APPROPRIATE AUTHORITY Vs. MASS TRADERS PRIVATE LTD

JUDGEMENT

(1.) These Appeals are preferred against the order dated 23.10.1992 passed by the learned single Judge in Writ Petition Nos.14319 and 14320 of 1989 respectively. The learned Single Judge has allowed the Writ Petitions and quashed the order dated 25.7.1989 passed by the Appropriate Authority under Section 269-UD(1) of Chapter XX-C of the Income Tax Act (hereinafter referred to as the Act). The Appropriate Authority has directed that the property in question bearing Municipal Nos.4 and 5 (New Nos.9 and 11) situated at Infantry Road, Bangalore be purchased under Section 269-UD(1) of the Act. The learned Single Judge has quashed the order on the following grounds: That on an earlier occasion, the Appropriate Authority has considered the consideration of Rs.1,25,02,500/- for the 2nd respondent's share and Rs.41,67,500/- for the 3rd respondent's share as adequate and granted 'No Objection Certificate' for registration of the sale transaction under Section 269-UD(1) of the Act on 27.6.1988; that during the gap of one year escalation if any, in the price has been taken care of because the difference in the consideration amount between the earlier Agreement of Sale dated 28.4.1988 and the present Agreement of Sale dated 22.5.1989 is Rs.17,36,325/-; that the Reserve Bank of India has accepted the price quoted in respect of the share of the 3rd respondent; that the order dated 25.7.1989 does not disclose any such circumstances leading to suspicion in the mind of the Authority, that there is hardly any application of the mind by the Appropriate Authority to the relevant facts arising in the case. On the aforesaid grounds, the learned single Judge has come to the conclusion that there is no justification for passing an order of pre-emptive purchase only because there is a different purchaser by a different agreement a little later. Therefore, respondents 1, 4, 5 and 6 in the Writ Petitions have come up in these Appeals.

(2.) Before we examine the correctness of the reasons given by the learned single Judge, it is necessary to state the relevant facts which are not in dispute: The property in question bearing Municipal Nos.4 and 5 (new Nos.9 and 11) is situated in the corner of Queen's Road and Infantry Road. The width of the Queen's Road is 20.15 metres and that of the Infantry Road is 18.75 metres. The property measures 43,309 Sft. It consists of a main building and a out-house covering an area of 960 Sq.mts.

(3.) Originally, the property in question was owned by one O.C.M. Maneckji. He purchased it in a Court auction on 20.3.1952. The auction sale was confirmed on 10.2.1953. The aforesaid O.C.M. Maneckji sold the property in question to Sri Nariman K.Irani and his wife Smt. Aimai N.Irani who is the 2nd respondent in this Appeal on 14.5.1957 for a sum of Rs.61,000/-. Thus, Smt.Aimai N.Irani was the joint owner along with her husband Nariman K.Irani, who died on 4.1.1972. Consequent on the death of Nariman K.Irani, his son - respondent No.3, Darius N.Irani became entitled to half-share in the half share of Nariman K.Irani, and his wife R-2 to the remaining share of Nariman K.Irani as per the personal law governing the Parsis. Thus, Smt. Aimai N.Irani became the owner of 3/4th share of the property in question and the 3rd respondent-her son became entitled to 1/4th share.