JUDGMENT

S. A. BOBDE, J.

1. This appeal is preferred by the appellants, who suffered an order of compulsory pre-emptive purchase under Chapter XXC of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) passed by the Appropriate Authority under Section 269UD of the Act.

2. Vidarbha Engineering Industries -Appellant No. 2 (hereinafter referred to as ‘Vidarbha Engineering’) holds on lease, three plots of land admeasuring 2595.152 sq mtrs i.e. 27934 sq ft at Dahipura and Untkhana, Nagpur (hereinafter referred to as the ‘subject land’). This land is comprised of three plots of land i.e. Plot Nos. 34, 35 and 36 obtained by Vidarbha Engineering from the Nagpur Improvement Trust. Vidarbha Engineering decided to develop the subject land and entered into an agreement for the purpose with Unitech Ltd. (herein after referred to as ‘Unitech’). The Memorandum of Understanding between them was formalized into a collaboration agreement dated 17.03.1994. Under this agreement the land holder agreed to allow Unitech to develop and construct a commercial project on the subject land a