Law: Income Tax Act, 1961

Section: 269C

Section 269C of the Income-tax Act, 1961, read with Articles 19(1)(f), 31 and 31C of the Constitution of India - Acquisition of immovable property in certain cases of transfer to counteract evasion of tax competent authority acquired land of petitioner under section 269D - Petitioner being aggrieved filed instant petition challenging vires of Chapter XX-A on grounds that it offends article 19(1)(f) as it interferes with fundamental right of citizens to acquire, hold and dispose of property - Whether impugned provisions i.e. Chapter XX-A squarely come within ambit of article 31C - Held, yes - Whether therefore, it could not be said Chapter XX-A offended article 19(1)(f) - Held, yes FACTS Petitioner purchased certain land for a consideration of Rs. 55,000 under a registered sale deed. The Inspecting Assistant Commissioner being the competent authority under section 269A(b) issued a notice to the petitioner under section 269D(1) for acquisition of the said properly. Aggrieved thereby, the petitioner fled instant petition challenging vires of Chapter XX-A on the grounds that (i) the provisions of Chapter XX-A offend article 19(1)(f) of the Constitution as they interfere with the fundamental right of citizens to acquire, hold and dispose of property; (ii) the right to acquire, hold and dispose of property would carry with it the right of fixing consideration and to bargain for the highest consideration in respect of one's property; that right cannot be abridged by a provision as contained in the impugned Chapter; (iii) the acquisition proceeding taken under section 269D was not in the interest of general public or for the protection of the interest of any Scheduled Tribe and, therefore, was not within the purview of the reasonable restriction contemplated under sub-article (5) of article 19. HELD The Direct Taxes Enquiry Committee under the Chairmanship of Mr. Justice Wanchoo submitted an interim report in December, 1970, suggesting ways and means to deal with black money and tax evasion. With a view to giving effect to some of the recommendations of the Committee and to meet the appalling challenge of evasion of tax, Parliament brought in the Taxation Laws…

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