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PETITIONER: KANWAR LAL

       Vs.

RESPONDENT: IIND ADDITIONAL DISTT. JUDGE, NAINITAL & ORS

DATE OF JUDGMENT20/04/1995

BENCH: SAWANT, P.B. BENCH: SAWANT, P.B. AGRAWAL, S.C. (J)

CITATION:  1995 AIR 2078            1995 SCC  Supl.  (2) 394  JT 1995 (4)    42        1995 SCALE  (2)858

ACT:

HEADNOTE:

JUDGMENT: SAWANT, J.: 1.   Leave granted. 2.   These four appeals arc directed against a        common judgment dated 19th October,  1987  delivered  by  the  High Court  in  four writ petitions filed before it by  the  four appellants.  Since the questions of 46 law  which  arise in these appeals arc common, it  would  be sufficient to refer to the 808  facts in one of the  appeals viz  civil  appeal arising out of S.L.P. No.  3204  of  1988 since the High Court has taken the facts from it. 3.   In 1920s, Government of India being anxious to  develop the undeveloped, lands throughout the country including that in   the  district  of  Nainital  offered  to  extend   many concessions  to those who agreed to develop the )and.   Lala Khushi  Ram Dusaj, predecessor of the appellant was  one  of the  persons  who accepted the offer and agreed  to  develop land  in  District Nainital.  Government  of  India  granted lease  of  4805  acres  of  land  to  Lala  Khushi  Ram  for development  under  the Crown Grants Act [later  renamed  as Government  Grants  Act, 1895 - hereinafter referred  to  as "the Grants Act"] by a registered lease deed dated 25.8.1920 which  was executed by the Secretary of State for  India  in Council  for a period extending upto 31st March, 2013.   One of  the  conditions  of the said lease  with  which  we  arc concerned here, was that the leased land would not be  taken away  except as specified by the clauses of the  lease  deed and  that too for the purpose of land reforms.  In case  the land was taken away, compensation was payable to the  lessee in  accordance with the provisions of the  Land  Acquisition Act,  1894.  Section 3 of the Grants Act provided  that  all provisions,   restrictions,   conditions   and   limitations contained  in any such grant or transfer shall be valid  and take effect according to their tenor, any rule of law, stat- ute  or  enactment  of  the  legislature  to  the   contrary

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notwithstanding.   After  taking possession  of  the  leased land,  the lessee Lala Khush; Ram is alleged to  have  spent moneys to clear the jungle and level the uneven terrain  and develop the land for agriculture. 4.   In  the  year  1959,  the State  of  U.P.  passed  U.P. Government    Estates   Thekedari   Abolition   Act,    1958 [hereinafter referred to as the "Principal Act"] and  issued notifications under the said Act for taking over the  leased lands granted under the Grants Act and issued  notifications vesting all such lands in the State.  In 1960, the State  of U.P. amended the Grants Act.  While retaining the provisions of  Section 3 of the said Act the Amendment added a  proviso to  the said section which stated that nothing in  the  said section shall prevent, or be deemed ever to have  prevented, the  effect of any enactment relating to the acquisition  of property,  land  reforms  or the imposition  of  ceiling  on agricultural land. 5.   By its decision dated 25th October, 1967     the   High Court declared the provisions of the Principal Act as  ultra vires the Constitution and quashed the notifications  issued under  the said Act, taking over the lands leased under  the Grants  Act.   In 1970, the State of U.P. passed  the  Uttar Pradesh Government Estates Thekedari Abolition [Re-enactment and  Validation] Act, 1970 [for short the  Validation  Act’] with the result that the Principal Act and the notifications which  had been issued thereunder were revived by  adding  a deeming clause.  Under the amended Principal Act, the  State issued  notifications  on 16th October,  1970  applying  the provisions of the U.P. Zamindari Abolition and Land  Reforms Act,  1950  [for  short the Z.A. Act]  to  the  villages  in question.   In  the  year 1973, the  appellant  who  is  the successor of Lala Khushi Ram, the original lessee,  received notices  under the amended Principal Act and  also  received copies of com- 47 sensation roll showing the compensation at less than  Rs.3/- per  acre.   The appellant, therefore, filed  his  objection before  the  Collector  who  referred  the  matter  to   the respondent   No.1-Additional   District  Judge.    On   17th December,   1977,  respondent  No.1  partly   accepted   the reference.   The appellant, therefore, moved the High  Court by  a writ petition.  On 19th October, 1987 the  High  Court dismissed  all the writ petitions before it by the  impugned common judgment.  Hence the present appeals. 6.   The  first contention raised in these appeals  is  that the  State  cannot  amend the Grants Act, which  is  a  pre- constitutional  central statute by its own enactment,  viz., the Principal Act so as to annul the provisions of Section 3 of  the Central Act.  The answer to this contention lies  in the  provisions  of Article 372 of  the  Constitution.   The relevant provisions of Article 372 arc as under:               "372.   Continuance in force of existing  laws               and  their adaptation-(1) Notwithstanding  the               repeal by this Constitution of the  enactments               referred to in Article 395 but subject to  the               other provisions of this Constitution, all the               laws  in  force  in  the  territory  of  India               immediately  before the commencement  of  this               Constitution  shall continue in force  therein               until altered or repealed or amended by a com-               petent  Legislature  or  other  competent  au-               thority.               (2)   For  the purpose of bringing the  provi-               sions of any law in force in the territory  of               India into accord with the provisions of  this

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             Constitution, the President may by order  make               such  adaptations  and modifications  of  such               law,  whether by way of repeal  or  amendment,               ’as may be necessary or expedient, and provide               that  the law shall, as from such date as  may               be specified in the order, have effect subject               to the adaptations and modifications so  made,               and any such adaptation or modification  shall               not be questioned in any court of law.               (3)   Nothing in clause (2) shall be deemed-               (a)   to  empower  the President to  make  any               adaptation  or modification of any  law  after               the   expiration  of  three  years  from   the               commencement of this Constitution; or               (b)   to prevent any competent Legislature  or               other  competent authority from  repealing  or               amending  any law adapted or modified  by  the                             president under the said clause.               Explanation 1.- The expression "law in  force"               in this article shall include a law passed  or               made  by  a  Legislature  or  other  competent               authority in the territory of India before the               commencement  of  this  Constitution  and  not               previously  repealed, notwithstanding that  it               or  parts of it may not be then  in  operation               either at all or in particular areas." Entry  18  of  List  II  of  the  Seventh  Schedule  of  the Constitution reads as under:               " 18.  Land, that is to say, rights in or over               land,  land tenures including the relation  of               landlord  and  tenant, and the  collection  of               rents; transfer and alienation of agricultural               land; land improvement and agricultural loans;               colonization." . 7.   Article  246 [3] read with Entry 18 of List II  of  the Seventh  Schedule  gives power to the State  Legislature  to make law with regard to rights in or over land, land tenures including  the  relation  of landlord  and  tenant  and  the collection of rents, transfer and alienation of agricultural land; land improvement and agricultural loans; colo- 48 nization.   Admittedly,  the lands in  question  were  under personal  cultivation of the appellant and, therefore,  they are  agricultural  lands.  Hence the State  legislature  was competent  to  enact the Principal Act  which  concerns  the rights  in  or  over the land etc. which  are  all  subjects covered  by Entry 18 of List II.  In view of the  provisions both  of  clauses  [1] and [3] (b) of  Article  372  of  the Constitution,  therefore,  the State Legislature  being  the competent  legislature  to enact such law  could  repeal  or amend  the  Grants Act or any of  its  provisions  including Section  3  thereof  This would be true also  of  the  State amendment  of the Grants Act by the Government Grants  [U.P. Amendment]  Act, 1960.  Hence the contention that the  State Legislature  could not amend the provisions of Section 3  of the Grants Act has to be rejected. 8.   The  next  contention of the appellant is that  in  the absence  of  a fresh notification issued under  the  amended Principal Act, the leasehold rights of the appellant  cannot be deemed to have been terminated, so as to enable the State to resume the lands. 9.   As the facts in the present case reveal, the  Principal Act was extended to the district of Nainital by notification dated   17th   June,  1965  w.e.f  26th  June,   1965.    By notification  dated 30th June, 1966, issued under Section  3

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of that Act, the lease of the appellant was determined.  The High  Court declared as unconstitutional the  provisions  of that Act and hence the Act was amended and re-enacted  w.e.f 20th  June,  1964  by  U.P.  Government  Estates   Thekedari Abolition [Re-enactment and Validation] Act, 1970.   Section 6 of the Validation Act validated anything done of purported to have been done and any action taken or purported to  have been taken under the provisions of the Principal Act,  viz., U.P.  Government  Estates  Thekedari  Abolition  Act.   That Section reads as follows:               "6.  Notwithstanding any judgment,  decree  or               order   of  any  court  or  Tribunal  to   the               contrary, anything done or purporting to  have               been  done and any action taken or  purporting               to have been taken under any provision of  the               principal Act before the commencement of  this               Act including, in particular, any notification               under   subsection  (3)  of  section  1,   any               determination of lease under section 3, or the               recovery  of  any rents or  other  dues  under               section 4 or the taking over of possession  or               charge of land or of books, accounts or  other               documents  under section 6 of that Act,  shall               be  deemed to be, and always to have  been  as               valid as if the provisions of this Act were in               force at all material times. 10.In  view  of the said express validating  provision,  the notifications  which were issued under the Principal Act  in terms  revived  with the revival of the  Principal  Act  and hence  the  action taken under the said  notifications  also stood  validated.   It  was not  necessary  to  reissue  the notifications after the enactment of the Validation Act.  To argue to the contrary would render the provisions of Section 6 of the Validation Act otiose. 11.It  is for this reason that we are unable  to  understand the  reliance  placed  on behalf of  the  appellant  on  the decision of this Court in Mahendra Lal Jaini v. 7he State of Uttar  Pradesh  and Others [(1963] Supp.  1 SCR  9121.   The question  considered in that case was whether an  Act  which was  invalid  being  ultra  vires  the  provisions  of   the Constitution would stand re- 49 vived  automatically on amendment of the relevant  provision of  the Constitution.  It was held that such a  revival  was not  automatic and that the Act had to be  re-enacted  after the  constitutional  provision which it  had  infringed  was amended.  The ratio of that decision is, therefore, not  ap- plicable  to the facts of the present case.   The  Principal Act has been re-enacted by amending the relevant  provisions to  bring  them  in conformity with the  provisions  of  the Constitution  and  by  the provisions of Section  6  of  the Validation  Act,  as pointed out above, all  acts  done  and purported  to  have been done under the principal  Act  have been expressly validated. 12.  The  next  contention was that the  Validation  Act  is violative  of the second proviso to Article 31A [1]  of  the Constitution.  Under the lease granted under the Grants Act, the  rights  of  the  lessee  were  heritable  as  well   as transferable.  As a result of the determination of the lease by  the Thekedari Abolition Act, the right which  have  been conferred  on the lessee are only heritable.  They  are  not transfer able by virtue of the provisions of the U.P Tenancy Act,   1939.   Hence,  the  lessee  is  entitled   to   full compensation. 13.  The  relevant  provisions of Article  31A  [1]  of  the

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Constitution read as follows:               "31A.   Saving  of  laws  providing  for   ac-               quisition  of  estates,  etc.-  (1)   Notwith-               standing anything contained in Article 13,  no               law providing for -               (a)   the  acquisition  by the  State  of  any               estate  or  of any rights therein or  the  ex-               tinguishment  or  modification  of  any   such               rights, or               x        x        x        x               shall be deemed to be void on the ground  that               it  is  inconsistent with, or  take-  away  or               abridges  any  of  the  rights  conferred   by               Article 14 or Article 19:               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:               Provided further that where any law makes  any               provision for the acquisition by the State  of               any  estate  and  where  any  land   comprised               therein is held by a person under his personal               cultivation,  it shall not be lawful  for  the               State  to acquire any portion of such land  as               is within the ceiling limit applicable to  him               under  any law for the time being in force  or               any building or structure standing thereon  or               appurtenant  thereto, unless the law  relating               to  the acquisition of such land, building  or               structure,   provides  for  payment  of   com-               pensation  at a rate which shall not  be  less               than the market value thereof" 14.What   is  prohibited  by  the  aforesaid  provision   is acquisition  by the State of any portion of the  land  under personal  cultivation  which portion is within  the  ceiling limit, without payment of its market value as  compensation. By  virtue  of  the  Principal  Act,  as  amended,  what  is conferred  permanently  on the erstwhile lessees  under  the Grants Act is the hereditary tenancy.  The Principal Act  as amended,  by itself does not restrict the right of  the  he- reditary  tenant to transfer the land.  The  restriction  on the  transfer by a hereditary tenant has been placed by  the U.P.  Tenancy Act, 1939.  It is, therefore, not  correct  to say  that it is the Principal Act as amended,  which  places the restriction on 50 the  right  of the hereditary tenant to transfer  the  land. Further while under the old lease, which is abolished by the Principal  Act, the lessee could hold the land only for  the period  of  the lease which was in the  present  case,  upto 2013, by virtue of the conferment of the hereditary  tenancy under  the Principal Act, the lessee can now hold such  land permanently.   It cannot be said that the conferment of  the permanent hereditary tenancy on the erstwhile  tenure-lessee is in any way inferior to the rights of the lessee under the old  grant.   Hence in the first instance, the  question  of payment  of compensation does not arise.  Secondly,  a  mere restriction on the incidence of the lease or owner.-,hip  is not acquisition within the meaning of Article 31A. 15.Article  31A [1] (a) of the Constitution states  that  no law providing for the acquisition by the State of any estate or any rights therein or the extinguishment or  modification of any such rights, shall be deemed to be void on the ground

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that it is inconsistent with, or takes away or abridges  any of  the rights conferred by Article 14 or Article  19.   The second  proviso  to Article 31A [1],  however,  states  that where any law makes any provision for the acquisition by the State  of  any estate and where any land comprised  in  such estate  is held by a person under his personal  cultivation, it shall not be lawful for the State to acquire the  portion of  such land as is within the ceiling limit  applicable  to him  under any law for the time being in force,  unless  the law  relating to the acquisition of such land  provides  for payment  of compensation at a rate which shall not  be  less than the market value thereof 16.     Thus  there  is  a  clear  distinction  between  the provisions of Article 31A [1] (a) and of the second  proviso to the said Article.  Whereas Article 31A[1] (a) holds valid the acquisition by the State of any estate or of any  rights therein  or the extinguishment or modification of  any  such rights, the second proviso carves out an exception to it  by providing  that [i] if any, estate is acquired by the  State which comprises any land under personal cultivation and [ii] if such land is within the ceiling limit applicable to  such person, such land as is within the ceiling limit will not be acquired  without payment of compensation.  In other  words, the  second  proviso provides for compensation only  if  the land  within  the ceiling limit is wholly  acquired  by  the State.   If only some of the rights of the person  concerned in  such land are acquired or extinguished or are  modified, the second proviso does not come into play.  In the  present case,  instead  of  having  the  full  rights  as  a  lessee including the right to transfer the land, the appellant will be  a  hereditary tenant without the right to  transfer  the land.   To  that  extent the rights  of  the  appellant  are modified or his right to transfer the land is  extinguished. He  has  not been deprived of all his rights.   It  is  not, therefore,  a case of acquisition of his estate  within  the meaning  of the second proviso to Article 31A  [1].   Hence, the appellant is not entitled to compensation as provided by the  said  proviso.  Further, as pointed  out  earlier,  the appellant  is  conferred with the rights as  the  hereditary tenant  permanently  in  place of his earlier  rights  as  a tenure-lessee  which  were to expire after 2013.   This  is, therefore,  a clear case of modification of the rights  and. not  of  acquisition  of  all  the  rights.   It  cannot  be contended further that this modification is less  beneficial to the appellant On this account also the second proviso  to Article 51 31A[11 requiring compensation to be paid, does not come into play in the present case. 17.It  was  then urged that in any case  the  appellant  has become Government lessee within the meaning of Section  133A of  the U.P. Zamindari Abolition and Land Reforms Act,  1950 [hereinafter called ’the Z.A. Act’] and hence the land would stand  excluded  from the provisions of the  Principal  Act. The  provision  of  Section 133A of the Z.A.  Act  reads  as follows:               "133A.   Government lessees.  Every person  to               whom  land  has  been let  out  by  the  State               Government shall be called a government lessee               in   respect   of   such   land   and    shall               notwithstanding   anything  to  the   contrary               contained in this Act be entitled to hold  the               same   in  accordance  with  the   terms   and               conditions of the lease relating thereto.  " 18.Since it is not disputed that by notification dated  16th

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October, 1970, the provisions of the Z. A. Act have been mad applicable to the said lands and Section 133A has also  been made applicable the lands covered by the Principal Act,  the land in question is excluded from the ambit of the Principal Act. 19.If  the scheme of the amended Principal Act is  examined, it  would appear the the Act has been passed to provide  for abolition of the thekedari system in Government estates  and the  "Government estate" has been defined in  the  Principal Act  to  mean land owned by the State  Government  in  Uttar Pradesh  which  indicates that the Act is intended  to  deal with  government  lands as well.  Moreover, Section  of  the amended  Principal Act which provides for  determination  of the  lease starts with a non obstante clause.  It  reads  as follows:               "3.Determination  of leases.   Notwithstanding               anything   in  any  law,  contract  or   other               document,  it  shall be lawful for  the  State               Government by order published in the  Official               Gazette  to determine with effect from a  date               (hereinafter called the date of determination)               to be specified, any lease" 20. In view of this non obstante clause Section 133A of  the Z.A.  Act  cannot have the effect of denying the  State  the power  under  the  said Section 3 to  determine  the  lease. Hence this contention must also fall 21.  There  was no other contention  raised.   The  appeals, therefore, fail for the reasons given above and not for  the reasons  given  by  the High Court and  are  dismissed  with costs. 58