JUDGMENT - T.D. SUGLA, J.:---By this petition under Article 226 of the Constitution of India, the petitioner, a co-operative society, has challenged the validity and legality of the Notice dated 11th April, 1977 issued by the competent authority under section 269-D(1) of the Income-Ttax Act, 1961. 2. A private limited company by name Flury's Swiss Confectionary Pvt. Ltd. (hereinafter referred to as 'vendors') were the owners of a piece of land together with two buildings standing thereon at Forbes Street Fort, Bombay. They demolished one of the old structures and constructed a new building in that place now known as Apeejay House consisting of office blocks, godowns and car parking spaces. The building was sold to various persons on what is known as ownership basis by blocks and godowns. Certain portions were retained by the vendors for their own use or for letting out to tenants. All this happened during the period from 1967 to 1972. The blocks and godowns so sold could not, in law, be registered in the name of persons who purchased them on ownership basis, the law being that the land and the structure thereon can be transferred to a co-operative society to be formed of such members who purchased blocks, godowns, flats etc. in the building. With this end in view the individual purchasere formed a society in the year 1972. The building along with the land appurtenant thereto was transferred to the said society by a sale deed executed on 25th October, 1972. The sale consideration shown in the sale deed was Rs. 41,71,020/-. This amount represented the sum total of the amounts for which the individual purchaser including the vendors had purchased and/or retained blocks and godowns etc. in the said building. 3. In order to find out whether the suit property was or was not transferred at its fair market value, the competent authority made reference to the District Valuation Officer-I, Income Tax Department, Bombay for valuing the suit property. The Valuation Officer estimated the fair market value of the property at Rs. 60,70,000/- as on 25th October, 1972. On receipt of the valuer's report the competent authority and Inspecting Assistant Commissioner by his letter dated 7th March, 1977 required the petitioner to show cause why acquisition proceedings under section 269-C/269-D should not be started. Reply to the show cause memo was filed on 25th March, 1977. 60,70,000/- as on 25th October, 1972. On receipt of the valuer's report the competent authority and Inspecting Assistant Commissioner by his letter dated 7th March, 1977 required the petitioner to show cause why acquisition proceedings under section 269-C/269-D should not be started. Reply to the show cause memo was filed on 25th March, 1977. According to the petitioner nothing was heard thereafter till 15th October, 1983 when another notice dated 24th September, 1983 issued by the competent authority under section 269-F(1) was received. 4. The sale deed had been lodged for registration on 16th February, 1973 but was registered on 20th August, 1976 only. Notice under section 269-D(1) was stated to have been issued on 11th April, 1977, the notification to that effect being published in the official gazette on 30th April, 1977. 5. Shri Dalvi, the learned Counsel for the petitioner, advanced arguments at length challenging each and every aspect of the matter. Since this Court finds that the petition can be decided on the short ground that formation of belief as regards third condition required in section 269-C(1) is not satisfied, it is not considered necessary to examine other arguments. It is pertinent to mention that the condition precedent for assumption of jurisdiction under section 269-C is whether the competent authority has reason to believe that any immovable property of a fair market value exceeding Rs. 25,000/- (then) has been transferred by a person to another person for an apparent consideration which is atleast less than 15% of the fair market value of the property and that the consideration for such transfer as agreed to between the parties has not been truly stated in the instrument of transfer with the object of-- (a) facilitating the reduction or evasion of the liability of the transferor to pay tax under this Act in respect of any income arising from the transfer; or (b) facilitating the concealment of any income or any moneys or other assets which have not been or which ought to be disclosed by the transferee for the purposes of Indian Income-tax tax, 1922 (11 of 1922) or this Act or the Wealth-tax Act, 1957 (27 of 1957). The sale consideration is admittedly more than Rs. 25,000/-. The sale consideration is admittedly more than Rs. 25,000/-. On the basis of valuation report, it may, for the present, be assumed that the apparent consideration in the sale deed is less than 15% of the fair market value of the property. In the circumstances what requires to be considered is whether the consideration for such transfer as agreed to between the parties has not been truly stated in the sale deed and it was so done with the object of Clauses(a) or (b) or both. It may be mentioned that in the notice under section 269-D(1) the competent authority has not struck the words "and/or" meaning thereby according to him the object of understatement of consideration could be either. 6. This Court had an occasion to consider, in the case of (Union Associates Co-operative Housing Society Ltd. v. Union of India and others.)1, 152 I.T.R. 114 whether presumptions raised in section 269-C(2) are available to the competent authority for the purpose of assuming jurisdiction under section 269-C/D. Following Calcutta and Gujarat High Court decisions it was held that the presumptions could be raised after the valid assumption of jurisdiction was acquired without the support of the presumptions and not for the purpose of assuming jurisdiction. No doubt Shri Jetley pointed out that Allahabad High Court in 150 I.T.R. 42 and Punjab and Haryana High Court in 161 I.T.R. 174 had taken a contrary view. Be that as it may, following this Court's judgment, it has to be held that the presumptions raised in section 269-C(2) are not available to the competent authority for the purpose of acquiring jurisdiction under section 269-C/D. 7. Considering the facts of the case independent of the presumption clauses of section 269-C(2), in the present case it cannot be held that the sale consideration was not truly stated in the sale deed. It is to be borne in mind that in this case the blocks/godowns etc. were purchased by various persons during the period from 1967 to 1972. The Co-operative society to whom the property was transferred was formed with view to comply with the requirement of law. The consideration shown therein was the sum total of the purchase price paid by the individual purchasers and/or the vendors who had retained portions of the property. were purchased by various persons during the period from 1967 to 1972. The Co-operative society to whom the property was transferred was formed with view to comply with the requirement of law. The consideration shown therein was the sum total of the purchase price paid by the individual purchasers and/or the vendors who had retained portions of the property. It cannot thus, be held that the competent authority could at all form a belief that the consideration as agreed to between the parties was something a more than what was stated in the document. That apart, there is a further condition, viz. ,even if it is assumed that there was understatement, the formation of belief has also to be that such an understatement was with a view to either the evasion of tax liability of the purchaser or that of the vendors. Here again, as stated earlier, the competent authority having kept the words "and/or" both between the two clauses in the notice as held by this Court in the case of (All India Reporter Ltd. v. Competent Authority, Inspecting Assistant Commissioner of Income Tax)2, 162 I.T.R. 697 it would have to be held that there was complete non application of mind on the part of the competent authority. He was uncertain as to whether the understatement was with the object of one or the other. It was necessary for him to say whether it was with a view to the object one or to the other or both. In this view of the matter it has to be held that condition No. 3 which is necessary for the assumption of valid jurisdiction under section 269 C is not satisfied in this case. 8. Before concluding, reference may also be made to the Board's circular, paragraph 38.1 at page 42 161 I.T.R. (Statute section), where, in the context of introducing Chapter XXC in the Income-tax Act, the Board opined that under Chapter XXA which covered section 269-C and 269-D, the requirement of law was that the competent authority had to, by some material, establish that there was an understatement of sale consideration in the sale deed with view to evasion of tax liability of the vendors and the purchaser and since that was an impossible task, it was considered appropriate to introduce the provisions in the form of Chapter XXC. This also supports the view taken by the Court in this case. 9. In the result, the petition succeeds. Rule is made absolute in terms of prayer (a). No order as to costs. Rule made absolute. -----