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Hindustan Motors Ltd. and anr. Vs. Members, Appropriate Authority and ors. - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtChennai High Court
Decided On
Case NumberWrit Petition Nos. 13303 and 15631 of 1997 and W.M.P. Nos. 21387 and 24796 of 1997
Judge
Reported in(2001)165CTR(Mad)153; [2001]249ITR424(Mad)
ActsIncome-tax Act, 1961 - Sections 269UA, 269UB, 269UC, 269UD, 269UD(1), 269UD(1A), 269UD(2), 269UE(1) and 269UM; Constitution of India - Article 226; Income-tax Rules, 1962 - Rule 48L; Registration Act, 1908; M.M.D.A. Development Control Rules; Wealth-tax Act
AppellantHindustan Motors Ltd. and anr.
RespondentMembers, Appropriate Authority and ors.
Appellant AdvocateV. Ramachandran, Adv. for K. Mani, Adv.
Respondent AdvocateChitra Venkataraman, Adv.
Cases ReferredAppropriate Authority v. Sudha Patil
Excerpt:
direct taxation - exchange of property - sections 269ua, 269ud and 269ue of income tax act, 1961 - petition challenging order of appropriate authority passed under section 269ud - petitioner and one other party entered into contract of exchange of their property - applied for no objection certificate (noc) - instead of giving noc appropriate authority passed order to purchase property of petitioner - order of pre-emptive purchase passed after considering material on record and comparative sale instances - judicial review limited only to extent of examining as to whether any finding perverse or contrary to establish principles of law - held, no reason to interfere with impugned order. - - 5. the petitioner submitted objections to the said notice, in terms of its letter dated june 9,.....p. satiiasivam, j.1. aggrieved by the order of the first respondent/the appropriate authority (income-tax department), chennai-54, dated august 21, 1997, passed under section 269ud(1) of the income-tax act, 1961, hindustan motors limited, calcutta-1, has filed writ petition no. 13303 of 1997.2. aggrieved by the very same order, the other party to the 'exchange', smt. a. r. chandrika has filed writ petition no. 15631 of 1997. since the issue raised is one and the same in both the writ petitions, they are being disposed of by the following common order. inasmuch as the petitioner in writ petition no. 15631 of 1997, is also the fifth respondent in writ petition no. 13303 of 1997, for convenience i shall refer to hindustan motors limited as petitioner and smt. a. r. chandrika as fifth.....
Judgment:

P. Satiiasivam, J.

1. Aggrieved by the order of the first respondent/the Appropriate Authority (Income-tax Department), Chennai-54, dated August 21, 1997, passed under Section 269UD(1) of the Income-tax Act, 1961, Hindustan Motors Limited, Calcutta-1, has filed Writ Petition No. 13303 of 1997.

2. Aggrieved by the very same order, the other party to the 'exchange', Smt. A. R. Chandrika has filed Writ Petition No. 15631 of 1997. Since the issue raised is one and the same in both the writ petitions, they are being disposed of by the following common order. Inasmuch as the petitioner in Writ Petition No. 15631 of 1997, is also the fifth respondent in Writ Petition No. 13303 of 1997, for convenience I shall refer to Hindustan Motors Limited as petitioner and Smt. A. R. Chandrika as fifth respondent.

3. The case of the petitioner is briefly stated hereunder :

The petitioner is a public limited company having its registered office at Calcutta and a division at Chennai. The petitioner owns a property comprising the land and building situated at No. 10, First Avenue, Harrington Road, Chetput, Chennai-31. The property comprises land measuring three grounds 777 square feet with a residential building thereon. The fifth respondent is the owner of the property comprising land measuring five grounds and 1,552 square feet with residential building thereon situated at No. 1, Second Main Road, Gandhinagar, Adyar, Chennai-20. The petitioner desired to construct a housing complex for the benefit of its emplo-yees. They were informed that the fifth respondent owns a properly comprising more than five grounds at Adyar. On an inspection, the petitioner was convinced that the said properly would be eminently suitable for its purpose of putting up a housing complex as required by it. After discussions and after various proposals on either side, the petitioner and the fifth respondent came to an agreement that the property belonging to the petitioner and the property belonging to the fifth respondent could be mutually exchanged. Pursuant to the agreement between the petitioner and the fifth respondent to exchange the properties mutually, they sought the assistance of a registered valuer to arrive at the terms of exchange after considering the nature of the properties and all relevant and connected matters in regard thereto. After detailed discussions, the parties agreed that the property at Adyar belonging to the fifth respondent shall be exchanged for the property at Harrington Road belonging to the petitioner, the petitioner paying to the fifth respondent a sum of Rs. 65,00,000 pursuant to the above exchange of the properties. The parties entered into an agreement of exchange dated March 28, 1997, setting out the terms mutually agreed to between them with regard to the above exchange. They were advised that in so far an exchange was a 'transfer' within the meaning of the said expression under Section 269UA(f) of the Income-tax Act, they should obtain a 'no objection certificate' to secure the registration of the deed of exchange and for the said purpose, they were required to file a statement in Form No. 37-1 in terms of Section 269UC of the Income-tax Act. Accordingly, the petitioner filed a statement in Form No. 37-1, dated March 28, 1997, prescribed under rule 48L of the Income-tax Rules, 1962.

4. On May 19, 1997, the petitioner received a notice under Sub-section (IA) of Section 269UD of the Income-tax Act. The first respondent called upon the petitioner to show cause why an order should not be made in respect of the property at Harrington Road, Chetput, Chennat, in accordance with the provisions of Section 269UD of the Income-tax Act. The notice stated that the first respondent had come across two sale instances in the past in the vicinity of the said property which he sought to compare with the said property. Apart from the aforesaid two sale instances relating to the property at Harrington Road, the first respondent incidentally pointed out that the property at Gandhi Nagar, Adyar, belonging to the fifth respondent and sought to be exchanged for the petitioner's property has shown 'considerable appreciation' when compared to two sale instances relating to 1995. After dealing with the two sale instances, the first respondent has stated that the variation between the prices in respect of the sale instances would raise a presumption of an attempt to evade tax.

5. The petitioner submitted objections to the said notice, in terms of its letter dated June 9, 1997. Apart from submitting detailed objections, the petitioner submitted valuation reports as well as detailed technical objection from a registered valuer apart from its own objections objecting to the assumption of the first respondent that there was an undervaluation of the petitioner's property and that the presumption of attempt to evade tax would arise. It is further stated that the petitioner is a public limited company of repute and there was no question of avoidance of tax in respect of the above transaction. The first respondent finally made an impugned order dated August 21, 1997, under Section 269UD(1) of the Income-tax Act. In the said order, the first respondent arbitrarily rejected the various contentions submitted by the petitioner and did not also consider the various sale instances cited by the petitioner in support of its contention that there was no undervaluation by the petitioner as alleged by the first respondent. In such circumstances, having no other effective remedy, has filed Writ Petition No. 13303 of 1997. Since the fifth respondent/petitioner in the other Writ Petition (W. P. No. 15631 of 1997) has also raised similar contentions, I am not referring the same.

6. In the light of the above factual position, I have heard learned senior counsel for the petitioner in both the writ petitions and the senior Central Government standing counsel (income-tax cases) for respondents Nos. 1 to 4 in both the cases.

7. There is no dispute that the petitioner owns a property comprising the land and building situated at No. 10, First Avenue, Harrington Road, Chetput, Chennai-31. The said property comprises land measuring three grounds 777 square feet with a residential building thereon. Likewise, the fifth respondent is the owner of the property comprising land measuring five grounds and 1,552 square feet with residential building thereon situated at No. 1, Second Main Road, Gandhi Nagar, Adyar, Chennai-20. After negotiation, the petitioner and the fifth respondent came to an agreement that the property belonging to the petitioner and the property belonging to the fifth respondent could be mutually exchanged. It is further seen that pursuant to the said agreement between the petitioner and the fifth respondent to exchange the properties mutually, they sought the assistance of a registered valuer to arrive at the terms of exchange, after considering the nature of the properties. It is further seen that accordingly, the parties agreed that the property at Adyar belonging to the fifth respondent shall be exchanged for the property at Harrington Road belonging to the petitioner, the petitioner paying to the fifth respondent a sum of Rs. 63,00,000 pursuant to the exchange of the properties. Finally, the parties entered into an agreement of exchange dated March 28, 1997, setting out the terms mutually agreed to between them with regard to the said exchange. It is further seen that both the parties were advised that in order to obtain a 'no objection certificate' to secure the registration of the deed of exchange, they were required to file a statement in Form No. 37-1 in terms of Section 269UC of the Income-tax Act (hereinafter referred to as'the Act'). Accordingly, the petitioner filed a statement in Form No. 37-1, dated March 28, 1997, prescribed under rule 48L of the Income-tax Rules (hereinafter referred to as 'the Rules'). In the said form, the petitioner was shown as the transferor and the fifth respondent as the transferee. On the basis of the direction to file a separate statement showing the fifth respondent as the transferor and the petitioner as the transferee in respect of the property at No. 1, Second Main Road, Gandhi Nagar, Adyar, belonging to the fifth respondent, two statements in Form No. 37-1 were filed one showing the petitioner as transferor in respect of the property at Harring-ton Road belonging to the petitioner and the other showing the fifth respondent as the transferor in respect of the property at Gandhi Nagar belonging to the fifth respondent. After rectifying certain errors that were noticed in the statements, a fresh set of statements in Form No. 37-1 were filed rectifying the errors, on May 5, 1997. While so, on May 19, 1997, the petitioner received a show-cause notice relating to the property belonging to the petitioner at Harrington Road, Chetput, Chennai, to show cause why an order should not be made in respect of the above property in accordance with the provisions of Section 269UD of the Act. In the said notice, the first respondent referred to two sale instances in the past in the vicinity of the said property and came to the conclusion that there was a difference of 39.92 per cent, taking into account the first property and 36.74 per cent, taking into account the second property. In the very same notice, it was pointed out that the property at Gandhi Nagar, Adyar, belonging to the fifth respondent sought to be exchanged for the petitioner's property has shown 'considerable appreciation' when compared to two sale instances relating to 1995. In the said show-cause notice, after referring those material aspects, the first respondent sought to exercise the right of pre-emptive purchase. The petitioner submitted objections to the said notice in their letter dated June 9, 1997. The petitioner also submitted valuation reports as well as detailed technical objection from a registered valuer apart from its own objections objecting of the assumption of the first respondent that there was an undervaluation of the petitioner's property and that the presumption of attempt to evade tax would arise. After affording adequate opportunity to the petitioner and after a full-fledged enquiry, the first respondent, by the impugned order dated August 21, 1997, by virtue of the powers vested on them under Section 269UD of the Act, passed an order to purchase the property at Harrington Road, more particularly described in annexure I to the order by the Central Government for a sum of Rs. 1,87,00,000. By virtue of the provisions of Section 269UE(1) of the Act, the said property shall vest in the Central Government from the said date. In so far as the property of the fifth respondent is concerned, the form submitted by them in Form No. 37-1 was rendered as infructuous.

8. Mr. V. Ramachandran, learned senior counsel for the petitioner, after taking me through the agreement of exchange dated March 28, 1997, relevant provisions from the Income-tax Act and the Rules and the impugned order of the first respondent, has raised the following contentions :

The impugned order is contrary to the provisions of Chapter XX-C of the Act and liable to be quashed ;

Inasmuch as the transaction is one of exchange, any action in terms of Chapter XX-C has to cover all the properties involved in the exchange and cannot be invoked in respect of any one of the properties in isolation of the other or others ; hence, the impugned order of the first respondent, ordering the purchase of only the petitioner's property and ignoring the transaction relating to the property sought to be given to the petitioner in exchange, in terms of the agreement of exchange and rejecting the statement in Form No. 37-1 filed in respect of the said property as infructuous, is bad in law ;

The first respondent has no jurisdiction to decide that there is an undervaluation in respect of one of the properties covered by exchange on the basis of the apparent consideration so estimated ;

The appropriate authority is bound to determine whether the property so offered constitutes adequate consideration taking into account all surrounding circumstances. He cannot merely proceed on the basis-of an estimate of value of one of the properties or both and come to the arbitrary conclusion that one of the properties is undervalued on the basis of sale instances referred to by him ;

A mere statement that a presumption of attempt to evade tax arises would not be sufficient discharge of the obligation cast on the first respondent under Chapter XX-C ;

The first respondent has cited two sale instances, both properties being situated in the Second Avenue, Harrington Road, Chennai. On the other hand, the property in respect of which the impugned order is passed is situated in the First Avenue, Harrington Road, Chennai. In view of the difference in road width of the first and second avenues, the properties in the second avenue would be far more valuable ;

Necessary allowances were not taken into account and consequently the impugned order which has been made without taking into account the eligible allowances is liable to be quashed ;

The first respondent has not determined the value in respect of the property offered in exchange, the apparent consideration has not been determined and, consequently, the first respondent cannot make an order for purchase of property under Section 269UD(1) of the Act. The first respondent ought to have accepted the value fixed by the Registration Department.

9. On the other hand, Mrs. Chitra Venkataraman, learned senior Central Government standing counsel (income-tax cases), after taking me through the impugned order of the first respondent, would contend that the petitioner was given adequate opportunity before passing the impugned order. She also contended that the first respondent has correctly referred to two sale instances nearer to the property of the petitioner and assessed the value in accordance with the accepted principles and rightly passed the impugned order. She further contended that this court does not sit in appeal over the decision of the appropriate authority and re-appraise the materials placed before it. She further contended that inasmuch as the order of pre-emptive purchase was passed after considering materials on record and comparitive sale instances, the judicial review by this court under article 226 of the Constitution of India is very limited and accordingly prayed for dismissal of the writ petitions.

10. I have carefully considered the rival submissions.

11. Since the contentions raised by learned senior counsel for the petitioners are interconnected, I shall consider and give my reasons hereunder. Chapter XX-C deals with purchase by the Central Government of immovable properties in certain cases of transfer. Among other provisions, we are concerned with Section 269UA which reads as follows :

'2G9UA. In this Chapter, unless the context otherwise requires,--

(a) 'agreement for transfer' means an agreement, whether registered under the Registration Act, 1908 (16 of 1908), or not, for the transfer of any immovable property ;

(b) 'apparent consideration',--

(1) in relation to any immovable property in respect of which an agreement for transfer is made, being immovable property of the nature referred to in Sub-clause (i) of Clause (d), means,--

(i) if the immovable property is to be transferred by way of sale, the consideration for such transfer as specified in the agreement for transfer ;

(ii) if the immovable property is to be transferred by way of exchange,--

(A) in a case where the consideration for the transfer consists of a thing or things only, the price that such thing or things would ordinarily fetch on sale in the open market on the date on which the agreement for transfer is made ;

(B) in a case where the consideration for the transfer consists of a thing or things and a sum of money, the aggregate of the price that such thing or things would ordinarily fetch on sale in the open market on the date on which the agreement for transfer is made, and such sum ;'

12. Section 269UB speaks about constitution of appropriate authority and Section 269UC refers to restrictions on transfer of immovable property.Section 269UD enables the appropriate authority to pass orders for purchase by the Central Government of immovable property. As per Sub-section (1A), before making an order under Sub-section (1), the appropriate authority shall give a reasonable opportunity of being heard to the transferor, the person in occupation of the immovable property if the transferor is not in occupation of the property, the transferee and to every other person whom the appropriate authority knows to be interested in the property. Every order made by the appropriate authority under sub-section (1) shall specify the grounds on which it is made. As per Sub-section (2), the appropriate authority shall cause a copy of its order under Sub-section (1) in respect of any immovable property to be served on the transferor, the person in occupation of the immovable property if the transferor is not in occupation thereof, the transferee, and on every other person whom the appropriate authority knows to be interested in the property. Section 269UE(1) says that where an order under Sub-section (1) of Section 269UD is made by the appropriate authority in respect of an immovable property referred to in Sub-clause (i) of Clause (d) of Section 269UA, such property shall, on the date of such order, vest in the Central Government in terms of the agreement for transfer referred to in Sub-section (1) of section 269UC.

13. In view of specific reference including transfer of immovable property by way of exchange in Sub-clause (ii) of clause (1) of Section 269UA(b), the said transaction of exchange between the petitioner and the fifth respondent is covered by Chapter XX-C of the Act and, as such, the contra argument regarding lack of jurisdiction is liable to be rejected.

14. Both the properties in question, namely, at No. 10, First Avenue, Har-rington Road, Chetput and at No. 1, Second Main Road, Gandhi Nagar, Adyar, were valued by a registered valuer, namely, Prashanth Engineers and the petitioner filed a statement in Form No. 37-1 on the basis of the said valuation. The appropriate authority rejected both the valuation reports as well as apparent consideration shown in the statement based on the aforesaid valuation reports. The conclusion of the appropriate authority is that the report of the registered valuer is not based on any evidence of the market value of the land. On the other hand, the appropriate authority relied on two sale instances of the property in which 'no objection certificates' were issued and according to the said authority which are authentic documents.

15. Mr. Ramachandran, learned senior counsel for the petitioner, by drawing my attention to Section 269UA(b) of the Act, would contend that in respect of an exchange, the apparent consideration of the property which is sought to be transferred, would represent the market value of the property that is taken in exchange plus the money, if any, paid in addition to the property. Thus, according to him, applying the said definition, theapparent consideration for the property at Harrington Road belonging to the petitioner would represent the market value of the property at Adyar. It is also stated that in terms of Section 269UD(1), if the Government desires to purchase the property which is the subject-matter of an exchange, it should pay to the owner the market value of the property which is taken in exchange. Accordingly, it is further stated that the appropriate authority ought to have valued the Adyar property to determine the actual consideration that should be paid by the Government to the petitioner. It is argued that in the absence of valuation of the Adyar property by the appropriate authority, it is impossible for the appropriate authority to actually determine the consideration payable to the petitioner for the purchase of the petitioner's property at Harrington Road. He very much relied on a decision in the case of Hari Krishna Kanoi v. Appropriate Authority : [1994]207ITR743(Cal) . The following passage is very much pressed into service (page 767) :

'One of the grounds for the petitioners contending that the appropriate authority has not determined the apparent consideration in terms of the agreement is that the appropriate authority should have taken the market value of the construction to be made by the petitioners on lot 'B'. It is submitted that Rs. 10 lakhs only represented the cost of construction. The objection must be sustained. The appropriate authority has treated the proposed construction as a 'thing' within the meaning of Section 269UA(b)(2)(ii) and (iii). It should have addressed its mind to the market value of such construction on the date of the agreement. It has not.'

16. A perusal of the relevant provisions would clearly show that where an order for the purchase of any immovable property is made under Section 269UD(1) of the Act, the Central Government shall pay, by way of consideration for such purchase, an amount equal to the amount of the apparent consideration. In such a circumstance, the question of fulfilling the promises as per the agreement does not arise. In terms of Section 269UM, the transferee cannot make any claim against the transferor by reason of such transfer being not in accordance with the agreement for the transfer of the immovable property entered into. Accordingly, the contention of the learned senior counsel for the petitioner is liable to be rejected.

17. Now I shall consider the sale instances cited in the show-cause notice as well as in the ultimate order passed by the appropriate authority. According to the first respondent, both the properties are located in Second Avenue, Harrington Road, Chetput, which is adjacent to the First Avenue and simiarly located and comparable. It is seen that the appropriate authority has based the valuation on documented sale instances where land value has been fixed as Rs. 2,100 square feet by the registered valuer. It is the definite case of the petitioner that the land value in First Avenue, Harrington Road, are lower by 32 per cent, as compared to Second Avenue,Harrington Road, based on a comparison of the guideline value. In this regard, the appropriate authority has concluded that guideline values are fixed by the registering authorities for the purposes of collection of stamp duty and that guideline values of land for the purposes of registration of an immovable property can have no application for determining the market value under Chapter XX-C of the Act. The appropriate authority has relied on a decision of the Rajasthan High Court in Krishna Kuntar Rini'dl v. Union of India , wherein it was held that the market rates for the purpose of registration of an immovable properly as notified by the Sub-Registrar can have no application for determining the market value under Chapter XX-C of the Act. It is further stated that it is limited only for payment of stamp duty. I am in agreement with the view expressed by the Rajasthan High Court. Further, the principles for valuation in respect of an immovable property under the Wealth-tax Act or other tax ation laws arc different from the principles which are applicable to acquisition proceedings. The proceedings under Chapter XX-C are akin to the acquisition proceedings and not to the valuation principles which are applicable for assessing the tax on the basis of the valuation of the property. A certain element of guess has to be there based on objective factors having reasonable nexus with the evidence on record. The various factors arc there on the basis of which out of the various method by which the valuation of the immovable property can be made, appropriate method is to be adopted. It depends on the location of the property, the purpose for which the property is used, the nature of the property the time when the agreement is entered into and similar other objective factors. The valuation, therefore, has to be done by a method which is more objective and could furnish reliable data to arrive at a just conclusion. As already stated, the market rates notified by the Sub-Registrar for the purpose of registration cannot be a proper guide for valuation in respect of preemptive purchase.

18. Appropriate authority has referred to two sale instances in the past in the vicinity of the said property which are relevant and comparable. The details of two sale instances as mentioned in the show-cause notice as well as in the impugned order of the appropriate authority are stated hereunder :

Sl. No.Date of agree-mentDescription of the properlyRate per ground for landModified rate as on the date of agreement allowing 1 per cent. p.m.

(1)(2)(3)(4)(5)

128.2.96No. 6, II Avenue, Harrington Road, Chennai.

Land : 5.500 sq. ft. (2.29 grds)

Bldg : About 3,200 sq. ft. (double storeyed)(i) Rs. 64,13,000 considering depreciated cost for building(i) Rs. 72,46,690Year of construction-1962

Frontage-15.25 mtrs.

Road width-12.19 mtrs.

Residential area.

Transferee : Sri M. Avais Murvee and two others. D. No. 2, Kothari Road, Nungambakkam, Chennai.

Apparent consideration : Rs. 1,55,00,000(ii) Rs. 66,28,000 considering scrap value for building(ii) Rs. 74,89,640224.10.96No. 8, II Avenue, Harrington Road, Chennai.

Land 62.20 per cent. UDS out of 8,800 sq. ft. Bldg.

About 4,435 sq. ft.(i) Rs. 67,31,000considering depreciated cost for building(i) Rs. 70,67,550Year of construction- 1963

Frontage-24.08 mtrs.

Road width-12.19 mtrs.

Residential area.(ii) Rs. 70,05,000 considering scrap value for building(ii)Rs. 73,53,250Transferee : S. I. Property Inv. Ltd., Chennai.Apparent consideration Build up area.5.000 sq. ft. at Rs. 1,000 per sq. ft.Rs. 50,00,000Rs. 1,18,60,000

Total Rs. 1,68,00,000

Discounted consideration Rs.1,61,36,000.

19. Though learned senior counsel for the petitioner would state that in both the sale instances the properties situate in Second Avenue whereas the property in question is in First Avenue hence the same cannot be compared, I am unable to accept the said contention in the light of the discussions by the appropriate authority. It is clear that both the sale instances relate to properties proximate in location to the subject property and arc in the residential zone of development as per M.M.D.A. Development Control Rules. In respect of the property at Serial No. 1, taking note of. efflux of time, the appropriate authority has allowed appreciation at 1 per cent. p.m. and worked out the fair market value of the subject property. The fair market value in this case works out to Rs. 2,61,66,000 as against the apparent consideration of Rs. 1,87,00,000. Accordingly, the appropriate authority has concluded that there is significant undervaluation of the subject property by 39.92 per cent. Likewise, if the sale instance at Sl. No. 2 is considered, according to the appropriate authority, the understatement will be 36.74 per cent. The details furnished show a reasonable presump-tion of attempt to evade tax. Though it is stated that the other property, namely, Second Main Road, Gandhi Nagar, Adyar, has not been considered by the appropriate authority even in the show-cause notice dated May 19, 1997, the appropriate authority has referred to and compared with the sale instances in the same locality. The following details have been furnished with regard to the Adyar property :

Sl. No.Dateof agreementDescription of thepropertyLandrate per ground

1.5-8-95D.No. 2, II Main Road, Gandhi Nagar, Adyar, Chennai.Rs. 21,00,000Land: 10,797,33 sq. ft. out of 13,464 sq. ft. Apparent consideration : Rs. 99,00,000Discounted consideration : Rs. 94,49,011 Transferee : Mrs. Geetha Kumar, No. 55, Rukmani Road, Kalakshetra Colony, Besant Nagar,Chennai.210-11-95D.No. 19. I Main Road, Gandhi Nagar,Adyar, Chennai.Rs.34,61,000Land: 12,960 sq. ft. Apparent consideration Rs.1,95,00,000Discountedconsideration Rs. 1,87,88,190 Transferee : Dev Apartments, Adyar, Chennai.

20. It is clear that the land rate reflected in the case of the property at door No. 1, Second Main Road, Gandhi Nagar, Adyar, Chennai, is Rs. 43,64,000 which indicates an appreciation of more than 1 per cent, per month. Here again, the appropriate authority have allowed 1 per cent, per month on the consecutive side for updating the land value.

21. It is also clear that with regard to the first sale instance, 'no objection certificate' has been issued for Rs. 1,50,00,000 which is also reflected in page 1 of the sale deed document No. 890 of 1996, the purchaser having paid and the seller having accepted the receipt of the amount. As rightly observed by the appropriate authority, this represents the true market value of the property. As stated earlier, for the purpose of collecting stamp duty, the value is apportioned between land and building, whatever value for land indicated by the vendor and the executant in the document is taken as base and stamp duty worked out. Hence, the value furnished by the petitioner based on the materials supplied by the Sub-Registrar cannot be accepted for valuing the property under Chapter XX-C. Though the second sale instance relating to the property at door No. 8, II Avenue, Harrington Road, is not registered, after considering all the relevant materials, the appropriate authority has issued 'no objection certificate' and it reflects the market rate of the land as on the date of that agreement on October 24, 1996. On the other hand, the value furnished by Prashanth Engineers merely on the basis of materials supplied by the Sub-Registrar here again cannot be accepted. As rightly observed by the appropriateauthority, there was appreciation in land rate in Chetput locality where the subject property is situated. In fact, Adyar area where the property being exchanged is situated, has also shown appreciation in land rate. Though reliance was placed about the statement in the newspapers regarding slump in the prices of land, as rightly observed, the rise or slump in the prices of land reported in the newspapers cannot be generalised as applicable to all areas. The appropriate authority has also considered the documents in respect of few cases of property transactions in Harrington Road filed by the petitioner, and after giving adequate reasons, rejected those documents. The desire of the fifth respondent to retain the building as her residence and not for development, the appropriate authority has allowed a reduction of 10 per cent, in the land rate for restricted market as suggested by the valuer while evaluating the fair market value. Further, even though the Coovum river has any effect on the property in question, the appropriate authority have given due consideration for locational disadvantage on account of the Coovum and allowed 5 per cent, reduction in the land rate while evaluating the fair market value. Regarding the width of the road, the appropriate authority has obtained necessary details from the Madras Metropolitan Development Authority and considered the claim of the petitioner. In the light of the detailed discussions by the appropriate authority based on acceptable materials, though learned senior counsel for the petitioner has referred to various decisions regarding fixation of market value and other aspects, I am of the view that it is unnecessary to refer the same. Further it is settled law that when the facts are clear, there is no need to refer decisions for those aspects.

22. Finally, as rightly contended by learned senior Central Government standing counsel, this court exercising jurisdiction under Article 226 of the Constitution of India, cannot scrutinise the matter like an appeal. It is settled law that judicial review is limited only to the extent of examining as to whether any finding is perverse or there is non-application of mind or the order is contrary to the established principles of law. This court is not sitting in appeal over the orders passed by the appropriate authority and the satisfaction has to be arrived at by the appropriate authority on the basis of the valuation report and the relevant documents which have been taken into consideration. Further, it is not the calculation or the manner which could be examined under Article 226 of the Constitution of India. The calculation is always a question of fact. The principles of valuation alone have to be considered. I have already observed that the appropriate authority has considered the relevant sale instances and after allowing reduction to certain extent arrived at a correct conclusion. In this regard, it is useful to refer a decision of the Supreme Court in the case of Appropriate Authority v. Sudha Patil : [1999]235ITR118(SC) . After discussing the provisions referred to in Chapter XX-C of the Act as well as powerof this court under Article 226 of the Constitution of India, the Supreme Court has observed that at (page 128) :

'... we are of the considered opinion that merely because no appeal is provided for against the order of the appropriate authority, directing compulsory acquisition by the Government, the supervisory power of the High Court docs not get enlarged nor the High Court can exercise an appellate power.'

23. In the light of the law laid down by the apex court, after examining the order of the appropriate authority, in detail, I do not find any good reason to interfere with the said order. Further, the appropriate authority considered all the aspects and afforded adequate opportunity to the parties concerned. Accordingly, both the writ petitions fait and the same are dismissed. No costs. Consequently, both the writ miscellaneous petitions are closed.


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