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PETITIONER: SONAPUR TEA CO., LTD.

       Vs.

RESPONDENT: MUST.  MAZIRUNNESSA

DATE OF JUDGMENT: 04/03/1961

BENCH: GAJENDRAGADKAR, P.B. BENCH: GAJENDRAGADKAR, P.B. SARKAR, A.K. WANCHOO, K.N. GUPTA, K.C. DAS AYYANGAR, N. RAJAGOPALA

CITATION:  1962 AIR  137            1962 SCR  (1) 724  CITATOR INFO :  R          1965 SC 632  (11)  R          1972 SC 425  (32)  E          1990 SC1771  (12)  RF         1991 SC1792  (6)

ACT: Land Holding-Fixation of ceiling--Enactment, if a  colorable legislation-Constitutional  validity  --Assam  Fixation   of Ceiling on Land Holding Act, 1957 (Assam 1 of 1957), ss.  4, 5,   16,  18  Assam  Land  and  Revenue   Regulation,   1886 (Regulation  1 of 1886), ss. 3(g), 9-Constitution of  India, Art. 31A(2)(b).

HEADNOTE: These appeals arose out of. two petitions filed in the  High Court  under  Art. 226 of the Constitution  challenging  the constitutional validity of the Assam Fixation of Ceiling  on Land  Holding Act, 1957.  The High Court in  dismissing  the petitions  held that the impugned Act was protected by  Art, 31A of the Constitution.  The Act was a measure of  agrarian reform  and imposed limits on land to be held by persons  in order to bring about its equitable distribution.  The Act as originally passed as also its subsequent amendment  received the   assent  of  the  President  and  this  satisfied   the requirement  of  the  proviso  to  Art.  31A(1)(a)  of   the Constitution.   The  question, therefore,  was  whether  the rights  of the appellants which were taken away or  abridged by  the impugned Act were "rights" in relation to an  estate within the meaning of Art. 31A(2)(b) of the Constitution. Held,  that  the  expression "’rights’, in  relation  to  an estate"  in Art. 31A(2)(b) of the Constitution is of a  very wide  amplitude and construed liberally, as it must be,  and considered in the light of the provisions of ss. 3(g) and  9 of the Assam Land and Revenue Regulation, 1886, the existing law  relating  to  tenures,  and  the  relevant  definitions contained in the impugned Act, there could be no doubt  that the  rights  of  the petitioners,  which  the  impugned  Act extinguished, fell within the expression. Thakur Raghubir Singh v. The State of Ajmer, [1959] Supp.  1

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S.C.R.  478,  Sri  Ram Reim Narain Medhi  v.  The  State  of Bombay, [1959] Supp. 1 S.C.R. 489 and Atma Ram v. The  State of Punjab, [1959] Supp. 1 S.C.R. 748, referred to. A  colourable  legislation is one in which  the  Legislature transgresses  the  lawful limits of its  legislative  powers ,and   "conceals  its  real  purpose  under  the  cover   of apparently  legitimate  and reasonable provisions  and  thus seeks to do indirectly what it cannot do directly. K.   G. Gajapathi Narayan Deo v. The State of [1954]  S.C.R. 1, referred to. 725 It  was  not  correct to say that the  impugned  Act  was  a colourable  legislation whose concealed purpose was to  make profit  by disposing of land in the manner provided  by  Ch. III  or  that by pith and substance it was a  profit  making measure  or  that ss. 16 and 18 of the Act were  devices  to that end.  This is broadly contradicted by the whole  object of the Act which is a measure of agrarian reform, writ large on  all its provisions and clearly negatived by s. 4 Of  the Act  which provides that in no case can the payment made  by the  tenant in getting the settlement exceed the  amount  of compensation  payable  by the Government  in  acquiring  the land.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeals Nos. 235 and 236 of 1960. Appeals from the judgment and decree dated January 23,  1959 of  the Assam High Court at Gauhati in Civil Rules Nos.  138 and 139 of 1958. N.   C.  Chatterjee, Amjad Ali and K. R. Chaudhari, for  the appellant (in C. A. No. 235 of 1960). D.   N.  Mukherjee, for the appellant (In C. A. No.  236  of 1960). S.   M. Lahiri, Advocate-General, Assam and Naunit Lal,  for the respondents. 1961.  April 4. The Judgment of the Court was delivered by GAJENDRAGADKAR,  J.These two appeals arise out of  two  writ petitions Nos. 138 and 139 of 1958 filed respectively by the two  appellants,  Sonapur Tea Co. Ltd., of  15-D  Sambhunath Pandi Street, Calcutta 9, and Musst.  Mazirunnessa, wife  of Abdul Gafur of Village Bhoknamari, District Kamrup, in which they  challenged  the  validity of  the  Assam  Fixation  of Ceiling on Land Holdings Act I of 1957 (hereafter called the Act).   The said writ petitions have been dismissed  by  the Assam  High  Court substantially on ground  that  since  the impugned  Act  falls within the protection of Art.  31A  the challenge  made  by  the  two  appellants  to  the   several provisions  of  the Act under Arts. 14, 19(1)(f)  and  31(2) cannot  be entertained Having dismissed the  writ  petitions principally   on   this  ground  the  High   Court   granted certificates to both the appellants to come to this Court in appeal, 726 and so it is with the said certificates that the two appeals have been brought to this Court. It is not necessary to set out the material facts leading to the two writ petitions in any detail.  It would be enough to say  that under s. 5 of the, impugned Act notices  had  been served  on  both  the appellants by  the  respondent  Deputy Commissioner  and Collector of Kamrup calling upon  them  to submit a return giving the particulars of all their lands in the  prescribed  form and stating therein the  selection  of

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plot  or plots of land (not exceeding in the  aggregate  the limits fixed under s. 4) which they desired to retain  under the provisions of the Act.  The appellants contended  before the High Court that the impugned Act under which this notice had  been served on them was invalid and ultra vires and  so they  wanted  the notice issued under s. 5  to  be  quashed. That is the only relevant fact which needs to be stated  for deciding the present appeals. The Act received the assent of the President on December  7, 1956,  and  was published in the official State  Gazette  on January  16,  1957.   Subsequently it  was  amended  by  the amending  Act  XVII of 1957 and assent was obtained  to  the amendment thus made on November 8, 1957.  By a  notification issued  by  the  State Government on  February  7,1958,  the amended Act came into force on February 15, 1958. It is relevant to consider briefly the broad features of the Act.   It has been passed because the Legislature deemed  it necessary to make provision for the imposition of limits  on the amount of land that may be held by a person in order  to bring  about an equitable distribution of land.  That  being the  object  of the Act the principal provision of  the  Act imposes  a  ceiling  on existing holding  by  s.4.  The  act extends  to  the seven Districts specified in s.  1(2),  and from its operation are excepted the lands specified in  cls. (a) to (c) of s.2. These clauses refer to lands belonging to any religious or charitable institution of a public  nature, lands  held  for  special cultivation  of  tea  or  purposes ancillary  thereto and lands exceeding 150  bighas  utilised for large scale cultivation of citrus in a compact block  by any person before January 1, 1955, lands                         727 utilised  by  efficiently  managed  farms  on  which   heavy investments  or permanent structural improvements have  been made  and  whose  break up is likely to lead to  a  fall  in production,  and  lands  held by a sugar factory  or  a  co- operative  farming society for cultivation of sugarcane  for the purpose of such factory.  It would thus be noticed  that the  measure  of agrarian reform introduced by the  Act  has made  exceptions in regard to lands which it thought  should be  left out of the operation of the Act in the interest  of the  economy  of  the State.  Section 3  is  the  definition section.  It defines land as meaning land which is or may be utilised  for agricultural purposes or purposes  subservient thereto  and includes the sites of buildings appurtenant  to such  land.   Under s. 3(g) the word  ’landholder’  has  the meaning  assigned  to  it  in the  Assam  Land  and  Revenue Regulation,  1886 (Regulation I of 1886).  ’Landlord’  under s.  3(h) is a person immediately under whom a  tenant  holds but  does not include the Government; and ’owner’  under  s. 3(i)  includes proprietor, land-holder or  settlement-holder as defined in s. 3 of the Assam land and Revenue  Regulation I of 1886 but it does not include Government.  Section  3(o) defines  ’tenant’ as meaning a person who holds  land  under another person and is, but for a special contract would  be, liable  to pay rent for that land to the other  person,  and includes a person who cultivates the land of another  person on  condition of delivering a share of the  produce.   These are the only definitions which are relevant for our purpose. Section  4  which is the key section of the  Act  prescribes ceiling  on existing holding.  The limit prescribed  is  150 bighas in the aggregate subject to its provisos.  Section  5 empowers the appropriate authorities to call for  submission of  returns  by  persons  holding lands  in  excess  of  the ceiling.  Section 8 empowers the State Government to acquire such  excess lands by publishing in the official  gazette  a

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notification to the effect that such lands are required  for public  purpose,  and such publication shall  be  conclusive evidence  of  the  notice of acquisition to  the  person  or persons  holding  such lands.  Acquisition of  excess  lands prescribed by s. 8 is followed by the vesting of the said 728 lands  in  the  State  under s. 9.  On  publication  of  the notification  under s. 8 all such excess lands  shall  stand transferred  to  the State Government from the date  of  the publication of the said notification free from  encumbrances by  their  original  owner  or  owners.   Under  s.  11  the Collector  is  authorised  to take possession  of  the  said lands.    Section   12   prescribes   the   principles    of compensation.  and  provides the manner in  which  the  said compensation should be apportioned between the owner and the tenant; and s.13 provides for the manner of payment of  such compensation.    Under   s.  14  ad   interim   payment   of compensation  can  be  made as  specified.   These  are  the relevant  provisions in Chapter 11 which deals with  ceiling on existing holding and acquisition of excess land. Chapter  III deals with the disposal of excess land.   Under s. 16(l) if there is any cultivating tenant in occupation of the  land  acquired  from an owner then he  shall  have  the option of taking settlement of such land within a prescribed period  on  the following conditions, namely, (a)  that  the area  of land so settled together with any other lands  held by  him or any member of his family either as tenant  or  as owner  shall  not exceed in the aggregate  the  limit  fixed under  s.  4,  and  (b)  that he  shall  pay  to  the  State Government  in  one or more equal  annual  installments  not exceeding  five an amount fixed by it but not exceeding  the compensation payable by the State Government for acquisition thereof, provided that he shall have the right to adjust any amount which he is entitled to receive as compensation under the  provisions of the Act against an equal amount which  he is liable to pay under el. (b).  Section 16(2) provides that on  payment of full amount under sub-section (1)  above  the land  shall  be settled with a tenant with the status  of  a landholder.  Under s. 18 it is provided that if a tenant  in occupation  of any land acquired -under s. 8 does  not  take settlement of such land he shall acquire no right, title and interest  in  the land and shall be liable  to  be  ejected. Chapter  IV  deals with excess land under annual  lease  and provides  for its taking over.  Chapter V puts a ceiling  on future 729 acquisition,  and  chapter  VI  provides  for  ceiling   for resumption of land from tenants for personal cultivation  by the landlord.  Chapter VII provides for the establishment of a  Land  Reform  Board, and lays  down  its  functions,while chapter VII contains miscellaneous provisions.  That briefly is the scheme of the Act. The  question which arises for our decision is whether  this Act  is protected under Art. 31A of the Constitution.   This Article  has  been  construed  by  this  Court  on   several occasions  in dealing with legislative measures of  agrarian reforms.  The object of such reforms generally is to abolish the intermediaries between the State and the cultivator  and to  help the actual cultivator by giving him the  status  of direct relationship between himself and the State.   Article 31A(l)(a) provides that, notwithstanding anything  contained in  Art.  13, no law providing for the  acquisition  by  the State  of  any  estate  or of  any  rights  therein  or  the extinguishment or modification of any such rights, shall  be deemed to be void on the ground that it is inconsistent with

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or  takes  away or abridges any of the rights  conferred  by Art.  14, Art. 19 or Art. 31, provided that, where such  law is a law made by the Legislature of a State, the  provisions of  this  Article shall not apply thereto unless  such  law, having been reserved for the consideration of the President, has  received  his assent.  We have already  seen  that  the assent  of the President has been obtained both for the  Act as  it was originally passed and for the amending Act  which subsequently modified some of the provisions of the original Act,  and  so the requirement prescribed by the  proviso  to Art. 31A(l)(a) is satisfied.  That raises the question as to whether  the rights of the appellants which are  undoubtedly taken  away or abridged constitute rights in relation to  an "estate" as defined by Art. 31A(2)(b). We  have already seen the definitions of  land,  landholder, landlord  and tenant prescribed by s. 3(f),(g),(h) and  (o). It  is  common ground that the lands sought to  be  acquired fall within an "estate" as defined by Art. 31 A(2).  Do  the rights vesting in the appellants amount 92 730 to  rights  in relation to an "estate"?  For  deciding  this question it would be necessary to consider the provisions of the existing law relating to tenure in force in Assam at the relevant time.  The existing law relating to land tenure  is to  be  found  in the provisions of the  a  Assam  Land  and Revenue  Regulation, 1886 (Regulation I of  1886).   Section 3(g)  of  the said Regulation provides that  a  ’landholder’ means  any  person deemed to have acquired the status  of  a landholder  under s. 8. No hen we turn to s. 8 we find  that it  provides the manner in which the status of a  landholder can  be acquired; and s. 9 provides for the rights  of  such landholders.   Under  s.  9  a  landholder  shall  have   a, permanent,  heritable  and  transferable right  of  use  and occupancy  in  is land subject to the  payment  of  revenue, taxes,  cesses and rates from time to time legally  assessed or  imposed  in  respect of the  land.   The  remaining  two clauses of this section need not be considered.  It would be noticed  that  the  expression "rights  in  relation  to  an estate" is of a very wide amplitude and as such the  context requires that it must receive a very liberal interpretation. Thus considered there can be no doubt that the rights of the appellants   which   have  been   extinguished   undoubtedly constitute  "rights in relation to an estate" as defined  by Art.  31A (2) (b).  Indeed this position is-  not  seriously disputed  by Mr. Chatterjee who fairly conceded that  having regard  to  the decisions of this Court in  Thakur  Raghubir Singh v. The State of Ajmer (Now Rajasthan) (1), Sri Ram Ram Narain  Medhi v. The State of Bombay(’) and Atma Ram v.  The State  of Punjab (3 ) he would not be able to  contend  that the view taken by the High Court is erroneous. Faced with this difficulty Mr. Chatterjee attempted to argue that the Act is a colorable piece of legislation and  should be  struck  down  as  such.  His  argument  is  that  though ostensibly  it purports to be a measure of  agrarian  reform its principal object and indeed its pith and substance is to acquire  the  property covered by its  provisions  and  make profit by disposing of the (1)  [1959] Supp. 1 S.C.R. 478.  (2) [1959] Supp.  1  S.C.R. 489. (3) [1959] Supp. 1 S.C.R. 748. 731 same in the manner provided by Chapter III.  Mr.  Chatterjee seemed to suggest that the Legislature should not have  made it  necessary  for  the tenants to exercise  an  option  for

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taking  settlement under s. 16 because the exercise  of  the said  option  involves the liability to pay  the  prescribed amount  though in five installments, and that, according  to Mr.  Chatterjee  indicates  that the State  wanted  to  make profit  out of the bargain.  Mr. Chatterjee’s  grievance  is against  the provisions of s. 18 also under which  a  tenant who does not opt for settlement is liable to be evicted.  We are  not  impressed  by  this  argument.   The  doctrine  of colorable  legislation  really postulates  that  legislation attempts  to do indirectly what it cannot do  directly.   In other  words,  though the letter of the law  is  within  the limits  of the powers of the Legislature, in  substance  the law  has  transgressed those powers and by doing so  it  has taken  the precaution of concealing its real  purpose  under the cover of apparently legitimate and reasonable provisions (Vide:  K. G. Gajapati Narayan Deo v. The State  of  Orissa) This position is not and can not be disputed. Is Mr. Chatterjee, however, right when he contends that  the pith and substance of the Act and indeed its main object  is to acquire property and dispose of it at a profit?  That  is the  question which calls for our decision.  In our  opinion the  answer to this question must obviously be  against  the appellants.  The whole object of the Act which is writ large in  all its provisions is to abolish the intermediaries  and leave  the lands either with the tiller or  the  cultivator. With  that  object  ceiling has been  prescribed  by  s.  4, provisions  have  been made for the acquisition  of  excess. lands, and disposal of excess lands in favour of the tenants have been provided for.  It is significant that in  settling the lands upon the tenants it is expressly provided that the payment  which the tenant may have to make -and that too  in one or more easy installments not exceeding five-will  never exceed the compensation payable by the State Government  for acquisition (1)  [1954] S.C.R. 1 732 thereof.   This provision clearly negatives  the  assumption made  by  Mr. Chatterjee that any profit is intended  to  be made  in the matter of disposal of excess lands.  The  State is paying compensation to the persons dispossessed under the principles prescribed by s. 12; amongst the persons entitled to  such  compensation tenants are included,  and  when  the State proceeds to settle lands on tenants it expects them to pay  a fair amount of price for the land and puts a  ceiling on  this  price  that it shall never exceed  the  amount  of compensation  payable in respect of the Paid land.   In  our opinion  this provision is very fair and reasonable  and  it would  be  idle  to  attack  it  as  a  piece  of  colorable legislation.   We have already seen that the  settlement  of land on the tenants would make them landholders and that  is the  basic idea of the Act.  If a tenant does not  agree  to take  settlement it cannot be helped and so the  land  would then  have to be taken from him and given over  to  somebody else  who would be prepared to take settlement.  It is  thus clear that the object of putting ceiling on existing holding is  to  take  over excess lands and settle  them  on  actual cultivators Or tenants and that is the essential feature  of agrarian reform undertaken by several States in the country. The  Act  conforms to the pattern usually followed  in  that behalf  and  the attack against its validity on  the  around that  it is a colorable piece of legislation must  therefore fail. In the result we hold that there is no substance in the  two appeals.  They are accordingly dismissed with costs-one  set of hearing.

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Appeals dismissed.                             733