The court's decision was based on the interpretation of Section 269D(1) of the Income Tax Act, 1961, and the refusal to interfere with the authority's satisfaction.

Puttaswamy, J.—An house property bearing No. 2 situated on Artillery Road, Civil Station, Bangalore City, measuring about 627 sq. mts. was originally owned by one Sadiq Hussain of Banglore City, who on June 15, 1981, transferred the same to the petitioner for a sum of Rs. 1,80,000. On an examination of the said transfer, the Inspecting Assistant Commissioner of Income Tax (Acquisition Range), Bangalore, ("IAC"), being of the opinion that the fair market value of the property exceeded the apparent consideration stated in the instrument of transfer by more than 15% had issued notice No. CR 62/30399/81-82 dated December 18, 1981 (annexure G) to the transferor and transferee under s. 269D(1) of the I.T. Act of 1961 (Central Act 43 of 1961) ("the Act"), proposing to acquire the property for the Government under Chapter XXA of that Act. In this petition under art. 226 of the Constitution, the petitioner has challenged the said showcause notice principally on two ground and they are (i) that the proceedings had not been initiated by the IAC within the permitted time and (ii) that the transaction being real and genuine, there was no justification to initiate proceedings under the Act.

2. The respondents have resisted this writ petition.

3. Sri. K. Poornabodha Rao, learned counsel for the petitioner, strenuously contends that the initiation of the proceedings had to be reckoned as made only on April 5, 1982, on which day only the IAC intimated the fact of publication in the Official Gazette and, so reckoned, the proceeding were barred by time. In support of his contention, Sri Rao strongly relies on a Division Bench ruling of the Allahabad High Court in U.S. Awasthi and Another Vs. Inspecting Assistant Commissioner of Income Tax (Acquisition Range) and Another, (1977) 107 ITR 796 All.

4. Sri K. Srinivasan, learned senior standing counsel for the Income Tax Department, appearing for the respondents, refuting the contention of Sri Rao contends that the date of publication in the Official Gazette should be reckoned as the date of publication for purpose of s. 269D(1) of the Act and, so constructed, the proceedings were in time. In support of his contention, Sri Srinivasan strongly relies on the ruling of the Supreme Court in State of Maharashtra Vs. Hans George, AIR 1965 SC 722 , and a Division Bench ruling of the Gujarat High Court in COMMISSIONER OF Income Tax, GUJARAT-III Vs. SHILABEN KANCHANLAL RANA. COMMISSIONER OF Income Tax, GUJARAT-III v. BHAGWANDAS S. RESHAMWALA., (1980) 124 ITR 420 Guj.

5. In his letter No. CR 62/30899/81-82/Acq. dated April 2, 1982 (annexure J), IAC has stated that the notice of acquisition had been published in the Government of India Gazette dated March 6, 1982, on page 2999 of part III-1, the correctness of which is not disputed by the petitioner. While that is so, this court must necessarily proceed to examine the case on the basis of the facts stated by the IAC in her letter dated April 2, 1982 (annexure J), which means that the notice of acquisition had been published in the Government of India Gazette dated March 6, 1982. Even otherwise, I have no reason to disbelieve the correctness of the statement made by the IAC in her letter dated April 2, 1982.

6. What emerges from the above is that the notice of acquisition had been published in the Government of India Gazette dated March 6, 1982, and that fact had been intimated by the IAC in her letter dated April 5, 1982. On these facts, the question is whether the initiation is barred by time, which depends on the true construction of s. 269D(1) of the Act. That section that is material reads thus :

"269D(1). The competent authority shall initiate proceedings for the acquisition, under this Chapter, of any immovable property referred to in section 269C by notice to that effect published in the Official Gazette :

Provided that no such proceedings shall be initiated in respect of any immovable property after the expiration of a period of nine months from