Judgment :- R. JAYASIMHA BABU, J. The petitioner has sought for a direction to the Appropriate Authority to grant to the petitioner a no-objection certificate under s. 269UL of the IT Act, 1961 (hereinafter referred to as 'the Act'), in respect of the property comprising 2374/75000 undivided share of the land situated in No. B. Estcott Road, Royapettah, Madras bearing survey No. 904, R.S. 1279 and the office No. 3 in the first floor of the building known as 'Gokhale Bhavan' with a sale plinth area of 2, 374 sq. ft. and pursuant to the agreement of sale entered into by the petitioner and M/s Royapettah Benefit Fund Ltd. the second respondent dt. 6th June, 1990. 2. The petitioner filed Form 37-I seeking a no objection certificate from the authority on 20th June, 1990. The petitioner also produced several documents along with that form. The Appropriate Authority just before expiry of two months from that date, on 16th Aug., 1990, addressed a long letter to the petitioner stating therein that according to the authority there were several omissions in the form and also pointed out that there is breach of Chatper-XX-C of the Act by the proposed vendor of the petitioner. It was asserted in that letter that the vendor of the petitioner had breached Chapter XX-C by having failed to obtain a no-objection certificate for transfer of 50 per cent of undivided share to one Sunile Estates on 29th Feb., 1988. The authority however, did not choose to exercise its power of compulsory purchase; nor did it grant a no-objection certificate. It concluded its communication thus, "The statement is deemed to be returned herewith on account of the above defects." 3. Learned counsel for the petitioner stated at the Bar that the statement in fact was not returned to the petitioner. It is undisputed that the period of two months within which the authority should have compulsorily purchased if it had wanted to, expired long ago. The authority, by sending communication in the manner it did clearly misconceived this rule and also its power. It acted in the manner which is wholly inconsistent with the statutory provisions which are required to be adhered to, while exercising its jurisdiction. The authority, by sending communication in the manner it did clearly misconceived this rule and also its power. It acted in the manner which is wholly inconsistent with the statutory provisions which are required to be adhered to, while exercising its jurisdiction. The authority was, under the provision of s. 269UL of the Act, required to consider the statement in Form 37-I. If it felt that the power of compulsory purchase was not to be exercised in relation to the property, it was required to give a no-objection certificate. If it though otherwise, it was required to give notice of its intention to effect compulsory purchase; heard the petitioner and thereafter make an order as the appropriate authority. Neither of these things had been done. It appears to have woken up very late and just before the expiry of the period of limitation of two months, sent a long letter, neither granting the certificate of no-objection nor proposing compulsory purchase. The principal points made therein being the alleged violation of law by the proposed vendor of the petitioner some two years prior to the date of agreement, pursuant to which the petitioner sought to purchase the property. 4. Learned senior counsel for the petitioner rightly criticised the communication as disclosing a patent failure to exercise the jurisdiction insofar as it declined to grant no-objection certificate and also exceeding jurisdiction insofar as it sought to go into the legality and validity of the agreement by holding that the vendor had committed breach of Chapter XX-C of the Act two years earlier and, therefore, impliedly was not in a position to enter into valid agreement with the petitioner for the transfer of the property covered by the agreement. 5. The Supreme Court in the case of Appropriate Authority & Anr. vs. Tanvi Trading & Credits (P) Ltd. & Ors. while confirming the decision of the Delhi High Court held that the authority can only grant no-objection certificate or proceed with compulsory purchase and observed as under: "We agree that two alternatives are open under the scheme of the legislation (i) The Union of India through the Appropriate Authority could buy the property; or (ii) in the event of its decision not to buy, to issue a 'No-objection certificate' leaving it open to the parties to deal with the property." 6. There was no third alternative available to the authority to return the form on the ground of alleged omissions therein and on account of an alleged want of necessary title on the part of the vendor in seeking to convey the property. The power to return the form and seek corrections of the defects therein was conferred on the authority for the first time by the Finance (No. 2) Act, 1995 w.e.f. 1st July, 1995. Simultaneously sub-s. (4) was introduced in s. 269UC of the Act. The Supreme Court considered the effect of these provision in the case of Jagadish A. Sadarangai vs. Government of India wherein it was held that even after the introduction of that sub-section the defects regarding the legality and validity of the agreement which renders the agreement void and unenforceable cannot be rectified. The appropriate authority, therefore, even after the introduction of sub-s. (4) must necessarily decide as to whether it should proceed with compulsory purchase even after noticing a defect in the title of the proposed transferor. No power is given to the authority to call upon the transferor to rectify the defect in his own title and thereafter file Form 37-I so that the authority thereafter could safely proceed to purchase compulsorily with the assumption that the Government will acquire a valid title to the property. 7. The objective of Chapter XX-C of the Act is not to enable the Government to acquire the properties free of any defect in title. The object is only the limited purpose of ensuring that the tax is not evaded. The powers are conferred on the authority to either direct compulsory purchase or to grant a no-objection certificate in cases where compulsory purchase is not warranted or is not thought to be in the interest of the law. 8. In the circumstances of this case, it is clear that the authority could not in law take the decision it did. It had to grant a no-objection certificate if it was unable to make up its mind as to whether it was worthwhile to make a compulsory purchase. 8. In the circumstances of this case, it is clear that the authority could not in law take the decision it did. It had to grant a no-objection certificate if it was unable to make up its mind as to whether it was worthwhile to make a compulsory purchase. Apparently, the authority had grave doubts whether this was a fit case for a compulsory purchase as in its own view, the transferor had violated Chapter XX-C of the Act, at the earlier point of time and the authority apparently thought even the agreement between the transferor and the builder was not a valid agreement. That, however, cannot be a ground for declining the grant of no-objection certificate. The authority has also adopted curious mode of 'deeming to return the form' without actually returning it. No support for that can be found in any of the provisions of the Act. The writ petition is allowed. The authority shall grant a no-objection certificate within a period of six weeks from the date of receipt of a copy of this order. The petitioner is also entitled to costs of Rs. 1, 500. Consequently, the connected W.M.P. is disposed.