SHANTABEN RATILAL Vs. APPROPRIATE AUTHORITY

JUDGEMENT

(1.) PETITIONERS Nos. 1 to 5 were the co owners of final plot No. 718 in T.P. Scheme No. 28, admeasuring 834 sq. mtrs (997 sq. yds) (hereinafter referred to as 'said property'). They purchased the land by registered sale deed dt. 24th July, 1985 for a consideration of Rs. 6,13,384 (at the rate of Rs. 615 per sq.yard). After purchase of the land, they constructed a super structure specially suited to automobile business in which their husbands were interested and who were doing business at Anand. However, the husbands of the petitioners were not interested in developing their business at Ahmedabad. On 20th Oct., 1993, petitioners Nos. 1 to 5 entered into a written agreement of sale with petitioner No. 6, which is a public limited company, for a consideration of Rs. 64 lakhs in respect of the said property. Before that, the said property was got evaluated through a Government Approved Valuer who valued it at Rs. 62,93,000. The petitioners submitted Form No. 37 I on 27th Oct., 1993. In the said form, it was specifically mentioned that M/s Auto Parts Sales & Service were the tenants in the said property.

(2.) THEREAFTER , the transferee (petitioner No. 6) received a notice dt. 4th Jan., 1994 asking it to show cause as to why the said property should not be purchased under the provisions of Chapter XX C of the IT Act. Petitioner No. 6 replied to the said show cause notice by its letter dt. 7th Jan., 1994 stating, inter alia, that it paid Rs. 4 lakhs more than the market price because its principal, M/s Telco, desired that they should have a separate show room for Tata cars at Ahmedabad and if the said property is purchased, the time for constructing a new building can be saved and the business could be started immediately and that further sum of Rs. 5 or 6 lakhs would be required to be spent in modifying the building for its requirements, as the building was constructed for Fiat cars, which is smaller in size as compared to Tata Estate and Tata Sierra cars. It was also pointed out that the property is situated in the residential zone and there are no comparable sale instances. In spite of the abovestated reply, the petitioner No. 6 received an adverse order dt. 27th Jan., 1994 (Annexure "G"). In the order, it was observed that the appropriate authority is satisfied that the said property is fit for pre emptive purchase under S. 269UD(1) of the IT Act because the apparent consideration has been understated by more than 15%. Hence, the appropriate authority ordered to purchase the said property for a net consideration of Rs. 58,99,581. That order is challenged in the present petition.

(3.) AT this stage, we may state that except the last contention, other contentions are not required to be dealt with in the present proceeding.