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PETITIONER: SAROJINI TEA CO. (P) LTD

       Vs.

RESPONDENT: COLLECTOR OF DIBRUGARH, ASSAM AND ANR

DATE OF JUDGMENT24/01/1992

BENCH: RAMASWAMY, K. BENCH: RAMASWAMY, K. KULDIP SINGH (J)

CITATION:  1992 SCR  Supl. (2)  25  1993 SCC  Supl.  (4) 632  1992 SCALE  (3)70

ACT:      Assam  Taxation of Ceiling on Land Holdings  Act,  1956 (as amended by Assam Act VIII of 1971):      Section   12-Land   Ceiling-Excess   land-Compensation- Computation  of:  ‘Annual  Land  Revenue’-Whether   includes ‘surcharge’on  land revenue and ‘local rate’  payable  under Assam  Land Revenue and Land (Surcharge) Act, 1970 and Local Rates  Regulation,   1879:   Belated  appeal-Condonation  of delay-Whether provisions of Limitation Act, 1963 would apply.

HEADNOTE:      The  appellant, a tea company, whose land was  declared excess under the Assam Fixation of Ceiling on Land  Holdings Act, 1956 as amended by Assam Act, VIII of 1971, was awarded compensation,  equal to 50 times of the annual land  revenue of the excess land as provided under section 12 of the  Act. However,   the  compensation  was  assessed  excluding   the surcharge  on  land revenue and the local  rate  payable  in respect of the land.      On  appeal by the Company, the District Judge  enhanced the  amount  of compensation by including the  surcharge  on land revenue as well as the local rate as part of the annual land  revenue, against which respondent No. 1 filed  a  writ petition before the High Court.      The  High Court allowed the writ petition holding  that the expression ‘full rate of annual land revenue’ meant only the  revenue assessed on the land as such and not the  local rates  leviable under the Local Rates Regulation,  1879  nor the  surcharge on land revenue levied under the  Assam  Land Revenue and Land (Surcharge) Act, 1970.      Aggrieved,  the  appellant  preferred  the  appeal   by special leave to this  Court.      On  the  question  :  whether  the  surcharge  on  land revenue  levied  under  the  Assam  Land  Revenue  and  Land (Surcharge) Act, 1970                                                 372 and   the   local  rate  payable  under  the   Local   Rates Regulations, 1879 can be held to be land revenue,      Allowing the appeal in part, this Court,      HELD: 1.1 The expression ‘surcharge’ in the context  of taxation  means  an additional imposition which  results  in enhancement  of  the tax and the nature  of  the  additional

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imposition is the same as the tax on which it is imposed  as surcharge. [p.381 B-C]      Bisra  Stone Lime Co. Ltd. & Anr. etc. v. Orissa  State Electricity Board & Anr., [1976] 2 SCR 307; Commissioner  of Income  Tax,  Kerala  v. K. Srinivasan, [1972]  2  SCR  309; Vishwesha  Thirthaswamiar & Ors. v. State of Mysore &  Anr., [1972] 1 SCR 137, relied on.      C.V.  Rajagopalachariar  v. State of Madras,  AIR  1960 Mad. 543, referred to.      Shorter Oxford English  Dictionary, referred to.      1.2  A surcharge on land revenue is an  enhancement  of the  land  revenue  to  the  extent  of  the  imposition  of surcharge.   The nature of such imposition is the same  viz. land revenue on which it is a surcharge. [pp. 381 C-D]      1.3 The surcharge payable under the Assam Land  Revenue and Land (Surcharge) Act, 1970 constitutes land revenue  and has  to  be taken into account  for  assessing  compensation under  section 12 of the Assam Fixation of Ceiling  on  Land Holdings Act, 1956. [p.385 C-D]      1.4  In  view of the provisions of  section 12  of  the Assam   Ceiling   Act,  the  measure   for   assessment   of compensation  is  ‘the  full rate of  annual  land  revenue’ payable for the land acquired.  [pp.377H; 378A]      1.5  The  use of the words "full rate of"  before  the words  "annual land revenue payable for the land" in  s.  12 (a) (1) (i) of the Ceiling Act does not have a bearing  upon the  nature  of the levy, which is land revenue.   The  said words have reference to the quantum of the levy which  would form  the basis for assessment of  compensation and  do  not render  inapplicable  the  principles  that  imposition   of surcharge on land revenue in only an enbancement of the land revenue  and nature of the said imposition is land  revenue. Vishwesha  Thirthaswamiar & Ors. v. State of Mysore &  Anr., [1972] 1 SCR 137, relied on.[P,382 D-E]                                                 373      Benoy  Mazumdar v. Deputy Commissioner, Cochin &  Ors., (Civil  Rule No. 28 of 1977 decided on 28.9.1981 by  Gauhati High Court), inapplicable.      1.6   The  provisions  for  assessment   of   surcharge contained  in  the Surcharge Act indicate  that  while  land revenue is assessed in one settlement and continues till the succeeding settlement, surcharge having been imposed  during the  currency of the settlement, is required to be  assesed. The  need for assessment arises on account of the fact  that surcharge is not leviable on a person holding land measuring less  than 10 Bighas and, therefore, before making a  demand for surcharge it is necessary to determine whether a  person from whom demand  is made is liable under the provisions  of the  Surcharge Act and is not entitled to  claim   exemption from such levy. [pp.382 GH; 383 A]      1.7 The fact that the person holding land less than  10 Bighas though liable to pay land revenue, is not  liable  to pay  surcharge under the Surcharge Act, does not  alter  the character and nature of the levy. [p.383B]      1.8  The  High  Court was not  right  in  holding  that surcharge on land revenue levied under the Surcharge Act  is different  and distinct in character from land  revenue  and does not fall within the ambit  of annual land revenue under section  12  of  the Ceiling Act; and  to  this  extent  the judgment  of the High Court is liable to be set aside.  [pp. 382 CD; 385 C]      2.1   Local  rate  leviable   under  the  Local   Rates Regulation  is,  a  levy which  is  distinct  and  different in nature from land revenue. [pp. 384 H; 385 A]

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    2.2  The  expression ‘rate’ is generally  used  in  the same sense as the expression ‘cess’.  Section 4 of the Local Rates  Regulation also indicates that the local rate  is  in the nature of cess because in section 4 it has been provided that  when  a  rate  is  imposed  on  any  land  under  this Regulation any cess now leviable on such land for any of the purposes  mentioned in Section 12, shall cease to be  levied on such land or if such cess be maintained, a corresponding diminuition shall be made for such rate. [p.384 F-G]      Guruswamy  & Co. v. State of Mysore, [1967] 1 SCR  548; India  Cement  Ltd. & Ors. v. State of Tamil  Nadu  &  Ors., [1990] 1 SCC 12 followed.                                                      374      2.3 The amount realised by way of local  rate under the Regulations is to  be used for incurring expenditure for the relief  and  prevention  of famine and for  local  purposes. Land  revenue,  on  the other hand, forms  part  of  general revenue  of  the State and is not limited for  a  particular purpose. [p.384 G-H]      2.4  The  High Court has rightly held that  local  rate payable  under  the  Local  Rate  Regulations,  1879  is  an imposition which is distinct in character from land  revenue and  cannot  be regarded as land revenue or tax in  lieu  of land   revenue.   It  cannot,  therefore,  be   taken   into consideration for assessing compensation under Section 12 of the Ceiling Act. [p.385 B]      3.  Since  there is nothing in the  Ceiling  Act  which excludes  the  applicability  of sections 4  to  24  of  the Limitation  Act, 1963 to proceedings under the Ceiling  Act, the  said  provisions are applicable to such  proceedings in view  of  sub-section (2) of section 29  of  the  Limitation Act,  1963  and the District Judge was competent to  condone the  delay in the filing of the appeal.  In the exercise  of jurisdiction  under  Article 136  of the  Constitution,   it would  not  be  appropriate  to  interfere  with   the  said exercise  of discretion by the District Judge. [pp.376  G-H; 377 A]

JUDGMENT:      CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6650 of 1983.      From  the  Judgment  and Order dated  1.6.1983  of  the Gauhati High Court in Civil Rule No. 876 of 1981.      A.K.  Ganguli, Vijay Hansaria, Sunil Kumar  Jain,  A.K. Lawania, Suresh Gupta and Rudra Kahlon for the Appellant.      A.K.  Mazumdar,  S.K.  Nandy and  P.  Goswami  for  the Respondents.      The Judgment of the Court was delivered by      S.C.AGRAWAL,  J.  This  appeal  by  special  leave   is directed  against the judgment and order dated June 1,  1983 of the Gauhati High Court in Civil Rule No. 876 of 1981.  It raises for consideration the question whether the expression ‘annual land revenue’ in Section 12 of the Assam Fixation of Ceiling on Land Holdings Act, 1956 (hereinafter referred  to as  ‘the  Ceiling Act’) would  include  ‘surcharge’  payable under the Assam Land Revenue and Land (Surcharge) Act,  1970 (hereinafter referred to as ‘the                                                        375 Surcharge Act’) and the ’local rate’ payable under the  Assam Local  Rates  Regulation, 1979 (hereinafter referred  to  as ’the Local Rates Regulation’).      The  Ceiling  Act  was  enacted  by  the  Assam   State Legislature  to make provision for imposition of  limits  on

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the  areas of land that may be held by a person.  Section  4 of  the  Act prescribes the ceiling on  the  existing  land. Under s.5 a person holding land in excess of the ceiling  is required  to  submit  a  return and  under  s.  7  (I),  the Collector  prepares a draft statement which shows the  lands in  excess of the limits fixed under s. 4.  The  said  draft statement is published under sub-section (2) of S. 7 for the purpose  of  submitting objections.  After  considering  the said  oobjections, the draft statement is made  final  under sub-section  (4)  of S.7; and with effect from the  date  on which  the final statement is signed by the  Collector,  all rights,  title and interest of the person or  persons  whose lands   are  shown  in  excess  in  such  statement,   stand transferred to and vested in the State Government, free from all  encumbrances  created  by such  person.   S.  12  makes provision  for  payment of compensation for the  land  which stands  transferred to and vested in the  State  Government. Under clause (a) of S. 12 where the person from whom  excess land  has been acquired, held it as the owner  thereof,  the compensation,  that  is payable is, in the  case  of  fallow land,  an  amount  equal to 25 times the full  rate  of  the annual land revenue for such land and, in case of any  other land, an amount equal to 50 times such annual land revenue.      The  Ceiling Act, as originally enacted, did not  apply to  tea estates.  It was amended by Assam Act VIII  of  1971 which came into force on March 27, 1971 whereby  sub-section (2)  of  S.  4  was amended and the  Ceiling  Act  was  made applicable  to  tea plantations and land in excess  of  such land as has been used for special cultivation of tea and the purposes ancillary thereto, was brought within the ceiling.      The  apellant  is a tea company.  Land  measuring  1650 bighas, 4 Katthas and 5 lathhas belonging to it was declared as  excess land under the Ceiling Act on  September 9,  1975 by the Collecter, Dibrugarh, respondent No. I herein, and he also took over possession of the same.  A sum of Rs.  71,811 was  assessed as the compensation payable to  the  appellant for the said land under S. 12 of the Ceiling Act.  The  said figure  was  arrived at by excluding the surcharge  and  the local  rate payable in respect of the land.   The  appellant filed  an appeal against the said order before the  District Judge,  Dibrugarh,  who  by his order dated  July  1,  1981, enhanced  the  amount  of  compensation  by  including   the surcharge  as well as the local rate as part of  the  annual land revenue.  Respondent No. 1 challenged the said order of the District Judge by moving a writ petition under                                                        376 Articles  226  and 227 of the Constitution before  the  High Court,  which was allowed by the High Court by its  judgment dated  June  1, 1983 on the view that the  expression  ’full rate of annual land revenue’ meant only the revenue assessed on the land as such and the Legislature by enacting S. 12 of the Ceiling Act did not have in their mind the local   rates which were already leviable under the Local Rates Regultion, at  the time of enacting s. 12 of the Act and the  surcharge on the land revenue which was subsequently levied under  the Surcharge  Act.   The said decision of the  High  Court  was based  on  its earlier judgment dated December 21,  1982  in Civil Rule No. 194 of 1982 wherein the High Court had  fully considered  this question and had arrived at  the  aforesaid conclusion.  Feeling aggrieved by the aforesaid judgment  of the High Court, the appellant has filed this appeal.      Before  we proceed to deal with the submissions of  the learned  counsel  for the appellant, we may  deal  with  the preliminary objection that has been raised by Mr.  Mazumdar, the  learned counsel for the respondents.  Mr  Mazumdar  has

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urged  that  the appeal filed by the  appellant  before  the District Judge, Dibrugarh, against the order for  assessment of  compensation u/s. 12 of the Ceiling Act, was  barred  by limitation  and  that  the  District  Judge  was  in   error condoning  the  delay in filing the said apppeal.   In  this regard,  Mr.  Mazumdar has submitted that under  the  law  a period of 30 days is prescribed for filing an appeal against an order under s. 12 and that in the instant case the  final order   granting  compensation  was  passed  by  the   State Government  on February 8, 1979 and the apeal was  filed  on September  19,  1979, long after the  stipulated  period  of limitation.   On behalf of the appellant, it  was  submitted before the District Judge that no order was communicated  to the  appellant  and that the Collector by  his  order  dated February  17,  1979 directed the  appellant to  collect  the amount of Rs. 71, 811 and on request the company got a  copy of the sanctioning letter on September 6, 1979 only and thus the  appellant  became aware of the sanction order  only  on September  6, 1979 and it preferred an appeal  on  September 19,  1979 which was within limitation.  The  District  Judge has  observed that the Government sanction  of  compensation was  communicated  by the Collector vide  his  letter  dated February  17,  1979  which  was  duly  acknowledged by   the appellant vide its letter dated March 16, 1979 and that  the appellant  could have preferred the appeal by that time  and that  the appeal was filed beyond the period of  limitation. But taking into consideration the peculiar circumstances  of the proceeding of the principles of natural justice and fair play, the District Judge condoned the delay in the filing of the appeal.  Since there is nothing in the Celling Act which excludes the applicability of ss. 4 to 24 of the  Limitation Act, 1963, to proceeding under the Ceiling                                                        377 Act, the said provisions are applicable to such  proceedings in  view of sub-section (2) of s.29 of the  Limitation  Act, 1963  and  the District Judge was competent to  condone  the delay  in the filing of the appeal.  On a  consideration  of the facts and circumstances of the case, the District  Judge considered  it proper in the interest of justice to  condone the  delay.   In  the exercise  of  our  jurisdiction  under Article  136  of  the Constitution, we do  not  consider  it appropriate   to  interfere  with  the  said   exercise   of discretion by the District Judge.  The preliminary objection raised  by  the  learned counsel  for  the  respondents,  is therefore, rejected.      The main question that arises for consideration in this appeal relates to assessment of compensation u/s. 12 of  the Ceiling  Act.  The relevant provisions  of the said  section are as under:-          "12. where any land is transferred to and vested in          the State Government under Sub-s.(4) of s.7 of  the          Act,  there shall be paid compensation which  shall          be determined by the Collector or any other officer          authorised  by the State Government in  the  manner          and  in  accordance with the principles  laid  down          below, namely:          (a) (1) where the person from whom the excess  land          has been acquired held it as the owner thereof, the          compensation (inclusive of the value of any tenancy          right) shall be-          (i)  in case of fallow land, an amount equal to  25          times the full rate of annual land revenue  payable          for such land; and          (ii) in case of other land, inclusive of the  value          of  trees, an amount equal to 50 times such  annual

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        land revenue;                xx   xx   xx   xx   xx   xx   xx   xx   xx          "Provided  that where the land is revenue free,  or          assessed to land revenue at a concessional rate, or          where it is not assessed to land revenue under  the          provisions   of   the  Assam   Land   and   Revenue          Regulations, 1886 or of the Assam Land Revenue  Re-          assessment  Act,  1936, the compensation  shall  be          determined  on  the  basis of annual  land  revenue          assessable  under  the  provisions  of  the  afore-          mentioned Acts on similar, full revenue-paying land          situated nearest to it."      From  a perusal of the aforesaid provisions,  it  would appear  that the measure for assessment of  compensation  is ‘the full rate of annual land                                                   378 revenue’  payable  for the land  acquired.   The  expression ‘land   revenue’  is  not  defined  in  the   Ceiling   Act. Assessment and payment of land revenue in Assam is  governed by the Assam Land and Revenue Regulation, 1886  (hereinafter referred to as ‘the Revenue Regulation’).  Clause (3) of s.3 of  the  Revenue  Regulation defined  the  expression  ‘land revenue’ in the following terms:-          "3 (e) "land revenue" means any revenue assessed by          the State Government on an estate, and includes any          tax assessed in lieu of land revenue;"      By  the  Assam Land Revenue  Re-assessment  Act,  1936, enacted  for the purpose of regulating reassessment of  land revenue   in  Assam,  the  land  revenue  was   re-assessed. Thereafter,   the  Assam  State  Legislature   enacted   the Surcharge  Act in 1970 to provide for the levy of  surcharge on land revenue and rent assessed in the State of Assam.  In sub-section (1) of s.2 of the said Act the expression  ‘land revenue’  is defined in the same terms as in s.3 (e) of  the Revenue Regulation.  In s. 3 the following provision is made for the levy of surcharge:-          "3.  Levy of Surcharge.  Every person holding  land          measuring  10 (ten) bighas or more  directly  under          the  State  Government  shall be liable  to  pay  a          surcharge on land revenue or rent, as the case  may          be, at the rate of 30 per cent of the land  revenue          or  rent of all classes of holdings in addition  to          the land revenue or the rent payable by him."      Section  4  provides  for  provisional  assessment   of surcharge  and  issue  of notice to the  person  or  persons concerned.  Section 5 provides for filing of objections  and making of assessment after giving an opportunity of hearing. Sec.  7  makes  the  following  provision  for  recovery  of surcharge:-          "7.   Surcharge  recoverable  as  arrear  of   land          revenue.   The  surcharge assessed under  this  Act          shall be payable along with the land revenue or the          rent, as the case may be, in the manner  prescribed          and any arrear of any surcharge shall be realisable          as an arrear of land revenue."      Since  the  question for consideration is  whether  the surcharge  levied under the Surcharge Act can be held to  be land  revenue, it is necessary to examine the nature of  the said   levy.   According  to  the  Shorter  Oxford   English Dictionary the word ‘surcharge’ stands for an additional  or extra                                                       379 charge or payment.  In Bisra Stone Lime Co. Ltd & Anr.  etc. v.  Orissa State Electricity Board & Anr. [1976] 2  SCR  307 after  referring  to  the said definition,  this  Court  had

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observed:          "Surcharge  is thus a superadded charge,  a  charge          over and above the usual or current dues."  (p.310-          11)      In  that  case the Orissa State Electricity  Board  had imposed a uniform surcharge of 10% on the power tariff.   It was  argued that surcharge was unkown to the  provisions  of the Electricity (Supply) Act, 1948 and the Electricity Board had  no power under the said Act to levy a  surcharge.  This Court  negatived  the said contention and in  that  context, after expalining the meaning of the expression  ‘surcharge’, it was observed:          "Although, therefore, in the present case it is  in          the  form  of  surcharge, it  is  in  substance  an          addition  to the stipulated rates of  tariff.   The          nomenclature,   therefore,  does  not   alter   the          position.   Enhancement  of  the rates  by  way  of          surcharge is well within the power of the Board  to          fix  or  revise  the  rates  of  tariff  under  the          provisions of the Act" (P. 311)      Similarly,  in  Commissioner of Income Tax,  Kerala  v. K.Srinivasan, [1972] 2 SCR 309, a question arose whether the term  ‘income-tax’ as employed in s. 2 of the  Finance  Act, 1964,  would  include  surcharge  and  addtional   surcharge whenever provided.  This Court while tracing the concept  of surcharge in taxation laws of our country, has observed:          "The power to increase federal tax by surcharge  by          the  federal  legislature was recommended  for  the          first time in the report of the committee on Indian          Constitutional  Reforms, Vol. 1 Part I.  From  para          141  of  the  proposals it appears  that  the  word          "surcharge" was used compendiously for the  special          addition  to taxes on income imposed in  September,          1931.  The Government of India Act 1935, Part  VII,          contained provisions relating to finance, property,          contracts  and  suits.   Sections 137  and  138  in          Chapter  1 headed "finance" provided for levy   and          collection  of  certain succession   duties,  stamp          duties, terminal tax, taxes on fares and  freights,          and  taxes on income respectively.  In the  proviso          to  s. 137 the federal legislature was empowered to          increase  at  any time any of the duites  of  taxes          leviable  under  that section by  a  surcharge  for          federal purposes and the whole proceeds of any such          surcharge  were to form part of the revenue of  the          federation.   Sub-section (3) of s.138 which  dealt          with  taxes  on income related to imposition  of  a          surcharge." (P.312)                                                        380      It was further observed at page 315 of the report:          "The  meaning of the word "surcharge" as  given  in          the Webster’s New International Dictionary includes          among  others  "to  charge (one) too   much  or  in          addition..."   also  "additional  tax".   Thus  the          meaning of surcharge is to charge in addition or to          subject to an additional or extra charge".      In C.V. Rajagopalachariar v. State of Madras, AIR  1960 Mad.  543,  in  the  context  of  the  Madras  Land  Revenue Surcharge Act, 1954 and the Madras Land Revenue  (Additional Surcharge) Act, 1955, it has been laid down:-          "The   word  "surcharge"  implies  an   excess   or          additional  burden  or  amount  of  money  charged.          Therefore,  a surcharge of land revenue would  also          partake the character of land revenue and should be          deemed  to be an additional land revenue.  Although

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        S.4  of the two anactments referred to  above  only          deems it to be recoverable as a land revenue it  is          manifest that the surcharge would be a part of  the          land revenue.  The effect of the two Acts would be,          therefore, to increase the land revenue payable  by          a  land  holder  to the  extent  of  the  surcharge          levied.   If therefore, a surcharge levy  has  been          made, the Government would be enabled to collect  a          higher  amount  by  way  of  land  revenue  from  a          ryotwari  pattadar than what was warranted  by  the          terms of the previous ryotwari settlement."      The  said  decision  was  approved  by  this  Court  in Vishwesha  Thirthaswamiar & Ors. v. State of Mysore  &  Anr, [1972]  1 SCR 137. In that case this Court  was  considering the  question  whether  the  Mysore  State  Legislature  was competent to enact the Mysore Land Revenue (Surcharge)  Act, 1961.   After  examining the nature of the levy  the  Mysore High  Court  had  held  that  the  so-called  land   revenue surcharge  was but an additional imposition of land  revenue or a land tax and fell either within Entry 45 or Entry 49 of the  State List.  This Court agreeing with the view  of  the High  Court  held that the surcharge  fell  squarely  within Entry  45 of the State List, namely, land revenue.   It  was observed:-          "The legislation is but an enhancement of the  land          revenue by imposition of surcharge and it cannot be          called  a tax on land revenue, as contended by  the          learned counsel for the appellant.  It is a  common          practice  among the Indian Legislatures  to  impose          surcharge  on  existing tax.  Even art 271  of  the          Constitution speaks of a surcharge for the  purpose          of the Union being                                                        381          levied  by way of increase in the duties  or  taxes          mentioned in art, 269 and art. 270" (p.140)          "It  seems to us that the Act clearly  levies  land          revenue  although it is by way of surcharge on  the          existing  land  revenue.  If this is so,  the  fact          that  the surcharge was raised to 100% of the  land          revenue  on the wet and garden land and 75% of  the          land  revenue in respect of dry lands,  subject  to          some  minor exceptions, does not change the  nature          of the imposition." (p. 141)      From  the aforesaid decisions, it is amply  clear  that the expression ‘surcharge’ in the context of taxation  means an additional imposition which results in enhancement of the tax and the nature of the additional imposition is the  same as the tax on whcih it is imposed as surcharge.  A surcharge on  land  revenue is an enhancement of the land  revenue  to the  extent of the imposition of surcharge.  The  nature  of such  imposition is the same viz., land revenue on which  it is a surhcarge.      The learned Judges of the High Court have taken note of the  decisions of this Court referred to above and  were  of the view that if they were to interpret only the  expression ‘land revenue’, there would not be any difficulty. They have observed that in the instant case they were interpreting the expression "full rate of annual land revenue payable for the land" in S. 12 (a) (1) of the Ceiling Act.  According to the learned Judges, the  expression "full rate of land revenues" has  to  be  understood in conformity with  the  Assam  Land Revenue  Regulation where different classes of  estates  are often  referred to in terms of revenue, for example,  khiraj or  full  revenue  paying estates and  Nisf-khiraj  or  half revenue paying estates.  The learned Judges have referred to

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the  provisions of the Assam Land Revenue Reassessment  Act, 1936 which prescribes the procedure for reassessment and how the  rates of revenue are to be fixed, as well as the  Assam Assessment  of Revenue  Free Waste land Grant Act, 1948  and have  observed that the rate of revenue has been  understood in  the  sense  of revenue assessed on  land.   The  learned Judges  have  also  taken  note of  the  provisions  of  the Surcharge  Act and have pointed out that the  Surcharge  Act makes   provision  for  assessment  of  surcharge   in   the prescribed procedure whereas in the case of land revenue, it is  assessed  in  one  settlement  and  continues  till  the succeeding settlement; and under S.3 of the Surcharge Act  a person  holding land measuring less than 10  Bighas,  though liable  to pay land revenue, is not liable to pay  surcharge on  his  land revenue.  The learned Judges  have  also  laid emphasis on the expression ‘in addition to the land revenue’ used  in S.3 of the Surcharge Act and the expression  ‘along with land revenue’ in S.7 of the Surcharge Act.                                                        382 Taking  into  account the features referred  to  above,  the learned  Judges  of  the  High  Court  have  held  that  the Legislature   clearly   distinguished   land   revenue   and surcharge.  The learned Judges also referred to the decision of  a Full Bench of five Judges of the High Court  in  Benoy Mazumdar  v. Deputy Commissioner, Cochin & Ors  (Civil  Rule No.28  of  1977 decided on September 28, 1981)  wherein  the court  was  dealing  with  the  constitutional  validity  of S.7(1A) of the Assam Land (Requisition and Acquisition) Act, 1948,  and had to deal with the question of compensation  in terms of multiple of annual land revenue.  After  mentioning the  various  decisions that were referred to  in  the  said decision,  the  learned Judges have observed that  in  those cases  the  annual land revenue was taken to mean  the  land revenue  as  assessed  on  land  and  nowhere  the  idea  of surcharge  entered into that concept.      With  great respect to the learned Judges of  the  High Court,  we are unable to subscribe to this view.  We do  not find  any  sound basis for holding that  surcharge  on  land revenue  levied  under the Surcharge Act  is  different  and distinct  in character from land revenue and does  not  fall within the ambit of annual land revenue under section 12  of the Ceiling Act.  The use of the words "full rate of" before the  words  "annual land revenue payable for  the  land"  in Section  12(a)  (1) (i) of the Ceiling Act do  not,  in  our opinion,  have a bearing upon the nature of the levy,  which is  land  revenue.   The said words have  reference  to  the quantum  of  the  levy  which  would  form  the  basis   for assessment  of  compensation.   We  find  it  difficult   to appreciate   how   these  words  render   inapplicable   the principles   laid   down   by  this   Court   in   Vishwesha Thirthaswamiar’s case (supra), that imposition of  surcharge on land revenue is only  an enhancement of the land  revenue and nature of the said imposition is land revenue.      We  do not consider that the words "in addition to  the land revenue" in S.3 and the words"along with land  revenue" in  S.7  of the Surcharge Act imply  that  surcharge  levied under the said Act is levy which is distinct in nature  from land revenue.  These expressions only mean that surcharge  @ 30%  of the land revenue leviable under S.3 of the Surcharge Act  is  over and above the amount that is payable  as  land revenue  and  in that sense it is an  additional  charge  or imposition  which   is payable by way of surcharge  on  land revenue.   The fact that the said sum is to be paid and  can be recovered along with the land revenue also does not alter the nature of the levy if it is otherwise found to be of the

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same  character as land revenue.  As regards the  provisions for  assessment of surcharge contained in the Surcharge  Act for assessment, we find that while land revenue is  assessed in   one  settlement  and  continues  till  the   succeeding settlement,   surcharge  having  been  imposed  during   the currency of the settle-                                                        383 ment,  is required to be assessed.  The need for  assessment arises on account of the fact that surcharge is not leviable on  a person holding land measuring less than 10 Bighas  and therefore,  before  making  a demand  for  surcharge  it  is necessary to determine whether a person from whom  demand is made is liable under the provisions of the Surcharge Act and is not entitled to claim exemption from such levy.  The fact that  the  persons holding land less than 10  Bighas  though liable to pay land revenue, are not liable to pay  surcharge under  the Surcharge Act, does not, in our view,  alter  the character  and  nature of the levy.  Benoy  Mazumdar’s  case (supra)  and the cases referred to therein, have no  bearing because in those cases the question whether surcharge is  to be  included in land revenue, was not in issue and  has  not been considered.      For the reasons aforesaid, we are unable to endorse the view  of  the  High Court that  surcharge  on  land  revenue payable  under the Surcharge Act is not land revenue  but  a levy  which  is distinct from land revenue.   In  consonance with   the  law  laid  down  by  this  Court  in   Vishwesha Thirthaswamiar’s  case  (supra), it must be held  that   the surcharge  on land revenue levied under the  Surcharge  Act, being  an  enhancement of the land revenue, is part  of  the land  revenue and has to be treated as such for the  purpose of assessing compensation under s. 12 of the Ceiling Act.      We may now examine whether the local rate payable under the Local Rates Regulation can be regarded as land  revenue. In  the  Preamble to the Local Rates  Regulation,  the  said Regulation  has been made to provide "for the levy on   land of  rates to be applied to defray the  expenditure  incurred and  to be incurred for the relief and prevention of  famine and  for  local purposes".  In S.1 of the Regulation  it  is prescribed that the said Regulation shall come into force in such districts, in such parts thereof and on such dates,  as the  State  Government may by notification in  the  Official Gazette,  from  time  to time, direct.   Section  3  of  the Regulation  prescribes  the rates assessable  and  reads  as under:-          "3. Rates Assessable.  All land shall be liable  to          a  levy at the rate of twenty-five paise for  every          rupee  of the anuual value of the land in  addition          to  the  land-revenue  and local  cesses  (if  any)          assessed thereon".      Sec.4 which deals with the effect of imposition of land rates on cess now leviable provides as follows:-          "4.  Effect of imposition of land rate on cess  now          leviable.  When a rate is imposed on any land under          this Regulation, any cess now leviable on such land          for  any  of the purposes mentioned in  S.12  shall          cease to be levied on such land; or if such                                                        384          cess  be  maintained,  a  corresponding  diminution          shall be made in such rate."      Section 5 contains the following provision with  regard to recovery of rates:          "5. Recovery of rate.  All sums due on account of a          rate  imposed  on any land  under  this  Regulation          shall  be payable by the land-holder and  shall  be

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        recoverable as if they were arrears of land revenue          due on such land.          When such land is held by two or more  land-holders          such  land-holders shall be jointly  and  severally          liable for such sums".      In  Guruswamy  & Co. v. State of Mysore, [1967]  1  SCR 548; Hidayatullah J., as the learned Chief Justice then was, has observed as under:          "The word ‘cess’ is used in Ireland and is still in          use in India although the word rate has replaced it          in  England.  It means a  tax and is generally used          when  the levy is for some  special  administrative          expense  which  the name  (health  cess,  education          cess, road cess etc.) indicates.  When levied as an          increment to an existing tax, the name matters  for          the  validity of the cess must be judged of in  the          same  way as the validity of the tax to which it is          an increment".      In  India Cement Ltd. & Ors. v. State of Tamil  Nadu  & Ors. [1990] 1 SCC 12;  these observations have  been  quoted and it has been mentioned that though they were made in  the dissenting judgement, there was no dissent on this aspect of the matter.      From  the aforesaid observations, it would appear  that the  expression ‘rate’ is generally used in the same as  the expression  ‘cess’. S.4 of the Local Rates  Regulation  also indicates that the local rate which is imposed by the  Local Rates Regulation in the nature of cess because in S.4 it has been provided that when a rate is imposed on any land  under this Regulations any cess now leviable on such land for  any of the purposes mentioned in S.12, shall cease to be  levied on such land or if such cess be maintained, a  corresponding diminution  shall  be  made for  such  rate.   Moreover,  as indicated  in  the Preamble, the amount realised by  way  of local  rate is to be used for incurring expenditure for  the relief  and  prevention of famine and  for  local  purposes. Land  revenue,  on  the other hand, forms  part  of  general revenue  of  the State and is not limited for  a  particular purpose.    Local  rate  leviable  under  the  Local   Rates Regulation                                                        385 is,  therefore,  a levy which is distinct and  different  in nature  from land revenue.  S.3 only provides  a  convenient mode  of  prescribing the rate for levy of  local  rate   by fixing  it as a proportion, namely, 25% of the annual  value of  the land and S.5 only provides the mode of  recovery  of the rate as arrear of land revenue.  The said provisions  do not  have  the effect of equating the local rate  with  land revenue or making it a tax in lieu of land revenue.      The High Court has rightly held that local rate payable under  the Local Rate Regulation is an imposition  which  is distinct in character from land revenue and cannot be regard as land revenue or tax in lieu of land revenue.  It  cannot, therefore,   be  taken  into  consideration  for   assessing compensation under S.12 of the Ceiling Act.      The  appeal  is,  therefore,  partly  allowed  and  the judgement  of  the  High Court to the  extent  it  hold  the ‘Surcharge’  is  a  levy different and  distinct  from  land revenue  is set aside and it is held that surcharge  payable under the Assam Land Revenue and Land (Surcharge) Act,  1970 constitutes  land revenue and had to be taken  into  account for assessing compensation under S.12 of the Assam  Fixation of Ceiling on Land Holdings Act, 1956.  The view of the High Court  that  the local rate payable under  the  Local  Rates Regulation  1879,  is  to be excluded  for  the  purpose  of

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assessing  such compensation, is upheld.  The order  of  the High  Court  setting aside the judgement and  order  of  the District  Judge, dated July 1, 1981 in Misc. Appeal No.5  of 1979 is maintained. The matter will go back to the  District Judge,  Dibrugarh, for re-determination of the  compensation payable  to the appellant in Misc.  Appeal No.5 of  1979  in accordance with law.  The parties are left to bear their own costs. R.P                             Appeal partly allowed.                                                       386