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Judgment
R.A. Jahagirdar J.
These petitions challenge the proceedings taken by the authorities under Chapter XXC of the Income Tax Act, 1961, hereinafter referred to as "the Act". Under the provisions of this Chapter, an order has been made u/s 269UD of the Act for the purchase by the Central Government of the immovable properties which are mentioned in the statements filed u/s 269UC of the Act. In my opinion, these petitions, as other similar petitions which are before me for admission, raise substantial questions of law and a rule ought to be issued.
Rule is accordingly issued in each of these two petitions.
I have heard the learned advocates for the petitioners as well as the respondents in each of these petitions on the question of interim relief. The provisions of Chapter XXC of the Act themselves provide for certain safe-guards regarding the properties which become vested as soon as an order is passed u/s 269UD of the Act. Mr. Setalvad, for the respondents has suggested that apart from the safeguards that may be available under the Act, it is necessary, in order to avoid complications during the pendency of these petitions, that certain undertakings should be taken by the court from the petitioners. Mr. Dastur, appearing for the petitioners, in Writ Petition No. 3536 of 1986 and Mr. Shivram, appearing for the petitioners, in Writ Petition No. 3548 of 1986 have, however, argued that it is not necessary to insist upon the undertakings. On the other hand, it should be enough to protect the interests of the Government as well as that of the petitioners if an order is passed by this court requiring the petitioners to submit the information as suggested by Mr. Setalvad and also an order preventing the petitioners from doing any act which, according to the respondents, is likely to prejudice the case of the respondents. After hearing the learned advocates for the parties, I am of the opinion that certain undertakings ought to be furnished by the petitioners in these two petitions where both the transferees and the transferors are the petitioners. Accordingly, I direct as follows :
Pending the hearing and final disposal of the petitions, no further steps shall be taken by the parties pursuant to the purchase order made u/s 269UD of the Act passed in these cases provided the following conditions are fulfilled :
(1) Within three weeks from today, the petitioners will file an affidavit in these petitions giving full particulars (such as the name, age or occupation) of any person or persons at present either occupying the premises or claiming any interest therein;
(2) Within three weeks from today, the petitioners will undertake on affidavit to this court that �
(a) the petitioners, their successors, servants and/or agents will not sell, transfer or alienate or in any manner dispose of the premises to any person or party;
(b) the petitioners, their successors, servants and/or agents will not create any interest in the premises or deal with or encumber the same in any manner;
(c) the petitioners, their successors, servants and/or agents will not induct any person or party into the premises hereinafter and will not part with the possession of the premises in any manner whatsoever;
(d) the petitioners will surrender vacant and peaceful possession to the appropriate authority (or any other person duly authorised in that behalf him) of the premises in the event of the rule herein being ultimately discharged as if the purchase order was passed on the day the rule was so discharged.
Within three weeks from today, the transferors will undertake on affidavit to this court that they will not take any plea of limitations for the non-payment of the amount of consideration for the period during which the order of stay passed is operative nor will they contend that the premises have re-vested in the transferors u/s 269UH of the Act for the same reason.
If the affidavits are not filed within the period as directed above, the order of stay will stand vacated and the appropriate authority will be entitled to proceed under the provisions of Chapter XXC of the Act in respect of the premises. The relevant time for handing over possession and payment of consideration will be calculated as if the purchase order was passed on the day the orders stand vacated.
It is also hereby ordered that �
(a) if any construction or improvement is made in respect of the premises, the same will be done at the risk of the petitioners and will not in any way enhance the amount of consideration payable u/s 269UF of the Act;
(b) if any damage or material alteration is caused to the premises by the petitioners, other than normal wear and tear, the amount of consideration shall be reduced by such sum as the appropriate authority, for reasons to be recorded in the writing, may by order determine after giving reasonable opportunity of being heard to the parties concerned and the reasons recorded shall be communicated to the parties concerned.
It is clarified that, in view of the order passed hereinabove, the appropriate authority will not tender the amount of consideration u/s 269UG of the Act to the persons entitled thereto. In the event of the rule herein being discharged, the amount of consideration will be tendered to the persons entitled thereto as if the purchase order was issued on the date the rule was discharged.
The respondents shall, if they so desire file affidavits in reply to these petitions within four weeks from today.
The hearing of these petitions is expedited. Parties are at liberty to move for a fixed date of hearing.