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TMI Blog1952 (5) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... he raiyats and other occupants of lands in those areas into direct relation with the Government. The constitutionality of these Acts having been challenged in the respective State High Courts on various grounds, the Bihar Act was declared unconstitutional and void on the ground that it contravened article 14 of the Constitution, the other grounds of attacks being rejected, while the other two Acts were adjudged constitutional and valid. The appeals are directed against these decisions. Petitions have also been filed in this Court under article 32 by certain other zamindars seeking determination of the same issues. The common question which arises for consideration in all these appeals and petitions is whether the three State Legislatures, which respectively passed the three impugned statutes, were constitutionally competent to enact them, though some special points are also involved in a few of these cases. 3. As has been stated, various grounds of attack were put forward in the courts below, and, all of them having been repeated in the memoranda of appeals and the petitions, they would have required consideration but for the amendment of the Constitution by the Constitution (Firs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in which such compensation is to be given". 5. The argument may be summarised thus. Entry of List II read with article 246(3) was obviously tended to authorise a State Legislature to exercise right of eminent domain, that is, the right of compute sorv acquisition of private property. The exercise such power has been recognised in the jurisprudence all civilised countries as conditioned by public necessity and payment of compensation. All legislation is this country authorising such acquisition of property from Regulation I of 1824 of the Bengal Code down to the Land Acquisition Act, 1894, proceeded on that footing. The existence of a public purpose and an obligation to pay compensation being thus the necessary concomitants of compulsory acquisition of private property, the term "acquisition" must be construed as importing, by necessary implication, the two conditions aforesaid. It is a recognised rule for the construction of statutes that, unless the words of the statute clearly so demand, a statute is not to be construed so as to take away the property of a subject without compensation : Attorney-General v. Di Keyser's Royal Hotel (1920) A.C. 508, 542. The pow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in accordance with the procedure prescribed in article 31(3) which provides "No such law as is referred to in clause (2) made by the Legislature of a State shall have effect unless such law, having been reserved for the consideration of the President, has received his assent". 8. Learned counsel stressed the words "law" and "legislature" and submitted that, inasmuch as the legislature of a State included the Governor (article 168) and a bill could become a law only after the Governor assented to it under article 200, clause (3) of article 31 must be taken to require that a State law authorising compulsory acquisition of property should receive the Governor's as well as the President's asset, the former to make it a law and the latter to give it "effect". As the relative bills were reserved in each case by the Governor concerned after they were passed by the House or Houses of Legislature, as the case may be, without giving his assent under article 200, the statutes did not satisfy the requirements of article 31(3) and so could not have "effect". This ground of attack, it was claimed, was not excluded by article 31-A or a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecting them. The fact of the matter is the zamindars lost the battle in the last round when this Court upheld the constitutionality of the Amendment Act which the Provisional Parliament enacted with the object, among, others, of putting an end to this litigation. And it is no disparagement to their learned counsel to say that what remained of the campaign has been fought with such weak arguments as overtaxed ingenuity could suggest. 12. It will be convenient here to set out the material provisions of the Constitution on which the arguments before us have largely turned. Article 31(2). No property movable or immovable..... shall be acquired for public purposes under any law authorising..... such acquisition unless the law provides for compensation for the property..... acquired and ether fixes the amount of compensation or specifies the principles on which and the manner in which the compensation is to be determined and given. (3) No such law as is referred to in clause (2) made by the Legislature of a State shall have effect unless such law, having been reserved or the consideration of the President, has received his assent. (4) If any bill pending at the commencement of this C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1(4) excludes attack only on the ground of contravention of article 31(2), while article 31-A bars objections based on contravention of other provisions of Part III as well, such as articles 14 and 19. This indeed was the reason for the enactment of articles 31-A and 31-B, as the words of exclusion in article 31(4) were found inapt to cover objections based on contravention of article 14. On the other hand, the law referred to in article 31(4) covers acquisition of any kind of property, while article 31-A relates only to the acquisition of a particular kind of property, viz., estates and rights therein, and what is more important for our present purpose, the non obstante clause in article 31(4) overrides all other provisions in the Constitution including the List of the Seventh Schedule, whereas a law which falls within the purview of article 31-A could only prevail over "the foregoing provisions of this Part". Now, the three impugned statutes fall within the ambit of both article 31(4) and article 31-A and 31B. Putting aside the latter articles for the moment, it is plain that, under article 31(4), the three impugned statutes are protected from attack in any court on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the limitations in express terms. An attack on the ground of contravention of these provisions implies that the law in question authorises acquisition without reference to a public purpose and without payment of compensation. This was precisely the objection raised both by Mr. Das and Dr. Ambedkar to the constitutional validity of the impugned statutes, and such objection really amounts to calling those laws in question on the ground that they contravened the provisions of article 31(2), though learned counsel stoutly denied that they were relying on the provisions of article 31(2). The denial, however, seems to me to be based on a quibbling distinction without a difference in substance. Their main attack was really grounded on the absence of these two essential prerequisites of valid legislation authorising acquisition of private property, though Mr. Das would deduce them by implication from entry 36 of List II and entry 42 of List III, while Dr. Ambedkar sought to derive them from the spirit of the Constitution. But this is only a form of, stating the objection which, in substance, is that the statutes are bad because of the absence of a public purpose and the omission to provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the very properties excluded. 15. It is true that under the common law of eminent domain as recognised in the jurisprudence of all civilized countries, the State cannot take the property of its subject unless such property is required for a public purpose and without compensating the owner for its loss. But, when these limitations are expressly provided for and it is further enacted that no law shall made which takes away or abridges these safeguards, and any such law, if made, shall be void, there can be no room for implication, and the words "acquisition of property" must be understood in their sense of the act of acquiring property, without importing into the phrase an obligation to pay compensation or a conditions as to the existence of a public purpose. The entries in the Lists of the Seventh Schedule are designed to define and delimit the respective areas of legislative competence of the Union and State Legislatures, and such context is hardly appropriate for the imposition of implied restrictions on the exercise of legislative powers, which are ordinarily matters for positive enactment in the body of the Constitution. 16. There are indications in article 31 it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Parliament the power of making laws with respect to acquisition or requisitioning of property for the purposes of the Union. For, if the restrictive conditions as to public purpose and payment of compensation are to be derived only from those words, then it must follow that in the absence of those words in entry 33, Parliament can make laws authorising acquisition or requisitioning of property without a public purpose and a provision for compensation. No reason was suggested why parliamentary legislation with respect to acquisition or requisitioning of property is to be free from such restrictive conditions while State legislation should be subject to them. The fact is that the law-making power of both Parliament and State Legislatures can be exercised only subject to the aforesaid two restriction, not by reason of anything contained in the entries themselves, but by reason of the positive provisions of article 31(2), and, as laws falling under article 31(4) or under articles 31-A and 31-B cannot be called in question in a court of law for non- compliance with those provisions, such laws cannot be struck down as unconstitutional and void. 18. It was further contended that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibited from giving his assent where such reservation by him is made compulsory. The Constitution would thus seem to contemplate only "bills" passed by the House or Houses of Legislature being reserved for the consideration of the President and not "laws" to which the Governor has already given his assent. It was said that article 31(3) provides a special safeguard which, in order to ensure that no hasty or unjust expropriatory legislation is passed by a State Legislature, requires for such legislation the assent of both the Governor and the President, and, to make this clear, the words "law" and "legislature" were deliberately used in clause (3). I am unable to agree with this view. The term "legislature" is not always used in the Constitution as including the Governor, though article 168 makes him a component part of the State Legislature. In article 173, for instance, the word is clearly used in the sense of the "House of legislature" and excludes the Governor. There are other provisions also where the word is used in contexts which exclude the Governor. Similarly the word "law" is sometimes loosely used in ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sses due for any period prior to the date of the vesting of the estates in Government "shall vest and be recoverable by the State" was unconstitutional and void. In the first place, there was no public purpose to be served by the acquisition of such property. The Government evidently lacked funds for the payment of even the illusory compensation provided for in the Act, and accordingly, hit upon the device of acquiring these arrears on payment of only 50 per cent of their value as provided in section 24. Raising funds for augmenting the Treasury could not be regarded as a public purpose such as would justify expropriation of private property. Secondly, it was said that these 'arrears' would represent so much money when realised, and money could not be the subject of compulsory acquisition as the obligation to pay compensation would practically turn such acquisition into a forced loan. Nor could the payment of 50 per cent of the face value of the arrears be regarded as compensation for the loss of the total arrears, for, refund of one half of a sum of money taken away could never make good the loss of the balance. The argument proceeds on a misconception. Whatever ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower to do away with these tanks in the maintenance of which large numbers of people are interested, but are large, under Indian law, by reason of their tenure, with the duty of preserving and repairing them". These are, obviously, the works of benefit to the raiyats of the estate, and their cost, which the zamindars are thus under an obligation to bear, is a perfectly legitimate deduction in computing the net assets of the estate. IF the zamindars had, in the past, neglected this duty, that does not affect the property of the deduction before determining the compensation payable to them. It is, therefore, idle to say that it is a mere contrivance for reducing the compensation. This apart, if, as I have endeavoured to show, payment of compensation is not a justiciable issue in the case of the impugned statues, having regard to articles 31(4), 31A and 31-B, it is not open to the court to inquire whether a deduction which results in reducing the compensation is unwarranted and therefore, a fraud on the Constitution. 23. Lastly, Mr. Das turned his attack on section 32 (2) read with section 43 (2) (p). Under the former provision compensation was payable in cash or in bonds or par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arred from enquiring into under article 212(1) of the Constitution. Rule 20 (1) read as follows : "A matter requiring the decision of the Assembly shall be decided by means of a question put by the Speaker on a motion made by a member". 25. What appears to have happened in this. One of the Ministers moved that "The C. P. and Berar Abolition of Proprietary Rights (Estates, Mahals, Alienated Lands) Bill 1949, (No. 64 of 1949) as considered by the House be passed into law". Thereupon the Speaker read the motion to the House, and this was followed by several speeches welcoming the measure, amid general acclamation in the House, as a great boon to the tillers of the soil. The official report of the proceedings prepared by the Secretary under rule 115 (1), however, did not record that the Speaker put the question in the usual form : "The question is etc." and that the motion was carried. It was argued that the official report being the only "authentic record of the proceedings of the Assembly" under rule 115 (2) it must be taken to be conclusively established that the motion was not put to the House and carried by it. There is, in my opinion, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le was only illustrative, and that, accordingly, articles 31-B could not be wider in scope. Reliance was placed in support of this argument upon the decision of the Privy Council in Sibnath Banerji's case (1945) F.C.R. 195 (P.C.). I cannot agree with that view. There is nothing in article 31-B to indicates that the specific mention of certain statutes was only intended to illustrate the application of the general words of article 31-A. The opening words of article 31-B are only intended to make clear that article 31-A should not be restricted in its application by reason of anything contained in article 31-B and are in no way calculated to restrict the application of the latter article or of the enactments referred to there in to acquisition of "estates." The decision cited affords no useful analogy. 27. In some of the cases the estates sought to be acquired are situated in what was previously the territory of Indian States and belong to their former rulers. On the merger of those States in Madhya Pradesh or Uttar Pradesh, as the case may be, by virtue of the "covenant of merger" entered into between the rulers and the Government of India the properties in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mber, 1949, a Bill instituted the Bihar Land Reforms Bill was introduced in the Legislative Assembly of Bihar and was passed by both the Houses of Legislature, and after having been reserved for the consideration of the President of India, received his assent on the 11th September, 1950. The Act was published in the Bihar Government Gazette on the 25th September, 1950, and on the same day a notification under section 1 (3) of the Act was published declaring that the Act would come into force immediately. On the same day, a notification under section 3 of the Act was published stating that the estate and tenures belonging to the respondent and two other passed to and became vested in the State of Bihar under the provisions of the At. The respondent filed a petition in the High Court of Judicature at Patna under article 226 of the Constitution, challenging the constitutionality of the said Bihar Land Reforms Act and praying for a writ in the nature of mandamus to be issued on the State of Bihar restraining it from acting in any manner by virtue of, or under provisions of the said Act. This application was heard along with three title suits and other similar applications filed by vari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act is not open to challenge on any such ground. As Act has been held invalid by the High Court solely the ground that it violated the provisions of article 14 of the Constitution the basis of the judgment declare the Act to be unconstitutional is no longer tenable and it has therefore to be reversed in case this court agrees with the decision of the High Court on the points decided against the respondent. 34. Mr. P. R. Das for the respondent frankly conceded that no objection to the validity of the Act at this stages could be raised on the ground that it contravened any of the provisions of Part III of the constitution. He however supported the decision of the Court on grounds decided against him by that court and urged the following :- 1. That it was not with in the competence of the Bihar State Legislature to enact the impugned Act. 2. That the acquisition of the estates not being for public purpose, the Act was unconstitutional. 3. That the legislative power in various section of the Act has been abdicated in favour of the executive and such abdication of power was unconstitutional. 4. That the Act was a fraud on the Constitution and that certain parts of the Act were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not have been of the intended by the legislature to pass the Act in any truncated form in which it would remain if the provisions regarding compensation are taken out of it the whole Act should be held unconstitutional. 37. To appreciate the contentions raised by Mr. Das on the question of the competence of the Bihar Legislature to enact the Bihar Land Reforms Act, 1950, it is necessary to refer to its provisions and to see on what subjects the legislature has purported to enact the law. 38. The title of the Act indicates that the law provide for some kind of land reform in Bihar. Its preamble gives no indication as to the nature of these reform except that it provides for the constitution of Land Commission to advice the State Government on the agrarian policy, whatever that expression may mean. The dominant purpose of the Act is that of transference to the State of the interests of proprietors and tenure- holders in land and of the mortgagees and lessees of such interests including the interests in trees, forests, fisheries, jalkars, ferries, huts, bazars, miner and minerals. Section 3 provides that the Government may, from time to time, by notification declare the estates or t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the proprietors or tenure-holders for payment of arrears of revenue and cesses to the Government prior to the date of vesting is kept alive. The other consequences of vesting are that no suit can be maintained for recovery of any money from a proprietor or tenure holder which is secured by a mortgage or charge on the estate and no such estate or tenure covered by the Act is liable to attachment. The Collector is entitled to take charge of the estate and to inspect the documents and accounts which he thinks necessary to do for the management of the estate or tenure. Section 5 permits the proprietors and tenure-holders to retain their homesteads but only in the capacity of tenants free from the obligation to pay rent. Section 6 allows them to retain possession of lands in their has possession or in the possession of lessees under them, on payment of rent as raiyats to the State in the status of occupancy tenants. Section 7 provides that buildings together with lands on which such buildings stand and in the possession of proprietors and tenure-holders and used as golas, factories or mills shall be retained by them on payment of rent. Section 8 gives a right of appeal to a party aggr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has to be calculated on the basis of the average gross annual income of twenty-five agricultural years preceding the agricultural year in which the date of vesting falls, which in the opinion of a forest officer, the forests would have yielded if they had been placed during the said period of twenty-five years under the management of the State. 39. Section 23 lays down the method of computation of net income. It provides that the net income of a proprietor or tenure-holder shall be computed by deducting from the gross asset of such proprietor or tenure-holder, as the case may be, the following :- (a) any sum payable as land revenue or rent ; (b) any sum payable by such proprietor as agricultural income-tax in respect of any agricultural income derived from such estate of tenure for the previous agricultural year : (c) any sum payable by such proprietor or tenure holder as income-tax in respect of any income derived from such estate or tenure, other than royalties for the previous agricultural year : (d) any sum payable as chaukidari tax or municipal tax; (e) cost of management of such estate or tenure at rates varying from five to twenty per cent, according to the amount of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te acquired also comprised land purchased by him by spending about a crore of rupees and also comprised mortgages, to the tune of half a crore. All these vest in the Bihar State along with the inherited zamindaris of the Maharaja and arrears of rent amounting to ₹ 30,00,000, while the total compensation payable is nearly a sum of ₹ 9,00,000. This section further provides that to the amount thus payable shall be added the amount of fifty per cent. of the arrears of rent referred to in clause (b) of section 4 along with the amount of compensation payable in respect of mines and minerals as determined under section 25. The section also lays down the method of assessment of compensation in the case of persons who have only a share in the zamindari or have other minor interests in the tenures or estates where the estate or tenure is held in trust etc., or where they are of an impartible nature. In the case of mines and minerals the method of assessment is laid down in section 25. It has either to be fixed by agreement of by a tribunal appointed for the purposes. The subsequent sections provide for the preparation of compensation roll and for hearing of appeals etc. Section 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Bihar Act is constitutional as regards transfer of estates to the State and that this is mainly an enactment under legislative head 36 of List II, it is convenient now to examine the contention of Mr. Das to the effect that in the contents of the power conferred on the legislature by this entry their exists a concomitant obligation to pay compensation and that as the provisions regarding payment of compensation are illusory, the Act is unconstitutional and that article 31(4) of the Constitution does not afford any protection against this attack. 44. For a proper appreciation and appraisal of the proposition of Mr. P. R. Das that the obligation to pay compensation is implicit in the language of entry 86 of List II of the Seventh Schedule and that the power to take compulsorily raises by implication a right to payment, the power to acquire being inseparable from the obligation to pay compensation if is necessary to examine briefly the origin of the power of the State on the subject of compulsory acquisition of property. This power is a sovereign power of the State. Power to take property for public use has been exercised since olden times. Kent speaks of it as an inherent sovereig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mere right of pre-emption, and it has no condition of compensation annexed to it, either precedent or subsequent; but there is a right to take, and attached to it as in incident, an obligation to make compensation; this latter, morally speaking, follows the other, indeed like a shadow but it is yet distinct from it, and flows from another source." 47. Shorn of all its incidents, the simple definition of the power to acquire compulsorily or of the term "eminent domain" is the power of the sovereign to take property for public use without the owner's consent. The meaning of the power in its irreducible terms is, (a) power to take (b) without the owner's consent, (c) for the public use. The concept of the public use as been inextricably related to an appropriate exercise of the power and is considered essential in any statement of its meaning. Payment of compensation, though not an essential ingredient of the connotation of the term, is an essential element of the valid exercise of such power. Courts have defined "eminent domain" so as to include this universal limitation as an essential constituent of its meaning. Authority is universal in support of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 of that statute a fetter was imposed on the power of legislation itself. The Constitution however, declared laws not providing for compensation as void and it not only placed a fetter on the power of legislation but it guaranteed the expropriated proprietor a remedy in article 32 of the Constitution for enforcement of his fundamental right. I am therefore of the opinion that Mr. Das is not right in his contention that unless adequate provision is made by a law enacted under legislative power conferred by entry 36 of List I for compensation the law is unconstitutional as entry 36 itself does not authorize the making of such a law without providing for compensation. The it was said that entry 36 of List II was linked up with entry 42 of the Concurrent List by the words "subject to "occurring therein and that the validity of any law made in exercise of legislative power under entry 36 was conditional on the simultaneous exercise of the legislative power under entry 42 and because there has been no valid exercise of this power (the provisions of the impugned Act regarding the determination of compensation being illusory) the legislation under entry 36 fails. In my opinion, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s do not have any apposite application to the case of legislative powers conferred by a constitution. The entries in the lists are merely legislative heads and are of an enabling character. Duty to exercise legislative power and in a particular manner cannot be read into a mere head of legislation. If the argument of the learned counsel was sound, then it would be open to this Court to issue mandamus to the legislature to exercise its power of legislation under entry 42, if it failed to do so. Mr. Das, when faced with this question, had to admit that he could not seriously contend that a legislature could be directed to enact a stature if it did not wish to do so. Failure make a law under entry 42 cannot make a law made under entry 36 bad. In my opinion, the decision in the case of Julius v. Bishop of Oxford (1880) 5 App. Cas. 214 has no relevancy to the matter before us. 52. The crucial point for determination in these appeals is to discover the extent to which article 31(4) of the Constitution or the new articles 31-A and 31-B have deprived the expropriated, proprietor of his rights or remedies in respect of this matter and of the guaranteed right to get compensation for propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen a Bill has received the assent of the President according to the Procedure prescribed in article 31 (3)and (4) then, notwithstanding anything in this Constitution, the law so assented to shall not be called in question in any court on the ground that it contravenes the provisions of clause (2). 54. In order to determine the scope of this clause, it is necessary to determine what are the specific provisions of clause (2) which clause (4) makes unjusticiable. A strict construction has to be placed on the language of this clause, it being in the nature of a debarring provision. In my opinion, the provisions, of sub-clause (2) made unjusticiable by clause (4), relate to the etermination and payment of compensation. The whole purpose of the clause is to make the obligation to pay compensation a condition precedent to the compulsory acquisition of property. The words of the clause preceding the word "unless" are merely descriptive of the law, the validity of which would be questionable if there was no provision for determination and for payment of compensation for the property taken in its contents. The use of the word "such" fully supports this interpretation. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31(2) but exists aliunde in the content of the power itself and that in fact is the assumption upon which this clause of the article proceeds. 56. The result of this discussion is that the scope of article 31(4) is limited to the express provisions of article 31(2) and courts cannot examine either the extent or the adequacy of the provisions of compensation contained in any law dealing with the acquisition of property compulsorily for public purpose but the barring provisions of article 31(4) do not in any way touch the powers of the court to see whether the acquisition has been made for public purpose. The provisions of this clause also do not take away the court's power to examine whether the legislature that made the law has acted in exercise of its law making power within the lists or has merely made some other law though it has ostensibly exercised its powers under a certain legislative head which cannot be used to support the legislation. 57. As regards the new articles 31-A and 31-B, they merely place beyond the reach of the court any enactment dealing with compulsory acquisition of property which may infringe any of the provisions of Part III of the ? Constitution; in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the State or any other public purpose. Private property cannot be acquired for a private purpose. The right to legislate under entry 36 postulates the existence of a public purpose and the contention is that there was no public purpose behind the Act. The learned Judges of the High Court negatived this contention on the ground that the question whether there was a public purpose in support of the acquisition of the estates had been by implication decided by the Constituent Assembly and therefore the Court could not go into this matter. Shearer J. said as follows :- "We are, in my opinion, estopped from saying that the acquisition of estates and tenures is not an acquisition for such a purpose. That it is, has been decided by the Constituent Assembly itself." 61. This decision was reached in view of the provisions of clauses (4) and (6) of article 31 which were interpreted to mean that the Constituent Assembly gave their express approval to this legislation. Reuben J. observed as follows :- "From article 31, clause (2), it is clear that the Constituent Assembly considered two requirements as essential for compulsory acquisition, namely, a public purpose and pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and if an average family be taken to consist of four persons, five and a half million people will be ruined by this legislation, while the ryots will not benefit in any manner because all the lands excepting the waste lands sought to be transferred are in the possession and cultivation of the ryots and no part of the rent realisable from them is being commuted for their benefit. It is pointed out that the waste lands were sufficient to meet the requirements of villagers for grazing cattle and for pasture and that in effect the acquisition of the estates was for the purpose of creating one machine-ridden and red-tapist super-landlord by depriving a substantial portion of the public of their means of livelihood. 63. The learned counsel proceeded to say that nationalization of land may be the policy of the party in power but this is not a public purpose which involves benefit to the community. Reference in this connection was made to the decision in Hamabai Pramjee Petit v. Secretary of State for India [(1915) 42 I.A. 44.] where it was observed that the phrase "public purpose" whatever it may mean, must include a purpose, that is, an object or aim, in which the general inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rms Act, 1950. " The preamble of the Constitution says that India has been constituted into a Sovereign Democratic Republic to secure to all its citizens justice, social, economic and political. Article 39 of the Directive Principles of State Policy states as follows :- "The State shall, in particular, direct its policy towards securing that the ownership and control of the material resources of the community are so distributed as best to subserve the common good; and that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment." 66. Now it is obvious that concentration of big blocks of land in the hands of a few individuals is contrary to the principle on which the Constitution of India is based. The purpose of the acquisition contemplated by the impugned Act therefore is to do away with the concentration of big blocks of land and means of production in the hands of few individuals and to so distribute the ownership and control of the material resources which come in the hands of the State as to subserve the common good as best as possible. In other words, shortly put, the purpose behind t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cquisition of chosen in action and that the compensation paid for it was fifty per cent. of the amount of arrears. I regret I am able to accept this suggestion. It is a well accepted proposition of law that property of individuals can not be appropriated by the State under the power of compulsory acquisition for the mere purpose of adding to the revenues of the State." The principle of compulsory acquisition of property."says Cooley (in Vol. II at p. 113, Constitutional limitations) "is rounded on the superior claims of the whole community over an individual citizen but is applicable only in those cases where private property is wanted that public use, or demanded by the public welfare and that no instance is known in which it has been taken for the mere purpose of raising a revenue by sale or otherwise and the exercise of such a power is utterly destructive of individual right. Taking money under the right of eminent domain, when must be compensated in money afterwards is nothing more or less than a forced loan. Money or that which in ordinary use passes as such and which the Government may reach by taxation, and also rights in action which can only be available whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 30 of 1951), the rents due were ₹ 10,26,103 and in Appeal No. 339 of 1951, the amount is ₹ 9,52,937. 70. Next it was contended that the impugned Act is a fraud on the Constitution and therefore void. It was said that the Act, while pretending to comply with the Constitution, evades and invades it; that the Act merely pretends to comply with the Constitution when it says that it provides for payment of compensation but in effect it has produced a scheme for non-payment of compensation by shift and contrivance. Reference was made to certain provisions of the Act of a confiscatory nature, already noticed in this judgment. Section 9 was mentioned under which mines in the course of development and fetching no income yet vest in the State without payment of compensation. No compensation has been made payable in respect of forests or trees which were not fetching any income at the date of vesting. In a nutshell, it was contended that the object of the Act was to acquire properties of the zamindars by payment of compensation (so-called) out of the moneys belonging to the zamindars themselves and that in some cases they had not only to give up their estates for nothing but woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discrimination in regard to taxation. Such an Act might well be ultra vires the Commonwealth Parliament. Their Lordships are using the language of caution because such a case may never arise, and also because it is their usual practice in a case dealing with constitutional matters to decide no more than their duty requires. They will add only that, in the view they take of the matter, some of the legislative expedients -objected as ultra vires by Evatt J. in this forcible dissenting judgment may well be colourable, and such acts are not receiving the approval of their Lordships." 72. It was urged that a statute could be declared to be a fraud on the Constitution on the same principles that are applicable to cases of corporations or of executive bodies, whenever they act in excess or in abuse of their statutory powers. Reliance was placed in this connection the observations of Abbott C.J. in Fox v. Bishop of Chester 107 E.R. 520, at p.527, which are in these terms :- "Our judgment is founded upon the language of the Statute 31 Eliz. c. 6. and the well-known principle of law, that the provisions of an Act of Parliament shall not be evaded by shift or contrivance." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r able piece of legislation. It has been enacted under power conferred by legislative entry 42 of List III. It is well-settled that Parliament with limited power cannot do indirectly what it cannot do directly. (Vict South Australia v. The Commonwealth 65 C.L.R. 373 and Madden v. Nelson & Port Sheppard R. W. Co. (1899) A.C. 626. In Deputy Federal Commissioner of Taxation (N. S. W.) v. W. R. Moran Proprietary Ltd. 61 C.L.R. 735 at p. 793, it was observed as follows :- "Where the law-making authority is of a limited or qualified character, obviously it may be necessary to examine with some strictness the substance of the legislation for the purpose of determining what it is that the legislature is really doing. In such cases the court is not to be over persuaded by the appearance of the challenged legislation...... In that case, this court applied the well known principle that in relation to constitutional prohibitions binding a legislature, that legislature cannot disobey the prohibition merely by employing an indirect method of achieving exactly the same result..... The same issue may be whether legislation which at first sight appears to conform to constitutional requirement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be that the determination of the equivalent may be left for ascertainment on the basis of certain uniform rules; for instance, it may be laid down that he principles for determining compensation will be the rental basis or the market value of the property etc. But it is difficult to imagine that there can be any principles for nonpayment of compensation or for negativing the payment of compensation. No principles are required to be stated for non-payment of compensation. A simple statement that no compensation ill be paid is quite enough to attain the object. I know of no rinciples for determination of compensation which result in its nonpayment except in the Act under notice. All legislative heads have to be reasonably construed and the power given under entry 42 is a positive power given to bring about the result of payment of compensation and not non-payment of the same. The key words in the entry are "compensation" and "given". Anything that is unrelated to compensation or the giving of it cannot be justified by legislation under entry 42. Reference was made in this connection to the United Provinces v. Atiqa Begum (1940) F.C.R. 110 at p. 135, in which it w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry 42 List III. Suppose, for instance, instead of a twelve and a half per cent. It declared that a deduction of seventy per cent. be made on that account. Could it be said by any reasonable person that such a piece of legislation was legislation on principles of determining compensation or of making payment of compensation. This provision, therefore, in my opinion has been inserted in the Act as a colourable exercise of legislative power under entry 42 and is unconstitutional on that ground. The power has not been exercised under any other legislative head authorizing the State legislature to pass such a law. Legislation ostensibly under one or other of the powers conferred by the Constitution but in truth and fact not falling within the content of that power is merely colourably constitutional but is really not so. [Vide Quebec v. Queen Insurance Co. (1878)App. Cas. 1090; Russell v. The Queen.(7 (1882) App. Cas. 841)] Reference in this connection may also be made to the decision of the Privy Council in Madden v. Nelson & Fort Sheppard R. W. Co. (1899) A.C. 626. This Clause therefore is unconstitutional legislation made colourably valid under exercise of legislative power under ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct is unenforceable for this reason. 85. The last point urged by M. Das was that section 32 (2) of the Act was void as in it legislative functions had been abdicated by the legislature in favour of the executive. A two-fold attack was leveled against this provision. Firstly, it was said that the Constitution having in entry 42 of List III of the Seventh Schedule vested authority in the legislature to make laws on the question of the principles as to the payment of compensation and the manner and form of its payment, in other words, it having trusted these matters to the care, judgment and wisdom of the legislature, it had no power to delegate these matters to the executive. Secondly, it was contended that section 32 () delegated essential legislative power to the executive which it was incompetent to do. Reference was made to the opinion of this Court in Special Reference No. 1 of 1950. The matters alleged to have been delegated are these :- 1. The determination of the proportion of the case payment to the payment by giving bonds, negotiable or non-negotiable. 2. The determination of the period of redemption of these bonds. 3. The period of interval between the several instalm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bad on the ground that it is a piece of unregulated delegation of legislative power. 88. Mr. Das's contention in Cases Nos. 319,327,330 and 332 of 1951 and in the other cases in which he appeared were the same. 89. Mr. Das's contention in Cases Nos. 309 and 328 of 1951 raised a large number of points, some of which are covered by the arguments of Mr. P. R. Das, which I have discussed already. The rest seem me to be unsubstantial but it is necessary to notice at a few of them upon which great stress was laid by the learned counsel. Mr. Choudhury contended that the field of legislation on the question of principles of determination of compensation and the mode and manner of payment of such compensation was already occupied by the Land Acquisition Act which was an existing law of Parliament and, therefore, the State Legislature could not enter on this field and legislate on the principles of payment of compensation. This argument really has no force, because the provisions to assessment of compensation enacted in the Land Acquisition Act only apply to acquisitions that are made by notification under that Act. Its provisions have no application to acquisitions made under eith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... right has been alleged therein. There was no appearance for the respondents in Cases Nos. 18 of 1950 and 299 of 1951 and no opposition to the appeals being allowed. They are accordingly allowed. I will make no order as to costs in any of these appeals and petition. Mukherjea, J. 95. I had the advantage of going carefully through the judgment of may learned brother Mahajan J. and I concur entirely in the conclusions arrived at by him. In my opinion, the Bihar Land Reforms Act of 1950 is not unconstitutional, with the exception of the provisions contained in section 4 (b) and 23 (f) of the Act and these provisions alone must be held to be void and inoperative. 96. As regards section 23 (f) of the Bihar Land Reforms Act, my learned brother has based his decision on the ground that the provision of this clause constitutes a fraud on the Constitution, and although in enacting the provision, the legislature purported to exercise its powers under entry 42 of the Legislative List III in Schedule VII of the Constitution, in reality it is a colourable exercise of that power under which a thing has been done which is not contemplated by that entry at all and lies outside its ambit. It agr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect of which suits were pending on the date of vesting or in respect of which decrees were obtained before that date together with costs allowed by such decrees. Under section 24 of the Act, 50% of these arrears of rent are directed to be added to the amount of compensation more payable for the estate or interest calculated in accordance with the provisions of the Act. 99. The arrears of rent whether merged in decrees or not, which were due to the landlord for a period anterior to the date of notification under section 3 (1) of the Act, were undoubtedly the property of the landlord, irrespective of his interest in the estate or tenure which is the subject-matter of acquisition. Such arrears could not vest in the State as a normal result of acquisition of any estate or interest therein, and it is conceded by the learned Attorney-General that article 31-A of the Constitution has no application so far as these arrears of rent are concerned. The arrears of rent, therefore, are the subject-matter of separate and independent acquisition under the Bihar Land Reforms Act, if the word "acquisition" can at all be appropriate to cases of this description. 100. It cannot be dispute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ist III of Schedule VII of the Constitution. In my opinion, this is a mere device or pretence and the real objects which the legislation intended to accomplish is to deprive a man of his money which is not ordinarily a subject-matter of acquisition in exercise of what are known as powers of eminent domain by the State, without giving him anything in exchange; and under the guise of acting under entry 42 of List III, the legislature has in truth and substance evaded and nullified its provisions altogether. 103. The general principles, which distinguish the powers of eminent domain from other powers of the State under which the sacrifice of the proprietary interest of a citizen could be demanded or imposed are fairly well-known. As had been observed by Cooley in his Constitutional Limitations "every species of property which the public needs may require and which the Government cannot lawfully appropriate under any other right, is subject to be seized and appropriated under the right of eminent domain [See Cooley on Constitutional Limitations. Vol. II, p. 1113.]. Money as such and also rights in action are ordinarily excluded from this List by American jurists and for good reas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in which such compensation is to be given. I do not, however, agree with the learned Attorney-General for the reasons already given by any learned brother in his judgment that legislation under this head need not provide for any compensation at all and that a legislative provision which declares that no compensation is to be given comes within the ambit of this legislative head. Such construction is repelled by the very language of the entry which speaks of giving compensation and not of denying or withholding it. Stripped of all disguise, the net result of the impugned provision is that it would be open to the State Government of appropriate to itself half of the arrears of rent due to the landlord prior to the date of the acquisition without giving him any compensation whatsoever. Taking of the whole and returning a half means nothing more or less than taking half without any return and this is naked confiscation, no matter in whatever specious form it may be clothed or disguised. The impugned provision, there fore in reality does not lay down any principle for determining the compensation to be paid for acquiring the arrears of rent nor does its say any thing relating to the for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The result is that concur in the order which has been made by my learned brother Mahajan J. in this case and I allow the appeals subject to the two modifications indicated above. There would be no order as to costs. Das, J. 106 The proceedings out of which these appeals have arisen were initiated by different proprietor of estates in Bihar challenging the constitutional validity of the Bihar Land Reforms Act, 1950 (Bihar Act XXX of 1950) which will hereafter in this judgment be referred to as "The Act". 107. On January 26, 1950, when our Constitution came in to force, the Bill which eventually became the Act was pending before the Legislature of the State of Bihar After the Bill had been passed by the States Legislature, it was reserved for the consideration of the president. On September 11, 1950 that Bill received the assent of the President and became the Act. The provisions of the Act have been analysed and summarised in the judgment just delivered by Mahajan J. and it is not necessary for me to burden this judgment by recapitulating the same. On September 25, 1950 the text of the Act was published in the Official Gazette with a notification under section 1(3) date ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... radesh and Madhya Pradesh also passed legislation for the abolition of zamindaries in their respective States and the validity of those legislations was also contested by the proprietors affected thereby. The respective High Courts of those States, however, upheld the validity of the respective State legislation and the aggrieved proprietors came up to this Court either on appeal or on substantive application under article 32. It was at that stage that the Constituent Assembly passed the Constitution (First Amendment) Act, 1951. Sections 4 and 5 of the Act which are material for our purpose are as follows :- 4 After article 31 of the Constitution the following article shall be inserted, and shall be deemed always to have been inserted, namely :- 31-A. (1) Notwithstanding anything in the foregoing provisions of this Part, no law providing for the acquisition by the State of any estate or of any rights therein or for the extinguishment or modification of any such rights 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 any provisions of this Part : Provided that where such law is a law made by the Legisl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Constitution including article 14 and that the respondents cannot, therefore complain of the breach of the equal protection of the laws under article 14 which was the only ground on which the respondents succeeded in the High Court. Learned counsel, however, maintain that although they cannot challenge the constitutionally of the Act on the round that it contravenes or is inconsistent with or takes away or abridges any of the rights conferred by any of the provisions of Part III of the Constitution; is, nevertheless, open to them to call the Act into question on other grounds founded on other parts of the Constitution or on general principles of law. Accordingly Mr. P. R. Das formulates the following five principal grounds of attack against the Act, namely : On a proper interpretation of articles 245 and 246 read with entry 36 in List II and entry 42 in List III the Bihar Legislature had no power to enact the said Act inasmuch as it makes no provision for the payment of just compensation for the proposed acquisition of the zamindaries and tenures. B. Even if the Court does not accept the correctness of the arguments based on entry 36 in List III and entry 42 in List III a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , in some of the English statutes for compulsory acquisition of lands and hereditaments (e.g., 5 & 6 Vic. C. 94 and 8 & 9 Vic. C. 18) the word "purchase" was used to denote acquisition. As there can be no sale without a price, there can be no compulsory acquisition of private property without a provision for payment of just compensation, i.e., its equivalent value in money. That the obligation to pay just compensation for compulsory acquisition of private property is a principle of natural equity recognised by all temperate and civilized governments, that the right to compensation is an incident to the exercise of the power of eminent domain and that the one is so inseparably connected with the other that they may be said to exist, not as separate and distinct principles but, as parts of one and the same principle are well-established by a series of decisions of the American courts quoted by Harlan J. in Chicago, Burlington and Quincy Railroad Company v. Chicago [166 U.S. 216; 41 L. Ed. 979.]. In England Lord Dunedin in Attorney- General v. De Keyser's Royal Hotel Ltd. [(1920) A.C. 508.], described the obligation to pay compensation as "a necessary concomitant to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y principle for determining what may, in the eye of the law, be regarded as just compensation at all, the Act is ultra vires and void. The arguments thus developed by Mr. P. R. Das undoubtedly have the merit of attractive ingenuity and apparent cogency and certainly call for very careful consideration. 113. To cut at the root of the above argument the learned Attorney-General appearing for the appellant State contends that the impugned Act is a law made with respect to matters mentioned in entry 18 in List II and not under entry 36 in List II. The contention is that if is essentially a legislation for land reforms and alteration of land tenures. It is pointed out that the Act eliminates the interests of all zamindars and in intermediate tenure-holders so that the State and the actual tiller of the soil may be brought into direct relationship. Incidental to this primary object is the acquisition of the various interests in the land. Reference is made to the cases of The United Provinces v. Mst. Atiqa Begum and Others [(1940) F.C.R. HO at p. 134.], Thakur Jagannath Baksh Singh v. The United Provinces [(1946) F.C.R. 111 at p. 119.] and Megh Raj and Another v. Allah Rakhia and Others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bargain between the Crown and the subject, but came to be determined later on by statutes of local application and finally by statutes of general application and that, therefore, the Crown, which is an assenting party to every statute, must, in effect, be regarded as having consented to the exercise of its prerogative being made subject to payment of compensation regulated by statutes. In that case, however, it was not disputed in arguments that the taking itself was a matter of prerogative right. In the United States of America the power of eminent domain was not originally, in terms, conferred on the United States by any provision of the Federal Constitution, but this power has always been recognised to exist as an inherent attribute of the sovereignty of the State. So far as the United States are concerned, the Fifth Amendment by providing that private property shall not be taken for public use without just compensation gave a constitutional recognition to the right of eminent domain and, to protect the subjects, imposed a limitation on the exercise of that right by the State. This indicates that the power of acquisition and the obligation to pay compensation are two separate a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of property except for the purposes of the Union subject to the provision of entry 42 of List III' and that both Parliament and the State Legislatures may make laws with respect to matters set forth in entry 42 in List III, namely, the principles for determining the compensation and the form and matter of giving such compensation. This legislative power of Parliament or of the State Legislatures is, by article 245, made "subject to the provisions of this Constitution." One of the provisions of the Constitution is article 31(2) under which no property can be "taken possession of or acquired for public purposes under any law authorising the taking of such possession or such acquisition unless the law provides for compensation for the property and either fixes the amount of compensation or specifies the principles on which, and the manner in which, the compensation is to be determined and given." The scheme of our Constitution obviously is to provide the three things separately, namely, the power of making a law for acquisition of property in article 246 read with entry 33 in List I and entry 36 in List II, the obligation of such law to provide for compensa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as meaning "conditional post the exercise of the legislative power under entry 42 to List III, that is to say, conditional upon fulfilling the obligation to provide for compensation and the force and the manner in which such compensation is to given. I agree with S. K. Das J. that the word "subject to" have not the meaning sought to be given to them by Mr. P. R. Das but that they mean "but not" so as to indicate that the scope of entry 36 in List II is restricted, that is to say, that the subject matter of entry 42 in List III is not within the content of entry 36 in List II. If entry 42 in List III were, by reason of the words "subject to the provisions of entry 42 o of the List III" occurring in entry 36 in List II, to be read as having been made a part of the content of entry 36 in List II then it may well be argued that, in view of article 246, Parliament will not be competent to maintain law with respect to principles on which compensation is to be determined. It is in order to prevent this argument and out of abundant caution that he subject-matter of entry 42 in List III has been excluded from the content of entry 36 in List II by the word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied duty on the Legislature on the principle referred to in the House of Lords case. 117. That the obligation to provide for compensation is not included in the content of the legislative power under entry 36 in List II, by itself or read with entry 42 in List III, will be made further clear when we come to consider closely clauses (4) and (5) of article 31 and article 31-A. Article 31(4) protects a law of the description mentioned therein against the provisions of article 31(2). It follows, therefore, that what is sought to be protected by article 31(4) is a law for the acquisition or taking possession of property which does not, amongst other things, provide for compensation or does not fix the amount or specify the principles on which and the manner in which the compensation is to be determined and given, for otherwise there would be no necessity for any protection. The question at once arises as to whether there is any legislative entry in List II under which a law for acquisition or taking possession of property without compensation can be made by a State Legislature. To test the validity of Mr. P. R. Das's argument and to avoid the complication arising out of the residua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature with respect to acquisition of property. It is futile to attempt to get over this anomaly by suggesting that clauses (4) and (5) (b) (ii) of article 31 have been inserted in the Constitution ex abundanti cautela, for, if Mr. P. R. Das were correct in his submission, no amount of caution was necessary for protecting a law that, ex hypothesis, cannot be made at all. Similar arguments may as well be founded on article 31-A, for that article also protects a law from article 31(2) which is in Pat III of the Constitution. It is suggested that article 31-A, postulates a valid law made by a competent legislature within the ambit of its legislative powers. If a State Legislature in making a law for the acquisition of property for a public purpose under entry 36 in List II must provide for compensation then a law made conformably with this supposed requirement of that entry by a State Legislature will require no protection at all against article 31(2), and article 31-A must be regarded as meaningless and unnecessary. Surely, that conclusion is manifestly untenable. In my opinion clauses (4) and (5) (b) (ii) of article 31 and article 31-A clearly negative Mr. P. R. Das's proposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssible, the Court should adopt that which will implement and discard that which will stultify the apparent intention of the makers of the Constitution. Further, it must be borne in mind that article 31(4) which applies "notwithstanding anything in this Constitution", will by force of the very words, protect the Act against even legislative incompentency, if any, arising out of the alleged non-compliance with the suggested implies provisions, if any, of entry 36 in List II and entry 42 in List III. In my judgment the respondents are not, by reason of articles 31(4), 31-A and 31-B, entitled to call the Act in question on the ground that it does not provide for compensation, whether the ground is formulated as a breach of article 31(2) or of the implied provisions, if any, of the legislative heads mentioned above. 120. It will be noticed that the argument that the Act is unconstitutional is founded on the assumption that it has not laid down any principle for determining compensation as required by entry 42 List III and that the provision for compensation is wholly illusory. Chapter V of the Act deals with assessment of compensation. Shortly put, the scheme is to start with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome of the landlords, that in practice they do spend money on this account. Therefore, there is nothing wrong, when calculating the net income of a landlord, to deduct something which the landlords should and some of them often do, in practice, spend under this head. I see no absence of principle in this provision. The rate of deduction, I have said, has been fixed according to the capacity of the proprietors or tenure-holders. It has been shown, and it is not denied that in many cases a calculation of the net income on the basis of the principles laid down in the Act operates to reduce the gross income to a very small net income. To take only one instance, the gross annual income of the Darbhanga estate is about ₹ 47,85,069, the deduction allowed by the Act is about ₹ 44,88,585 and the net income computed according to the principles laid down in the Act comes to about ₹ 2,96,484 or say ₹ 3 lacs and the compensation payable to the Maharajadhiraj of Darbhanga will be only rupees 9 lacs. It has also been shown that at least in one case, e.g., in the case of the Raja of Purnea the compensation calculated according to the principle laid down in the Act works out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epel the first ground of attack leveled against the Act by Mr. P. R. Das. But before passing on to the second main ground of attack I think it right to deal with a few subsidiary points canvassed before us. 122. It is said that section 3 of the Act, which is its main operative section, does not contemplate or authorise the acquisition of arrears of rent at all, for the notification under that section only refers to the vesting of the estates or tenures in the State. It is, however, to be noticed that the consequence of issuing that notifications that the arrears of rent including all that are mentioned in clause (b) of section 4 are also to vest in, and be recoverable by, the State. This vesting of the arrears of rent in the State necessarily implies the transfer of the rights of the proprietors or tenure-holders to the State and this process must, therefore, amount to the acquisition of that right by the State. Therefore, in effect, the Act does contemplate the acquisition of the arrears of rent by the State. 123. On the authority of a passage in Wills' Constitutional Law, p. 816, it is argued that the power of eminent domain cannot be exercised with respect to money and cho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... value to the money compulsorily taken away, could not be said to be a just compensation. That argument, in view of articles 31(4), 31-A and 31-B, would, of course, have been futile. But I see no difference in principle or law when compensation for acquisition of arrears is made in money. In such a case if only a moiety of the amount of arrears is returned the obvious complaint will be that the return of 50,000 rupees is not fair or adequate compensation for taking away ₹ 1,00,000 and that complaint may have prevailed had there been no provision like those we have in articles 31(4), 31-A and 31-B. Apart from this, the argument completely overlooks the fact that the arrears of rent are not really cash in the till of the proprietor or tenure-holder but is only a debt due by the tenants. What is the market value of this book debt? This debt will have to be realised, possibly by suit followed by execution proceedings involving time and money in costs. Part of it, quite conceivably, may not be realised at all. Therefore, the State takes the risk of realising or not realising the arrears of rent but irrespective of the results of its efforts for their realisation the fifty percent o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpensation and it is this "provision" only that cannot be made a ground of attack on the Act by reason of articles 31(4), 31-A and 31-B of the Constitution. This argument has found favour with Reuben J. and S. K. Das J. The latter learned Judge, after referring to a passage in his own judgment in the earlier case of Sir Kameswar Singh v. The province of Bihar [A.I.R. 1950 Pat. 392.] concludes as follows :- "Clause (2), strictly speaking, does not, in express words, make "public purposes" a condition precedent compulsory acquisition but rather assumes that such acquisition can be for public purposes only; it has so by necessary implication." 125. The learned Judge then refers to the following passage in the judgment of my learned brother Mukherjea J. in Chiranjit Lal Choudhury v. The Union of India & Others [(1950) S.C.R. 869.]:- "Article 31 (2) of the Constitution prescribes a two fold limit within which such superior right of the State should be exercised. One limitation imposed upon the acquisition or taking possession of private property which is implied in the clause is that such taking away must be for public purpose. The other condition i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ental right contained therein. The enunciation of this fundamental right necessarily requires a statement of the ambit and scope of the State action and to fix the ambit and scope of the State action it is necessary to specify the limitations on the State action, for that limitation alone is the measure of the fundamental right. Clause (2) of the article, in its positive form, omitting words unnecessary for our present purpose, will read as follows :- "Any property,...................................... may be taken possession of or acquired for public purposes under any law authorising the taking of such possession or such acquisition if the law provides for compensation for the property taken possession of or acquired.............." 129. Put in the above form, the clause makes it clear at once and beyond any shadow of doubt that there are three limitations imposed upon the power of the State, namely, (1) that the taking of possession or acquisition of property must be for a public purpose, (2) that such taking of possession or acquisition must be under a law authorising such taking of possession or acquisition and (3) that the law must provide for compensation for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erty. Entry 36 covers any purpose except the purpose of the Union and is not, in terms, limited to public purpose. Secondly, the argument based on the words "subject to" etc. at the end of entry 36 in List II which are supposed to import the provisions of entry 42 in List III into entry 36 in List II is not well-founded and it becomes obvious when we look at entry 33 in List I. There are no words at the end of that entry as "subject to" etc. and, therefore, the alleged requirement of a public purpose under entry 42 in List III cannot be said to be incorporated in entry 33 in List I. It would, therefore, follow that whereas under entry 36 in List II which is to be read with entry 42 in List III by reason of the words "subject to" etc. in entry 36 in List II the Legislature of a State can only make a law for compulsory acquisition of property for a public purpose, Parliament may, under entry 33 in List I which does not attract entry 42 in List III, make a law for compulsory acquisition of property without a public purpose. Such a result could never have been intended by the Constitution. Besides, turning to entry 42 in List III, I find nothing in support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... round of the legislative incompetency arising out of the absence of a public purpose, the question still remains whether there is in fact a public purpose within the meaning of our Constitution to support the Act. It is to be noted that there is no recital of any public purpose in the Act itself, but it is conceded that this circumstance is not fatal to the validity of the Act. It is, however, urged that this circumstance, nevertheless, shows that the Legislature had, at the time of the passing of the Act, no public purpose in its view. It is claimed that, apart from the absence of any such recital, there is no indication whatever as to the existence of any public purpose in any of the operative provisions of the Act. It is not disputed that as a result of this enactment a very large sum of money now payable by the tenants as and by way of current rent and arrears of rent to their respective landlords will be intercepted by the State but it is urged, on the authority of certain passages in Cooley's Constitutional Limitations, 8th Edn., Vol. II, p. 1118 (Footnote 1) and in Professor Willis' Constitutional Law, p. 817, that the exercise of the power of taxation and not that o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l show that any definition attempted would exclude some subjects that properly should be included in, and include some subjects that must be excluded from, the operation of the words "public use". As might be expected, the more limited application of the principle appears in the earlier cases, and the more liberal application has been rendered necessary by complex conditions due to recent developments of civilization and the increasing density of population. In the very nature of the case, modern conditions and the increasing inter-dependence of the different human factors in the progressive complexity of a community make it necessary for the Government to touch upon and limit individual activities at more points than formerly." 133. To the like effect are the following observations to be found in Corpus Juris, Vol. XX, article 39, at pp. 552 and 553 under the caption "What is a public use" :- "No general definition of what degrees of public good will meet the constitutional requirements for a "public use" can be framed, as it is in every case a question of public policy. The meaning of the term is flexible and is not confined to what may c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the community as opposed to the particular interests of the individual must be regarded as a public purpose. The onward March of civilization our notions as to the scope of the general interest of the community are fast changing and widening with the result that our old and narrower notions as to the sanctity of the private interest of the individual can no longer stem the forward flowing tide of time and must necessarily give way to the broader notions of the general interest of the community. The emphasis is unmistakable shifting from the individual to the community. This modern trend in the social and political philosophy is well reflected and given expression to our Constitution. Our Constitution, as I understand it, has not ignored the individual but has endeavoured to harmonise the individual interest with the paramount interest of the community. As I explained in Gopalan's case [(1950) S.C.R. 88.] and again in Chiranjit Lal's case (supra) our Constitution protects the freedoms of the citizen by article 19(1)(a) to (e) and (g) but empowers the State, even while those freedoms last, to impose reasonable restrictions on them in the interest of the State or of publ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e law must keep pace with the realities of the social and political evolution of the country as reflected in the Constitution. If, therefore, the State is to give effect to these avowed purposes of our Constitution we must regard as a public purpose all that will be calculated to promote the welfare of the people as envisaged in these directive principles of State policy whatever else that expression may mean. In the light of this new outlook what, I ask, is the purpose of the State in adopting measures for the acquisition of the zamindaries and the interests of the intermediaries ? Surely, it is to subserve the common good by bringing the land, which feeds and sustains the community and also produces wealth by its forest, mineral and other resources, under State ownership or control. This State ownership or control over land is a necessary preliminary step towards the implementation of the directive principles of State policy and it cannot but be a public purpose. It cannot be overlooked that the directive principles set forth in Part IV of Constitution are not merely the policy of any particular political party but are intended to be principles fixed by the Constitution for direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent as unsound for more reasons than one. In the first place the existence of a public purpose being, as I hold, a provision of article 31(2), its absence, if any, in relation to the arrears of rent cannot, by reason of articles 31(4), 31-A and 31-B be made a ground of attack against the Act. Secondly, it is an entirely wrong approach to pick out an item out of a scheme of land reforms and say that that item is not supported by a public purpose. One may just as well say that there is no public purpose in the acquisition of forests or of mines and particularly of undeveloped mines, for such acquisition has no bearing on a scheme of agrarian reforms in that it does not improve or affect the conditions of the tillers of the surface of the soil. This, I apprehend, is not the right way of looking at things. The proper approach is to take the scheme as a whole and than examine whether the entire scheme of acquisition is for a public purpose. Thirdly, I do not regard the deduction of 4 to 12 1/2 per cent. of the gross assets as acquisition or confiscation at all, but I regard it, for reasons stated above as a part of a principle laid down by the for the purpose of determining the amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the zamindaries and the tenures is, as I hold, dictated or inspired by the sound public purpose of ameliorating the economic and political conditions of the actual tenants, the self same public purpose may well require the acquisition of the arrears of rent so as to avert the undesirable but inevitable consequences I have mentioned. The Bihar Legislature obviously thought that the tenants in arrears will have better treatment and a more reasonable accommodation, in the matter of the liquidation of the huge arrears, from the State which will act under the guidance of the Land Commission than from the expropriated landlords whose sole surviving interest in their erstwhile tenants will only be to realise as much of the arrears as they can from the tenants and within the shortest possible time without any mercy or accommodation. The same remarks apply to the acquisition of decrees for arrears of rent. The overriding public purpose of ameliorating the conditions of the cultivating raiyats may well have induced the Legislature to treat the arrears of rent and the decrees for rent differently from the other ordinary moveable properties of the zamindars or tenure-holders, e.g., their mone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into an attack on the legislative competency of the Bihar Legislature to pass this Act. On ultimate analysis it amounts to nothing more than saying that while pretending to give compensation the Act does not really give it. It is the absence of a provision for just and adequate compensation that makes the Act bad, because, according to Mr. P. R. Das, the legislative power under entry 36 in List II and entry 42 in List III requires the making of such a provision. The failure to comply with this constitutional condition for the exercise of legislative power may be overt or it may be covert. When it is overt, we say the law is obviously bad for non- compliance with the requirements of the Constitution, that is to say, the law us ultra vires. When, however, the non-compliance is covert, we say that it is a fraud on the Constitution, the fraud complained of being that the Legislature pretends to act within its power while in fact it is not so doing. Therefore, the charge of fraud on the Constitution is, on ultimate analysis, nothing but a picturesque and epigrammatic way of expressing the idea of non-compliance with the terms of the Constitution. Take the case of the acquisition of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in these entries. If the principles so laid down in the Act do not an any rare case produce any compensation or do not produce adequate compensation in some cases, such absence of compensation may be a contravention of article 31(2) but in view of articles 31(4), 31-A and 31-B and particularly due to the words, "not withstanding anything in this Constitution" occurring in article 31(4) it cannot be made a ground of attack on the Act, even though such ground is formulated in a different but attractive language namely, as a fraud on the Constitution. Accordingly this point must also be rejected. I, however, repeat that if I took a different view I would still have the same difficulty as to the in severability of the different provisions of the Act as I have herein before indicated. Re. Ground D : Mr. P. R. Das's fourth point is that the Act is unenforceable in that section 32 (2) provides for compensation in forty equal instalments without specifying the period of interval between the instalments. In course of arguments, however. Mr. P. R. Das has thought fit not to press this point and accordingly it does not require any refutation. Re. Ground E : Mr. P. R. Das' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid in cash or in bonds or partly in cash and partly in bonds and that if a payment is to be made either wholly or partly in bonds, these bonds may be either negotiable or non-negotiable and non-transferable. Having laid down the principle, the Legislature has, by a rule made under section 43 (3) (p), left it to the Executive to determine the proportion in which the compensation shall be payable in cash and in bonds and the manner of such payment of compensation. These details, it will be observed, depend on special circumstances, e.g., the extent of the ability of Government to pay, the extent of the necessities of the proprietors and many other considerations, with which the Executive Government would be more familiar than the Legislature itself. I am unable to accept Mr. P. R. Das's contention that this amounts to a delegation of an essential legislative function within the meaning of the decision of my learned brothers. 138. Mr. Sanjiva Chowdhuri has urged that the Land Acquisition Act, 1894 being continued by the Constitution and that Act which is a Central Act having been extended by notification in 1899 to Ramgarh State for which he appears, the Central Act must apply t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and the form and the manner in which such compensation is to be given." 143. From very early times, law has recognized the right of Government compulsorily to acquire private properties of individuals for a public purpose and this has come to be known as the law of eminent domain. But it is a principle of universal law that the acquisition can only be on payment of just compensation. Story on the Constitution, Vol. 2, page 534 paragraph 1790, has the following passage in discussing the concluding clause of the Fifth Amendment of the American Constitution : "The concluding clause is that private property shall not be taken for public use without just compensation. This is an affirmance of a great doctrine established by the common law for the protection of private property. It is founded in natural equity, and is laid down by jurists as a principle of universal law. Indeed, in a free government, almost all other rights would become utterly worthless, if the Government possessed and uncontrollable power over the private fortune of every citizen. One of the fundamental objects of every good government must be the due administration of justice; and how vain it would be to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uties created thereby, we must examine the legislation itself or must have resort to general and well-recognized principles of law of jurisprudence. No resort can be had to anything implicit or hidden when the statute makes an express provision on the same subject. As just compensation has to be paid when property is acquired for a public purpose, the legislation has to formulate the principles for determining the compensation and the form and the manner in which it is to be given. Entry 42 means nothing more than a power conferred on the legislature for achieving this end. The power is conferred but there is no duty cast to provide for compensation. For any statement that the payment of compensation is a primary condition for acquisition of property for a public purpose, we have to look at the provision of the Constitution itself and this we find in article 31(2) as stated already. Mr. Das was obliged to take up the untenable position that entry 42 of its own force implies an obligation to pay compensation, as he could not otherwise jump over the hurdles created in his way by sub-sections (3) and (4) of article 31 and the new articles 31-A and 31-B. 147. The learned Attorney-Gene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the commencement of the Constitution in the legislature of the State, and after it was passed by the legislature, it was reserved for the consideration of the President and received his assent. Therefore the bar that it shall not be called in question in any court on the ground that it contravenes the provisions of clause (2) becomes applicable. True, compensation has to be provided for, by reason of sub-clause (2) of the article, but sub-clause (4) postulates an exception and the right to challenge the validity of the Act on the ground that not compensation has been provided for or that the compensation is really illusory or inadequate is taken away. As if this were not enough, two more stiles have been erected in his way and they are the new articles 31-A and 31-B brought in by way of amendment. Article 31-A, sub-clause (1) is in these terms :- "Notwithstanding anything in the foregoing provisions of this Part, no law providing for the acquisition by the State of any estate or of any rights therein or for the extinguishment or modification of any such rights shall be deemed to be void on the ground that it is inconsistent with, to takes away or abridges any of the rights c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... article 31 relates to the contravention of the provisions of clause (2). The provision of clause (2) is only as regards compensation as can be gathered from its latter part :- "Unless the law provides for compensation for the property taken possession of or acquired and either fixes the amount of the compensation, or specifies the principles on which, and the manner in which, the compensation is to be determined and given." 152. It is assumed, rightly, that the existence of a public purpose is part and parcel of the law and is inherent in it. The existence of a public purpose is not a provision or condition imposed by article 31(2) as a limitation on the exercise of the power of acquisition. The condition prescribed is only as regards compensation. Article 31(4) debars the challenge of the constitutionality of an Act on this ground but no other. Whether there is any public purpose at all, or whether the purpose stated is such a purpose is open, in my opinion, to judicial scrutiny or review. 153. When the legislature declares that there is a public purpose behind the legislation, we have of course to respect its words. The object of the Act in question is to extinguish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty of individuals cannot be appropriated by the State under the power of eminent domain for the mere purpose of adding to its revenues; taxation is the recognised mode to secure this end. If the latter was the real object it must be observed that to take one man's property compulsorily for giving it away to another in discharge of Government's obligations is not a legitimate and permissible exercise of the power of acquisition. 155. Sub-clause (1) of section 24 no doubt provides that 50 percent of the arrears of rents shall be added to the amount of compensation. This means one of two things (a) either the other 50% is taken without payment of any compensation, which is confiscation virtually or (b) 50 percent is taken as the consolidated value of the arrears of rent-a lump sum payment for the acquisition of choses in action or actionable claims. Taken either way, it is difficult to see wherein the public purpose consists. Whether moneys could be compulsorily acquired at all by a State is a moot question. Wills says in his Constitutional Law at page 816 :- "While, as stated above, any and all property is in general subject to the exercise of the power of eminent doma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. Even so, they stand on the same footing as money, of less value no doubt than if they were coin or currency notes. It seems that choses in action too cannot be so acquired; reference has been made already to Cooley's observations. 158. The two cases Long Island Water Supply Company v. City of Brooklyn [166 U.S. 685; 41 L. Ed. pp. 1, 165.] and City of Cincinnati v. Louisville & Nashville Railroad Company [223 U.S. 389; 56 L. Ed. 481.] do not support the contrary view. In the former case, a Water Supply Company was under a contract to supply water to the town of New Lots (which subsequently became merged in the city of Brooklyn) in consideration of the town paying for hydrants to be furnished and supplied as provided in the contract. The contract was for a term of 25 years. When the merger took place, the city of Brooklyn was given power to purchase or to condemn the property of the company within 2 years but it did neither. In 1892, the legislature passed another authorising the City of Brooklyn to condemn the property of the company, provided the necessary proceedings were commenced within one year after the passing of the Act. The procedure for the acquisition was presc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion are exempt from compulsory acquisition, it is not on the ground that they are movable property but on the ground that generally speaking there could be no public purpose in their acquisition. 161. The provisions in section 23, sub-clause (f) that 4 to 12 1/2 percent of the gross assets can be deducted from the amount as representing "cost of works of benefit to the raiyats". This is an obvious device to reduce the gross assets and bring it down to as low a level as possible. The Act does not say that this charge represents the expenditure on works of benefit or improvement which the zamindars and proprietors were under any legal obligation to carry out and which they failed to discharge. Nor are we told anything about the future distention of this deducted sum. It is an arbitrary figure which the legislature has said must be deducted from the gross assets. The deduction is a mere contrivance to reduce the compensation and it is a colourable or fraudulent exercise of legislative power to subtract a fanciful sum from the calculation of gross assets. 162. Stripped of their veils or vestments, the provisions in the Act about "arrears of rent" and the "cos ..... X X X X Extracts X X X X X X X X Extracts X X X X
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