Deputy Commissioner of Income-tax Vs. Unitech Industries Pvt. Ltd. - Court Judgment

Excerpt:
- sections 100-a [as inserted by act 22 of 2002], 110 & 104 & letters patent, 1865, clause 10: [dr. b.s. chauhan, cj, l. mohapatra & a.s. naidu, jj] letters patent appeal order of single judge of high court passed while deciding matters filed under order 43, rule1 of c.p.c., - held, after introduction of section 110a in the c.p.c., by 2002 amendment act, no letters patent appeal is maintainable against judgment/order/decree passed by a single judge of a high court. a right of appeal, even though a vested one, can be taken away by law. it is pertinent to note that section 100-a introduced by 2002 amendment of the code starts with a non obstante clause. the purpose of such clause is to give the enacting part of an overriding effect in the case of a conflict with laws mentioned with the non obstante clause. the legislative intention is thus very clear that the law enacted shall have full operation and there would be no impediment. it is well settled that the definition of judgment in section 2(9) of c.p.c., is much wider and more liberal, intermediary or interlocutory judgment fall in the category of orders referred to clause (a) to (w) of order 43, rule 1 and also such other orders which poses the characteristic and trapping of finality and may adversely affect a valuable right of a party or decide an important aspect of a trial in an ancillary proceeding. amended section 100-a of the code clearly stipulates that where any appeal from an original or appellate decree or order is heard and decided by a single judge of a high court, no further appeal shall lie. even otherwise, the word judgment as defined under section 2(9) means a statement given by a judge on the grounds of a decree or order. thus the contention that against an order passed by a single judge in an appeal filed under section 104 c.p.c., a further appeal lies to a division bench cannot be accepted. the newly incorporated section 100a in clear and specific terms prohibits further appeal against the decree and judgment or order of a single judge to a division bench notwithstanding anything contained in the letters patent. the letters patent which provides for further appeal to a division bench remains intact, but the right to prefer a further appeal is taken away even in respect of the matters arising under the special enactments or other instruments having the force of law be it against original/appellate decree or order heard and decided by a single judge. it has to be kept in mind that the special statute only provide for an appeal to the high court. it has not made any provision for filing appeal to a division bench against the judgment or decree or order of a single judge. no letters patent appeal shall lie against a judgment/order passed by a single judge in an appeal arising out of a proceeding under a special act. sections 100-a [as inserted by act 22 of 2002] & 104:[dr. b.s. chauhan, cj, l. mohapatra & a.s. naidu, jj] writ appeal held, a writ appeal shall lie against judgment/orders passed by single judge in a writ petition filed under article 226 of the constitution of india. in a writ application filed under articles 226 and 227 of constitution, if any order/judgment/decree is passed in exercise of jurisdiction under article 226, a writ appeal will lie. but, no writ appeal will lie against a judgment/order/decree passed by a single judge in exercising powers of superintendence under article 227 of the constitution. - the tribunal came to the conclusion that the initiation of acquisition proceedings by the competent authority was improper and bad because in the case of acquisition of land, ascertainment of the fair market value has to be based on factors such as instances of sale of properties situated in the same locality. as the report of the district valuation officer was not based on any such comparable sales located in the same vicinity, reliance of the competent authority upon the report of the district valuation officer was bad in law. initiation of acquisition proceedings, under the circumstances, have rightly been held to be bad in law by the tribunal.ashok bhan, j.1. this appeal has been filed by the deputy commissioner of income-tax, acquisition range, rohtak, under section 269h of the income-tax act, 1961, (hereinafter referred to as 'the act'), against the order of the income-tax appellate tribunal, delhi bench 'a', new delhi (hereinafter referred to as 'the tribunal'), dated july 28, 1994, whereby the order of the competent authority for acquisition of the property has been quashed.2. the assessee-respondent purchased land measuring 70 kanals in village jharsa, tehsil and district gurgaon, vide sale deed no. 2715 dated august 12, 1986, for an apparent consideration of rs. 23,18,750. the competent authority made a reference to the district valuation officer, chandigarh, on september 8, 1986. the district valuation officer submitted his report dated october 31, 1986, determining the fair market value at rs. 40,01,200. the competent authority, after recording its reasons, issued notices to the transferor and the transferee under section 269d(1) of the act on november 7, 1986. the transferee put in appearance and filed his objections.3. the district valuation officer had arrived at the fair market value of rs. 40,01,200 by following the undermentioned method (taken from annexure i, attached with the report of the district valuation officer, which was placed on record by counsel appearing for the department during the course of arguments) ;'property : land 79 k 2 m at vill. jharsa.land 70 k 0 m at vill. jharsa (gurgaon)land rate derivation.--regd. no. & date : 6248 dated january 21, 1986-transferor, sh. ram mehar and others, r/o. sarhol--transferee--anurag construction co., new delhi--area 11 k 05 m--apparent consideration rs. 6,12,000-location vill. sarhole. land rate as on january 21, 1986, from the above rs. 109.70 per sq. mt. taking land appreciation at 10 per cent. per annum land rate in 8/86 rs. 116 per sq. mt. deduct 10 per cent. for situation, the land rate comes to rs. 104 per sq. mt. 2. by development method : per sq. mt.average land rate in theinstanced case comes to rs. 65.50 per sq. mt. development charges as per cpwdnorms (1-10-1976)25.10c. i. of gurgaon 263 percent.66.10cost of development landwith 15 per cent. entrepreneur's profit = (65.50 + 91.10) 1.15 = rs. 180.09assuming 70 % yield, the value of building plot180.09_____91.100.70rs. 257.27say :rs. 257current rate ofdevelopment plot of south city by unitechrs. 443 per sq. mt.cost of price of virginland 443/257 x 65.50rs. 113max. rate from the abovetwo methods rs. rs. 113 per sq. mt. which has been adopted 1. f. m. v. 1. 40012 sq. mt. at rs.113 per sq. mt.45,21,3562. 35409 sq. mt. at rs.113 per sq. mt.40,01,217say:40,01,200'4. the transferee replied to the notice on december 19, 1996, it was submitted by him that the method of valuation adopted by the district valuation officer was not correct. he submitted that the land in question is a part of the total purchases, ultimately to be developed into a colony 'south city'. as per the agreement with the director, town and country planning department, haryana, the maximum profit which could be derived by the transferee was 15 per cent. in these circumstances, the correct method was development method and not yield method, which was adopted by the district valuation officer, that the district valuation officer has assumed the yield of land at 70 per cent. whereas as per the approved plan and the scheme of the haryana government, the yield is about 55 per cent. ; that the district valuation officer has taken the current rate of development plot at rs. 443 per sq. mt. whereas the plots were booked by the transferee for rs. 336 per sq. mt. along with the objections, the transferee furnished a chart plan with the revenue record for the period january, 1985, to june, 1986, giving the data of various mutations/transfers executed by various parties in the adjoining villages. an average purchase price from january 1985, to june 1986, ranged between rs. 41.91 and rs. 55.93 per sq. mt. in village kanhai and between rs. 54.36 and rs. 71.73 per sq. mt. in village jharsa.5. the contentions raised by the transferee were rejected by the competent authority. it was held that the objection against the adoption of the development method raised by the transferee was not correct as the land had been acquired for the purposes of converting it into a residential complex and, therefore, there was no flaw in the method of valuation adopted by the district valuation officer. the submission of the transferee regarding yield of 55 per cent. allowed by the haryana government and the reservation of plots for weaker sections of the society was rejected on the ground that the transferee had not furnished any documentary evidence. the competent authority after recording the following satisfactions, passed an order under section 269f(6) for acquisition of the property in question under chapter xxa of the act, after taking prior approval of the commissioner of income-tax, haryana, rohtak, dated march 22/30, 1993 ;'(i) the immovable property to which the proceedings relate is of a fair market value exceeding one hundred thousand rupees ;(ii) the fair market value of such property exceeds the apparent consideration therefor by more than fifteen per cent. of such apparent consideration ; and(iii) the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer with such object as is referred to in clause (a) or clause (b) of sub-section (1) of section 269c.'6. the transferee, aggrieved against the aforesaid order of the competent authority, filed an appeal before the tribunal, which was accepted. the tribunal came to the conclusion that the initiation of acquisition proceedings by the competent authority was improper and bad because in the case of acquisition of land, ascertainment of the fair market value has to be based on factors such as instances of sale of properties situated in the same locality. as the report of the district valuation officer was not based on any such comparable sales located in the same vicinity, reliance of the competent authority upon the report of the district valuation officer was bad in law. the tribunal concluded that there was no evidence to determine the fair market value available by way of comparison with the apparent consideration and in the absence of the same, it was not possible to come to the conclusion that there was a difference of 15 per cent. between the apparent consideration and the market value initiation of the acquisition proceedings was held to be vitiated. the appeal was accepted and the proceedings were quashed. counsel for the parties have been heard. for valuation of land, there are three classified accepted methods, i.e.,(i) the price paid of bona fide transactions of purchase of land adjacent to the land acquired within a reasonable time possessing similar advantages ;(ii) capitalisation of net profits, shortly before the date of sale ; and(iii) opinion of valuers or experts.7. the district valuation officer had relied upon the transfer of an area of 11 kanals 5 marlas of land for rs. 6,12,000, located in village sarhol on january 21, 1986. the average price per square metre came to rs. 109.70. taking land appreciation at 10 per cent. the price of land in august, 1986, was fixed at rs. 116 per sq. mt. after deducting 10 per cent. for situation, the price of the land was determined at rs. 104 per sq. mt. admittedly, village sarhol is at a distance of six kilometres from the land under acquisition. fair market value has to be based on factors such as sale of properties situated in the same locality. since the land which was treated as a comparable sale instance, is not located in the same village, reliance by the district valuation officer on this sale instance to determine the fair market value of the transferee's land, under the circumstances, cannot be treated as a fair basis for determining the fair market value. the land rate derivation method adopted by the district valuation officer, under the circumstances, cannot be accepted. similarly, the development method adopted by the district valuation officer cannot be accepted because the district valuation officer had taken the yield of land at 70 per cent. whereas, as per the approved plan and the scheme of the haryana government, the yield was only about 55 per cent. the district valuation officer had taken the rate of development plot at rs. 443 per sq. mt. whereas the assessee-transferee had booked the plots at rs.336 per sq. mt. the development method adopted by the district valuation officer, under the circumstances, could also not be adopted. there was no other evidence before the competent authority for determining the fair market value. the district valuation officer's valuation report fixing the fair market value of the land at rs. 40,01,200 was improper and, therefore, the initiation of the acquisition proceedings was not proper. the act requires the indication of difference of 15 per cent. between the fair market value when compared with the apparent consideration to give a pre-emptive right to the government to initiate the acquisition proceedings and acquire the land. there was no cogent evidence before the competent authority to prima facie conclude that the difference between the fair market value and the apparent consideration was more than 15 per cent. initiation of acquisition proceedings, under the circumstances, have rightly been held to be bad in law by the tribunal.8. finding no merit in this appeal, we dismiss the same with no order as to costs.