Bombay High Court
Sasmita Investments Ltd vs Apropriate Authority And 19 Ors on 25 April, 2025
Author: B. P. Colabawalla
Bench: B. P. Colabawalla
2025:BHC-OS:7011-DB
app 298-14.docx
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
APPEAL NO.298 OF 2014
IN
SUIT NO.2094 OF 2006
Sasmita Investments Ltd. .. Appellant/Org. Plaintiff
Versus
Appropriate Authority & Ors. .. Respondents/Org. Defendants
Mr. Harish Salve, Senior Counsel (through V.C.) a/w Zal
Andhyarujina, Senior Counsel a/w Shanay Shah, Gunjan
Mangla, Serena Jethmalani, Darshan Mehta & Aaditya Mapara
i/b Dhruve Liladhar & Co. for the Appellant.
Adv. R. Venkatramani, the learned Attorney General of
India a/w Mr. B. M. Chatterji, Senior Advocate a/w V.
Digitally
Vijayalakshmi, Shreyash Shah, Udayan Mukherjee, Raman
signed by
UTKARSH Yadav i/b. Nivedita Mullerpattan for the Respondent Nos. 1
UTKARSH KAKASAHEB
KAKASAHEB BHALERAO
BHALERAO Date:
and 2.
2025.04.25
20:15:16
+0530
CORAM: B. P. COLABAWALLA &
FIRDOSH P. POONIWALLA, JJ.
RESERVED ON : MARCH 13, 2025
PRONOUNCED ON : APRIL 25, 2025
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JUDGMENT:
[ PER B. P. COLABAWALLA, J. ]
1. The above appeal takes exception to the order dated 7 th April
2014 [for short the “impugned order”] passed by the learned Single Judge
of this Court. By the impugned order, the learned Single Judge dismissed the
suit filed by the Appellant [Original Plaintiff] on the ground that it was
barred under the provisions of Section 269-UN and/or Section 293 of the
Income Tax Act, 1961 [for short the “IT Act, 1961“].
2. Initially, by order dated 29th January 2013, the learned Single
Judge framed three preliminary issues [to be decided in the above suit] under
the provisions of the Order XIV Rule 2 of the Code of Civil Procedure, 1908
[for short “CPC“]. For the sake of convenience, the issues framed by the
learned Single Judge are reproduced hereunder:-
1. Whether the jurisdiction of the Hon’ble Court to try,
entertain and dispose of the present suit is barred under section
269UN of the Income Tax Act, 1961 as pleaded in paragraph 1 of
the Written Statement and/or section 293 of the Income Tax Act,
1961?
2. Whether the law of limitation bars the present suit?
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3. Whether the plaintiff has the locus standi to maintain the
present suit as pleaded in paragraph 11 of the written statement
and/or is estopped from instituting the present suit?
(emphasis supplied)
3. Issue No.1 was answered in the affirmative, i.e. against the
Appellant (original Plaintiff), and consequently the above suit was dismissed.
Also, since the finding on Issue No.1 was in the affirmative, namely, that the
suit was barred by virtue of Section 269-UN and/or Section 293 of the IT Act,
1961, the other two issues were not answered by the learned Single Judge. It
is being aggrieved by this order dismissing the suit that the above appeal is
filed.
FACTS OF THE CASE:
4. Before we deal with the legal issues raised in the above appeal, it
would be appropriate to deal with some basic facts. For the sake of
convenience, we shall refer to the parties as they were arrayed before the
learned Single Judge.
5. The Plaintiff is a Company inter-alia carrying on the business of
investment in properties. The 1st Defendant is the appropriate authority
constituted under the provisions of Chapter XX-C of the IT Act, 1961. The 2 nd
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Defendant is the Union of India impleaded through the Secretary, Ministry of
Finance. Defendant Nos. 3 to 18 [hereinafter referred to as the “Mulanis”],
as also one Mr. Omprakash Navani [i.e. Defendant No.19], are joined as
Defendants as they have, together, executed a Deed of Conveyance dated 16 th
May 2006 in favour of the Plaintiff and sold their right, title and interest in
the suit property to the Plaintiff. In the present suit, no reliefs are claimed
against Defendant Nos. 3 to 19, and they have been added as proper parties
and out of abundant caution.
6. On or about 16th May 1981 one Jaisingh Gopaldas Mulani and
others [the Mulanis] on the one hand, and Defendant No.19 on the other,
entered into an agreement for sale of 12,916 sq.ft. [approx] of unutilized
Floor Space Index [FSI] forming a part of the plot of land bearing C.S. No.
152 admeasuring about 1962 square yards equivalent to 1636.30 sq.mtrs or
thereabouts situated at Walkeshwar Road, Mumbai [together hereinafter
referred to “the suit property”]. Thereafter, the Mulanis and Defendant
No.19 [Omprakash Navani] entered into an Agreement dated 13 th July 1991
with one M/s. Seawell Interdrill Services Pvt. Ltd. [for short “Seawell”] for
sale of the suit property and also the rights of Defendant No.19 [Omprakash
Navani] therein under the Agreement dated 16 th May 1981.
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7. By the time the Agreement dated 13 th July 1991 was executed by
the Mulanis and Defendant No.19 in favour of Seawell, Chapter XX-C
[consisting of Section 269-U to Section 269-UO] of the IT Act, 1961 was
brought into force. Accordingly, the Mulanis submitted Form 37-I under
Section 269-UC of the IT Act, 1961 to Defendant No.1, declaring their
intention to sell the suit property in terms of the said Agreement dated 13 th
July 1991. On 27th September 1991, Defendant No.1 passed an order of
compulsory purchase of the suit property under Section 269-UD(1) of the IT
Act, 1961 [for short the “1st Compulsory Purchase Order”] on the
ground that the consideration mentioned in the said Agreement was
understated. Being aggrieved by the 1st Compulsory Purchase Order [dated
27th September 1991], the Mulanis as well as Seawell preferred Writ Petition
No. 3159 of 1991 and Writ Petition No. 3251 of 1991 respectively. What was
sought in the aforesaid Writ Petitions was quashing of the 1st Compulsory
Purchase Order.
8. By order dated 12th April 1993, this Court set aside the 1st
Compulsory Purchase Order [dated 27th September 1991] and remanded the
matter back to Defendant No.1 to dispose of Mulanis’ application for
approval [in Form 37-I] in accordance with law and keeping in view the
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Judgment of the Hon’ble Supreme Court in the case of C.B. Gautam Vs.
Union of India [(1993) 199 ITR page 530 : (1993) 1 SCC 78].
9. After the remand, Defendant No.1 once again passed an order for
compulsory purchase dated 29th June 1993 [for short the “2nd Compulsory
Purchase Order”] on the ground that the consideration mentioned in the
Agreement dated 13th July 1991 was understated. Once again, being aggrieved
by the 2nd Compulsory Purchase Order, the Mulanis and Seawell filed Writ
Petitions in this Court, being Writ Petition No. 2131 of 1993 and Writ Petition
No. 1782 of 1993. This Court, by its order dated 11 th June 2002, disposed of
the Writ Petition filed by the Seawell by quashing and setting aside the 2nd
Compulsory Purchase Order and remanded the matter once again to
Defendant No.1 with a direction that in case Defendant No.1 decides again to
compulsorily purchase the suit property, Seawell will be free to re-approach
this Court, if necessary, against such decision of Defendant No.1.
10. According to the Plaintiff, the 1st Defendant once again
mechanically and without application of mind, passed an order dated 12 th
September 2002 compulsorily purchasing the suit property [for short the
“3rd Compulsory Purchase Order”]. Subsequent to the 3rd Compulsory
Purchase Order [dated 12th September 2002], the 1st Defendant addressed a
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letter dated 24th September 2002 to the Mulanis and Defendant No.19
[Omprakash Navani] inter-alia stating that it was willing to pay the apparent
consideration after possession of the suit property, free from all
encumbrances, along with documents and relevant papers in original, was
handed over to Defendant No.1, and all liabilities of the vendors [as per their
agreement] were discharged.
11. In response to this letter, the Mulanis addressed a letter dated
4th October 2002 inter alia stating that the suit property stood vested with the
Central Government under Section 269-UE of the IT Act, 1961 and the
amount of Rs.7,74,99,000/- as provided in the agreement for sale dated 13 th
July, 1991 [being the apparent consideration] must be immediately deposited
with the advocates of the owners. According to the Plaintiff, the request of
the Mulanis to deposit the apparent consideration with their lawyers, M/s.
Kanga and Company, fell on deaf ears. Neither was the consideration offered
to the vendors, nor the vendors ever refused to accept the same. Further, the
IT Department did not deposit the apparent consideration anywhere after the
3rd Compulsory Purchase Order was passed on 12th September 2002.
12. Considering how the matter had progressed, Seawell [the
original purchaser] addressed a letter dated 12 th December 2002 to
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Defendant No.1 inter-alia stating that as per the 3rd Compulsory Purchase
Order, it was the statutory obligation of Defendant No.1 and/or No.2 to
tender the apparent consideration to the vendors [the Mulanis and
Defendant No.19] by 31st October 2002 in accordance with Section 269-UG of
the IT Act, 1961. They having failed to do so, the suit property statutorily re-
vested with the Mulanis and Defendant No.19 by virtue of Section 269-UH(1)
of the IT Act, 1961. By this very letter dated 12 th December 2002, Seawell [the
Original Purchaser] also called upon the appropriate authority to issue a
declaration under the IT Act, 1961 to the effect that the order dated 12 th
September 2002 [the 3rd Compulsory Purchase Order] stood abrogated
[under Section 269-UH(2)]. However, no such declaration was issued by the
appropriate authority.
13. It appears that thereafter between January 2003 to May 2005,
the Mulanis made several visits and requested Defendant No.1 to pass a
formal order declaring that the 3rd Compulsory Purchase Order stood
abrogated. However, no decision was taken or response given by the 1 st
Defendant either on the request of the Mulanis or to the letter dated 12th
December 2002 addressed by Seawell.
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14. It appears that in the year 2004, Seawell was merged with an
entity called Trikaya Investment Ltd. [for short “Trikaya”]. This was done
pursuant to an order dated 29th September 2004 passed by this Court
sanctioning the scheme of amalgamation between Seawell and Trikaya.
Accordingly, Trikaya by its letter dated 20th May 2005, made another
representation to Defendant No.1 repeating and reiterating the contents of
the letter dated 12th December 2002 addressed by Seawell. In other words,
Trikaya also requested Defendant No.1 to make a declaration that the 3rd
Compulsory Purchase Order dated 12th September 2002 stood abrogated. In
response to this letter, Defendant No.1 wrote a letter dated 10 th June 2005 to
Seawell inter-alia stating that the vendors had not complied with their
request for handing over peaceful possession along with the title documents
and other papers pertaining to the suit property, and in the absence of which
the payment of the apparent consideration was withheld by the 1 st Defendant.
A similar letter was also addressed on 19th December 2005 to Trikaya.
15. It appears that thereafter, the Mulanis, Defendant No.19
[Omprakash Navani] and Trikaya terminated the agreement dated 13th July
1991, and the Plaintiff herein purchased the suit property from the Mulanis
and Defendant No.19 [Omprakash Navani] by a Deed of Conveyance dated
16th May 2006 [registered as document No.4720/2006 with the Sub-
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Registrar of Assurances, Mumbai] for a total consideration of Rs.
18,25,00,000/-, of which Rs.7,50,00,000/- was paid to the Mulanis, and Rs.
10,75,00,000/- was paid to Defendant No.19 [Omprakash Navani],
respectively.
16. It is in these facts that the Plaintiff has approached this Court by
filing the above suit inter-alia seeking a declaration that the 3rd Compulsory
Purchase Order [dated 12th September 2002] stands abrogated on and from
31st October 2002, and on and from the said date, all the rights, title and
interest in the suit property and all rights to the FSI thereto, stood re-vested
in the Mulanis and Defendant No.19 [Omprakash Navani] respectively. A
further declaration is sought that on and from 16 th May 2006, the Plaintiff is
the absolute owner of the suit property and has absolute right, title and
interest therein, including the right to sell, develop, alienate, transfer, create
any interest in and in any manner to deal with and dispose of the suit
property without any hindrance. The other consequential prayer sought is to
restrain the Defendants and/or their servants and agents from in any manner
interfering with the Plaintiff’s possession and/or its right to develop, alienate,
sell, transfer, or create any interest in the suit property. For the sake of
convenience, the prayers in the above suit are reproduced hereunder:-
“A. For a Declaration that:
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app 298-14.docxi. The said Order dated 12 th September, 2002 of
Compulsory Purchase of the said Property stands
abrogated on and from 31st October, 2002;
ii. on and from 31st October, 2002 all right, title and
interest in the said Property, and all rights to the said
FSI, stood re-vested in the Mulanis and Om Prakash
Navani, respectively, andiii. On and from 16th May, 2006, the Plaintiff is the
absolute owners of the said Property and have the
absolute right, title and interest in the said Property
including the right to develop, alienate, sell, transfer,
create any interest in and in any manner to deal with
and dispose of the said Property without any let or
hindrance.
B. For a Perpetual Injunction restraining the Defendants and
their servants and agents from in any manner interfering with the
Plaintiff’s possession and/or its right to develop, alienate, sell,
transfer, create any interest in and in any manner to deal with
and dispose of the said Property.
(B1) In the alternative to prayer (B) above, if this Hon’ble Court
holds that the Defendants are in actual possession of the said
Property, this Hon’ble Court be pleased to issue mandatory
injunction directing the Defendants to forthwith deliver or cause
to be delivered possession of the said Property to the Plaintiff.
C. For Mandatory Injunction directing the Defendants and their
servants and agents to forthwith remove their Board and security
personnel on and from the said Property.”
SUBMISSIONS OF THE PLAINTIFF:
17. In this factual backdrop, Mr. Salve, the learned Senior Counsel
appearing for the Plaintiff, submitted that the learned Single Judge
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committed a gross error in holding that the suit filed by the Plaintiff seeking
the aforesaid declarations was barred by virtue of Section 269-UN and/or
Section 293 of the IT Act, 1961. To substantiate this argument, Mr. Salve took
us through the scheme of Chapter XX-C of the IT Act, 1961. He submitted
that under Section 269-UC, no transfer of any immovable property [in such
area and of such value exceeding five lakh rupees as may be prescribed], can
be effected except after an agreement for transfer is entered into between the
person who intends transferring the immovable property [the transferor] and
the person to whom it is proposed to be transferred [the transferee], in
accordance with the provisions of Section 269-UC(2), at least four months
before the intended date of transfer. Further, the agreement must be reduced
to writing in the form of a statement by each of the parties to such transfer or
by any of the parties to such transfer acting on behalf of himself and on
behalf of other parties. Mr. Salve submitted that once this statement is
submitted, the appropriate authority, if it is of the opinion that the
consideration is understated, may make an order under Section 269-UD(1)
for purchase of the said property at an amount equal to the amount of the
apparent consideration, namely, in the present case, the consideration
mentioned in the agreement. He submitted that once an order is made under
Section 269-UD(1) by the appropriate authority in relation to any immovable
property, such property shall vest in the Central Government under Section
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269-UE(1) of the IT Act, 1961. He, thereafter, brought to our attention
Section 269-UF(1) and submitted that where a compulsory order for the
purchase of any immovable property is made by the appropriate authority
[under Section 269-UD(1)], the Central Government shall pay, by way of
consideration, an amount equal to the amount of the apparent consideration.
He submitted that under Section 269-UG, this amount is to be paid within a
period of one month from the end of the month in which the concerned
immovable property becomes vested in the Central Government under sub-
section (1), or, as the case may be, sub-section (6) of Section 269UE.
18. Mr. Salve thereafter turned our attention to Section 269-UH
which stipulates that if the Central Government fails to tender [under sub-
section (1) of Section 269-UG] or deposit [under sub-section (2) or sub-
section (3) of Section 269-UG], the whole or any part of the amount of
consideration required to be tendered or deposited within the period
specified, the order to purchase the immovable property by the Central
Government made under sub-section (1) of Section 269-UD shall stand
abrogated and the immovable property shall stand re-vested in the transferor
after the expiry of the aforesaid period. He submitted that this happens by
operation of law as stipulated in Section 269-UH. Here, it is the specific case
of the Plaintiff that since the consideration was not tendered within the time
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stipulated as set out under Section 269-UG [i.e. by 31 st October 2002], the 3rd
Compulsory Purchase Order [dated 12th September 2002], by operation of
law, stood abrogated and the suit property stood re-vested in the transferors,
namely, the Mulanis and Defendant No.19 [Omprakash Navani] after the
expiry of the aforesaid period. It is this declaration that is sought in the
above suit. Since the Plaintiff has thereafter purchased the suit property from
the Mulanis and Defendant No.19 [Omprakash Navani], consequential reliefs
are also sought as set out earlier.
19. Mr. Salve submitted that if one carefully goes through the
scheme of Chapter XX-C of the IT Act, 1961, then it is clear that the
declaration sought by the Plaintiff in the above suit is clearly not barred
under any provision of the IT Act, 1961. He submitted that the learned Single
Judge has completely misconstrued the provisions of Chapter XX-C whilst
coming to the conclusion that the above suit is barred by virtue of Section
269-UN and/or Section 293 of the IT Act, 1961. Mr. Salve submitted that
Section 269-UN stipulates that save as otherwise provided in Chapter XX-C,
any order made under Section 269-UD(1) or any order made under Section
269-UF(2) shall be final and conclusive and shall not be called in question in
any proceedings, either under the IT Act, 1961 or in any other law for the time
being in force. Mr. Salve submitted that in the present case, the order dated
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12th September 2002 passed under Section 269-UD(1) [the 3rd Compulsory
Purchase Order] is not being called into question at all in the present suit. In
fact, the present suit proceeds on the basis that the 3rd Compulsory Purchase
Order [dated 12th September 2002] is valid. What the Plaintiff seeks in the
present suit is a declaration that due to non-compliance of the provisions of
Section 269-UF read with Section 269-UG, the 3rd Compulsory Purchase
Order [dated 12th September 2002] stands abrogated and the suit property
stands re-vested in the name of transferors, namely, the Mulanis and
Defendant No.19 [Omprakash Navani], under Section 269-UH. This, by no
stretch of the imagination, can be construed to mean that the Plaintiff is
calling into question the order passed by the appropriate authority under
Section 269-UD(1) of the IT Act, 1961. He, therefore, submitted that the
reliance placed on Section 269-UN to oust the jurisdiction of this court, is
wholly misconceived and misplaced.
20. Similarly, Mr. Salve submitted that even Section 293 of the IT
Act, 1961 does not oust the jurisdiction of this Court. He submitted that
Section 293 bars a suit to set aside or modify any proceedings taken, or order
made, under the IT Act, 1961, and no prosecution, suit or other proceedings
shall lie against the Government or any officer of the Government for
anything done in good faith or intended to be done in good faith under the IT
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Act, 1961. The present suit does not in any way seek to modify or set aside
any proceedings taken, or order made, under the IT Act, 1961. What the
present suit seeks is only a declaration that by virtue of Section 269-UH, the
3rd Compulsory Purchase Order [dated 12th September 2002] stands
abrogated and the suit property re-vests in the transferors. This relief is
sought solely on the basis that the apparent consideration was not tendered
or deposited within the time stipulated in Section 269-UG. Mr. Salve
submitted that the reliefs prayed for in the suit are in fact in alignment with
the scheme of Chapter XX-C, and not to set aside or modify any proceeding
taken, or order made, under the IT Act, 1961. He, therefore, submitted that
on the plain reading of the aforesaid sections, it is clear that the jurisdiction
of this Court is not barred by virtue of any of the provisions of the IT Act,
1961. Mr. Salve submitted that if this be the case, the impugned order clearly
proceeds on the wrong premise and therefore requires interference in appeal.
21. Mr. Salve was at pains to point out that the learned Single Judge
has in fact grossly erred when he came to the conclusion that as the Plaintiff
is seeking a declaration that the 3rd Compulsory Purchase Order stands
abrogated, this Court will have to further declare that the said order [dated
12th September 2002] stood annulled, cancelled or set aside. He submitted
that the abrogation takes place by operation of law and there is no question of
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giving a further declaration that the order is set aside. In fact, Mr. Salve
pointed out that the learned Judge erroneously proceeded on the basis that if
the declaration sought in the suit is granted, this Court will have to declare
that the proceedings initiated under Chapter XX-C are illegal and therefore
barred under Sections 269-UN and/or 293 of the IT Act, 1961. In the facts of
the present case, there is no question of declaring the proceedings illegal as
the Plaintiff itself proceeds on the basis that the proceedings, and which
culminated in the 3rd Compulsory Purchase Order [dated 12th September
2002], are valid, was the submission. In light of the declaration sought, the
Plaintiff can never contend that either the proceedings, or the order dated
12th September 2002, are illegal. The Plaintiff cannot seek a declaration of
abrogation and yet contend that the order which stood abrogated, was illegal.
If the order was illegal, there would be no question of its abrogation, was the
submission. For all these reasons, Mr. Salve submitted that impugned order
is wholly incorrect and ought to be quashed and set aside.
SUBMISSIONS OF THE ATTORNEY GENERAL OF INDIA:
22. On the other hand, the learned Attorney General of India
submitted that the present suit challenging the 3rd Compulsory Purchase
Order [dated 12th September 2002] is not maintainable and is liable to be
dismissed. He submitted that this court lacks jurisdiction to entertain the
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present suit seeking a declaration that the 3rd Compulsory Purchase Order
[dated 12th September 2002] passed under Section 269-UD of the IT Act,
1961 stands abrogated, as this would amount to an inquiry into all matters
and issues allegedly leading to the alleged abrogation. This would be wholly
impermissible in view of Section 293 of the IT Act, 1961. The learned
Attorney General submitted that Section 293 unequivocally bars any civil suit
or legal proceeding in respect of any action taken under the IT Act, 1961,
including orders passed under Section 269-UD. The bar under Section 293
applies to the entire IT Act, 1961 enacting a bar against any adjudication of
proceedings under the Act by any court. This would necessarily include all
matters in relation to 3rd Compulsory Purchase Order [dated 12th September
2002] passed under Section 269-UD.
23. The learned Attorney General then submitted that the relief
sought by the Plaintiff, namely, that there is an abrogation under Section
269-UH(1), is an indirect way of questioning the 3rd Compulsory Purchase
Order [dated 12th September 2002]. It does not make any difference that the
Plaintiff says that it is not questioning the said order. Implicit in the
examination of abrogation under Section 269-UH is the rescinding of the 3rd
Compulsory Purchase Order. Consequently, without any inquiry into the
stand taken by the 1 st and 2nd Defendants, and their conduct under Section
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269-UE, there cannot be any adjudication under Section 269-UH. In other
words, without examining the legality or otherwise of all matters leading to
the alleged abrogation, there cannot be any declaration under Section 269-
UH. The bar under Section 293 cannot be evaded by resorting to framing the
suit the way it has been framed, was the submission.
24. The next submission of the learned Attorney General of India
was that Section 9 of the Code of Civil Procedure, 1908 is itself premised
upon the availability of jurisdiction. If a statute, either expressly or by
necessary implication, bars adjudication by any court, then Section 9 will
stand automatically excluded. The question as to whether an abrogation has
really taken place, is a question within the scope of the IT Act, 1961. Any
inquiry in this regard will be treated as a proceeding under the IT Act, 1961.
The widely stated provision of Section 293, which includes adjudication of
matters under Chapter XX-C, can neither be truncated, nor is it open to the
court to add any exceptions or additions to the provisions, by permitting
adjudication in relation to Section 269-UH.
25. The learned Attorney General of India thereafter submitted that
Section 293 and Section 269-UN must be read harmoniously, both ousting
the civil court’s jurisdiction. He submitted that though distinct in their
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textual formulation, Section 293 and Section 269-UN must be read together,
as they serve the common legislative purpose of excluding the civil court’s
jurisdiction over disputes arising from actions taken under Chapter XX-C of
the IT Act, 1961. The learned Attorney General submitted that Section 293
applies to the entire IT Act, 1961 including orders passed under Section 269-
UD. The contention that Section 269-UN only partially ousts the jurisdiction
and that Section 293 does not apply in the present case is wholly incorrect.
Any argument that the special provision [Section 269-UN] would negate the
applicability of the general ouster clause [Section 293] is misconceived, as
there is no conflict between these two provisions. The special versus the
general principle will apply only when there is an express intent to substitute
a field already occupied. In fact, Section 293 existed even before the
amendment introducing Chapter XX-C, and continues to apply broadly to all
actions under the IT Act, 1961 including the compulsory purchase orders
passed under Section 269-UD. According to the learned Attorney General,
the harmonious construction of Section 269-UN and Section 293 reinforces
the legislative intent to completely oust the jurisdiction of civil courts in
matters related to compulsory purchase orders passed under Section 269-
UD. Therefore, any challenge to such an order by way of a civil suit must fail.
The legislative history of Section 293 and the scheme of Chapter XX-C clearly
indicate that once an order is passed under Section 269-UD, it is meant to
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attain finality, thereby preventing interdiction of purchase orders through
civil litigation.
26. The learned Attorney General thereafter submitted that it is the
plaintiff’s case that they have a right to demand a declaration that the 3rd
Compulsory Purchase Order [dated 12th September 2002] passed under
Section 269-UD is abrogated, due to the alleged non-compliance of Section
269-UH. In order to get into the question whether the court could pass such a
declaration, the court would first have to decide the antecedent facts leading
to such abrogation. According to the learned Attorney General, in light of the
express language of Section 293, the civil court cannot examine these factual
questions, and consequently, cannot give any declaration that the 3rd
Compulsory Purchase Order [dated 12th September 2002] stood abrogated.
27. The learned Attorney General submitted that it is pertinent to
note that the plaintiff has not challenged the 3rd Compulsory Purchase
Order [dated 12th September 2002] under writ jurisdiction. Even after the
payment period [under Section 269-UH] expired on 31st October 2002, there
was no writ petition filed either by Defendant Nos.3 to 18 [the Mulanis] or
Defendant No.19 [Omprakash Navani] or Seawell. It is only in 2006, when
the original vendors cancelled the purchase agreement with Seawell, and
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entered into a new agreement with the plaintiff [that led to the transfer of the
suit property to the plaintiff], who then filed the above suit. What is also
important to note is that the 1st compulsory purchase order [dated 27th
September 1991] and the 2nd compulsory purchase order [dated 29th June
1993] were challenged by the original vendors by filing writ petitions.
However, the 3rd Compulsory Purchase Order [dated 12th September 2002]
has not been challenged at any point of time by filing a writ petition. The
learned Attorney General submitted that it was the argument of the Plaintiff
they filed a suit rather than filing a writ petition because there were disputed
questions of fact that required adjudication. The learned Attorney General
submitted that such an argument appears to be one of convenience rather
than there actually being any disputed questions of facts involved. He
submitted that there is no question of fact involved as such which needs to be
decided in the suit. The issue involved in this case could successfully be
decided in a writ petition, was the submission. According to the learned
Attorney General, the suit is filed as an afterthought to avoid delay and
latches caused by the original vendors in taking appropriate action. The
Plaintiff is only taking advantage of its own wrong by purchasing litigation,
was the submission.
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28. Without prejudice to the aforesaid arguments, the learned
Attorney General submitted that under Section 269-UH(2), when an order
under Section 269-UD(1) is abrogated and the immovable property is re-
vested in the transferor, the appropriate authority [Defendant No.1] is
required to make a declaration in writing to that effect and follow the further
process stipulated under Section 269-UH(2). It was submitted that none of
the legal requirements as stipulated in Section 269-UH(2) had occurred,
namely, that the appropriate authority did not issue any declaration in
writing, or deliver a copy of such declaration to the transferors or any person
interested therein, or deliver or caused to be delivered possession of the suit
property back to the transferors. In the absence of the mandatory legal
compliance of Section 269-UH(2), i.e. passing of a declaration by the
appropriate authority, the transferor or any other person cannot take upon
themselves and declare that the compulsory purchase order passed under
Section 269-UD(1) stood abrogated, and thereafter proceed to deal with the
immovable property.
29. For all the aforesaid reasons, it was submitted that no exception
can be taken to the impugned order passed by the learned Single Judge who
held that the suit filed by the Plaintiff was clearly barred by the provisions of
Section 269-UN and/or Section 293 of the IT Act, 1961.
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30. We must mention that the learned Attorney General also
addressed us on the merits of the matter, namely, that in fact the
Government has duly complied with the provisions of Chapter XX-C and
deposited the apparent consideration within the time frame set out therein,
and consequently, there is no question of seeking any declaration of
abrogation. To be fair, even Mr Salve, the learned senior counsel appearing
on behalf of the plaintiff, addressed us on this issue. We, however, made it
clear to both parties that the merits of the matter was not the scope of the
present appeal and hence we wouldn’t be deciding whether in fact the
Government had complied with the time-frame for depositing the apparent
consideration so that the 3rd Compulsory Purchase Order [dated 12th
September 2002] did not stand abrogated. That is an issue which would have
to be decided in the suit, subject of course to the fact that we come to the
conclusion that the suit is maintainable as contended by the plaintiff. Hence
we are not burdening this judgement with this aspect of the matter.
REASONING, FINDINGS AND CONCLUSION:
31. We have heard the learned counsel for the parties at great
length. We have also perused the papers and proceedings in the above appeal
and the impugned order passed by the learned Single Judge. Before we
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proceed to decide whether the suit filed by the Plaintiff is barred under the
provisions of Sections 269- UN and/or 293 of the IT Act, 1961, it would be
appropriate to refer to the relevant provisions of Chapter XX-C of the IT Act,
1961. Though only some sub-sections of the provisions of Chapter XX-C are
relevant for our purposes, for the sake of convenience, we have reproduced
the entire section/provision and highlighted the relevant sub-sections.
32. Section 269-UA is the definitions Section and stipulates that in
Chapter XX-C, unless the context otherwise requires, the words defined
therein shall mean and/or include what is stated therein. For our purposes,
the definition of the words “apparent consideration” and “immoveable
property” are relevant and reproduced hereunder:-
“(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 ordinarilyPage 25 of 61
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app 298-14.docxfetch 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;
(iii) if the immovable property is to be transferred by
way of lease,–
(A) in a case where the consideration for the
transfer consists of premium only, the amount
of premium as specified in the agreement for
transfer;
(B) in a case where the consideration for the
transfer consists of rent only, the aggregate of
the moneys (if any) payable by way of rent and
the amounts for the service or things forming
part of or constituting the rent, as specified in
the agreement for transfer;
(C) in a case where the consideration for the
transfer consists of premium and rent, the
aggregate of the amount of the premium, the
moneys (if any) payable by way of rent, and
the amounts for the service or things forming
part of or constituting the rent, as specified in
the agreement for transfer,
and where the whole or any part of the consideration
for such transfer is payable on any date or dates
falling after the date of such agreement for transfer,
the value of the consideration payable after such
date shall be deemed to be the discounted value of
such consideration, as on the date of such
agreement for transfer, determined by adopting such
rate of interest as may be prescribed in this behalf.
(2) 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 (ii) of clause (d), means,–
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(i) in a case where the consideration for the transfer
consists of a sum of money only, such sum;
(ii) 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;
(iii) 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,
and where the whole or any part of the consideration
for such transfer is payable on any date or dates
falling after the date of such agreement for transfer,
the value of the consideration payable after such
date shall be deemed to be the discounted value of
such consideration, as on the date of such
agreement for transfer, determined by adopting such
rate of interest as may be prescribed in this behalf;”
(emphasis supplied)
“(d) “immovable property” means–
(i) any land or any building or part of a
building, and includes, where any land or
any building or part of a building is to be
transferred together with any machinery,
plant, furniture, fittings or other things,
such machinery, plant, furniture, fittings
or other things also.
Explanation.–For the purposes of this sub-
clause, “land, building, part of a building,
machinery, plant, furniture, fittings and other
things” include any rights therein;
(ii) any rights in or with respect to any land or any
building or a part of a building (whether or not
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including any machinery, plant, furniture, fittings
or other things therein) which has been
constructed or which is to be constructed,
accruing or arising from any transaction (whether
by way of becoming a member of, or acquiring
shares in, a cooperative society, company or other
association of persons or by way of any
agreement or any arrangement of whatever
nature), not being a transaction by way of a sale,
exchange or lease of such land, building or part of
a building;”
(emphasis supplied)
33. In the present case, it is not in dispute that the transfer [by way
of sale] of the “immovable property” in question is one as defined in Section
269-UA(d)(i), and therefore, the “apparent consideration” would be as
defined in Section 269-UA(b)(1)(i). Section 269-UB gives power to the
Central Government to constitute an “appropriate authority” for carrying out
the functions as stipulated in Chapter XX-C and not relevant for the purposes
of the present appeal.
34. Section 269-UC puts a restriction on the transfer of certain
immovable properties and stipulates as under:-
“269-UC. Restrictions on transfer of immovable
property.–(1) Notwithstanding anything contained in
the Transfer of Property Act, 1882 (4 of 1882), or in any
other law for the time being in force, no transfer of any
immovable property in such area and of such value
exceeding five lakh rupees, as may be prescribed
shall be effected except after an agreement forPage 28 of 61
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app 298-14.docxtransfer is entered into between the person who
intends transferring the immovable property
(hereinafter referred to as the transferor) and the
person to whom it is proposed to be transferred
(hereinafter referred to as the transferee) in
accordance with the provisions of sub-section (2) at
least four months before the intended date of
transfer.
(2) The agreement referred to in sub-section (1)
shall be reduced to writing in the form of a
statement by each of the parties to such transfer or
by any of the parties to such transfer acting on
behalf of himself and on behalf of the other parties.
(3) Every statement referred to in sub-section (2) shall,–
(i) be in the prescribed form;
(ii) set forth such particulars as may be prescribed;
and
(iii) be verified in the prescribed manner,
and shall be furnished to the appropriate authority
in such manner and within such time as may be
prescribed, by each of the parties to such
transaction or by any of the parties to such
transaction acting on behalf of himself and on
behalf of the other parties.
(4) Where it is found that the statement referred to in sub-
section (2) is defective, the appropriate authority may
intimate the defect to the parties concerned and give them
an opportunity to rectify the defect within a period of
fifteen days from the date of such intimation or within such
further period which, on an application made in this behalf,
the appropriate authority may, in its discretion, allow and if
the defect is not rectified within the said period of fifteen
days or, as the case may be, the further period so allowed,
then, notwithstanding anything contained in any other
provision of this Chapter, the statement shall be deemed
never to have been furnished.”
(emphasis supplied)
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35. To put it in a nutshell, what Section 269-UC stipulates is that no
transfer of any immovable property [in such area and of such value exceeding
five lakh rupees as may be prescribed], can be effected except after an
agreement for transfer is entered into between the person who intends
transferring the immovable property [the transferor] and the person to whom
it is proposed to be transferred [the transferee], in accordance with the
provisions of Section 269-UC(2), at least four months before the intended
date of transfer. Further, the agreement must be reduced to writing in the
form of a statement by each of the parties to such transfer or by any of the
parties to such transfer acting on behalf of himself and on behalf of the other
parties.
36. Section 269-UD inter alia provides that once the agreement of
transfer [in the form of a statement as required under Section 269-UC(2)] is
furnished, and the appropriate authority is of the opinion that the
consideration mentioned therein is understated, it can purchase the said
property by making an order to that effect as stipulated in Section 269-UD(1).
Section 269-UD reads as under:-
“269-UD. Order by appropriate authority for
purchase by Central Government of immovable
property.–(1) Subject to the provisions of sub-
sections (1-A) and (1-B), the appropriate authority,
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app 298-14.docx(3) of Section 269-UC in respect of any immovable
property, may, notwithstanding anything contained
in any other law or any instrument or any
agreement for the time being in force, [* * *] make
an order for the purchase by the Central
Government of such immovable property at an
amount equal to the amount of apparent
consideration:
Provided that no such order shall be made in respect of
any immovable property after the expiration of a period of
two months from the end of the month in which the
statement referred to in Section 269-UC in respect of such
property is received by the appropriate authority:
Provided further that the statement referred to in
Section 269-UC in respect of any immovable property is
received by the appropriate authority on or after the 1st
day of June, 1993, the provisions of the first proviso shall
have effect as if for the words “two months”, the words
“three months” had been substituted :
Provided also that the period of limitation referred to in
the second proviso shall be reckoned, where any defect as
referred to in sub-section (4) of Section 269-UC has been
intimated, with reference to the date of receipt of the
rectified statement by the appropriate authority:
Provided also that in case where the statement referred
to in Section 269-UC in respect of the immovable property
concerned is given to an appropriate authority, other than
the appropriate authority having jurisdiction in accordance
with the provisions of Section 269-UB to make the order
referred to in this sub-section in relation to the immovable
property concerned, the period of limitation referred to
in the first and second provisos shall be reckoned with
reference to the date of receipt of the statement by the
appropriate authority having jurisdiction to make the order
under this sub-section:
Provided also that the period of limitation referred to in
the second proviso shall be reckoned, where any stay has
been granted by any court against the passing of an order
for the purchase of the immovable property under this
Chapter, with reference to the date of vacation of the said
stay.
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app 298-14.docx(1-A) 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.
(1-B) Every order made by the appropriate authority under
sub-section (1) shall specify the grounds on which it is
made.
(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.”
(emphasis supplied)
37. Once an order of compulsory purchase is passed under Section
269-UD(1), the immoveable property, which forms the subject matter of the
said order, vests in the Central Government as stipulated in Section 269-
UE(1) or 269-UE(6), as the case may be. For the sake of convenience Section
269-UE reads as under:
“269-UE. Vesting of property in Central Government.
–(1) Where an order under sub-section (1) of Section
269-UD is made by the appropriate authority in
respect of an immovable property referred to in sub-
clause (i) of clause (d) of Section 269-UA, 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 269-
UC:
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app 298-14.docxProvided that where the appropriate authority, after giving
an opportunity of being heard to the transferor, the
transferee or other persons interested in the said property,
under sub-section (1-A) of Section 269-UD, is of the opinion
that any encumbrance on the property or leasehold interest
specified in the aforesaid agreement for transfer is so
specified with a view to defeat the provisions of this
Chapter, it may, by order, declare such encumbrance or
leasehold interest to be void and thereupon the aforesaid
property shall vest in the Central Government free from
such encumbrance or leasehold interest.
(2) The transferor or any other person who may be in
possession of the immovable property in respect of which
an order under sub-section (1) of Section 269-UD is made,
shall surrender or deliver possession thereof to the
appropriate authority or any other person duly authorised
by the appropriate authority in this behalf within fifteen
days of the service of such order on him:
Provided that the provisions of this sub-section and sub-
sections (3) and (4) shall not apply where the person in
possession of the immovable property, in respect of which
an order under sub-section (1) of Section 269-UD is made,
is a bona fide holder of any encumbrance on such property
or a bona fide lessee of such property, if the said
encumbrance or lease has not been declared void under the
proviso to sub-section (1) and such person is eligible to
continue in possession of such property even after the
transfer in terms of the aforesaid agreement for transfer.
(3) If any person refuses or fails to comply with the
provisions of sub-section (2), the appropriate authority or
other person duly authorised by it under that sub-section
may take possession of the immovable property and may,
for that purpose, use such force as may be necessary.
(4) Notwithstanding anything contained in sub-section (2),
the appropriate authority may, for the purposes of taking
possession of any property referred to in sub-section (1),
requisition the services of any police officer to assist him
and it shall be the duty of such officer to comply with such
requisition.
(5) For the removal of doubts, it is hereby declared that
nothing in this section shall operate to discharge thePage 33 of 61
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app 298-14.docxtransferor or any other person (not being the Central
Government) from liability in respect of any encumbrances
on the property and, notwithstanding anything contained in
any other law for the time being in force, such liability may
be enforced against the transferor or such other person.
(6) Where an order under sub-section (1) of Section
269-UD is made in respect of an immovable property,
being rights of the nature referred to in sub-clause
(ii) of clause (d) of Section 269-UA, such order shall
have the effect of–
(a) vesting such right in the Central
Government; and
(b) placing the Central Government in the same
position in relation to such rights as the
person in whom such a right would have
continued to vest if such order had not
been made.
(7) Where any rights in respect of any immovable property,
being rights in, or with respect to, any land or any building
or part of a building which has been constructed or which is
to be constructed, have been vested in the Central
Government under sub-section (6), the provisions of sub-
sections (1), (2), (3) and (4) shall, so far as may be, have
effect as if the references to immovable property therein
were references to such land or building or part thereof, as
the case may be.”
(emphasis supplied)
38. Thereafter, Section 269-UF inter alia provides that where an
order is made to purchase the immovable property [under Section 269-
UD(1)], the Central Government shall pay by way of consideration, an
amount equal to the amount of the apparent consideration. Section 269-UF
reads as under:
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app 298-14.docx“269-UF. Consideration for purchase of immovable
property by Central Government.–(1) Where an
order for the purchase of any immovable property
by the Central Government is made under sub-
section (1) of Section 269-UD, the Central
Government shall pay, by way of consideration for
such purchase, an amount equal to the amount of
the apparent consideration.
(2) Notwithstanding anything contained in sub-section (1),
where, after the agreement for the transfer of the
immovable property referred to in that sub-section has
been made but before the property vests in the Central
Government under Section 269-UE, the property has been
damaged (otherwise than as a result of normal wear and
tear), the amount of the consideration payable under that
sub-section shall be reduced by such sum as the
appropriate authority, for reasons to be recorded in writing,
may by order determine.”
(emphasis supplied)
39. Section 269-UG provides for a time-frame for payment or
deposit of the consideration referred to in Section 269-UF. It basically
stipulates that the amount of consideration payable in accordance with the
provisions of Section 269-UF shall be tendered to the person entitled thereto
within a period of one month from the end of the month in which the
immovable property concerned becomes vested in the Central Government,
either under Section 269-UE (1) or 269-UE (6), as the case may be. Section
269-UG reads thus:
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app 298-14.docx“269-UG. Payment or deposit of consideration.–(1)
The amount of consideration payable in accordance
with the provisions of Section 269-UF 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 immovable property concerned
becomes vested in the Central Government under
sub-section (1), or, as the case may be, sub-section
(6), of Section 269-UE:
Provided that if any liability for any tax or any other sum
remaining payable under this Act, the Wealth Tax Act, 1957
(27 of 1957), the Gift Tax Act, 1958 (18 of 1958), the Estate
Duty Act, 1953 (34 of 1953), or the Companies (Profits)
Surtax Act, 1964 (7 of 1964), by any person entitled to the
consideration payable under Section 269-UF, the
appropriate authority may, in lieu of the payment of the
amount of consideration, set off the amount of
consideration or any part thereof against such liability or
sum, after giving an intimation in this behalf to the person
entitled to the consideration.
(2) Notwithstanding anything contained in sub-section (1),
if any dispute arises as to the apportionment of the amount
of consideration amongst persons claiming to be entitled
thereto, the Central Government shall deposit with the
appropriate authority the amount of consideration required
to be tendered under sub-section (1) within the period
specified therein.
(3) Notwithstanding anything contained in sub-section (1),
if the person entitled to the amount of consideration does
not consent to receive it, or if there is any dispute as to the
title to receive the amount of consideration, the Central
Government shall deposit with the appropriate authority
the amount of consideration required to be tendered under
sub-section (1) within the period specified therein:
Provided that nothing herein contained shall affect the
liability of any person who may receive the whole or any
part of the amount of consideration for any immovable
property vested in the Central Government under this
Chapter to pay the same to the person lawfully entitled
thereto.
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app 298-14.docx(4) Where any amount of consideration has been deposited
with the appropriate authority under this section, the
appropriate authority may, either of its own motion or on
an application made by or on behalf of any person
interested or claiming to be interested in such amount,
order the same to be invested in such Government or other
securities as it may think proper, and may direct the
interest or other proceeds of any such investment to be
accumulated and paid in such manner as will, in its
opinion, give the parties interested therein the same
benefits therefrom as they might have had from the
immovable property in respect whereof such amount has
been deposited or as near thereto as may be.”
(emphasis supplied)
40. Thereafter, Section 269-UH, which is important for our
purposes, provides for the consequences if the Central Government fails to
tender the consideration as stipulated in Section 269-UG(1) or deposit the
same under Section 269-UG(2) or 269-UG(3). Basically, what this Section
stipulates is that if the Central Government fails to either tender or deposit
the consideration [as stipulated in the said Section], the order of compulsory
purchase passed under Section 269-UD(1) shall stand abrogated and the
immovable property [forming the subject matter of the said order] shall
stand re-vested in the transferor. This Section further stipulates that where
an order under Section 269-UD(1) is abrogated and the immovable property
re-vests with the transferor, the appropriate authority shall make a
declaration to that effect. Section 269-UH reads as under:
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app 298-14.docx“269-UH. Revesting of property in the transferor on
failure of payment or deposit of consideration.–(1)
If the Central Government fails to tender under sub-
section (1) of Section 269-UG or deposit under sub-
section (2) or sub-section (3) of the said section, the
whole or any part of the amount of consideration
required to be tendered or deposited thereunder
within the period specified therein in respect of any
immovable property which has vested in the Central
Government under sub-section (1) or, as the case
may be, sub-section (6) of Section 269-UE, the order
to purchase the immovable property by the Central
Government made under sub-section (1) of Section
269-UD shall stand abrogated and the immovable
property shall stand revested in the transferor after
the expiry of the aforesaid period:
Provided that where any dispute referred to in sub-section
(2) or sub-section (3) of Section 269-UG is pending in any
court for decision, the time taken by the court to pass a
final order under the said sub-sections shall be excluded in
computing the said period.
(2) Where an order made under sub-section (1) of
Section 269-UD is abrogated and the immovable
property revested in the transferor under sub-
section (1), the appropriate authority shall make, as
soon as may be, a declaration in writing to this
effect and shall–
(a) deliver a copy of the declaration to the persons
mentioned in sub-section (2) of Section 269-UD; and
(b) deliver or cause to be delivered possession of the
immovable property back to the transferor or, as the
case may be, to such other person as was in
possession of the property at the time of its vesting
in the Central Government under Section 269-UE.”
(emphasis supplied)
41. Section 269-UI stipulates the powers of the appropriate
authority and Section 269-UJ gives the power to the appropriate authority
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for rectification of mistakes apparent from the record. Both these Sections
are not germane for deciding the issue in the present appeal, and therefore,
are not reproduced hereunder.
42. Section 269-UK puts certain restrictions on revocation or
alteration on certain agreements for transfer of immovable property. This
Section basically stipulates that notwithstanding anything contained in any
other law for the time being in force, no person shall revoke or alter an
agreement for the transfer of an immovable property, or transfer such
property, in respect of which a statement has been furnished to the
appropriate authority under Section 269-UC unless: (a) the appropriate
authority has not made an order for the purchase as contemplated under
Section 269-UD; or (b) in a case where an order for the purchase of
immovable property by the Central Government has been made [under
Section 269-UD (1)], but the said order stands abrogated under Section 269-
UH(1). This Section also stipulates that any transfer of immovable property
made in contravention of the provisions of sub-section (1) of Section 269-UK
shall be void. For the sake of convenience, Section 269-UK reads thus:-
“269-UK. Restrictions on revocation or alteration of
certain agreements for the transfer of immovable
property or on transfer of certain immovable
property.–(1) Notwithstanding anything contained
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app 298-14.docxperson shall revoke or alter an agreement for the
transfer of an immovable property or transfer such
property in respect of which a statement has been
furnished under Section 269-UC unless,–
(a) the appropriate authority has not made an order
for the purchase of the immovable property by
the Central Government under Section 269-UD
and the period specified for the making of such
order has expired; or
(b) in a case where an order for the purchase
of the immovable property by the Central
Government has been made under sub-
section (1) of Section 269-UD, the order
stands abrogated under sub-section (1) of
Section 269-UH.
(2) Any transfer of any immovable property made in
contravention of the provisions of sub-section (1) shall be
void.”
(emphasis supplied)
43. Section 269-UL puts restrictions on registration etc of
documents in respect of transfer of immovable property and stipulates that
no registering officer appointed under the Registration Act, 1908 shall
register any document which purports to transfer the immovable property
exceeding the value prescribed under Section 269-UC unless a certificate
from the appropriate authority is obtained stating that it has no objection to
such transfer.
44. Thereafter, and what is important for our purposes, is Section
269-UN. This Section provides that save as otherwise provided in Chapter
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XX-C, any order made under Section 269-UD (1) or under Section 269-UF
(2) shall be final and conclusive and shall not be called in question in any
proceeding, either under the IT Act, 1961, or under any other law for the time
being in force. For the sake of convenience, Section 269-UN is reproduced
hereunder:-
“269-UN. Order of appropriate authority to be final
and conclusive.–Save as otherwise provided in this
Chapter, any order made under sub-section (1) of
Section 269-UD or any order made under sub-
section (2) of Section 269-UF shall be final and
conclusive and shall not be called in question in
any proceeding under this Act or under any other
law for the time being in force.”
45. The other Section and which is relevant for our purposes is
Section 293 of the IT Act, 1961. What this Section stipulates is that no suit
shall be brought in any Civil Court to set aside or modify any proceeding
taken, or order made, under the IT Act, 1961, and no prosecution, suit or
other proceeding shall lie against the Government or any Officer of the
Government for anything done in good faith or intended to be done in good
faith under the IT Act, 1961. Section 293 reads thus:-
“293. Bar of suits in civil courts.–No suit shall be
brought in any civil court to set aside or modify
any proceeding taken or order made under this
Act, and no prosecution, suit or other proceeding
shall lie against the Government or any officer of
the Government for anything in good faith done or
intended to be done under this Act.”
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46. We have referred to all these Sections for the purposes of
understanding the scheme of Chapter XX-C of the IT Act, 1961. At the risk of
repetition, to summarize, what these provisions stipulate is that firstly, before
a transfer of immovable property is done (of a value and area prescribed) the
agreement entered into for such transfer has to be reduced to writing in the
form of a statement and submitted to the appropriate authority [Section 269-
UC]. Once this is done, and the appropriate authority is of the opinion that
the consideration in the agreement is understated, it can pass an order
compulsorily purchasing the property for the amount equal to the amount of
the apparent consideration [Section 269-UD]. Once the order of compulsory
purchase is passed under Section 269-UD, the immovable property, from the
date of the said order, vests in the Central Government as provided in Section
269-UE (1) or 269-UE(6), as the case may be. For this purchase of immovable
property, the Central Government has to pay consideration equal to the
amount of the apparent consideration as stipulated in Section 269-UF. It is
not as if the Government can take its own sweet time in paying the said
consideration. Under Section 269-UG, the consideration has to be paid
within a period of one month from the end of the month in which the said
immovable property becomes vested in the Central Government under
Section 269-UE(1) or Section 269-UE(6), as the case may be. If this
consideration is not paid within the stipulated period [i.e. the period
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mentioned in Section 269-UG], then Section 269-UH stipulates that the
compulsory order of purchase passed under Section 269-UD(1) shall stand
abrogated and the immovable property shall stand re-vested in the transferor
after the expiry of the aforesaid period. Section 269-UH further stipulates
that once an order is abrogated and the immovable property is re-vested in
the transferor [as stipulated in Section 269-UH (1)], the appropriate
authority shall make a declaration to that effect. As mentioned earlier,
Section 269-UN stipulates that any order made under Section 269-UD(1) or
Section 269-UF(2) shall be final and conclusive and shall not be called in
question in any proceeding under the IT Act, 1961 or any other law for the
time being in force.
47. What we have to consider in this appeal, firstly, is whether the
reliefs sought in the present suit are barred by virtue of the provisions of
Section 269-UN of the IT Act, 1961. As mentioned earlier, in the present suit,
the Plaintiff seeks a declaration that:
(i) the 3rd Compulsory Purchase Order [dated 12th
September 2002] stands abrogated on and from 31 st
October 2002;
(ii) that on and from 31st October 2002 all right, title and
interest in the suit property and all rights to the said
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app 298-14.docxFSI, stands re-vested in the Mulanis [Defendant Nos.3
to 18] and Omprakash Navani [Defendant No.19]
respectively; and
(iii) on and from 16th May 2006 the Plaintiff is the absolute
owner of the suit property and has the absolute right,
title and interest in the same including the right to
develop, alienate, sell, transfer, or create any 3 rd party
rights, interest without any hindrance.
48. The question is whether these declarations are hit by the
prohibition as stated in Section 269-UN. After carefully considering the
submissions made by Mr. Salve, as well as by the learned Attorney General of
India, we are unable to see how Section 269-UN would bar the jurisdiction of
this Court from giving such declarations. As mentioned earlier, Section 269-
UN stipulates that save as otherwise provided in Chapter XX-C, no order
made under sub-section (1) of Section 269-UD or any order made under sub-
section (2) of Section 269-UF shall be “called in question” in any proceeding
either under the IT Act, 1961 or under any other law for the time being in
force. The declaration sought in the above suit that the 3rd Compulsory
Purchase Order (dated 12th September 2002) stands abrogated on and from
31st October 2002, and from that date the suit property re-vests in the
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Mulanis and Defendant No.19 [Omprakash Navani], does not in any way “call
in question” the 3rd Compulsory Purchase Order dated 12th September 2002.
In fact, the case of the Plaintiff proceeds on the basis that the 3rd Compulsory
Purchase Order is valid, and because the consideration was not paid within
the time stipulated in Section 269-UG, the 3rd Compulsory Purchase Order
stands abrogated as provided in Section 269-UH of the IT Act, 1961. The
abrogation takes place by operation of law as stipulated in Section 269-UH(1)
provided the consideration is not paid within the time frame as stipulated in
Section 269-UG. This by no stretch of the imagination could mean that the
3rd Compulsory Purchase Order [passed under Section 269-UD (1)] is being
“called in question” in the present suit.
49. To our mind, the phrase “called in question” appearing in
question 269-UN refers to a situation where the validity or the legality of the
order passed under Section 269-UD (1) or under Section 269-UF (2) is being
challenged or disputed. On the other hand, seeking a declaration that the
order under Section 269-UD (1) stands “abrogated” means that the said order
is officially brought to an end, either by law or by agreement. As per our
knowledge, the word “abrogate” means to officially end a law, an agreement,
etc. or to end a law, agreement, or custom formally. Seeking a declaration
that the order passed under Section 269-UD(1) stands abrogated can never
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mean that the said order is being challenged or being “called in question” as
referred to in Section 269-UN. In fact, seeking a declaration that an order
stands abrogated, proceeds on the basis that the said order, which now
stands abrogated, was valid. Once this is the case, we are clearly of the view
that the suit filed by the Plaintiff is not barred by virtue of the provisions of
Section 269-UN of the IT Act, 1961.
50. However, the matter does not stop here. We also have to
examine whether the suit would be barred by virtue of the provisions of
Section 293 of the IT Act, 1961. As mentioned earlier, Section 293 inter alia
stipulates that no suit shall be brought in any Civil Court to set aside or
modify any proceeding taken, or order made, under the IT Act, 1961. From
the language of Section 293, it is clear that it is of wide import. If any suit is
brought which has the effect to set aside or modify any proceeding taken
under the IT Act, 1961, or to set aside or modify any order made under the
said Act, the same would be barred. The question therefore is whether the
declaration sought by the Plaintiff would have the effect of either setting
aside or modifying any proceeding taken, or order made, under the IT Act,
1961. Here also, we are clearly of the view that the declarations sought by the
Plaintiff do not have any such effect. What is sought in the above suit is that
the 3rd Compulsory Purchase Order passed by the appropriate authority
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[under Section 269-UD (1)] stands abrogated. This declaration is sought on
the basis that the consideration payable for the purchase of the immovable
property by the Central Government was not paid within the time stipulated
in Section 269-UG. We fail to see how seeking such a declaration would
either set aside or modify any proceeding taken under the IT Act, 1961 or to
set aside or modify any order made under the IT Act, 1961. All that the
Plaintiff seeks in the present suit is that by virtue of Section 269-UH the 3rd
Compulsory Purchase Order stood abrogated for non-compliance of the
provisions of Section 269-UG. If the Plaintiff, at trial, fails to establish this
fact, it would not be entitled to the declaration. This, however, does not mean
that this Court does not have jurisdiction to entertain the suit. It is now well
settled that the jurisdiction of Civil Courts is all embracing except to the
extent it is excluded by an express provision of law or by clear intendment
arising from such law. This is the purport of Section 9 of the Code of Civil
Procedure, 1908. This has been so held by a Constitution Bench judgment of
the Hon’ble Supreme Court in the case of Dhulabhai ETC V/S State of
Madhya Pradesh and Another [(1968) 3 SCR 662 : AIR 1969 SC
78: 1968 SCC Online SC 40]. Paragraphs 9 and 32 of this judgment reads
thus:-
“9. To which category do such cases belong in India? The
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app 298-14.docxaccepted in 67 Ind App 222 = (AIR 1940 PC 105) and in
Raleigh Investment Co. v. Government General in Council, 74
Ind App 50 = (AIR 1947 PC 78). In the first case it was laid
down by the Judicial Committee that the ouster of the
jurisdiction of a civil court is not to be lightly inferred and can
only be established if there is an express provision of law or is
clearly implied. In the second case it was held that where a
liability to tax is created by statute which gives special and
particular remedies against illegal exactions the remedy
contemplated by the statute must be followed and it is not
open to the assessee to pursue the ordinary civil process of
courts. To the latter case we shall refer in some detail
presently. Opinion in this Court has, however, wavered as to
how far to go with the dicta of the Privy Council in the two
cases.
**********
32. Neither of the two cases of Firm of Illuri Subayya, 1964-1
SCR 752 = (AIR 1964 SC 322) or Kamla Mills, 1966 1 SCR 64
= (AIR 1965 SC 1942) can be said to run counter to the
series of cases earlier noticed. The result of this inquiry into
the diverse views expressed in this Court may be stated as
follows:
(7) Where the statute gives a finality to the orders of the
special tribunals the civil court’s jurisdiction must be
held to be excluded if there is adequate remedy to
do what the civil courts would normally do in a suit.
Such provision, however, does not exclude those
cases where the provisions of the particular Act have
not been complied with or the statutory tribunal has
not acted in conformity with the fundamental
principles of judicial procedure.
(2) Where there is an express bar of the jurisdiction of
the court, an examination of the scheme of the
particular Act to find the adequacy or the sufficiency
of the remedies provided may be relevant but is not
decisive to sustain the jurisdiction of the civil court.
Where there is no express exclusion the examination
of the remedies and the scheme of the particular Act
to find out the intendment becomes necessary and
the result of the inquiry may be decisive. In the
latter case it is necessary to see if the statute
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creates a special right or a liability and provides for
the determination of the right or liability and further
lays down that all questions about the said right and
liability shall be determined by the tribunals so
constituted, and whether remedies normally
associated with actions in civil courts are prescribed
by the said statue or not.
(3) Challenge to the provisions of the particular Act as
ultra vires cannot be brought before Tribunals
constituted under the Act. Even the High Court
cannot go into that question on a revision or
reference from the decision of Tribunals.
(4) When a provision is already declared
unconstitutional or the constitutionality of any
provision is to be challenged, a suit is open. A writ of
certiorari may include a direction for refund if the
claim is clearly within the time prescribed by the
Limitation Act but it is not a compulsory remedy to
replace a suit.
(5) Where the particular Act contains no machinery for
refund of tax collected in excess of constitutional
limits or illegally collected a suit lies.
(6) Questions of the correctness of the assessment
apart from its constitutionality are for the decision of
the authorities and a civil suit does not lie if the
orders of the authorities are declared to be final or
there is an express prohibition in the particular Act.
In either case the scheme of the particular Act must
be examined because it is a relevant enquiry.
(7) An exclusion of the jurisdiction of the civil court is
not readily to be inferred unless the conditions
above set down apply.
(emphasis supplied)
51. In the present case, we do not find that the declaration sought by
the Plaintiff in the above suit is expressly barred under Section 269-UN or
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under Section 293. We also do not find any clear intendment in these
provisions which would bar the Civil Court from granting the relief sought.
We agree with the learned Attorney General of India that Section 293 and
Section 269-UN of the IT Act, 1961 have to be read harmoniously. However,
even reading them harmoniously, in the facts of the present case, we fail to
see how these two provisions would oust the jurisdiction of the Civil Court. As
mentioned earlier, all that the Plaintiff seeks in the present suit is a
declaration that on and from 31st October 2002, the 3rd Compulsory
Purchase Order stands abrogated and the suit property re-vests in the
Mulanis and Defendant No.19 (Omprakash Navani). This declaration, in no
way, calls into question the said order as referred to in Section 269-UN and
neither does it seek to modify or set aside the said order as contemplated
under Section 293. In these circumstances, even when Section 269-UN and
Section 293 are read harmoniously, and together, they would not oust the
jurisdiction of this Court.
52. With the greatest respect, we are unable to agree with the
learned Attorney General of India that the question, as to whether an
abrogation has really taken place, is a question within the scope of the IT Act,
1961, and that any inquiry in this regard will be treated as a proceeding under
the IT Act, 1961. The abrogation referred to in Section 269-UH takes place by
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operation of law provided the consideration is not paid within the time-frame
as stipulated in Section 269-UG. What is pertinent to note is that there is no
machinery under the IT Act, 1961, when the authorities under the IT Act,
1961 refuse to recognize the abrogation which comes into effect by the
operation of law. We, therefore, fail to understand as to how any inquiry with
regard to whether the abrogation taken place or otherwise would be a
proceeding under the IT Act, 1961. A “proceeding” under the IT Act, 1961
would necessarily mean a proceeding initiated under the relevant provisions
of said Act, and not otherwise.
53. In fact, as held by the Constitution Bench of the Hon’ble
Supreme Court in Dhulabhai ETC (supra), where the statute gives
finality to the orders of the special tribunals, the Civil Court’s jurisdiction
must be held to be excluded if there is an adequate remedy to do what the
Civil Court would normally do in a suit. The Hon’ble Supreme Court has
further opined that such a provision, however, does not exclude those cases
whether the provisions of the particular Act have not been complied with, or
the statutory tribunal has not acted in conformity with the fundamental
principles of judicial procedure. Where there is an express bar of the
jurisdiction of the Civil Court, an examination of the scheme of the particular
Act should be undertaken to find the adequacy or the sufficiency of the
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remedies provided, and which may be relevant but not decisive to sustain the
jurisdiction of the Civil Court. Where there is no express exclusion, the
examination of the remedies and the scheme of the particular Act to find out
the intendment becomes necessary, and in such a case it is necessary to see if
the statute creates special rights or a liability and provides for the
determination of the right or liability, and further lays down that all
questions about the said right and/or liability shall be determined by the
tribunals so constituted, and whether remedies normally associated with
actions in Civil Courts are prescribed by the said statute or not. The Hon’ble
Supreme Court has clearly opined that the exclusion of the Civil Court’s
jurisdiction is not readily to be inferred unless it is barred, either expressly or
by necessary implication. We therefore find that the argument canvassed by
the learned Attorney General of India that the present suit is barred because
any inquiry to be done with reference to whether an abrogation has taken
place or otherwise would be a proceeding under the IT Act, 1961, does not
commend to us. Consequently, we are unable to agree with the submissions
of the learned Attorney General of India that the present suit is barred either
under the provisions of Section 269-UN or under Section 293 of the IT Act,
1961.
54. As correctly submitted by Mr. Salve, the learned Single Judge
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has erred when he came to the conclusion that as the Plaintiff is seeking a
declaration that the 3rd Compulsory Purchase Order stands abrogated, this
Court will have to further declare that the said order stood annulled, canceled
or set aside. The abrogation of the order takes place by operation of law and
there is no question of giving a further declaration that the order is canceled
or set aside. In other words, by seeking the declaration of abrogation, the
order passed under Section 269-UD (1) is not called into question at all. We
further agree with Mr. Salve that the learned Single Judge erroneously
proceeded on the basis that if the declaration sought in the suit is granted,
this Court will have to declare the proceedings initiated under Chapter XX-C
are illegal and therefore barred under Section 269-UN and/or Section 293 of
the IT Act, 1961. The fact that the Plaintiff seeks a declaration of abrogation
proceeds on the basis that the proceedings initiated under Chapter XX-C are
in fact valid and not illegal. The declaration of abrogation is sought by virtue
of Section 269-UH because the consideration was not paid within the time
stipulated under Section 269-UG. Once this is the case, we are unable to
agree with the findings of the learned Single Judge that by seeking the
aforesaid declarations, the Plaintiff is either seeking to set aside the order
passed under Section 269-UD (1) or that the proceedings initiated under
Chapter XX-C would be rendered as illegal. In light of our findings, we find
that the impugned order passed by the learned Single Judge is not
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sustainable. We accordingly set aside the impugned order and answer issue
No.1 in the negative i.e. against the Revenue (Defendant Nos.1 and 2) and in
favour of the Plaintiff. As far as other two issues are concerned, since they
have not been answered by the learned Single Judge, we are not giving any
findings on the same.
55. Before concluding, we must refer to the judgment of the Hon’ble
Supreme Court in the case of Commissioner of Income Tax
Bhubaneswar and Another V/S Parmeshwari Devi Sultania and
Others [(1998) 3 SCC 481], and which has been heavily relied upon [in
paragraph 48 of the impugned order] by the learned Single Judge to come to
the conclusion that he did. In the case of Parmeshwari Devi (supra) the
Plaintiff had filed a suit for partition against seven defendants, Defendant
Nos 6 and 7 being the Union of India through the Finance Secretary, and
Commissioner of Income Tax, Orissa, respectively [who were the Appellants
before the Supreme Court]. Defendant Nos.1 and 2 were the step-brothers
and Defendants 3 to 5 were the step-sisters of the Plaintiff (Parmeshwari
Devi). The Plaintiff stated that she was the daughter of one Shri. Bansidhar
Agarwal from his first wife, while Defendant Nos.1 to 5 were the children of
Bansidhar Agarwal from his second wife. Defendant No.1 was Babulal whose
residential and business premises were subjected to a search and seizure
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operation under Section 132 of the IT Act, 1961 and various assets including
certain gold ornaments [being the subject matter of the suit filed by the
Plaintiff], were seized. In the suit, the Plaintiff (Parmeshwari Devi) prayed for
partition of those very gold ornaments seized under the IT Act, 1961. The
Plaintiff stated that her mother died in 1938 and at that time she was
possessed of 200 tolas of gold ornaments which was her stridhan. Her
mother made a Will bequeathing the gold ornaments to the Plaintiff and the
other children of Bansidhar from his second wife in proportion of the number
of daughters of each of such children to meet the dowry demand and
marriage requirements of their daughters. These ornaments were kept in the
custody of the father of the Plaintiff who died on 10 th February 1990. After his
death the ornaments came in the custody of Babulal (Defendant No.1). It was
at that time that the family decided to partition the ornaments. According to
the Plaintiff, since the Plaintiff had 5 daughters, she was entitled to 5/14 th
share in the ornaments. However, before the partition could take place, the
Income Tax Officer raided the house of the 1 st Defendant and seized those
gold ornaments which weighed 2128 gms along with other assets. The
Plaintiff filed a Petition before the Income Tax Officer for return of the
ornaments, but he refused. The Plaintiff then issued a notice to the
Commissioner of Income Tax (Defendant No.7) who, according to the
Plaintiff, assured her that justice would be done to her claim and had stated
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that her case would be disposed of within three months. Since nothing
happened, this, according to the Plaintiff, gave rise to a cause of action to the
Plaintiff who then filed the partition suit. In this judgment, the Hon’ble
Supreme Court, in paragraph 3, noticed that from the facts it was quite
obvious that the Plaintiff would not have filed the suit for partition as there
was no dispute to her claim by the other relatives but for the fact that gold
ornaments were then in the custody of the Income Tax Department. It is in
this light and looking at the averments in the plaint that the Hon’ble Supreme
Court came to the conclusion that the suit was barred under Section 293 of
the Income Tax Act. The Hon’ble Supreme Court basically came to the
conclusion that if ultimately the suit is to result in a decree, it would have the
effect to set aside or modify the proceedings taken and order made under the
IT Act, 1961. It therefore held that the suit would not be maintainable. We fail
to see how this decision can apply to the facts of the present case. There can
be no dispute about the proposition that if ultimately the suit results in a
decree which has the effect of setting aside or modifying any proceedings
taken, or order made under the IT Act, 1961, such a suit would not be
maintainable in light of the express language of Section 293. However, in the
facts of the present case, we fail to see how seeking a declaration that the 3rd
Compulsory Purchase Order stands abrogated would in any way either
directly or indirectly set aside or modify any proceedings taken under the IT
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Act, 1961, or any order made thereunder. We, therefore, find that the fact
situation before the Hon’ble Supreme Court in the case of Parmeshwari
Devi (supra) was completely different from the factual matrix before us.
56. We must mention here that it is too well settled a proposition
that the ratio of any decision must be understood in the background of the
facts of that case. It has been said a long time ago that a case is only an
authority for what it actually decides, and not what logically follows from it. If
one must refer to any authority on this subject, the Hon’ble Supreme Court in
the case of Sarva Shramik Sanghatana (K.V.) Mumbai V/S State of
Maharashtra and Others [2008 (1) SCC 494] has very succinctly and
eloquently reiterated the said proposition. Paragraphs 14 to 18 of the said
judgment reads thus:-
“14. On the subject of precedents Lord Halsbury, L.C., said
in Quinn v. Leathem [1901 AC 495 : (1900-1903) All ER Rep
1 (HL)] : (All ER p. 7 G-I)
“Before discussing Allen v. Flood [1898 AC 1 :
(1895-1899) All ER Rep 52 (HL)] and what was
decided therein, there are two observations of
a general character which I wish to make; and
one is to repeat what I have very often said
before–that every judgment must be read as
applicable to the particular facts proved or
assumed to be proved, since the generality of
the expressions which may be found there are
not intended to be expositions of the whole
law, but are governed and qualified by the
particular facts of the case in which such
expressions are to be found. The other is that aPage 57 of 61
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app 298-14.docxcase is only an authority for what it actually
decides. I entirely deny that it can be quoted
for a proposition that may seem to follow
logically from it. Such a mode of reasoning
assumes that the law is necessarily a logical
code, whereas every lawyer must acknowledge
that the law is not always logical at all.”
(emphasis supplied)
We entirely agree with the above observations.
15. In Ambica Quarry Works v. State of Gujarat [(1987) 1
SCC 213] (vide SCC p. 221, para 18) this Court observed:
“18. The ratio of any decision must be
understood in the background of the facts
of that case. It has been said long time
ago that a case is only an authority for
what it actually decides, and not what
logically follows from it.”
16. In Bhavnagar University v. Palitana Sugar Mill (P)
Ltd. [(2003) 2 SCC 111] (vide SCC p. 130, para 59) this
Court observed:
“59. … It is also well settled that a little
difference in facts or additional facts may
make a lot of difference in the
precedential value of a decision.”
(emphasis supplied)
17. As held in Bharat Petroleum Corpn. Ltd. v. N.R.
Vairamani [(2004) 8 SCC 579 : AIR 2004 SC 4778] a
decision cannot be relied on without disclosing the factual
situation. In the same judgment this Court also observed :
(SCC pp. 584-85, paras 9-12)
“9. Courts should not place reliance on
decisions without discussing as to how the
factual situation fits in with the fact situation of
the decision on which reliance is
placed. Observations of courts are neither to
be read as Euclid’s theorems nor as provisions
of a statute and that too taken out of their
context. These observations must be read in
the context in which they appear to have beenPage 58 of 61
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app 298-14.docxstated. Judgments of courts are not to be
construed as statutes. To interpret words,
phrases and provisions of a statute, it may
become necessary for judges to embark into
lengthy discussions but the discussion is meant
to explain and not to define. Judges interpret
statutes, they do not interpret judgments. They
interpret words of statutes; their words are not
to be interpreted as statutes. In London
Graving Dock Co. Ltd. v. Horton [1951 AC 737 :
(1951) 2 All ER 1 (HL)] (AC at p. 761), Lord
MacDermott observed : (All ER p. 14 C-D)
‘The matter cannot, of course, be settled
merely by treating the ipsissima verba of
Willes, J. as though they were part of an Act of
Parliament and applying the rules of
interpretation appropriate thereto. This is not
to detract from the great weight to be given to
the language actually used by that most
distinguished Judge, …’
10. In Home Office v. Dorset Yacht Co.
Ltd. [1970 AC 1004 : (1970) 2 WLR 1140 :
(1970) 2 All ER 294 (HL)] Lord Reid said,
‘Lord Atkin’s speech … is not to be treated as if
it were a statutory definition. It will require
qualification in new circumstances.’ (All ER p.
297g)
Megarry, J. in Shepherd Homes Ltd. v. Sandham (No.
2) [(1971) 1 WLR 1062 : (1971) 2 All ER 1267] ,
observed : (All ER p. 1274d)
‘One must not, of course, construe even a
reserved judgment of even Russell, L.J. as if it
were an Act of Parliament;’
And, in British Railways Board v. Herrington [1972 AC
877 : (1972) 2 WLR 537 : (1972) 1 All ER 749 (HL)]
Lord Morris said : (All ER p. 761c)
‘There is always peril in treating the
words of a speech or a judgment as
though they were words in a legislative
enactment, and it is to be remembered
that judicial utterances are made in the
setting of the facts of a particular case.’Page 59 of 61
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11. Circumstantial flexibility, one additional or
different fact may make a world of difference
between conclusions in two cases. Disposal of
cases by blindly placing reliance on a decision
is not proper.
12. The following words of Hidayatullah, J. in
the matter of applying precedents have
become locus classicus : (Abdul
Kayoom v. CIT [AIR 1962 SC 680] , AIR p. 688,
para 19)
’19. … Each case depends on its own facts and
a close similarity between one case and
another is not enough because even a single
significant detail may alter the entire aspect, in
deciding such cases, one should avoid the
temptation to decide cases (as said by
Cardozo) by matching the colour of one case
against the colour of another. To decide
therefore, on which side of the line a case falls,
the broad resemblance to another case is not
at all decisive.’
***
‘Precedent should be followed only so far as it
marks the path of justice, but you must cut the
dead wood and trim off the side branches else
you will find yourself lost in thickets and
branches. My plea is to keep the path to justice
clear of obstructions which could impede it.’ “
(emphasis supplied)
18. We have referred to the aforesaid decisions and the
principles laid down therein, because often decisions are
cited for a proposition without reading the entire decision
and the reasoning contained therein. In our opinion, the
decision of this Court in Sarguja Transport case [(1987) 1
SCC 5 : 1987 SCC (Cri) 19 : AIR 1987 SC 88] cannot be
treated as a Euclid’s formula.”
(emphasis supplied)
57. We, therefore, with the greatest respect, find that the learned
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Single Judge erred in heavily relying upon the aforesaid decision in the case
of Parmeshwari Devi (supra) to hold that the present suit was barred by
virtue of Section 269-UN and/or Section 293 of the IT Act, 1961.
58. For all the aforesaid reasons, we hereby set aside the impugned
order and answer issue No.1 in the negative i.e. against the Revenue
(Defendant Nos.1 and 2) and in favour of the Plaintiff. As far as the other two
issues are concerned, since they have not been answered by the learned
Single Judge, we are not giving any findings on the same, including whether
they can be tried as preliminary issues or whether they should be tried with
all other issues. The above appeal succeeds in the aforesaid terms. However,
there shall be no order as to costs. Since the above suit is of the year 2006,
the hearing of the suit is expedited. Now that the suit is restored, the order
passed by the learned Single Judge in Notice of Motion No.2340 of 2006 in
Suit No.2094 of 2006 dated 9th & 10th October 2007, shall stand revived and
continue till the disposal of the suit.
59. This order will be digitally signed by the Private Secretary/
Personal Assistant of this Court. All concerned will act on production by fax
or email of a digitally signed copy of this order.
[FIRDOSH P. POONIWALLA, J.] [B. P. COLABAWALLA, J.]
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