GORDHANDAS PURSHOTTAMDAS PATEL Vs. APPROPRIATE AUTHORITY

JUDGEMENT

(1.) THIS petition is filed by the petitioners for quashing and setting aside the order dt. 23rd Feb., 1995, passed by the respondent Appropriate Authority under S. 269UD(1) of the IT Act, 1961 (hereinafter referred to as "the Act") being illegal, ultra vires and unconstitutional.

(2.) IT is the case of the petitioner Nos. 1A to 1D that they are the owners of a piece of agricultural land admeasuring 6252 sq. mts. in the city of Baroda. Since they were desirous of selling the said land to petitioner Nos. 2A to 2B they entered into an agreement to sell on 27th Dec., 1993, for an amount of Rs. 1,91,00,000. Since the price exceeded Rs. 10 lacs, a statement in the Form No. 37 I of the Act was filled in by the parties on 30th Nov., 1994. No action was taken by the Appropriate Authority for more than two months except of sending some officers for inspection of the property. On 10th Feb., 1995, a show cause notice was issued under S. 269UD(1A) of the Act, inter alia, alleging that apparent and discounted rate of purchase price of the property under consideration was understated by more than 15%. For the said allegation, reliance was placed on sale instance property said to have been sold on 27th Dec., 1993. It was alleged that apparent consideration of property under consideration was Rs. 3,055 per sq. mt. whereas apparent consideration of sale instance property was Rs. 4,961 per sq. mt. Similarly, discounted consideration of property under consideration was Rs. 2,793 per sq. mt. while discounted consideration of sale instance property was Rs. 4,828 per sq. mt. The Appropriate Authority, in these circumstances, prima facie, formed an opinion that there was understatement of consideration of property under consideration to the extent of more than 15%. The petitioners were, therefore, called upon to show cause as to why an order in accordance with the provisions of S. 269UD(1) of the Act should not be passed and property should not be purchased by the Appropriate Authority. The petitioners were called upon to submit their reply by availing of opportunity of being heard. It was stated that if no reply and/or written submission would be filed, the Appropriate Authority would be constrained to presume that the petitioners had no objection to the proposed order to be passed against them.

(3.) THE Appropriate Authority after considering the show cause notice and replies submitted by the petitioners passed an order on 23rd Feb., 1995, in exercise of powers under S. 269UD(1) of the Act, whereby property under consideration was sought to be purchased. In para 4, considering the submissions of the petitioners, the Appropriate Authority observed :