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TMI Blog2011 (8) TMI 1275X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellants and then calculate compensation on the basis thereof in terms of Sections 18(1) (cc) and 19(1) (b) of KUZALR Act. We therefore find sufficient force in the argument of the counsel for the appellants that awarding no compensation attracts the vice of illegal deprivation of property even in the light of the provisions of the Act and therefore amenable to writ jurisdiction. That being so, the omission of the Section 39(1) (e) (ii) of the UPZALR Act 1950 as amended in 1978 is of no consequence since the UPZALR Act leaves no choice to the State other than to pay compensation for the private forests acquired by it in accordance with the mandate of the law. In view of the above, the present appeal is partly allowed while upholding the validity of the Act and particularly Sections 4A, 18(1) (cc) and 19 (1) (b) of the KUZALR Act, we direct the second respondent, i.e. Assistant Collector to determine and award compensation to the appellants by following a reasonable and intelligible criterion evolved on the aforesaid guidelines provided and in light of the aforesaid law enunciated by this Court hereinabove. The appellants will also be entitled to interest @ six percent per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were vested in the State Government. A notice issued by the Assistant Collector, Karan Prayag, District Chamoli, under Rule 2 of the Kumaun and Uttrakhand Zamindari Abolition and Land Reform Rules, 1965 (hereinafter referred to as "the KUZALR Rules") framed under the KUZALR Act was served upon the appellants intimating them that effective from 1st January, 1978, the rights, title and interest of hissedar in respect of the property in question had vested in the State Government free from all encumbrances and it invited objections and statement, if any, relating to the compensation qua the property in question. 3. Assailing the aforesaid notice issued by the Assistant Collector, the appellants preferred a writ petition under Article 32 of the Constitution before this Court. On 13th December 1978 while disposing the aforesaid writ petition, this Court passed the following order "We are of the opinion that it will be better if the Petitioner files a petition under Article 226 of the Constitution in the High Court. This Petition is therefore allowed to be withdrawn." 4. Subsequently, on 02nd April 1979 the appellants filed objections to the notice issued by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st and to reform the law relating to land tenure consequent upon such abolition and acquisition and to make provision for other matters connected therewith. 9. Subsequently, on 02nd August 1960 Kumaun and Uttarakhand Zamindari Abolition and Land Reforms Act, 1960 was enacted. The object of the KUZALR Act is to provide for the acquisition of the rights, title and interests of persons between the State and the tiller of the soil in certain areas of the Kumaun and Garhwal Divisions and for the introduction of land reforms therein. It is important to notice that the original KUZALR Act did not provide for vesting of private forests, and the definition of the word "land" in Section 3(10) thereof excluded forest. Section 3(10) of the KUZALR Act reads as follows:- "3(10). "land" means land held or occupied for purposes connected with agriculture, horticulture or animal husbandry which includes pisciculture and poultry farming but shall not include a forest;" 10. However, after the commencement of the Constitution (42nd Amendment) Act, 1976 which came into effect from 03rd January 1977 wherein inter-alia the subject "forests" was included in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is no specific whisper of defence raised under Articles 31A, 31B and 31C of the Constitution in the Counter-Affidavit/Reply filed by the State of Uttarakhand to the writ petition filed by the appellants in the High Court nor even before this Court but an attempt was made to argue the case on those grounds on behalf of the respondents. As there is no mention of any of the aforesaid Articles of the Constitution in the arguments or specific pleadings by the respondents in the writ petition, the question of deciding the applicability of those provisions of the Constitution and consequent protection of the Act, therefore, does not arise. 13.It was contended by Shri K.K. Venugopal, learned senior counsel appearing for the appellants that the original KUZALR Act, 1960 excluded private forests [Section 6(1) (4)], since the vesting of private forests in the State would not be by way of agrarian reform. It was further contended that the provision for agrarian reforms, therefore, should be a part of the Act, but, in the present case, the private forests so acquired under Section 4A of the KUZALR Act becomes the property of the State which is untenable. 14.It was further argued that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the instant case, it cannot be denied that KUZALR Act, 1960 is a statutory enactment, dealing with the agrarian reforms. Section 4 of the KUZALR Act provides that in respect of non-forest land, State Government may by notification take over the rights, title and interests of hissedar. The land so released is then dealt with by giving bhumidhari rights/asami rights to the tillers and thereby effectuating the purpose of agrarian reforms. 19. It is important to notice that Section 4A introduced in KUZALR Act by the UP Amendment Act 1978 does not require any notification but it specifies the date i.e. 01st January 1978 and provides that the right, title and interest of a hissedar in respect of forest land shall cease and vest by the application of the statute itself in the State Government. Section 8 of the KUZALR Act mandates that such "hissedar" becomes by operation of the statute a "bhumidhar". The aforesaid amendment was introduced by way of amendment so as to bring the said act in parity with the Principal Act, namely UP Zamindari Abolition and Land Reforms Act wherein the rights, title and interest of an intermediary (hissedar) was abolished and vested with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Ranjit Singh and Others Vs. State of Punjab and Others reported in [1965] 1 SCR 82. In the said decision, the Constitution Bench has stated thus:- "..........The scheme of rural development today envisages not only equitable distribution of land so that there is no undue imbalance in society resulting in a landless class on the one hand and a concentration of land in the hands of a few on the other, but envisages also the raising of economic standards and bettering rural health and social conditions. Provisions for the assignment of lands to village Panchayat for the use of the general community, or for hospitals, schools, manure pits, tanning grounds etc. ensure for the benefit of rural population must be considered to be an essential part of the redistribution of holdings and open lands to which no objection is apparently taken. If agrarian reforms are to succeed, mere distribution of land to the landless is not enough. There must be a proper planning of rural economy and conditions and a body like the village Panchayat is best designed to promote rural welfare than individual owners of small portions of lands...." 23. It is true that Section 4A of KUZALR Act, 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would emerge: firstly, the KUZALR Act is an enactment under Entry 18/List-II, i.e. "land" read with Entry 42/List-III of the Seventh Schedule of the Constitution. It was further submitted that at the highest, it can be said that KUZALR Act is relatable to Entry 18 of List II and 42 of List-III of the Seventh Schedule of the Constitution and if at all, only incidentally trenches in the legislative field of Entry 17A/List-III of the Seventh Schedule of the Constitution; and secondly, the Indian Forest Act, 1927 on the other hand, is in pith and substance a legislation under Entry 17-A/List-III i.e. "Forests" read with Entry 42/List-III of the Seventh Schedule of the Constitution. 28. It is trite law that the plea of repugnancy would be attracted only if both the legislations fall under the Concurrent List of the Seventh Schedule of the Constitution. Under Article 254 of the Constitution, a State law passed in respect of a subject matter comprised in List III i.e. the Concurrent List of the Seventh Schedule of the Constitution would be invalid if its provisions are repugnant to a law passed on the same subject by the Parliament and that too only in a situation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amine the nature and character of the KUZALR Act and examine and scrutinize the same in the context of the Central Act, namely, the Indian Forests Act, 1927. 31. As noted hereinbefore, Section 4A was introduced in KUZALR Act by an amendment in the year 1978 as a part of agrarian reforms and not by a separate enactment, as was done in the case of the UP Private Forests Act, 1948. Significantly, the agrarian reforms introduced by the UPZALR Act were not brought about by amending the UP Private Forests Act, 1948. It is to be noticed that the Indian Forest Act, 1927 and the UP Private Forests Act, 1948 that deal broadly with the same field of, inter-alia conservation, regulation, etc., of forests. It is to be further noticed that the UPZALR Act and after the 1978 amendment, KUZALR Act do not deal with conservation or regulation of forests but with agrarian reforms. In order to find out the subject matter of an enactment, even in the context of enactments relatable to List III of the Seventh Schedule of the Constitution, passed by different legislatures, the doctrine of pith and substance can be relied upon and would apply. 32. As discussed hereinbefore KUZALR Act is a law principally ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s dealt with like land, which is acquired under Section 4A of KUZALR Act. This emerges from a reading of Rule 41 of the KUZALR Rules itself. Further, the acquisition under the KUZALR Act is a case of "taking" upon payment of an amount, which is not intended to be the market price of the rights acquired. On the other hand, the power of acquisition under Section 37 of the Indian Forests Act 1927 i.e. the Central Act is an acquisition based on the principles of public purpose and compensation. 35. Thus, not only do the aforesaid Acts relate to different subject matters, but the acquisitions mentioned therein are conceptually different. The Central Act i.e. the Indian Forests Act 1927 mainly deals with the management, preservation and levy of royalty on transmit of forest produce. The Indian Forests Act 1927 also incidentally provides for and empowers the State Government to acquire any land which might be required to give effect to any of the purposes of the Act, in which case such land could be acquired by issuing a notification under Section 4 of the Indian Forests Act 1927. This however is to be understood as an incidental power vested on the State Government which could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove that it is unconstitutional. Prima facie, there does not appear to us to be any inconsistency between the State Act and the Central Acts. Before any repugnancy can arise, the following conditions must be satisfied: 1. That there is a clear and direct inconsistency between the Central Act and the State Act. 2. That such an inconsistency is absolutely irreconcilable. 3. That the inconsistency between the provisions of the two Acts is of such nature as to bring the two Acts into direct collision with each other and a situation is reached where it is impossible to obey the one without disobeying the other." 40. In other words, the two legislations must cover the same field. This has to be examined by a reference to the doctrine of pith and substance. In the instant case, the KUZALR Act deals with agrarian reforms and in the context deals with the private forests, this vests with the State and would therefore be managed by the Goan Sabha. The Indian Forest Act, 1927 which is the existing Central law, has nothing to do with agrarian reforms but deals with forest policy and management, and therefore is in a different field. Further, there is no direct conflict or collision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the State law may however be taken away if Parliament legislates under the proviso to clause (2). The proviso to Article 254(2) empowers the Union Parliament to repeal or amend a repugnant State law, either directly, or by itself enacting a law repugnant to the State law with respect to the `same matter'. Even though the subsequent law made by Parliament does not expressly repeal a State law, even then, the State law will become void as soon as the subsequent law of Parliament creating repugnancy is made. A State law would be repugnant to the Union law when there is direct conflict between the two laws. Such repugnancy may also arise where both laws operate in the same field and the two cannot possibly stand together: See Zaverbhai Amaidas v. State of Bombay; M. Karunanidhi v. Union of India and T. Barai v. Henry Ah Hoe." 43. Again a five-Judge Bench of this Court while discussing the said doctrine in Kartar Singh v. State of Punjab, (1994) 3 SCC 589 @ page 630 observed as under: "60. This doctrine of `pith and substance' is applied when the legislative competence of a legislature with regard to a particular enactment is challenged with reference to the entries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onflict. If the conflict becomes unavoidable, then Article 245 indicates the manner of resolution of such a conflict." Thereafter, this Court, in para 12, held that the question of repugnancy between the parliamentary legislation and the State legislation could arise in the following two ways: (SCC p. 220) "12. ... First, where the legislations, though enacted with respect to matters in their allotted sphere, overlap and conflict. Second, where the two legislations are with respect to matters in the Concurrent List and there is a conflict. In both the situations, parliamentary legislation will predominate, in the first, by virtue of the non obstante clause in Article 246(1), in the second, by reason of Article 254(1). Clause (2) of Article 254 deals with a situation where the State legislation having been reserved and having obtained President's assent, prevails in that State; this again is subject to the proviso that Parliament can again bring a legislation to override even such State legislation." 45. The aforesaid position makes it quite clear that even if both the legislations are relatable to List-III of the Seventh Schedule of the Constitution, the tes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Article 254 will arise when a law made by Parliament and a law made by the State Legislature occupies the same field with respect to one of the matters enumerated in the Concurrent List and there is a direct conflict in two laws. In other words, the question of repugnancy arises only in connection with subjects enumerated in the Concurrent List. In such situation the provisions enacted by Parliament and the State Legislature cannot unitedly stand and the State law will have to make way for the Union law. Once it is proved and established that the State law is repugnant to the Union law, the State law would become void but only to the extent of repugnancy. At the same time it is to be noted that mere possibility of repugnancy will not make a State law invalid, for repugnancy has to exist in fact and it must be shown clearly and sufficiently that the State law is repugnant to the Union law." 50. In a nutshell, whether on account of the exhaustive code doctrine or whether on account of irreconcilable conflict concept, the real test is that would there be a room or possibility for both the Acts to apply. Repugnancy would follow only if there is no such room or possibility. 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he pith and substance of the Punjab Act of 1953 is "Land" which falls under Entry 18 of List II (State List) of the Seventh Schedule to the Constitution. That Entry reads thus: "18. Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonisation." Our learned Brother has extracted a passage from a decision of a Constitution Bench of this Court in Ranjit Singh v. State of Punjab3 which took the view that since, the Punjab Act of 1953 is a measure of agrarian reform, it would receive the protection of Article 31-A. It may be recalled that the Act had received the assent of the President as required by the first proviso to that article. The power of the State Legislature to pass laws on matters enumerated in the State List is exclusive by reason of the provision contained in Article 246(3). In a nutshell, the position is that the Parliament has passed a law on a matter which falls under Entry 41 of the Concurrent List, while the State Legislature has passed a law which falls under Entry 18 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erms had to be sought and given for special reasons in respect of each enactment or provision or provisions. On the other hand, the observation clearly indicates that if the assent is sought and given in general terms it would be effective for all purposes. In other words, this Court observed that the assent sought for and given by the President in general terms could be effective for all purposes unless specific assent is sought and given in which event it would be operative only to that limited extent." 55. Further, in the case Kaiser-I-Hind (P) Ltd. v. National Textile Corporation (Maharashtra North), (2002) 8 SCC 182, this Court made it clear that it was not considering; whether the assent of the President was rightly or wrongly given?; and whether the assent given without considering the extent and the nature of the repugnancy should be taken as no assent at all? It observed as follows at page 203: "27. In this case, we have made it clear that we are not considering the question that the assent of the President was rightly or wrongly given. We are also not considering the question that -- whether "assent" given without considering the extent and the natu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t" is qua a particular law made by Parliament, then it is open to the Court to call for the proposals made by the State for the consideration of the President before obtaining assent. 3. Extending the duration of a temporary enactment does not amount to enactment of a new law. However such extension may require assent of the President in case of repugnancy." 57. If it is to be contended that Kaiser lays down the proposition that there can be no general Presidential assent, then such an interpretation would be clearly contrary to the observation of the Bench in Para 27 itself where it states that it is not examining the issue whether such an assent can be taken as an assent. 58. Such an interpretation would also open the judgment to a charge of being, with respect, per in curium as even though while noting the Jamalpur case - (1985) 3 SCC 661, it overlooks the extracts in the Jamalpur case dealing with the aspect of general assent: "The assent of the President under Article 254(2) of the Constitution is not a matter of idle formality. The President has, at least, to be apprised of the reason why his assent is sought if, there is any special reason for doing so ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the most important condition in order to invoke Article 300A of the Constitution. 62. With regard to claiming compensation, all modern constitutions which are invariably of democratic character provide for payment of compensation as the condition to exercise the right of expropriation. Commonwealth of Australia Act, a French Civil Code (Article 545), the 5th Amendment of the Constitution of U.S.A. and the Italian Constitution provided principles of "just terms", "just indemnity", "just compensation" as reimbursement for the property taken, have been provided for. 63. Under Indian Constitution, the field of legislation covering claim for compensation on deprivation of one's property can be traced to Entry 42 List III of the Seventh Schedule of the Constitution. The Constitution (7th Amendment) Act, 1956 deleted Entry 33 List I, Entry 36 List II and reworded Entry 42 List III relating to "acquisition and requisitioning of property". The right to property being no more a fundamental right, a legislation enacted under the authority of law as provided in Article 300A of the Constitution is not amenable to judicial review merely for alleged v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ely, the average annual income of last 20 to 40 years as provided in Section 29(1) (e) (i) and the estimate of annual yield on the date of vesting as provided in Section 39(1) (e) (ii). It was further argued that in respect of KUZALR Act, the same U.P. Legislature which had the example of Section 39(1)(e) deliberately dropped the second sub-clause and limited the compensation only to the average annual income of the last 20 years. From this it was argued that where there is no annual income, there would be no compensation. 66. It had been further argued that since the expression "average annual income" under Section 39(1) (e) (i) has already been judicially interpreted in the case of Ganga Devi v. State of U.P. (1972) 3 SCC 126 to mean "actual" annual income and not an estimate, therefore, if the forest land is not earning any income, then in the statutory formula set out in KUZALR Act, it would not be entitled to any compensation. 67. The Government is empowered to acquire land by exercising its various statutory powers. Acquisition of land and thereby deprivation of property is possible and permissible in accordance with the statutory framework enacted. Acqu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nification to the owner of the property expropriated. Payment of market value in lieu of acquired property is not a condition precedent or sine qua non for acquisition. It must be clearly understood that the acquisition and payment of amount are part of the same scheme and they cannot be separated. It is true that the adequacy of compensation cannot be questioned in a court of law, but at the same time the compensation cannot be illusory. 69. Further, it is to be clearly understood that the stand taken by the State that the right, title or interests of a hissedar could be acquired without payment of any compensation, as in the present case, is contrary to the express provisions of KUZALR Act itself. Section 12 of the KUZALR Act, 1960 states that every hissedar whose rights, title or interest are acquired under Section 4, shall be entitled to receive and be paid compensation. Further, Section 4A of the KUZALR Act makes it clear that the provisions of Chapter II (Acquisition and Modifications of existing rights in Land), including Section 12, shall apply mutatis mutandis to a forest land as they apply to a khaikhari land. Further, the intention of the legislature to pay compensation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of imagination. The property in question was definitely a productive asset. That being so, the criteria to determine possible income on the date of vesting would be to ascertain such compensation paid to similarly situated owners of neighboring forests on the date of vesting. Even otherwise, revenue authority can always make an estimation of possible income on the date of vesting if the property in question had been exploited by the appellants and then calculate compensation on the basis thereof in terms of Sections 18(1) (cc) and 19(1) (b) of KUZALR Act. We therefore find sufficient force in the argument of the counsel for the appellants that awarding no compensation attracts the vice of illegal deprivation of property even in the light of the provisions of the Act and therefore amenable to writ jurisdiction. 71. That being so, the omission of the Section 39(1) (e) (ii) of the UPZALR Act 1950 as amended in 1978 is of no consequence since the UPZALR Act leaves no choice to the State other than to pay compensation for the private forests acquired by it in accordance with the mandate of the law. 72. In view of the above, the present appeal is partly allowed while upholding the vali ..... X X X X Extracts X X X X X X X X Extracts X X X X
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