STATE OF ORISSA versus CHANDRA SEKHAR SINGH BHOI ETC.

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STATE OF ORISSA

v.

CHANDRA SEKHAR SINGH BUOi ETC.

July 15, 1969

[J.C. SHAH AND C. A. VAIDIALINGAM, JJ.J

Constitution of India-Art. 31-A pro••iso 2-'·Law for the time being in force"-O"iss<1 Land Reforms Act 16 of 1960-Ch. Iv: containing ceil ing provisions not brought into force-Chapter IV emended b,v Act 15 of 1965 and new ceiling provisions substituted fixing compensation not at market value-Chapter IV of Act 16 of 1960 if "law in force" within Article 31-A, proviso 2. ·

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The Consutution.of India, Art. 31-A, proviso 2, guarantees to a person. for compulsory acquisition of his Jand, the right to compensation which is not less than the market value when the land is within the ceiling limit applicable to him under a law for.., the time being in force. Section 1 (3) of the Orissa Land Reforms Act, 1960~ provided that the Act was to come into force in whole or i1,1 part on such dates as the Government may from time to time by notification appoint. Certain provisions of the Act were brought into force by n.otifications. But Chapter IV of the Act dealing with ceiling of holdings .of land was not brought into force. The Act Y.'as amended by Act 13 of 1965. The amending Act deleted Chapter IV and substituted fresh provisions. Chapter IV as amended dealt with ceiling and disposal of excess land and provided fof compensation at :fifteen times the fair and equitaQle re:nt. In the High Court the respondent land-holders urged that when Act 16· of 1960 was enacted it became law in force and the Ct'!iling limit prescriPed thereby became effective even though Chapter IV was not brought into force by notification under secf1on 1 ( 3) of the Act that since the Amepding Act 15 of 1965 sought to, r•'5trict the ceiling limit and to vest the sufplus land in the government there was compulsocy acquisition of land whiCh: could be valid only if the law provided for pay ment to the land-holder the market value of that part of the surplus land which was1 within the c~iling limit under Act 16 of 1960. The Higli Courl accepted the contention· and struck down Chapter IV of the Act as uncon .It was _of the vie·N, relying on this Court's decisior stitutional and invalid. in Thangal Kunju M1fPaliar's case, that the expression "law in force' had to be "construed otily in the constitutional sense and not in the sens1 of its actual operativeness."

In appeal by the State,

HELD : Allowing the appeal :

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A law cannot be said to be in force unle~s it is brought into op(;ratio1 by legislative enactment or by the exercise of authority by a d~legat empowered lo bring it: into.operation. The theory of a ~tatute being "i operation in a constitutional sense" has no validity. T'he decision of thi Court in Thangal Kunju Mudaliar lends no support tc the view expresse by the High Court. There this Court held that s. I (3) of Travancor Act 14 of 1124 (fvf.E;) \vas an ''existing la\v" on the date of the merge of the States of Travancore and Cochin and the power to bring into fore the provisions of the Travancore Act was exercisable by th..:: successor State Jt was not held that the other provisions of the Act were in force eve before an appropriate· notification was issued. [599 B-C: 600 C-DJ

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[ 1970] I S.C.R.

repealed by Act

Jn the present case the law relating to rhc ceiling limit, rf::., c:haptcr IV Clf Act 16 of 1960 was never operative by a notification and \\·a) no was ceiling limit applicable to the land holders under any .. l.n~' for the time being in force" \l:hic:1 atlract~d the application of the SL'cond proviso to Art. 31-A. [600 E]

15 of 1965.

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Tlrangal Kunju Mudaliar \'. M. Venkite1cliafa111 Potri, [1955] 2 S.C.R.

1196; explained.

CIVIL APPELLATE JURISDICTION: Civil Appeals No<. 1017, to 1027, 1029 to 1032, 1034 to 1037, 1901 to 1906 and 854 of 1968.

Appeals from the judgment and order dated January 30, 1967

of the Orissa High Court in O.J.Cs. Nos. 329 of 1965 etc.

C. B. Aganvala a,nd R. N. Sachthey, for the appellant (in a11

the appeals).

II. R. Gokhale, Santosh Chatterjee and G. S. Chatterjee, for

the respondents (in all the appeals).

The iudgment of the Court was delivered by

Shah, J. The State of Orissa has appealed to this Court against the judgment of the State High Court declaring "unconstitutional and invalid" Chapter IV of the Orissa Land Reforms (Amendment) A<;t 15 of 1965.

The Orissa Land Reforms Act 16 of 1960 (hereinafter called lhe principal Act) received the assent of the President on October 17, 1960. By s. 1(3) of the principal Act it was provided that the Act shall come into force in whole or in part, on such or date or dates as the Government may from time to time by .notification appoint and different dates may be appointed for different provi sions of the Act. By a notification issued on September 25, 1968 certain provisions of the principal Act other than those· contained in Chs. III and IV were brought into force. ~y a notification dated December 9, 1965 Ch. III (ss. 24 to 37 dealing with resump . tion for personal cultivation of any land held by a tenant and rela ted matte·s) was brought into force. But Ch. IV (ss. 38 to 52 dealing with cdling of holdings of land and disposal of excess land) was not brought into operation. The Legislature of the State ol Orissa amended the principal Act by Act 13 of 1965. By Act 13 of 1965 amendments were made in the principal Acts : the expressions "ceiling area" and "privileged raiyat" were defined by clauses ( 5) & 24 of 3. 24 and the expression "classes of land" was defined ins. 2(5-a). The original Chs. Ill and IV of the principal Act were deleted and were substituted by fresh provisions. Noth ing need be said about the amendments made in Ch. HI because in these groups of appeals the validity of these provisions is not in It may suffice to say that Ch. III (ss. 24 to 36) as amended hsue.

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ORISSA V. CHANDRA SEKHAR (Shah, J.)

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deals with the right of the landlord to resume land for personal cultivation, the extent of that right, and the proceedings for re sumption of land. Chapter IV as amended deals with ceilings and disposal of excess land. By s. 37 it is provided:

"(!) No person shall hold after the commencement of this Act lands as landholder or raiyat under personal cultivation in excess of the .ceiling area d~termined in the manner hereinafter provided.

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By s. 38 the Government is authorised to grant exemption from the operation of the ceiling in respect of certain classes of land. Section 39 deals with the principles for determining the ceiling in area. Sections 40, 41 & 42 deal with the filing of returns respect of lands in excess of the ceiling area on the date of com mencement of the Act and the consequences of failure to submit the return.· Section -43 provides for the preparation and publica tion of draft statements showing ceiling and surplus lands by the Revenue Officer and s. 44 provides for the publication of the final statement of ceiling and surplus lands after hearing objections, if any, received and ,after making enquiries as the Revenue Officer may deem necessary. Section 45 provides that :

"With effect from the beginning of the year next ,following the date of the final statement referred to in sub-section (3) of section 44 the interests of the person to whom the surplus lands relate and of all landholders mediately or immediately under whom the surplus lands were being held shall stand extinguished and the said lands shall vest absolutely in the Government free from all encumbrances."

Section 46 provides for determination of compensation. Section 47 sets out the principles for determining compensation. It pro vides that the compensation in respect of the interest of the land holders mediately or immediately under whom the surplus lands are being held as a landholder or raiyat shall be fifteen times the fair and equitable rent. It also provides for payment of market value of tanks, mells and of structures of a permanent nature situate in the land, determined on the basis of fair rent in the manner prescribe~ therein. Sections 48 and 49 deals with the preparation and publication of draft compensation assessment roll and the final compensation assessment roll. By s. 51 provision was made for settlement of surplus lands vested in the Govern ment under s. 45 with persons as raiyats in the order of prioritv . mentioned therein and s. 52 imposes a ceiling on future acquisi tions.

It is provided thereby :

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"The foregoing provisions of this Chapter shall, muratis mutant/is, apply where lands acquired and held under personal cultivation subsequent to the commence ment of this Act by any person through inheritance, be quesl. gift, family settlement, purchase, lease or other wise, together with the lands in his personal cultivation at the time of such acquisition exceeds his ceiling limit.

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By the amendments made in the Constitution by the I ?th Amend ment Act the principal Act is incorporated in the Ninth Schedule to the Constitution with effect from June 20. 1964. The Act is therefore not liable to be attacked en the plea that it is incon sistent with or takes away or abridges any of the fundamental rights conferred by Part III of the Constitution. But the pcwer of the competent Legislature to repeal or amend the Act incor porated in the Ninth Schedule is not thereby taken away. The amending Act passed after the enactment of the Constitution (Seventeenth Amendment) Act, 1964 does not therefore qualify for the protection of Art. 31-B. See Raman/a/ Gu!abchand Shah etc. v. State of Gujarat & Ors.( 1 ) Sri Ra . .'1 Ram Narain Medhi v. The State of Bombay ('). This position is not disputed.

Chapter IV incorporated in the principal Act by Orissa Act 13 of 1965 when brought into force is liable to be challenged on the ground that it is inconsistent with or takes away or abridges any of the fundamental rights conferred by Part Ill of the Con It wa~ urged however, and that plea has found favour stitution. with the High Court, that s. 4 7 incorporated by Act 13 of 1965 which provided for compensation not based on the market value of the land but at fifteen times the fair and equitable rent is in cor.sistent with Art. 31-A, proviso 2, and is on that account void. To appreciate the contention the constitutional provisions relating to protection guaranteed by the Constitution against compulsory a~quisition of property may be noticed. By Art. 31 (2) as amend ed by the Constitution (Fourth Amendment) Act, 1955, insofar as it is material, it !s provided :

"No property shall be compulsorily acquired or re quisitioned save for a public purpose and save by au thority of a law which provides for compensation for the property so acquired or requisitioned and eith"; foes the amount of the compensation or specifie> the princi ples on which, and the manner in which. the compen-

(1) [1969/ IS.C.R. 42. 12) [1959! Supp. I S.C.P. ·1~?

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ORISSA V. CHANDRA SEKHAR (Shah, J.)

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sation is to be determined and given;·

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Clause (2A) of Art. 31 which in substance defines the expression "law" providing for compulsory acquisition enacts that :

"Where a law does not provide for the transfer of the ownership or right to possession of any property to the State or to a corporation owned or controlled by the State, it shall not be deemed to provide for the compul sory acquisition or requisitioning of property, notwith standing that it deprives any person of his property."

By Art. 3 I (2) read with Art. 3 I (2A) property may be compul sorily acquired only for a public purpose and by authority of a law which provides for compensation for the property so acquired and either fixes the amount of the compensation or specifies the principles on which, ar,d the manner in which, the compensation In order that property may be is to be determined and given. validly acquired compulsorily the law must provide for the transfer of ownership or right to possession of any property to the State or to a corporation owhed or controlled by the State.

By virtue of s. 45 of the principal Act "the interests of person to whom the surplus lands relate and of all land-holders mediately or immediately under whom the surplus land3 were being held ........ stand extinguished and the lands .. · .... vest absolutely in the Government !,free from all encumbrances." This is clearly compulsory acquisit)on of land within the meaning of Art. 31(2) of the Constitution· and the compensation determined merely at fifteen times the fair and equitable rent may not, prima facie, be regarded as determination of compensation according to the principles specified by the Act. But Art. 3 lA which applies to the statute in question provides by the first clause :

"Notwithst11nding anything contained in Article 13

no Jaw providihg for-

{a) the. acquisition by the State of any estate or of any rights therein or the extinguishment or modification of any such rights, or

(b) (c) (d) (e)

shall be deemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by article 14, article 19 or article 31 :

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The principal Act 16 of 1960 and the amending Act 13 of 1965 were both Acts enacted for ensuring agrarian reform, and the lands held by the petitioners were "estates" within the meaning of Art. 31-A. Bys. 45 the rights of the land-holders were sought to be extinguished or modified. But to the operative part of Art. 31-A by s. 2 of the Constitution (Seventeenth Amendment) Act, 1964, the second proviso was add~d. The second proviso enacts:

"Provided further that where any law makes any pro vision for the r.cquisition 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 stand the ing law relating land, building or structure, provides for payment of compen sation at a rate which 'hall not be less than the market value thereof."

thereto, acquisition of

thereon or appurtenant

unless such

to the

By the Constitution (Seventeenth Aruendment) Act, l Q64, it was clearly enacted that under an;• law which provides for the acqui sition of any land in an estate under the penonal cnltivation of the holder, compensation shall not be less than the market value of the land if such land be within the ceilin$ limit applicable to the holder under any law for the time being m force.

Before the High Court it was urged on behalf of the land holders that when the principal Act was enacted it became law in force, and the ceiling limit prescribed thereby became effective, even though Ch. IV was not extended by a notification under s. 1 (3) of the Act, and since the subsequent legislation seeks to restrict the ceiling limit and to vest the surplus land in the Gov ernment under s. 45 as amended, there is compulsory acquisition of land which may be laid only if the law provides for payment to the landholder for extinction of his interest, the market value of that part of the surplus land which is within the ceiling J;"llit under the principal Act. This argument found favour with the High Court. In their view the expression "law in force" must be "con strued only in the constitut!onal sense and not in the sense of its actual operativeness", and on that account it must be held that "there was a ceiling limit already provided by the principal Act as it was 'law in force' within the meaning of that expression as used in the second proviso to Art. 31-A". They proceeded then to hold that s. 4 7 of the Act as amended provided for payment of compensation at a rate which is less than the market value of the land falling within the ceiling limit a.• originally fixed under

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OR!SSA V. CHANDRA SEKHAR (Shah, J.)

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Act 16 of 1960, and the guarantee of the second proviso to Art. 31-A of the Constitution is on that account infringed. We are unable to accept this process of reasoning. · The right to com pensation which is not Jess than the market value under any Jaw providing for the acquisition by the State of any land in an estate / in the personal cultivation of a person is guaranteed by the second proviso only where the land is within the ceiling limit applicable to him under any law for the time being in force. A law cannot be said to be in force unless it is brought into operation by legis lative enactment, or by the exercise of authority by a delegate empowered to bring it into operation. The theory of a statute being "in operation in a constitutional sense" though it is not in fact in operation has, in our judgment, no validity.

Again Ch. IV of the principal Act was repealed by the Amend ing Act 15 of 1965. Article 31-A proviso 2 guarantees to a person, for compulsory acquisition of hi~ land, the right to com pensation which .is not Jess than the market value, when the land is within the ceiling limit applicable to him under a law for the time being in force. : On the plain words of the proviso the law prescribing the ceiling limit must be in force at the date of acqui In the present case the Jaw relat\Iig to the ceiling limit viz. sition. Ch. IV of the principal Act was never made operative by a notifi cation, and was repealed by Act 15 of 19(i5. The ceiling limit under s. 47 of the principal Act was on that account inapplicable to the landholders who challenged the validity of s. 45 of the amending Act.

The decision of this Court A. Thangal Kunju Mudaliar v. M. ) on which the High Court relied Venkatachalam Potti and Anr.( 1 In that case lends no support to the views expressed by them. the Travancore State Legislature enacted Act 14 of 1124 M.E. to provide for investigating cases of evasion of tax. The Act was to come into force by s. 1 (3) on the date appointed by the State Government by notification. The · States of Travancore and Cochin merged on July l, 1949 and formed the United State of Travancore and Cochin. By Ordinance 1 of 1124 M.E. all exist ing laws of the Traval)core State were to continue in force in the United State. By a notification the Government of the United State brought the Travancore Act 14 of 1124 (M.E.) into force, and referred cases of· certain tax-payers for investigation to the Commission appointed in that behalf. The tax-payers challeng ed the authority of the Commission to investigate the cases. They contended that the Travancore Act 14 of 1124 (M.E.) not being a law in force when the United State was formed, the 'notification· bringing the Act into i.force was ineffective. The ·court rejected that plea. Section 1(3) of Travancore Act 14 of 1123 (M.E.) was

(I) (19551 2 S.C.R. 1196.

'L14 Sup. C.I./69-9

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existing law on July l, 1949, and continued to remain in force by virtue of Ordinance 1 of 1124 (M.E.). The notification issued in exercise of the power under s. 1 (3) of the Travancore Act 14 of 1124 (M.E.), the reference of the cases of the petitioners, the appointment of the authorised officials and the proceedings uPder the Act could not be questioned because s. 1(3) was existing law on July 1, 1949.

In A. Thangal Kunju MuJa/iar case(') the contention that Travancore Act 14 of 1124 (M.E.) was not law in force until a notification was issued bringing into operation the provisions of the Act, authorising the appointment of a Commission, and re ferring the cases of tax-payers to the Commission, was rejected. The Court held thats. 1(3) was in operation on July l, 1949 and the power to bring into force the provisions of the Travancore It was not held that Act was exercisable by the successor State. the other provisions of the Act were in force even before an ap In the case in hand s. 1 (3) of propriate notification was issued. the principal Act was in force, but Ch. IV of the Act was not brought into force. The argument that pro"isions of the Act which by a notification could have been but were not brought into force, must still be deemed to be law in force, derives no support from the case relied upon.

Section 1 (3) of Act 16 of 1960 is undoubtedly a law in force, but until the power is exercised by the State Government to issue an appropriate notification, the provisions of Ch. IV could not be deemed to be law in force, and since no notification was issued before Ch. IV of the principal Act was repealed, there was no ceiling limit applicable to the landholders under any law for the time being in force which attracted the application of the second proviso to Art. 31-A.

The appeals must, therefore, be allowed, and the order pass ed by the High Court declaring Ch. IV of Act 13 of 1965 BI?endinjl Act 1 ~ of _1960 ultra vires, be set aside. The State will get its costs m th!S Court from the respondents. There will be one hearing fee. There will be no order as to costs in the High Court.

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Appeals allowed.

(I) [1955) 2 S.C.R. 1196.

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