Kunnathat Thathunni Moopil Nair Vs.
The State of Kerala & ANR  INSC 285 (9 December 1960)
09/12/1960 SINHA, BHUVNESHWAR
P.(CJ) SINHA, BHUVNESHWAR P.(CJ) IMAM, SYED JAFFER SARKAR, A.K.
CITATION: 1961 AIR 552 1961 SCR (3) 77
CITATOR INFO :
R 1962 SC 123 (12) R 1962 SC 148 (1) R 1962
SC1006 (37,38,78,799) RF 1962 SC1371 (42) R 1962 SC1406 (37) RF 1962 SC1563
(22) R 1962 SC1621 (31,55,109,121) R 1962 SC1733 (3A) RF 1963 SC 591 (7) RF
1963 SC1667 (12) RF 1964 SC 370 (10) R 1964 SC 925 (45) R 1964 SC1013 (25) R
1966 SC 619 (7) E 1967 SC 691 (26,66) F 1967 SC1458 (23) R 1968 SC 658 (8) RF
1969 SC 378 (3) RF 1970 SC 169 (11) R 1970 SC1133
(5,7,8,18,23,24,25,26,29,30,31 D 1971 SC1321 (11,14) RF 1971 SC1801 (4) R 1972
SC 828 (27) D 1972 SC 845 (5,14,25,30) RF 1972 SC2563 (16) R 1974 SC 497 (21) R
1974 SC 543 (32) D 1974 SC 849 (19) RF 1975 SC 511 (17) RF 1975 SC1208 (28) R
1979 SC 321 (5) F 1980 SC 271 (43,49) E 1980 SC 286 (51,52) RF 1980 SC1789 (36)
D 1983 SC 762 (12) D 1986 SC1668 (11) D 1986 SC1930 (18) R 1990 SC 40 (8) RF
1992 SC 999 (12)
Land Tax-Constitutional validity of
enactment-Uniform basic tax on all lands-Classification--Tax on forest
areas-Legislative competence of State--Government's power to exempt Provisional
assessment-Validity-Travancore-Cochin Land Tax Act, 1955 (Travancore-Cochin 15
of 1955), as amended by Act 10 of 1957, ss. 4, 5-A, 7-Constitution of India,
Arts. 14, 19(1)(f), 31, 265, Schedule 7, List II, Entries 19, 49.
The Travancore-Cochin Land Tax Act, 1955 was
passed by the legislature of the State of Travancore-Cochin and was amended by
Act 10 of 057, by the State of Kerala. By s. 4 Of the Act all lands in the
State of whatever description and held under whatever tenure were to be charged
and levied a uniform rate of tax to be called the basic tax. Section 7 gave
power to the Government to exempt from the operation of the Act such 78 lands
or class of lands which the Government may, by notification, decide. Section 5A
which was introduced into the Act by the Amending Act enabled the Government to
make a provisional assessment of the basic tax in respect of the lands which
had not been surveyed by the Government and provided that the Government after
conducting the survey shall make a regular assessment and make the necessary
adjustments in respect of the amounts paid already. There was, however, no time
fixed for the conduct of the survey.
The petitioners who owned forest in the
State, challenged the constitutional validity of the Act on the grounds that
the provisions of the Act contravened Arts. 14, 19(i)(f) and 31(1) of the
Constitution of India inasmuch as (1) the Act did not have any regard to the
quality of the land or its productive capacity and the levy of a tax at a flat
rate of RS. 2 per acre imposed very unreasonable restrictions on the right to
hold property, (2) the. Act did not lay down any provision calling for a return
from the assessee for an enquiry or investigation of facts before the
provisional assessment was made or any right of appeal to any higher authority
and, in fact, did not make any provision for hearing the assessee at any stage,
(3) S. 7 gave arbitrary power to the Government to pick and choose in the
matter of grant of total or partial exemption from the provisions of the Act,
and (4) the tax proposed to be levied had absolutely no relation to the
production capacity of the land sought to be taxed or to the income they could
derive, and therefore the Act had been conceived with a view to confiscating
private property, there being no question of any compensation being paid to
those who may be expropriated as a result of the working of the Act.
The petitioners also challenged the
legislative competence of the legislature of the State to levy a tax on lands
on which forests stood. The case on behalf of the State of Kerala, inter alia,
was that the Act had its justification in Art. 265 Of the Constitution of
India, which was not subject to the provisions of Part III of the Constitution
and that, therefore, Arts. 14, 19 and 31 could not be pressed in aid of the
petitioners. , Held, (Sarkar, J., dissenting), that the Travancore-Cochin Land
Tax Act, 1955, infringed the provisions of Art. 14 Of the Constitution of
The Act obliged every person who held land to
pay the tax at the flat rate prescribed, whether or not he made any income out
of the property, or whether or not the property was capable of yielding any
income. Consequently, there was no attempt at classification in the provisions
of the Act and it was one of those cases where the lack of classification
created inequality. It was therefore hit by the prohibition to deny equality
before the law contained in Art. 14.
Section 5A of the Act which enabled the
Government to make a provisional assessment of the basic tax payable by the 79
holder of unsurveyed land imposed unreasonable restrictions on the rights to
hold property safeguarded by Art. 19(1)(f) of the Constitution, inasmuch as (1)
the Act did not impose an obligation on the Government to undertake survey
proceedings within any prescribed or ascertainable period, with the result that
a landholder might be subjected to repeated annual provisional assessments on
more or less conjectural basis and liable to pay the tax assessed, and (2) the
Act being silent as to the machinery and procedure to be followed in making the
assessment left it to the Executive, completely ignoring the legal position
that the assessment of a tax on a person or property was at least of a
Section 7 of the Act which vested the
Government with the power wholly or partially to exempt any land from the provisions
of the Act did not lay down any principle or policy for the guidance of the
exercise of discretion by the Government in respect of the selection contemplated
by the section, and was, therefore, discriminatory in effect and offended Art.
14. The section was not severable from the rest of the Act as both the charging
sections, S. 4 and S.
7, authorising the Government to grant
exemptions from the provisions of the Act were the main provisions of the
Shri Ram Krishna Dalmia v. Sri justice S. R.
Tendolkar,  S.C.R. 279, relied on.
The Act was also confiscatory in character
inasmuch as the provisions of the Act had the effect of eliminating the private
owners through the machinery of the Act, without proposing to acquire the
privately owned forests in the State after satisfying the conditions laid down
in Art. 31 of the Constitution.
Per Sinha, C.J., Imam, Subba Rao and Shah,
JJ.-Article 265 of the Constitution which provided that the State shall not
levy or collect a tax except by authority of law referred to a valid law, and
in order that the law might be valid, the tax proposed to be levied must be
within the legislative competence of the Legislature imposing a tax and
authorising the collection thereof and, secondly, the tax must be subject to
the conditions laid down in Art. 13, by which all laws inconsistent with or in
derogation of the fundamental rights in Part III shall be void.
Per Sarkar, J.-(1) The object of the Act was
to tax land in the State for raising revenues by providing for a low and
uniform rate of basic tax replacing all other dues payable to the Government
and the tax payers were classified according to the area of lands held by them.
Such a classification had an intelligible basis and had a rational relation to
the object of the Act. As tax was to be levied not because the land was
productive but because the land was held in the State, the classification did
not offend Art. 14 Of the Constitution, even though it might impose unequal
burden of the tax on the owners of land on account of owners of less productive
land being put on a larger burden.
80 (2)Section 5A did not offend Art. 14 and
in the absence of express provisions laying down the procedure according to
which the provisional assessment was to be made, the Act could not be held
invalid on the ground that it was against the rules of natural justice.
(3)Section 7, even if it were considered
invalid on the ground that it gave arbitrary power to the Government and
offended Art. 14, was severable from the rest of the Act and would not affect
the other provisions of the Act.
(4)The Act did not infringe the fundamental
rights in Art.
19(1)(f) as the rate of tax fixed by the Act
was a very low rate and the restrictions on those rights were reasonable.
(5) The Act was not in its nature ex-propriatary
and did not offend Art. 31. As there was no want of legislative competence, the
Act could not be assailed as a piece of colourable legislation on the ground
that though in form a taxing statute it, in effect, was intended to expropriate
lands by imposing a tax too heavy for the land to bear.
(6)The word "land" in Entry 49 of
List II, Sch. 7, of the Constitution, included "land on which a forest
stands" and, therefore, under that Entry taxation on land on which forests
stood was permissible and legal. The Act, therefore, could not be challenged as
being beyond the legislative competence of the State Legislature.
ORIGINAL JURISDICTION: Petitions Nos. 13 to
24, 42 and 46 to 54 of 1958.
Petitions under Article 32 of the
Constitution of India for enforcement of Fundamental Rights.
M.C. Setalvad, Attorney-General for India,
Syed Mahmud, J. B. Dadachanji, S. N. Andley, Rameshwar Nath and P. L. Vohra,
for the petitioners in petitions Nos. 13-18, and 4654 of 1958.
C.K. Daphtary, Solicitor-General of India,
Syed Mahmud, J. B. Dadachanji, S. N. Andley, Rameshwar Nath and P. L. Vohra,
for the petitioners in Petitions Nos. 19-24 of 1958.
S.N. Andley, Rameshwar Nath, J. B. Dadachanji
and P. L. Vohra, for the petitioner in petition No. 42 of 1958.
K.V. Suryanarayana Iyer, Advocate General of
Kerala and Sardar Bahadur, for the respondents.
1960. December, 9. The Judgment of Sinha, C.J.,
Jafer Imam, Subba Rao and Shah, JJ., was delivered 81 by Sinha, C. J. Sarkar,
J., delivered a separate Judgment.
SINHA, C. J.-In this batch of 22 petitions
under Art. 32 of the Constitution, the petitioners impugn the constitutionality
of the Travancore-Cochin Land Tax Act, XV of 1955, as amended by the
Travancore-Cochin Land Tax (Amendment) Act, X of 1957, which hereinafter will
be referred to as the Act. The Act came into force on June 21, 1955, and the
Amending Act on August 6, 1957. The petitioners are owners of forest areas in
certain parts of the State of Kerala, which, before the reorganisation of
States, formed part of the State of Madras. The respondents to the petitions
are: (1) the State of Kerala and (2) the District Collector, Palghat:
These petitions are based on allegations,
which are, more or less, similar, and the following allegations made in Writ
Petition No. 42 of 1958 may be taken as typical and an extreme case, which was
placed before us in detail to bring into bold relief the full significance and
effect of the legislation impugned in these cases. The petitioner in Petition
42 of 1958 is a citizen of India, who owns forests in certain parts of Palghat
Taluk in Palghat District, which was part of the State of Madras before the
reorganisation of States. These forests are now in the State of Kerala. Up to
the time that these forests were in the State of Madras, as it then was, the
Madras Preservation of Private Forests Act, Madras Act XXVII of 1949, governed
these forests. Even after these areas were transferred to the State of Kerala,
the said Madras Act, XXVII of 1949, continued to apply to these forests. Under
the said Madras Act the owners of forests, like the petitioner, could not sell,
mortgage, lease or otherwise alienate any portion of their forests without the
previous sanction of the District Collector; nor could they, without similar
permission, cut trees or do any act likely to denude the forest or diminish its
utility, as such. The District Collector, in exercise of the powers under the
Act, does not ordinarily permit the cutting of more than a small 82 number of
trees in the forest. Thus the petitioner has not the right fully to exploit the
forest wealth in his forest area and has to depend upon the previous permission
of the Collector. In exercise of the powers given to the Collector under the
Madras Act aforesaid, the petitioner's lessee was given permission to cut
certain trees in his forest, which brings to the petitioner by way of income
from. the forest, a sum of Rs. 3,100 per year. Under the Act, a tax called land
tax at a flat rate of Rs. 2 per acre has been imposed on the petitioner. In
pursuance of the provisions of the Act, as amended as aforesaid, the District
Collector of Palghat, purporting to act under the provisions of s. 5A of the
Act, issued a notice to the petitioner provisionally assessing the petitioner's
forest under the said Act to a sum of fifty thousand rupees per annum and
informing the petitioner that, if no representation was made within thirty days,
the said provisional assessment would be confirmed and a demand notice would be
issued. As there has been no survey of the area of forest land in the
petitioner's possession, the District Collector has conjectured the said area
to be twenty-five thousand acres. The Petitioner had made an application to the
District Collector under the Madras Preservation of Private Forests Act for
felling trees in an area of one thousand acres, but the Collector was pleased
to grant permission to out trees from 450 acres only in the course of five
years at the rate of 90 acres a year.
The petitioner has leased out that right to
another person, who made the highest bid of Rs. 3,100 per year, as the
landlord's fee for the right to cut and remove the trees, and other minor produce.
Besides the demand aforesaid, the revenue authorities have levied about four
thousand rupees as tax on the surveyed portions of the forest. The petitioner's
forest has large areas of and rocks, rivulets and gorges. The petitioner, in
those circumstances, questions the constitutional validity of the Act, the
provisions of which will be examined hereinafter.
These petitions have been opposed on behalf
of the first respondent and the allegations and submissions 83 made in the
petitions are sought to be controverted by a counter affidavit sworn to by an
Assistant Secretary of the Kerala Government in the Revenue Department. It is
in similar terms, as a matter of fact printed in most of these cases. It is
contended therein on behalf of the respondent that the petitions are not
maintainable in as much as no fundamental rights of the petitioners have been
that the allegations about the income, from
the forest lands are not admitted; and by way of submission, it is added, they
are irrelevant for the purposes of these petitions. It is stated that the Act
was passed with a view to unifying the system of land tax in the whole of the
State of Kerala.
It is submitted that the validity of the Act
has to be determined in the light of Art. 265 of the Constitution and that
Arts. 19 and 31 were wholly out of the way. It is denied that the tax imposed
was harsh or arbitrary, or has the effect of violating the petitioner's right
of holding property; and it was asserted that the allegations in respect of income
from the forests are entirely irrelevant, as the tax was not a tax on income,
but was an "impost on land". It is equally irrelevant whether the
land is productive or not. It is also contended that, in view of the provisions
of Art. 31(5)(b)(i) of the Constitution, Art.
31(2) could not be relied upon by the
petitioners. The allegation of the petitioners that the Act is a device to
confiscate private forests is denied. It is admitted that, except in certain
cases, the entire area is un-surveyed and that steps are being taken for
surveying those areas. It is also stated that the areas shown in the notices
served on the petitioners are based on information available to the Collector
of the District; and lastly, it is stated that only notice has been issued calling
upon the petitioners to make their representations, if any, to the proposed
provisional assessments. The assessments have not yet been made, and,
therefore, there is no question of demand of tax being enforced by coercive
processes. Finally, it is suggested that the Act has been enacted for the
legitimate revenue purposes of the State.
Before entering upon a discussion of the
points in 84 controversy, it is convenient at this stage to indicate briefly
the relevant provisions of the Act which is impugned by the petitioners as
ultra vires the State Legislature.
The preamble of the Act is in these terms:"Whereas
it is deemed necessary to provide for the levy of a low and uniform rate of
basic tax on all lands in the State of Travancore Cochin." Basic tax has
been defined as "the tax imposed under the provisions of this Act".
Section 3 lays down that the arrangement made under the Act for the levy of the
basic tax shall be deemed inter alia to be a general revenue settlement of the
State, notwithstanding anything in any statute, grant, deed or other
transaction subject to certain provisos not material for our present purposes.
The charging section is s. 4, which is in these terms:"Subject to the
provisions of this Act, there shall be charged and levied in respect of all
lands in the State, of whatever description and held under whatever tenure, a
uniform rate of tax to be called the basic tax." Section 5 lays down the
rate of the tax which, by the Amendment, has been raised to Rs. 2 per acre (two
pies per cent. of land per annum) and the basic tax charged and levied at that
rate shall be the tax payable to the Government in lieu of any existing tax in
respect of land.
Section 6 lays down that any stipulation in
any contract or agreement or lease or other transaction to pay land revenue
assessment of any land shall be construed as stipulation for the payment of the
amount. of basic tax, as charged and levied under the Act. Section 7 is in
these terms:"This Act is not applicable to lands held or leased by the
Government or any land or class of lands which the Government may, by
notification in the Gazette, either wholly or partially exempt from the
provisions of this Act." Sections 8 and 9 provide for the continuance of
the liability to pay certain dues in respect of existing tenures in addition to
the basic tax in respect of lands covered by those tenures. Section 10
abolishes the 85 irrigation assessment charged on certain tank beds and other
water reservoirs named and described therein. Section 11 preserves the right of
the Government to levy certain irrigation and water cesses and lays down that
the Act shall not affect the power of the Government to levy any rate or alter
any existing rate of irrigation or water cess on any land, as they deem fit. Cesses,
other than those mentioned in s. 11, are also abolished by s. 12. Section 13
authorises the Government to appoint such officers as they deem necessary for
the purpose of the Act. Section 14 lays down the bar of suits against the
Government in respect of anything done or any order passed under the Act.
Section 15 saves the right of the Government which accrued to it before the Act
came into force as also the conditions of any agreement. grant or deed relating
to any land, except to the extent indicated in the Act. Section 16 vests the
Government with the power to make rules for carrying into effect the provisions
of the Act, with particular reference to the power to make rules for the
apportionment of the basic tax charged on certain kinds of holdings, for
defining the powers and duties of the officers appointed under the Act and for
determining the kist installments and the due date for the payment thereof.
These in short are the provisions of the Act. The Act, as indicated above, was
amended by Act X of 1957 which substituted the words "State of
Kerala" for the words "State of Travancore-Cochin" and made
certain other consequential changes. The Amending Act introduced section 5A,
which has been very much assailed in the course of the argument before us and
it is, therefore, necessary to set it out in full. It is in these terms:"S.
5A. Provisional assessment of basic tax in the case of un-surveyed land8.-(1)
It shall be competent for the Government to make a provisional assessment of
the basic tax payable by a person in respect of the lands held by him and which
have not been surveyed by the Government, and upon such assessment such person
shall be liable to pay the amount covered in the provisional assessment.
86 (2)The Government after conducting a
survey of the lands referred to in sub-section (1) shall make a regular
assessment of the basic tax payable in respect of such lands. After a regular
assessment has been made, any amount paid towards the provisional assessment
made under sub-section (1) shall be deemed to have been paid towards the
regular assessment and when the amount paid towards the provisional assessment
exceeds, the amount payable under the regular assessment, the excess shall be
refunded to the person assessed." By s. 9, s. 3 of the Madras Revenue
Recovery Act, 1864, has been substituted in these terms:
"3. Landholder when and to whom to pay
kist. Every landholder shall pay to the Collector or other officer empowered by
'him in this behalf the land tax due from him on or before the day fixed for
payment under the rules framed under s. 16 of the Land Tax Act, 1955."
From a review of the provisions of the Act, as amended as aforesaid, it will be
clear that the provisions of the Act lay down in barest outline the policy to
impose a uniform and, what is asserted to be, a low rate of land tax on all
lands in the State of Kerala. Unlike other taxing statutes, it does not make
any provision for issue of notice to the assessee, nor is there any provision
for submission of a return by the assessee. By s. 5A, it authorises the
Government to make a "provisional assessment" in respect of land,
which has not been surveyed, and such provisional assessment is made payable by
the person made liable under the Act. It does not make any provision for any
appeals in cases where the assessee may feel dissatisfied with the assessment.
The Act does contemplate the making of "a regular assessment of the basic
tax". But it does not indicate as to when the regular assessment would be
made, except indicating that it can be made only after a survey has been made
in respect of the land assessed. The Act could not have been cast in more
general terms and the proceedings under the Act could not have been more
It has thus the merit of brevity as also of
simplicity, derived 87 from the fact that a tax is levied at a flat rate, irrespective
of the quality of the land and consequently of its productive capacity. Under
the Act, the charge has to be levied, whether or not any income has been
derived from the land. The Legislature was so much in earnest about levying and
realising the tax that it could not even wait for a regular survey of the lands
to be assessed with a view to determining the extent and character of the land.
Such are the provisions and the effect of the
Act, which has been assailed on a number of grounds on behalf of the
petitioners. It is contended, in the first instance, that inequality is writ
large in the provisions of the Act, which is clearly discriminatory in
character and effect and thus infringes Art. 14 of the Constitution. As the Act
does not have any regard to the quality of the land or its productive capacity,
and a tax at a flat rate of Rs. 2 per acre is proposed to be levied under the
Act, it is further contended, it imposes very unreasonable restrictions on the
right to hold property and is thus an invasion on the rights guaranteed to the
petitioners under Art. 19(1)(f) of the Constitution. The Act does not lay down
any provision calling for a return from the assessee, for any enquiry or
investigation of facts before the provisional assessment is made or for any
right of appeal to any higher authority from the order of provisional
assessment; in fact, there is no provision for hearing the assessee at any
stage. The Act is of an arbitrary character and is thus wholly repugnant to the
guaranteed rights of the petitioners. Section 7 quoted above gives uncanalised,
unlimited and arbitrary power to the Government to pick and choose in the
matter of grant of total or partial exemption from the provisions of the Act.
It also suffers from the vice of
discrimination. It has also been vehemently argued that the Act, though it
purports to be a tax on land, is really a law relating to forests in possession
of the petitioners and would not come within the purview of entry 18 read by
itself or in conjunction with entry 45 of List II, but is law relating to
forests under entry 19. If we tear the veil in which the real 88 purpose and
effect of the Act has been shrouded, 'it will I appear that the true character
and effect of the Act is not to levy a tax on land, but to expropriate the
private owners of the forests without payment of any compensation whatsoever.
Lastly, it has been urged that the whole Act has been conceived with a view to
confiscating private property, there being no question of any compensation
being paid to those who may be expropriated as a result of the, working of the
Act. This last argument is based on the assertion that the tax proposed to be
levied on private property in the State of Kerala has absolutely no relation to
the paying capacity of the persons sought to be taxed, with reference to the
income they could derive, or actually did derive from the property.
On behalf of the State of Kerala, the learned
Advocate General has argued that, though in most of the cases, that is to say,
except in seven petitions (Petitions 21, 22, 47, 49, 50, 51 and 54) the lands
have not been surveyed, the areas mentioned in the notices proposing
provisional assessment have been ascertained through the local agencies of the
Government. It was further contended that the State had only declared the
liability to the payment of the tax at a flat rate of Rs. 2 per acre in respect
of land, irrespective of the income to be derived there from. Hence there was no
necessity for making provision for a detailed enquiry or investigation. The
rate of the tax being known, and the area of the land to be taxed having been
locally ascertained, even though without any regular survey, what remained was
merely quantifying the tax, which was of a purely administrative character. The
local agencies estimated the land in possession of particular persons.
Those persons were called upon to pay
provisionally at the rate fixed by the statute. The State has, by executive
action, appointed authorities who are expected to act in accordance with the
principle of natural justice. There was, therefore, no need for laying down any
elaborate procedure as in other instances of taxing statutes. There is a
presumption that the authority appointed by the Government would act bona fide
and in a 89 proper manner. If there was any case of unfair dealings, the matter
could be brought to the Court. It was greatly emphasised that as a flat rate of
taxation had been envisaged by the Act and as ultimately the tax at that rate
would be realised from land found to be in possession of particular persons
after a regular survey, the regular survey to be ultimately made would
automatically determine the amount of tax to be paid and the adjustment of the
taxes already paid could be made on that basis. On the legal aspect of the
controversy raised on behalf of the petitioners, it was argued that the Act has
its justification in Art. 265 of the Constitution, which was not subject to the
provisions of Part III of the Constitution and that, therefore, Arts. 14, 19,
31 could not be pressed in aid of the petitioners. It was also contended that
even if the Act is, in effect, confiscatory, it cannot be questioned, being a
taxing statute. Finally, it was urged that the question of the amount of income
derived by the petitioners from the property sought to be taxed is wholly
irrelevant, because the Act was not a tax on income but it was a tax on the
The most important question that arises for
consideration in these cases, in view of the stand taken by the State of
Kerala, is whether Art. 265 of the Constitution is a complete answer to the
attack against the constitutionality of the Act. It is, therefore, necessary to
consider the scope and effect of that Article. Article 265 imposes a limitation
on the taxing power of the State in so far as it provides that the State shall
not levy or collect a tax, except by authority of law, that is to say, a tax
cannot be levied or collected by a mere executive fiat. It has to be done by
authority of law, which must mean valid law. In order that the law may be
valid, the tax proposed to be levied must be within the legislative competence
of the Legislature imposing a tax and authorising the collection thereof and,
secondly, the tax must be subject to the conditions laid down in Art. 13 of the
Constitution. One of such conditions envisaged by Art. 13(2) is that the
Legislature shall not make any law which 90 takes away or abridges the equality
clause in Art. 14, which enjoins the State not to deny to any person equality
before the law or the equal protection of the laws of the country.
It cannot be disputed that if the Act
infringes the provisions of Art. 14 of the Constitution, it must be struck down
as unconstitutional. For the purpose of these cases, we shall assume that the
State Legislature had the necessary competence to enact the law, though the
petitioners have seriously challenged such a competence. The guarantee of equal
protection of the laws must extend even to taxing statutes. It has not been
contended otherwise. It does not mean that every person should be taxed
equally. But it does mean that if property of the same character has to be
taxed, the taxation must be by the same standard, so that the burden of taxation
may fall equally on all persons holding that kind and extent of property. If
the taxation, generally speaking, imposes a similar burden on every one with
reference to that particular kind and extent of property, on the same basis of
taxation, the law shall not be, open to attack on the ground of inequality,
even though the result of the taxation may be that the total burden on
different persons may be unequal. Hence, if the Legislature has classified
persons or properties into different categories, which are subjected to
different rates of taxation with reference to income or property, such a
classification would not be open to the attack of inequality on the ground that
the total burden resulting from such a classification is unequal. Similarly,
different kinds of property may be subjected to different rates of taxation,
but so long as there is a rational basis for the classification, Art. 14 will
not be in the way of such a classification resulting in unequal burdens on
different classes of properties. But if the same class of property similarly
situated is subjected to an incidence of taxation, which results in inequality,
the law may be struck down as creating an inequality amongst holders of the
same kind of property. It must, therefore, be held that a taxing statute is not
wholly immune from attack on the ground that it infringes the equality clause
ill 91 Art. 14, though the Courts are not concerned with the policy underlying
a taxing statute or whether a particular tax could not have been imposed in a
different way or in a way that the Court might think more just and equitable.
The Act has, therefore, to be examined with reference to the attack based on
Art. 14 of the Constitution.
It is common ground that the tax, assuming
that the Act is really a taxing statute and not a confiscatory measure, as
contended on behalf of the petitioners, has no reference to income, either
actual or potential, from the property sought to be taxed. Hence, it may be
rightly remarked that the Act obliges every person who holds land to pay the
tax at the flat rate prescribed, whether or not he makes any income out of the
property, or whether or not the property is capable of yielding any income. The
Act, in terms, claims to be "a general revenue settlement of the State"
Ordinarily, a tax on land or land revenue is
assessed on the actual or the potential productivity of the land sought to be
taxed. In other words, the tax has reference to the income actually made, or
which could have been made, with due diligence, and, therefore, is levied with
due regard to the incidence of the taxation. Under the Act in question we shall
take a hypothetical case of a number of persons owning and possessing the same
area of land. One makes nothing out of the land, because it is arid desert. The
second one does not make any income, but could raise some crop after a
disproportionately large investment of labour and capital.
A third one, in due course of husbandry, is
making the land yield just enough to pay for the incidental expenses and labour
charges besides land tax or revenue. The fourth is making large profits,
because the land is very fertile and capable of yielding good crops. Under the
Act, it is manifest that the fourth category, in our illustration, would easily
be able to bear the burden of the tax. The third one may be able to bear the
tax. The first and the second one will have to pay from their own pockets, if
they could afford the tax. If they cannot afford the tax, the property is 92
liable to be sold, in due process of law, for realisation of the public demand.
It is clear, therefore, that inequality is writ large on the Act and is.
inherent in the very provisions of the taxing section. It is also clear that
there is no attempt at classification in the provisions of the Act. Hence, no
more need be said as to what could have been the basis for a valid
classification. It is one of those cases where the lack of classification
creates inequality. It is,, therefore, clearly hit by the prohibition to deny
equality before the law contained in Art. 14 of the Constitution. Furthermore,
sec. 7 of the Act, quoted above, particularly the latter part, which vests the
Government with the power wholly or partially to exempt any land from the
provisions of the Act, is clearly discriminatory in its effect and, therefore,
14 of the Constitution. The Act does not lay
down any principle or policy for the guidance of the exercise of discretion by
the Government in respect of the selection contemplated by a. 7. This Court has
examined the cases decided by it with reference to the provisions of Art. 14 of
the Constitution, in the case of Shri Ram Krishna Dalmia v. Shri Justice S. B.
Tendolkar and others (1). S. R. Das, C. J., speaking for the Court has deduced
a number of propositions from those decisions. The present case is within the
mischief of the third proposition laid down at pages 299 and 300 of the Report,
the relevant portion of which is in these terms:"A statute may not make
any classification of the persons or things for the purpose of applying its
provisions but may leave it to the discretion of the Government to select and
classify persons or things to whom its provisions are to apply. In determining
the question of the validity or otherwise of such a statute the Court will not
strike down the law out of hand only because no classification appears on its
face or because a discretion is given to the Government to make the selection
or classification but will go on to examine and ascertain if the statute has
laid down any principle or policy for the guidance of the exercise of
discretion by the Government in the matter of the selection or classification.
93 After such scrutiny the Court will strike
down the statute if it does not lay down any principle or policy for guiding
the exercise of discretion by the Government in the matter of selection or
classification, on the ground that the statute provides for the delegation of
arbitrary and uncontrolled power to the Government so as to enable it to
discriminate between persons or things similarly situate and that, therefore,
the discrimination is inherent in the statute itself" (p. 299 of the
The observations quoted above from the
unanimous judgment of this Court apply with full force to the provisions of the
Act. It has, therefore, to be struck down as unconstitutional. There is no
question of severability arising in this case, because both the charging
4 and s. 7, authorising the Government to
grant exemptions from the provisions of the Act, are the main provisions of the
Statute, which has to be declared unconstitutional.
The provisions of the Act are
unconstitutional viewed from the angle of the provisions of Art. 19(1)(f) of
the Constitution, also. Apart from the provisions of ss. 4 and 7 discussed
above, with reference to the test under Art. 14 of the Constitution, we find
that s. 5(A) is also equally objectionable because it imposes unreasonable
restrictions on the rights to hold property, safeguarded by Art. 19(1)(f) of
the Constitution. Section 5(A) declares that the Government is competent to
make a provisional assessment of the basic tax payable by the holder of
Ordinarily, a taxing statute lays down a
regular machinery for making assessment of the tax proposed to be imposed by
the statute. It lays down detailed procedure as to notice to the proposed
assessee to make a return in respect of property proposed to be taxed,
prescribes the authority and the procedure for hearing any objections to the
liability for taxation or as to the extent of the tax proposed to be levied,
and finally, as to the right to challenge the regularity of assessment made, by
recourse to proceedings in a higher Civil Court. The Act merely declares the
competence of the Government to make 94 a provisional assessment, and by virtue
of s. 3 of the Madras Revenue Recovery Act, 1864, the land-holders may be
liable to pay the tax. The Act being silent as to the machinery and procedure
to be followed in making the assessment leaves it to the Executive to evolve the
requisite machinery and procedure. The whole thing, from beginning to end, is
treated as of a purely administrative character, completely ignoring the legal
position that the assessment of a tax on person or property is at least of a
quasi-judicial character. Again, the Act does not impose an obligation on the
Government to undertake survey proceedings within any prescribed or
ascertainable period, with the result that a land-holder may be subjected to
repeated annual provisional assessments on more or less conjectural basis and
liable to pay the tax thus assessed. Though the Act was passed about five years
ago, we were informed at the Bar that survey proceedings had not even
commenced. The Act thus proposes to impose a liability on land-holders to pay a
tax which is not to be levied on a judicial basis, because (1) the procedure to
be adopted does not require a notice to be given to the proposed assessee; (2)
there is no procedure for rectification of mistakes committed by the Assessing
Authority; (3) there is no procedure prescribed for obtaining the opinion of a
superior Civil Court on questions of law, as is generally found in all taxing
statutes, and (4) no duty is cast upon the Assessing Authority to act
judicially in the matter of assessment proceedings. Nor is there any right of
appeal provided to such assessees as may feel aggrieved by the order of
That the provisions aforesaid of the impugned
Act are in their effect confiscatory is clear on their face. Taking the extreme
case, the facts of which we have stated in the early part of this judgment, it
can be illustrated that the provisions of the Act, without proposing to acquire
the privately owned forests in the State of Kerala after satisfying the
conditions laid down in Art. 31 of the Constitution, have the effect of
eliminating the private owners through the machinery of the Act. The petitioner
in petition 42 95 of 1958 has been assumed to own 25 thousand acres of forest
land. The liability under the Act would thus amount to Rs. 50,000 a year, as
already demanded from the petitioner on the basis of the provisional assessment
under the provisions of s. 5(A). The petitioner is making an income of Rs.
3,100 per year out of the forests. Besides, the liability of Rs. 50,000 as
aforesaid, the petitioner has to pay a levy of Rs. 4,000 on the surveyed
portions of the said forest. Hence, his liability for taxation in respect of
his forest land amounts to Rs. 54,000 whereas his annual income for the time
being is only Rs. 3,100 without making any deductions for expenses of
management. Unless the petitioner is very enamoured of the property and of the
right to hold it may be assumed that he will not be in a position to pay the
deficit of about Rs. 51,000 every year in respect of the forests in his
possession. The legal consequences of his making a default in the payment of
the aforesaid sum of money will be that the money will be realised by the
coercive processes of law. One can, easily imagine that the property may be
sold at auction and may not fetch even the amount for the realisation of which
it may be proposed to be sold at public auction. In the absence of a bidder
forthcoming to bid for the offset amount, the State ordinarily becomes the
auction purchaser for the realisation of the outstanding taxes. It is clear,
therefore, that apart from being discriminatory and imposing unreasonable
restrictions on holding property, the Act is clearly confiscatory in character
and effect. It is not even necessary to tear the veil, as was suggested in the
course of the argument, to arrive at the conclusion that the Act has that
unconstitutional effect. For these reasons, as also for the reasons for which
the provisions of ss. 4 and 7 have been declared to be unconstitutional, in
view of the provisions of Art. 14 of the Constitution, all these operative
sections of the Act, namely 4, 5A and 7, must be held to offend Art. 19(1)(f)
of the Constitution also.
The petitions are accordingly allowed with
costs against the contesting respondent, the State of Kerala.
96 SARKAR,J. These petitions were filed under
Art.32 of the Constitution, challenging the validity of the Travancore Cochin
Land Tax Act, 1955, as amended by Act X of 1957. The principal Act was passed
by the legislature of the State of Travancore-Cochin and the Amending Act, by
the legislature of the State of Kerala, in which the State of Travancore Cochin
had been merged. The petitioners are owners of lands in the State of Kerala.
The Act as amended and hereafter referred to as the Act, levied a certain basic
tax on all lands in the State of Kerala. The petitioners say that the levy is
illegal and violates their fundamental rights.
It appears from the preamble that the Act was
passed as it was deemed necessary to provide for the levy of a low and uniform
rate of basic tax on all lands in the State. The Act provides that the
arrangement made by it for the levy of the basic tax is to be deemed to be a
general revenue settlement of the State. Section 4 of the Act is the charging
section and it lays down that there shall be charged and levied in respect of
all lands in the State, of whatever description and held under whatever tenure,
a uniform rate of tax to be called the basic tax. Section 5 fixes the rate of
the tax at 2 n.P. per cent which works out at Rs. 2 per acre per annum. This
section also provides that the basic tax shall be the tax payable to the
Government in lieu of any other existing tax in respect of land. Section 12
abolishes all cesses on land except irrigation cess.
The first ground on which the validity of the
Act is challenged is that it offends the provision as to the equal protection
of the laws contained in Art. 14 of the Constitution. The Act applies to all
lands in the State and it imposes an uniform rate of tax, namely, Rs. 2 per
It is said that all lands in the State have
not the same productive quality; that some are waste lands and others, lands of
varying degrees of fertility. The contention is that the tax weighs more
heavily on owners of waste lands than on owners of fertile lands. It is said
that it is bound to happen that some owners make no income out of their lands
97 or make a small income and they would have to pay the tax out of their
pocket while the owners of better classes of lands yielding larger income would
be able to pay the tax out of the income from the lands. It is contended that
the Act therefore discriminates between several classes of owners of lands in
the State and is void as infringing the equality clause in the Constitution. It
may be conceded that all lands in the State are not of the same degree of
fertility. I am however unable to see that because of that, the Act can be said
to discriminate between the owners of them.
What is really said appears to be that the
Act makes a classification of the owners of lands according to areas.
Assume that the Act does so. The question
then is, is such a classification illegal? The equal protection clause in the
Constitution does not mean that there shall be no classification for the
purpose of any law. It has been said by this Court in Budhan Choudhury v. The
State of Bihar(1):
"It is now well established that while
article 14 forbids class legislation, it does not forbid reasonable
classification for the purposes of legislation. In order, however, to pass the
test of permissible classification two conditions must be fulfilled, namely,
(i) that the classification must be founded on an intelligible differential
which distinguishes persons or things that are grouped together from others
left out of the group and (ii) that differential must have a rational relation
to the object. Bought to be achieved by the statute in question".
On the argument of the petitioners, the Act
makes a classification between owners of lands using as the differentia, the
area of the land held by them. The question then, is, is that differentia
intelligible and has that differentia a rational relation to the object of the
Act? Now it seems to me that both the tests are satisfied in the present case.
The tax payers are classified according to the area of lands held by them. That
is quite an intelligible basis on which to make a classification;
holders of varying areas of land can (1)
 1 S.C.R. 1045 1049.
13 98 quite understandably be placed in
Next, has such a basis of classification, a
rational relation to the object of the Act? The Act is a taxing statute. It is
intended to collect revenue for the governmental business of the State. It says
that one of its objects is to provide a low and uniform rate of basic tax.
Another object mentioned is to replace all
other dues payable to the Government in respect of the ownership of the land by
a uniform basic tax. Why is it to be said that the use of the area of land held
as the basis of classification has no rational relation to these objects. I
find no reason. The object is to tax land held in the State for raising
revenues. It is the holding of the land in the State that makes the owner
liable to pay tax. It would follow that the quantum of the tax can be reasonably
linked with the quantum of the holding.
Why is it said that the classification on the
basis of area is bad? It is only because it imposes unequal burden of the tax
on the owners of land; because owners of less productive land would have a
larger burden put on them. Now if this argument is right, then tax on land can
be imposed only according to its productivity. I have not been shown any
authority which goes to this length. I am further unable to see how
productivity as the basis of classification could be said to have a more
rational relation to the object of a statute collecting revenue by taxing land
held in the State.
The tax is not levied because the land is
productive but because the land is held in the State. Again if the tax which
could be imposed on land had to be correlated to its productivity, then the
State would have no power to tax unproductive land and the provision in the
Constitution that it would have power to tax land would, to that extent, be
futile. It seems to me that a contention leading to such a result cannot be
Reliance was placed for the petitioners on
Cumberland Coal Company v. Board of Revision on Tax Assessments (1) in support
of the contention that a tax on land not based on its productivity, violates
(1) 76 L.Ed. 146.
99 I am unable to hold that this case
supports the contention.
What had happened there was that a certain
statute had imposed a tax ad valorem on all coal situated in a certain area and
in assessing the tax, the coal of the Cumberland Coal Company had been assessed
by the authorities concerned at its full value while the coal of the rest of
the class liable to the tax had been assessed at a lower value.
Thereupon it was held that "the
intentional systematic undervaluation by State Officials-of taxable property of
the same class belonging to other owners contravenes the constitutional right
of one taxed on the full value of his property." On this view of the
matter the Supreme Court of America directed readjustment of the assessments.
The statute with which this case was concerned had levied the tax ad valorem
which, it may be, is the same thing as a tax correlated to productivity. The
case had therefore nothing to do with the question that a tax on coal otherwise
than ad valorem would be unconstitutional. In fact this case did not declare
any statute invalid.
Then it seems to me that if the contention of
the petitioners is right, and land could be taxed only on its productivity, for
the same reason, taxes on all other things would have to be correlated to the
income to be derived from them. The result would be far reaching. I am not
prepared to accept a contention producing such a result and no authority has
been cited to lead me to accept it.
It may be that as lands are not of equal
productivity, some tax payers may be able to pay the tax out of the income of
the land taxed while others may have to find the money from another source. To
this extent the Act may be more hard on some than on others. But I am unable to
see that for that reason it is unconstitutional. All class legislation puts
some in a more disadvantageous position than others. If the classification made
by the law is good, as I think is the case with the present Act, the resultant
hardship alone cannot make it bad. It was said in Magonn v. Illinois Trust and
Savings Bank(1), "It is hardly (1) 42 L.Ed. 1037, 1043.
100 necessary to say that hardship, impolicy,
or injustice of state laws is not necessarily an objection to their
constitutional validity." It is then said that sub-sec. (1) of s. 5A,
which was introduced into the Act by the Amending Act, offends Art.
14. The impugned provision is in these terms:
S.5A. (1) It shall be competent for the
Government to make a provisional assessment of the basic tax payable by a
person in respect of the lands held by him and which have not been surveyed by
the Government, and upon such assessment such person shall be liable to pay the
amount covered in the provisional assessment.
This section was enacted as at the date of
the Act, all lands had not been surveyed and so the areas of all holdings were
not known. In the absence of such knowledge the tax which was payable on the
basis of the areas of the holdings could not be assessed on un-surveyed lands,
so the section provides that pending the survey, the Government will have power
to make a provisional assessment on un-surveyed lands.
This provision was necessary as the survey
was bound to take time.
The contention is that a. 5A(1) gives
arbitrary power to the Government to make a provisional assessment on any
person it chooses, leaving out others from the provisional assessment.
I am unable to read the sub-section in that
way. It may be that it leaves it to the Government to make a provisional
assessment if it chooses. This does not result in any illegal classification.
The surveyed lands and un-surveyed lands are distinct classes of properties and
may be differently treated. Again, all un-surveyed lands would on survey have
to pay tax from the beginning. It would follow that the holders of both classes
of lands are eventually subjected to the same burden. As to the contention that
under this section the Government has the right to levy the provisional
assessment at its choice on some and not on all holders of un-surveyed lands, I
am unable to agree that this is a proper reading of the section. In my view,
the 101 expression "a person" in the section does not lead to that
conclusion. That expression should be read as "all persons" and it is
easily capable of being so read. The section says, "It shall' be competent
for the' Government to make a provisional assessment of the basic tax payable
by a person". Now the basic tax is payable by all persons holding land. So
the provisional assessment, if made, has to be on all persons holding lands
whose lands have not been surveyed. The Government cannot, therefore, pick and
choose. A statute is intended to be legal and it has therefore to be read in a
manner which makes it legal rather than in a manner which makes it illegal. If
the Government did not make the provisional assessment in the case of all
liable to such assessment, then the Government's action could be legitimately
questioned. It has however not in fact been said in these petitions that in
deciding to make the provisional assessment the Government has made any
discrimination between the persons liable to such assessment.
Section 5A(1) is also attacked on the ground
that it is against rules of natural justice in that it does not say that in
making the provisional assessment, any hearing would be given to the person
sought to be assessed or requiring a return from him or giving him a right of
appeal in respect of the provisional assessment made. It is true that the'
section does not expressly provide for a hearing being given. It seems to me however
that if according to the rules of natural justice the assessee was entitled to
a hearing, an assessment made without giving him such a hearing would be bad.
The Act must be read so as to imply a provision requiring compliance with the
rules of natural justice. Such a reading is not impossible in the present case
as there is nothing in the Act indicating that the rules of natural justice
need not be observed.
It was said in Spack man v. Plumstead Board
of Works (1) where a statute requiring an architect to give a certain
certificate which did not provide the procedure as to how the architect was to
conduct himself, came up for consideration that, "No doubt, in the (1) 10
A.C. 229, 240.
102 absence of special provisions as to how
the person who is to decide is to proceed, the law will imply no more than that
the substantial requirements of justice shall not be violated." Again in
Maxwell on Statutes (10th ed.) p. 370 it has been said, "In giving
judicial powers to affect prejudicially the rights of person or property, a
statute is understood as silently implying, when it does not expressly provide,
the condition or qualification that the power is to be exercised in accordance
with the fundamental rules of judicial procedure, such, for instance, as that which
requires that before its exercise, the person sought to be prejudicially
affected shall have an opportunity of defending himself." In so far as
this Act confers a power on the Government to discharge the judicial duty of
making a provisional assessment, which the petitioners say, it does, it must
imply that the judicial process has to be observed.
As regards the return, that seems to me not
to be of much consequence. If the assessee is entitled to be heard, the fact
that he is not asked to make a return, would not constitute a departure from
the rules of natural justice.
Likewise, the absence of a right of appeal is
not something on which the petitioners can rely. Rules of natural justice do
not require that there must always be a right of appeal.
Under the Act it is the Government which
makes the assessment and it would not be unreasonable to hold that in view of
the high authority of the person assessing, the absence of a right of appeal is
not likely to cause any miscarriage of justice. I am therefore unable to hold
that in the absence of express provisions laying down the procedure according
to which the provisional assessment is to be made, the Act has to be held
It may here be stated that in those instances
where, in the present cases, provisional assessments had been made, the,
assessees had either themselves supplied the area of the lands held by them or
the area had been determined after giving them a hearing. After the area has
been determine , the amount of the tax payable is decided by a simple
calculation at the rate 103 of Rs. 2 per acre of land held and with regard to
this, no hearing is required.
Then again sub-see. (2) of s. 5A provides
that the Government after conducting a survey of the lands mentioned in
sub-sec. (1) under which provisional assessment is to be made, shall make a
regular assessment and adjustments would have to be made in regard to tax
already paid on the basis of the regular assessment. A point is made that there
is no time limit fixed within which the regular assessment is to be made and so
the Act leaves it to the arbitrary decision of the Government when to make the
regular assessment. I do not think that this contention is correct. Properly
read, the section in the absence of any indication as to time, means that
regular assessment would have to be made as soon after the survey, as is
It is also said that s. 7 of the Act offends
Art. 14. This section gives power to the Government to exempt from the
operation of the Act such lands or class of lands as the Government may by
notification decide. This section does not indicate on what grounds the
exemption is to be granted.
It therefore seems to me that it gives
arbitrary power to the Government and offends Art. 14. But the section is clearly
severable from the rest of the Act. If the section is taken out of the Act, the
operation of the rest of the Act will not in the least be affected. The only
effect will then be that the Government will have no power to exempt any land
from the tax. That will not in any way affect the other provisions of the Act.
The invalidity of this section is therefore no reason for declaring the entire
It may be pointed out that it is not alleged
in the petitions that the Government has exempted any lands or class of lands
from the operation of the Act.
It is contended that s. 8 of the amending Act
also shows the arbitrary nature of the Act. That section provides that if any
difficulty arises in giving effect to the provisions of this Act, the Government
may by order do anything not inconsistent with such provisions which appears to
it to be necessary or expedient 104 for removing the difficulty. This is a
common form of provision now found in many Acts. The power given under it
cannot be said to be uncontrolled for it must be exercised consistently with
the Act and to remove difficulties arising in giving effect to the Act. In any
event, this provision is contained in the amending Act only. Even if the
section be held to be invalid that would not affect, the rest of the amending
Act or any question that arises on these petitions.
The validity of the Act is also challenged on
the ground that it infringes Art. 19, cl. (1), sub-cls. (f ) & (g).
This challenge seems to me to be wholly
untenable. Apart from the question whether a taxing statute can become invalid
as offending Art. 19, as to which the position on the authorities does not seem
to be very clear, it is plain that Art. 19 permits reasonable restrictions to
be put on the rights mentioned in sub cls. (f ) & (g). Now there is no
dispute that the rate of tax fixed by the Act is a very low rate. It has not
been said that the rate fixed is unreasonable. It clearly is not so. The
restrictions on these rights under Art. 19(1), (f) & (g) put by the Act, if
any, are clearly reasonable. These rights cannot therefore be said to have been
infringed by the Act.
The lands of the petitioners are lands on
which stand forests. It is said that under the Madras Preservation of Private
Forests Act, (Act XXVII of 1949), which applies to the lands with which we are
concerned as they are situated in an area which previously formed part of the
State of Madras, the owners of the forests can work them only with the
permission of the officer mentioned in that Act. It is said that the control
imposed by the officer has been such that the income received from the forest
is much less than the tax payable under the Act in respect of the land on which
the forest stands. Taking by way of illustration Petition No. 13, it is pointed
out that the income from the forest with which that petition is concerned was
Rs. 8,477 for the year 1956-57 while the tax payable under the Act for more or
less the same period was Rs. 1,51,000. I am unable to hold that because of this
the Act offends Art. 19(1), (f) and (g).
105 It is not stated that the land is not
capable of producing any income other than the income from the forest standing
on it. There is nothing to show that in all times to come the income from the
land including the income from the forest, will be less than the tax imposed on
it by the Act.
The area of the land concerned in Petition
No. 13 is enormous being about 75,500 acres. I am further unable to hold the
impugned' Act to be invalid because of action that may be taken under another
Act, namely, the Madras Act XXVII of 1949.
The validity of the Act is challenged also on
the ground that it offends Art. 31 of the Constitution. I am unable to see any
force in this contention. If the statute is otherwise valid, as I have found
the present Act to be, it cannot, even if it deprives any person of property,
be said to offend Art. 31(1). It has been held by this Court in Ramjilal v.
Income-tax Officer,. Mohindargarh (1) that "clause (1) of Art. 31 must be
regarded as concerned with deprivation of property otherwise than by the
imposition or collection of tax, for otherwise Art. 265 becomes wholly
redundant." No question of cl. (2) of Art. 31 being violated arises here
for the Act does not deal with any acquisition of property.
It is also said that the Act is a colourable
piece of legislation, namely, that though in form a taxing statute it, in
effect, is intended to expropriate lands, held by the citizens in the State by
imposing a tax too heavy for the land to bear. As was said in Raja Bhairebendra
Narayan Bhup v. The State of Assam (2) "The doctrine of colourable
legislation is relevant only in connection with the question of legislative
competency". In the present case, there being in my view, no want of
legislative competency in the legislature which passed the Act in question, the
Act cannot be assailed as a piece of colourable legislation. I may add that I
do not accept the argument that the Act is in its nature expropriatary or that
the tax imposed by it is really excessive.
(1) S.C.R. 127, 136.
(2)  S.C.R. 303.
14 106 I come now to the last argument
advanced by the petitioners.
It is said that the Act was beyond the
legislature competence of the State Legislature. It is conceded that the State
Legislature has power to impose a tax on land under entry 49 of List 2 in the
Seventh Schedule to the Constitution, but it is said that land as mentioned in
that entry does not include lands on which forests stand. It is contended that
the State Legislature has power to legislate about forests under entry 19 of
that List and also as to land under entry 18. There is however no power to
impose a -axon forests while there is power under entry 49 of that list to tax
land. Therefore, it is said, that there is no power to impose tax on lands on
which forests stand and the Act in so far as it imposes tax on lands covered by
forests, which the lands of the petitioners are, is hence incompetent.
It is not in dispute that a State Legislature
has no power to impose a tax on a matter with regard to which it has the power
to legislate but has been given no express power to impose a tax. Therefore, I
agree, that a State Legislature cannot impose tax on forests. I am however not
convinced that "land" in entry 49 is not intended to include land on
which a forest stands. No doubt, a forest must stand on some land. In Shorter
Oxford Dictionary, one of the meanings of "forest" is given as an
extensive tract of land covered by trees and undergrowth, sometimes
intermingled with pastures. The concepts of forest and land however are
entirely different. The principal idea conveyed by the word "forest"
is the trees and other growth on the land. Under entry 19 there may no doubt be
legislation with regard to land in so far it is necessary for the purpose of
the forest growing on it. It is well known that entries in the legislative
lists have to be read as widely as possible. It is not necessary to cut down
the plain meaning of the word ,"land" in entry 49 to give full effect
to the word "forest" in entry 19. In my view, the two entries namely,
entry 49 and entry 18 deal with entirely different matters.
Therefore, under entry 49 taxation 107 on
land on which a forest stands is permissible and legal.
For these reasons I would dismiss these
BY COURT:-In accordance with the opinion of
the majority of the Court, these Petitions are allowed with costs against the
contesting Respondent, the State of Kerala.