State of Assam & Ors Vs. Rameshwar
Agarwala & Ors [1971] INSC 2 (6 January 1971)
SHAH, J.C. (CJ) SHAH, J.C. (CJ) HEGDE, K.S.
GROVER, A.N.
CITATION: 1971 AIR 674 1971 SCR (3) 306 1971
SCC (1) 269
ACT:
Assam Land Revenue Regulations-Rule 40 framed
there under Determination by Government of premium payable upon settlement of
land for "special cultivation"-If rate of premium must be fixed for
locality or can be fixed for tea garden-If premium can be fixed according to
commercial value.
HEADNOTE:
The first respondent applied to the Deputy
Commissioner, Lakhimpur for settlement of a Tea Garden for "special
cultivation of tea". In March, 1964 the Government of Assam permitted the
settlement on payment of Rs. 3.86 lakhs as premium. Upon the respondent failing
to make payment of the amount, the State Government directed the auction of the
tea garden. The first respondent thereafter moved a petition in the High Court
for a declaration inter alia that the State Government had acted illegally in
fixing the amount of premium. The High Court allowed the petition holding that
the order fixing the premium was not in conformity with rule 40 framed under
the Assam Land Revenue Regulations which required the State Government to fix
the rate of premium for a particular locality; it did not empower the
Government to fix the premium payable by an intending holder in a particular
case. On appeal to this Court,
HELD : The High Court was in error in setting
aside the order passed by the Government of Assam and indeclaring that the offer
to settle the tea garden on payment of the amount specified Rs. 3,86,000 was
not in conformity with rule 40.
There was no warrant for the assumption made
by the _High Court that in settling the premium to be fixed in respect of its
own property, the Government is bound to fix the premium generally in respect
of a region. The Government is by the Act or the Rules not disqualified from
fixing the premium to be paid in respect of an individual tea garden. In the
absence of any indication to the contrary a tea garden may appropriately be
regarded as a locality within the meaning of Rule 40. The rate of premium may
be fixed by the State Government according to its commercial value.
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 658 of 1967.
Appeal from the judgment and order dated June
27, 1966 of the Assam and Nagaland High Court in Civil Rule No. 296 of 1964.
Naunit Lal, for the appellants.
Sarjoo Prasad and S. N. Prasad. for the
respondent.
307 The Judgment of the Court was delivered
by shah, C. J. On October 24, 1957 Rameshwar Agarwalahereinafter called the
respondent applied to the Deputy Commissioner, Lakhimpur, for settlement of a
tea garden for "special cultivation of tea". By order dated March 11,
1964 the Government of Assam permitted settlement of the tea garden for special
tea cultivation on payment of Rs-.
3,86,008/as premium. The respondent failed to
pay the amount demanded. The State of Assam then put up the tea garden for
auction. The respondent moved a petition in the High Court of Assam for an
order declaring that in fixing the amount of the premium at Rs. 3,86,008/the
State acted illegally, and that the order was void and unenforceable at law
because in fixing the amount of thepremium the State acted without jurisdiction
and the order directing auction of the tea garden for not depositing the amount
demanded was also illegal. The High Court, upheld the contention and ordered
the State of Assam not to, give effect to the order dated March 31, 1964
calling upon the respondent to pay the amount due within two months of the
order and the order dated November 26, 1964 directing that the tea garden be
put up for auction. With certificate granted by the High Court, the State of
Assam has appealed .to this Court.
The tea garden belonged to the State of
Assam. The Government of Assam in the absence of any binding statutory
provision, could settle the tea garden on such commercial terms it could
reasonably obtain. The respondent applied to the Deputy Commissioner for
settlement of the tea garden and requesting the State Government for early
fixation of the amount of premium.. When the premium was fixed by the
Government the respondent protested, contending that the action of the State
was illegal Before the High Court it was contended by the Respondent that the
power of the State Government to fix the premium for which it could lease the
tea garden was restricted by Rule 40 framed under the Assam, Land Revenue
Regulations. The Rule reads "In addition to the land-revenue payable under
rule 17 and value of the timber assessed under rule 37, an applicant to whom a
lease for special cultivation is granted shall be liable to pay premium. The
rate of premium shall be fixed by the State Government from time to time for
each locality.
The reasons which persuaded the High to
upheld the plea, raised by the respondent may be set out in their own words :
"The only power which the Government has
got, is to fix the rate of premium under Rule 40 of the Rules 308 under the
Land Revenue Regulation and the question for us to consider is whether the
order of the Government fixing the premium for settlement of this land for
special cultivation is an order in conformity with Rule 40. . . .
In our opinion, what Rule 40 provides is to
confer upon the Government power to fix the rate of premium in every case which
shall be payable for the settlement and it is only the Deputy Commissioner that
is authorised to settle the land. The whole purpose, of Rule 40 is to confer
power on the Government to fix the rate of premium which will be valid for a
particular locality and that the Deputy Commissioner has to make the
settlement. He is given the power to realise the premium fixed by the
Government from time to time and to see that no document of lease is issued
before the premium has been paid by the intending holder. But Rule 40 does
empower, in our opinion, the State Government to fix the amount of premium in
the case of a particular settlement in a particular locality.............
the rate of premium for a particular locality
and the Legislature when framing the rules never intended that the Government
should be empowered to fixing the total amount of premium payable by the
intending holder. In our opinion, therefore, the order passed by the Government
directing the authorities to offer the land for settlement in case the
petitioners pay Rs. 3,86,000/is not in conformity with Rule 40 and this order
cannot be given effect-to." The expression "locality" is not
defined in the Act or in the Rules. We see no warrant for the assumption made
by the High Court that in settling the premium to be fixed in respect of its
own property, the Government is bound to fix the premium generally in respect
of a region. The Government is by the Act or the Rules not disqualified from
fixing the premium to be paid in respect of an individual tea garden. In the
absence of any indication to the contrary a tea garden may in our judgment be
appropriately regarded as a locality within the meaning of Rule 40. The power
to settle a tea garden on payment of land revenue, value of the timber and
premium is to be exercised according to the Rules. The rate of premium may be
fixed by the State Government according to its commercial value. In the absence
of any restriction imposed upon the State Government requiring that a general
rate shall be fixed covering a specified area larger 309 than a tea garden
there is nothing which prohibits the State Government from fixing the rate of
premium having regard to the commercial value of the tea garden. In the present
case the Sub-Divisional Officer reported that the price of the land of the
Dirpai tea garden be valued at Rs.1 500/per bigha and on that basis the State
Government computed the premium to be paid in respect of the entire Jokai Tea
Garden.
Fixation of a rate of Rs. 5001per bigha in
respect of the entire area of the tea garden may be regarded as a premium fixed
for the locality of the tea garden. The matter rested entirely in contract
between the Respondent and the State Government. There was an offer by the
respondent for settlement of the tea garden. He agreed to pay the land revenue
payable under r. 17. He also agreed to pay the value of the timber assessed
under r. 37. For settlement of the tea garden for special cultivation the
respondent was also liable to pay premium. The quantum of liability to pay land
revenue was governed by r. 17 and value of the timber was governed by r. 37.
The liability to pay premium had to be fixed by the State Government. In the
absence of any restriction placed by the Rules upon the power of the St-ate
Government, we do not think that the High Court had any jurisdiction to compel
the State to enter into a contract to settle the tea garden upon the respondent
on payment of premium after determining a general rate for a region larger than
the tea garden.
The High Court was in error in setting aside
the order passed by the Government of Assam and in declaring that the offer to
settle the land of the Dirpai Tea Garden on payment of Rs. 3,86,008/was not in
conformity with r. 40. The High Court also erred in directing that auction of
the land for nonpayment of the premium shall be set aside.
The appeal is allowed and the petition filed
by the respondent will be dismissed. The respondent will pay the costs in this
Court and in the High Court.
R.K.P.S. Appeal allowed.
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