
OF PURCHASE--Findings based on facts. Ratio & Held :
The decision of the authority proceeds on appreciation of evidence and being a pure finding of fact cannot be disturbed in exercise of writ jurisdiction.
Application :
Also to current assessment years.
Income Tax Act 1961 s.269UD(1) Constitution of India art 226 Compulsory purchase of immovable property by Central Government--WRIT PETITION AGAINST ORDER OF PURCHASE--Interest of third party created.
Ratio :
Writ petitioner having himself allowed auction to proceed thereby allowing creation of right of third party, cannot be permitted to contend in writ petition that price agreed for by him was inadequate.
Held :
In the first instance, the court is not inclined to exercise that writ jurisdiction because of the peculiar conduct of the petitioner. The petitioner permitted the auction to proceed and creation of right in third party. It is most improper that the authorities should be permitted to proceed with the auction and thereafter contention should be raised that the price fetched in the auction would indicate that the consideration agreed by the transferee was not inadequate. As the interest of the third party is created and the property is of considerable value, it is not appropriate to exercise writ jurisdiction.
Application :
Also to current assessment years.
Income Tax Act 1961 s.269UD(1) Constitution of India art 226 JUDGMENT M.L. Pendse, Actg. C.J.
1. This petition is filed by the proposed transferee to challenge the order dated February 16, 1995, passed by the appropriate authority under section 269UD(1) of the Income-tax Act, 1961. Malkani Interbuild had entered into an agreement dated November 10, 1994, for the transfer of office premises admeasuring 274 sq. situated on the 2nd floor of Malkani Chambers, Vile Parle (East), Bombay, for a declared consideration of Rs. 23,24,040. The Valuation Officer attached to the office of the appropriate authority inspected the premises and reported that the property under transaction was recently constructed and is located in the commercial area. All public utilities are available near the property and the property is located near the Western Express Highway. After taking into account the various factors, the Valuation Officer found that the rate of apparent consideration was inadequate. On consideration of the report, the appropriate authority served show-cause notices upon the transferor and the transferee.
2. The appropriate authority by a detailed order came to the conclusion that the fair market value of the property on the date of transfer was at least Rs. 41,10,000 and that the fair market value exceeds the apparent consideration by more that 15 per cent. The transferee thereupon filed rectification application and the same was disposed of on March 22, 1995. The present petition was filed by the transferee in this court on April 4, 1995.
3. The petitioner moved this court for grant of ad interim stay of the proposed auction fixed by the Department on April 26, 1995. The petitioner secured an ad interim order for stay of auction on April 25, 1995, but on the next day, on the application of the petitioner, the ad interim order was vacated. As the petitioner was not desirous to obtain ad interim relief withholding the auction proposed by the Department, the auction proceeded and the property is purchased by the auction purchaser, respondent No. 6. The petition is now posted for admission.
4. Shri Dastur, learned counsel, appearing on behalf of the petitioner, submitted that in the auction held by the Department, the property was sold for a consideration of Rs. 1,00,92,000 i.e. at the rate of Rs. 9,741 per sq. foot. It was contended that taking into consideration the price secured in the auction, the order passed by the appropriate authority should be set aside. Learned counsel urged that the fact that the price fetched at the rate of Rs. 9,741 per sq. ft. is indicative of the fact that the assumption that the value of the property was rising is not correct. Learned counsel submitted that in June or July, 1994, the office premises on the first floor of the building where the disputed premises are situated were sold at the rate of Rs. 7,804 per sq. foot and the price agreed to be paid by the petitioner about four months thereafter at the rate of Rs. 8,352 per sq. foot cannot be said to be inadequate. Shri Dastur further submitted that the instances relied upon by the appropriate authority are not at all comparable and, consequently, the order of the appropriate authority suffers from serious infirmity.
5. We are unable to find any merit in any of the contentions. In the first instance, we are not inclined to exercise writ jurisdiction because of the peculiar conduct of the petitioner. Though the petitioner filed a petition on April 4, 1995, and though the auction was set on April 26, 1995, the petitioner did not care to move the court for withholding the auction till April 25, 1995, and even after securing and ad interim order, on the next day voluntarily sought vacation of the order. In other words, the petitioner permitted the auction to proceed and the creation of right in third party. It is most improper that the authorities should be permitted to proceed with the auction and thereafter the contention should be raised that the price fetched in the auction would indicate that the consideration agreed by the transferee was not inadequate. As the interest of the third party is created and the property is of considerable value, it is not appropriate to exercise writ jurisdiction.
6. Apart from this consideration, in our judgment, the contention sought by learned counsel to challenge the impugned order cannot be entertained. The decision of the authority proceeds on appreciation of evidence and being a pure finding of fact cannot be disturbed in exercise of writ jurisdiction. It was contended that the authority did not take into consideration various factors which would indicate the value of the property and that the instances given are not comparable. We are afraid, we cannot accede to the submission for more than one reason. In the first instance, we do not agree with the submission that the said instances relied upon by the authority are not comparable. Secondly, it is not possible to expect mathematical accuracy in determination of the fair market value. The contention that the value of the property on the western side of Vile Parle is more than the eastern side has no merit. The area where the property is situated is a commercial area and there is hardly any place in Vile Parle which is not of valuable consideration. In our judgment, the order of the appropriate authority does not suffer from any infirmity and the petition must fail.
7. Accordingly, the petition is summarily dismissed.
8. Shri Dastur applies for maintenance of status quo. Prayer refused.