Sections 269TT, 269U and 269UA of Income Tax Act 1961

Section 269TT prescribed the mode of repayment on redemption of Special Bearer Bonds, 1991. Sections 269U and 269UA belonged to Chapter XXC, the historical statutory framework dealing with purchase by the Central Government of certain immovable properties in specified transfer cases.

Historical Chapter XXC: The Chapter XXC property-transfer regime is historical. Section 269UP provides that the Chapter does not apply to transfers of immovable property effected after 30 June 2002. The definitions below remain important for understanding older proceedings and the statutory scheme that applied during the Chapter's operative period.

Section 269TT - Mode of repayment of Special Bearer Bonds, 1991

Section 269TT begins with a non-obstante clause overriding anything inconsistent in any other law then in force. It required the amount payable on redemption of Special Bearer Bonds, 1991 to be paid only by an account payee cheque or an account payee bank draft drawn in the name of the person to whom payment was to be made.

Section 269U - Commencement of Chapter XXC

Section 269U authorised the Central Government to bring Chapter XXC into force by notification in the Official Gazette. Different commencement dates could be appointed for different areas. This area-based commencement mechanism was relevant to determining whether Chapter XXC applied to a particular immovable-property transaction.

Section 269UA - Definitions for Chapter XXC

Section 269UA supplied the principal definitions used throughout Chapter XXC unless the context otherwise required.

Agreement for transfer

An agreement for transfer meant an agreement for transfer of immovable property, whether or not registered under the Registration Act, 1908.

Apparent consideration

Apparent consideration depended on the nature of the property and the form of transfer. For property within Section 269UA(d)(i):

  • for a sale, it was the consideration specified in the agreement for transfer;
  • for an exchange involving things only, it was their ordinary open-market price on the date of the agreement;
  • for an exchange involving things plus money, it was the aggregate of that open-market price and the money amount;
  • for a lease, it was determined from the premium, rent, or the aggregate of premium, rent and amounts for services or things forming part of the rent, as applicable.

Where consideration was payable after the date of the agreement, the future amount was treated as its discounted value on the agreement date using the prescribed rate of interest.

Apparent consideration for rights in property

For immovable property within Section 269UA(d)(ii), apparent consideration could consist of money, the open-market value of things, or the aggregate of both. Future consideration was likewise discounted to its value on the date of the agreement at the prescribed rate.

Appropriate authority

Appropriate authority meant an authority constituted under Section 269UB to perform the functions assigned to that authority under Chapter XXC.

Immovable property

The definition covered two broad categories:

  • land, a building or part of a building, including machinery, plant, furniture, fittings or other things transferred with it, and including rights in those assets; and
  • rights in or with respect to land, a building or part of a building, constructed or to be constructed, arising from membership, acquisition of shares, agreement, arrangement or similar transaction, other than the direct sale, exchange or lease described in the first category.

Person interested

A person interested included all persons claiming, or entitled to claim, an interest in the consideration payable because of vesting of the property in the Central Government under Chapter XXC.

Transfer

For property covered by Section 269UA(d)(i), transfer included sale, exchange or a lease for a term of not less than twelve years. It also included allowing possession to be taken or retained in part performance of a contract of the nature referred to in Section 53A of the Transfer of Property Act, 1882.

For the twelve-year lease test, extension terms were aggregated with the initial lease term where the lease provided for such extensions.

For rights described in Section 269UA(d)(ii), transfer included doing anything, whether through membership, transfer of shares, agreement, arrangement or otherwise, that had the effect of transferring or enabling enjoyment of the property.

Connected legal provisions

Registration Act, 1908: Section 269UA expressly recognised that an agreement for transfer could be registered or unregistered.

Transfer of Property Act, 1882, Section 53A: part-performance possession was expressly included within the Chapter XXC definition of transfer.

Section 269UB: dealt with constitution of the appropriate authority referred to in Section 269UA.

Section 269UP: ended the application of Chapter XXC to transfers effected after 30 June 2002.

Official references

Income Tax Department - Income-tax Act
Income Tax Department e-Filing Portal
Legislative Department - Central Acts