Judgment:
1. These petitions arise out of the proceedings initiated under Chapter XX-C of the Income-tax Act, 1961 ('the Act' for short) seeking to acquire properties namely, flat Nos. 1301/1401 so far as writ Petition Nos. 2349 of 1993 is concerned with flat Nos. 903/1003 so far as Writ Petition No. 2348 of 1993 is concerned in Parasrampuria Tower No. 5, Oshiwara Village, Near Millat Nagar, Lokhandwala Complex, Andheri (W), Bombay 400 058 ('the said property').
2. The pre-emptive purchase under Chapter XX-C was on the ground that the consideration disclosed in the sale documents fall short of the real market value of the properties.
3. The potent contention amongst various others raised in these petitions, at the Bar, which alone is sufficient to dispose of these petitions, is that the amount of apparent consideration in both the petitions, as determined by the competent authority, had not at all been tendered by the Central Government to the parties to Form No. 37-I as was required to be tendered under Section 269UF read with Section 269UG of the Act. Thus, in the submission of learned Counsel appearing for the petitioners, the consequences of Section 269UH of the Act resulting in abrogation of the order must flow.
4. On being asked Mr. Asokan, learned Counsel appearing for the respondent-Department admits that till today no amount of apparent consideration has been tendered to the petitioners or deposited in any of the account of the Central Government with respect to the transactions in question.
5. In the above view of the admitted facts, in our considered view, the operation of Section 269UH of the Act in no way can be arrested. Consequently, the right to purchase exercised by the Central Government stands abrogated with the failure on the part of the Department to pay the amount of apparent consideration. In the result the impugned orders cannot stand the scrutiny of law. The impugned orders incorporated at exhibit E (in both the petitions) are, therefore, liable to be quashed and set aside. Accordingly, they are set aside and it is hereby declared that the properties in question (referred to in para. 1 supra) shall revest with the petitioners in both the petitions in accordance with the provisions of Section 269UH of the Act.
6. The view taken by us is in consonance with the law laid down by the apex court in the case of Union of India v. Dr. A.K. Garg : [2002]256ITR660(SC) wherein on more or less similar facts, the order of pre-emptive purchase was set aside.
7. Both the petitions are thus, allowed. Rule in each of them is made absolute in terms of prayer Clauses (a) and (c) with no order as to costs.