Judgment:
ORDER
R.C. Lahoti, J.
1. CWP 3853 and 3872/90 are between the same parties and seek reliefs which are more or less identical in nature. By order dated 7.10.1993 both the petitions have been directed to be heard together.
2. The relevant facts in brief. The immoveable property No. 701, Sahyog Building, 58, Nehru Place, New Delhi, belongs to M/S Link International, the petitioners. On 30.8.90, the petitioners entered into an agreement to sell the said property in favor of M/S. Electronic Component Industries Association the respondent No.3 for a consideration of Rs. 14,70,000/- only. Vide clause 12 of the agreement it was expressly agreed upon that the purchaser shall pay the transfer charges. On 8.9.90 the statement of transfer of immoveable property under Section 269UC of the Income-tax Act, 1961 in the prescribed proforma 37-I was filed before the appropriate authority duly signed by both the parties to the agreement. On 21.11.90, the appropriate authority passed an order (Annexure P-1) under Section 269UD(1) of the Act. The order, inter alia, recites :' Apparent Consideration: Rs.14,70,000/- including unearned increase payable to DDA,if any.'( emphasis upplied).
3. On 3.12.1990, CWP 3853/90 was filed challenging the impugned order dated 21.11.90 Annexure P-1 and in the alternative seeking quashing of the impugned order to the extent of the words inserted in the recital of apparent consideration as' including unearned increase payable to DDA, if any'. On 5.12.1990 CWP 3872/90 was filed by the petitioner wherein also challenge is laid to the impugned order dated 21.11.1990. However, the main plea in this petition is declaring Chapter XX-C of the Income-tax Act, 1961 as ultra virus the Constitution.
4. In CWP 3872/90 an interim order was passed on 7.12.1990 which reads as under :
'In the meantime,there will be stay of operation of the impugned order dated 21st November, 1990 with the result that the respondents will not be required to tender the apparent consideration. The petitioner in turn will not encumber the property nor will he alienate or transfer the possession thereof and he shall maintain status quo as of today.'
The above said order was continued till further orders on 15.1.1991 and was confirmed on 7.10.1993. It has thus remained effective till this day.
5. In the counter- affidavit filed by the purchaser- respondent No.3, it is stated that all transfer charges were to be borne by the transferee and thereforee, the amount of unearned increase if any was liable to be paid over and above the recited sale consideration by the purchaser. In the counter-affidavit filed by DDA-respondent No.4 in CWP 3853/90, it is submitted that as per the terms and conditions of auction relevant to the plot on which the building has come up, the written permission for sale or transfer of the floor space constructed on the plot was to be granted on payment of Rs. 100/- in the first sale or transfer and subsequently each sale/transfer was liable to be charged by the DDA @ Re 1/- per sft of the floor space to be transferred. Vide para 7, it is stated that 50% of the unearned increase was not chargeable on the impugned ansaction of sale provided written prior permission of DDA was obtained .
6. On 8.6.98, CM 6712/98 was moved by the petitioner submitting that the petitioner had no objection to the property being taken over by the appropriate authority subject to the petitioner being paid the amount of Rs.14,70,000/- with interest @ 18% p.a. and the impugned recital - 'including unearned increase payable to DDA, if any' being deleted from the order made under Section 269UD(1).
7. In view of the above said application the scope of controversy for decision in the two petitions has narrowed down. The first question is whether appropriate authority was justified in inserting the impugned recital in the order under Section 269UD(1)? Secondly, whether the petitioner is entitled to relief for payment of interest on the amount to be paid to the petitioner by appropriate authority.
8. Neither in the counter, nor at the time of hearing, the learned Sr Standing Counsel for the appropriate authority has been able to demonstrate how and on what material the appropriate authority arrived at the finding that the apparent consideration of Rs. 14,70,000/- included the amount of unearned increase payable to the DDA,if any. The order u/s 269UD(1) is to be passed after affording the parties an opportunity of hearing and has to be based on some material. It was brought to the notice of the appropriate authority that the amount of consideration did not include unearned in-crease which in the event of being payable, was to be borne by the intend-ing purchaser. Yet it was not deleted The recital was, thereforee, without any basis and has been inserted in the order arbitrarily. The same deserves to be struck down.
9. Where an order for the purchase of any immoveable property by the Central Govt is made under Section 269UD(1), the Central Govt shall u/s 269 UF pay by way of consideration for such purchase an amount equal to the amount of the apparent consideration. Under Section 269UG the said consideration shall be tendered to the person or persons entitled thereto within a period of one month from the end of the month in which the immoveable property concerned becomes vested in the Central Govt under section 269UE. The amount was admittedly not so tendered.
10. The learned counsel for the petitioner has in support of the petitioner's plea for payment of interest relied on two decisions of the Supreme Court, namely, Mrs Raj Laxmi Narayanan v. Mrs MK Gandhi, 1993 SC 273,and Sri Nand Lal Tejmal Kothari Vs . IAC, : [1998]230ITR943(SC) .
11. In Mrs Raj Laxami Narainan's case ( supra) the order under Section 269-UD was challenged before the Court and was stayed. Their Lordships directed interest @ 15% p.a. being paid by the Government to the petitioner on the amount of consideration. In Sri nand Lal Tej Mal Kothari's case their Lordships have directed the amount of apparent consideration to be paid with interest @ 9% p.a. from the date the impugned order was made.
12. The petitioner has come up laying challenge to the impugned order under Section 269 UD(1) to the extent of the objectionable recital therein. We have held the impugned recital to be arbitrary based as no material and hence liable to be struck down. The petitions are, thereforee, allowed and disposed of in terms of the following directions.
(i) From the impugned order dated 21.11.90 under Section 269UD(1) of the Income-tax Act, 1961 the words- 'including unearned increase payable to DDA,if any' as suffixed to 'apparent consideration: Rs.14,70,000'shall stand deleted
(ii) The amount payable to the petitioner shall carry an interest calculated @ 9% p.a. from 21.12.90 [the date falling one month after the date of the order u/s 269UD(1)] till the date of payment.
(iii) Subject to the above said directions the respondents shall proceed ahead with the order under Section 269UD(1). The interim order dated 7.12.90 passed in CWP 3872/90 stands vacated.
13. Both the petitions stand disposed of without any order as to costs.