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Issues Involved:
1. Violation of Article 14 of the Constitution. 2. Illusory right of appeal under Section 5 of the Act. 3. Excessive delegation of legislative function regarding the rate of cess. Detailed Analysis: 1. Violation of Article 14 of the Constitution: The appellants contended that the Andhra Pradesh (Krishna and Godavari Delta Area) Drainage Cess Act, 1968, was violative of Article 14 of the Constitution, which guarantees equality before the law. They argued that the Act imposed a flat and uniform rate of cess for each acre in a division, irrespective of the quality and productive capacity of the land, resulting in inequality. The Supreme Court, however, observed that a tax statute is subject to Article 14 but allows for a larger discretion to the Legislature in matters of classification due to the inherent complexity of fiscal adjustments. The Court noted that the rate of cess prescribed for each division had a rational nexus with the object of the Act and was based on intelligible differentia. The Act aimed to raise funds for implementing schemes to protect lands from floods, and since floods affect all lands equally, a uniform rate of cess per acre in a division was deemed just and reasonable. The Court cited previous cases to support the principle that in tax matters, the Legislature has wide discretion, and the burden of proving discrimination lies on the person complaining of it. The Court concluded that the provisions of the Act did not violate Article 14. 2. Illusory Right of Appeal under Section 5 of the Act: The appellants argued that the right of appeal provided by Section 5 of the Act was illusory. The Supreme Court dismissed this contention, stating that the Legislature had prescribed the maximum rate of cess, and the notification under the Act had fixed that rate. The procedure for levying the cess was detailed in Section 4 of the Act, and Section 5 provided a right of appeal to those aggrieved by the levy. The matters that could be contested in the appeal included the area for which the cess was levied or the ownership of that area. The Court found that the absence of discretion for the appellate authority to determine the rate of cess did not invalidate the right of appeal. 3. Excessive Delegation of Legislative Function: The appellants contended that there was excessive delegation of legislative power because the Act prescribed only the maximum rate of cess but not the minimum rate, leaving the precise rate to be determined by the Government. The Supreme Court rejected this argument, noting that it is within the Legislature's power to prescribe the maximum rate of cess, and the authority mentioned in the statute can levy cess up to that limit. The Court cited legal principles to support the view that prescribing a maximum limit is valid and binding. The Court also found that the Act provided sufficient guidelines for fixing the rate of cess, as it had to correlate with the expenditure on drainage schemes in each division. Conclusion: The Supreme Court upheld the constitutional validity of the Andhra Pradesh (Krishna and Godavari Delta Area) Drainage Cess Act, 1968, and dismissed the appeal and the writ petition. The Court found no violation of Article 14, no illusory right of appeal, and no excessive delegation of legislative power. The appeal and petition were dismissed without costs.
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