KRISHNA KUMAR RAWAT & ORS. versus UNION OF INDIA & ORS.

Citation: [2019] 10 S.C.R. 333 · Decided: 29-07-2019 · Supreme Court of India · Bench: ABHAY MANOHAR SAPRE · Disposal: Disposed off
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Judgment (excerpt)

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KRISHNA KUMAR RAWAT & ORS.
 v.
UNION OF INDIA & ORS.
(Civil Appeal Nos.9800-9801of 2010)
 JULY 29, 2019
[ABHAY MANOHAR SAPRE AND
DINESH MAHESHWARI, JJ.]
Income Tax Act, 1961 – ss.269UC, 269UD (1A), 269UE (1),
269UG (4) and Chapter XX-C – Rajasthan Urban Areas (Sub
Division) Rules, 1975 – r.11 – Vesting of Property in Central
Government – Appellants (Prospective buyers) entered into an
agreement for purchase of the suit land for a total consideration of
Rs.99,84,500/- – Appellants furnished information about the
purchase of the suit land u/s 269UC of the Act to the appropriate
authority – Appropriate authority issued a show cause notice u/
s.269UD (IA) of the Act stating that sale consideration disclosed by
the appellants was very low – After making inquiries and hearing
the parties, the appropriate authority passed an order dated
30.03.1994, directing that in terms of s.269UE(1) of the Act, the
suit land stood vested in the Central Government – Writ petition –
Single Judge of the High Court upheld the order dated 30.03.1994
– The appellants and vendor (respondent No.3) filed separate intra
court appeals before the Division Bench of High Court – Division
Bench of the High Court dismissed the appellants’ appeal, however,
partly allowed the vendor’s appeal with the direction that upon
department taking over possession of the suit land, prospective
buyers were entitled to claim refund of the amount paid to the vendor
together with interest @ 6% p.a., out of the maturity amount of the
FDR (created by department) and the remaining amount to be paid
to the vendor – Review Petition was also dismissed – On appeal,
held: Appropriate authority examined the location of the suit land,
its area and its proximity with main roads, industries and residential
colonies situated in the nearby areas and determined the market
value of the suit land at Rs.1,46,58,548/- as against the apparent
consideration of Rs.99,84,500/- fixed in the agreement – It was after
recording the factual findings, the appropriate authority came to a
[2019]  10 S.C.R. 333
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SUPREME COURT REPORTS
[2019] 10  S.C.R.
conclusion that the case for pre-emptive purchase of suit land as
contemplated u/s. 269UD(1) was made out against the appellants –
Findings recorded by the writ Court, appellate Court and review
Court were consistently against the appellants – These findings were
based on appreciation of evidence and in conformity with
requirements of s.269UD – Hence, the same are upheld – Insofar
the entitlement of the prospective buyers to the refund amount is
concerned, the Division Bench of the High Court did not take into
consideration s.269UG(4) of the Act – Thus, decision to be taken
by the appropriate authority for disbursement of the amount of
consideration, as required u/s. 269UG(4) of the Act in accordance
with law.
Dismissing the C.A.No.9800-9801/2010 and partly allowing
the C.A.No.9901/2010, the Court
CIVIL APPEAL Nos.9800-9801/2010
HELD: 1. Appropriate authority after setting out the facts
in detail, the appropriate authority examined the location of the
suit land, its area, and its proximity with the main roads, industries
and residential colonies situated in the nearby areas etc. The
appropriate authority then found that having regard to the
topography of the suit land, it has a potential market value.
[Para 26] [343-B]
2. Thereafter, the appropriate authority examined the
condition of the two existing godowns bearing Nos. 13 and 14
and other structures standing on the suit land and found as a fact
that the condition of the two existing godowns was very good and
these godowns were actually being used by the appellants for
commercial purposes. [Para 27] [343-C]
3. Considering the rates applicable as in the case of CPWD
structures by cost index and keeping in view the relevant factors
such as size, location, condition and the commercial use of the
godowns, the appropriate authority fixed Rs.42 lakhs as being
the market value of the two godowns. [Para 28] [343-D]
4. The appropriate authority then worked out the rate of
the suit land at Rs.1727.5 per sq. meter and accordingly
determined the market value of the suit land at Rs.1,79,21,532/-
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as against its declared value of  Rs.99,84,500/- in the agreement.
[Para 29] [343-E]
5. The appropriate authority then considered the appellants’
objections to the effect that while determining the market value
of suit land, deduction of 30% to 40% should hav
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