Shri Kishan Singh And Others vs The State Of Rajasthan And Others

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: supreme-court

Case Number: Petitions Nos. 621, 655 and 678 of 1955

Decision Date: 27 September 1955

Coram: Natwarlal H. Bhagwati, Syed Jaffer Imam, T.L. Venkatarama Ayyar

In this case the Court recorded that the petition was titled Shri Kishan Singh and Others versus The State of Rajasthan and Others and that the judgment was delivered on 27 September 1955. The matter was heard before a bench that consisted of Justice Natwarlal H. Bhagwati and Justice Syed Jaffer Imam. The parties were identified as the petitioners, who were the jagirdars of the Marwar region, and the respondents, who were the State of Rajasthan and other persons. The citation for the decision was reported as 1955 AIR 795 and also as 1955 SCR (2) 531. The statutory provisions under consideration were sections 81, 82, 83, 84, 85 and 86 of the Marwar Land Revenue Act of 1949, which dealt with the settlement of fair and equitable rent and the powers of the Settlement Officer to enforce rent rates. The petitioners claimed that these provisions infringed their fundamental rights guaranteed under Articles 14, 19(1)(f) and 31(2) of the Constitution of India.

The petitioners argued that after the merger of Marwar into the State of Rajasthan the Act had become discriminatory because it applied only to the jagirdars of Marwar and not to the whole class of jagirdars throughout Rajasthan. They maintained that the method of fixing rents by referring to different areas on different dates and by using the average of collections over the preceding ten years could lead to varying rent rates and thus to inequality, which they said was prohibited by Article 14. Further, they contended that the Act deprived landlords of their right to realise rent from tenants freely and without obstruction, thereby invading the right to hold property protected by Article 19(1)(f). They also asserted that the power conferred on the Settlement Officer by section 86 to enforce rent rates retrospectively amounted to an acquisition of property without compensation, in violation of Article 31(2), and that the officer’s discretion under that section was absolute and uncontrolled, constituting an encroachment on the right to hold property. The Court held that these contentions had to be rejected. It observed that Article 14 forbids only unequal treatment of persons who are similarly situated and that a classification based on territory is permissible when it is relevant to the purpose of the legislation. The Court further explained that a tenancy law cannot be said to contravene Article 14 merely because it does not extend to the entire State. Consequently, the petitioners bore the burden of demonstrating that conditions in other parts of Rajasthan were comparable to those in Marwar, and the Court found that they had failed to meet this burden.

In the earlier discussion, the petitioners were required to demonstrate that the conditions prevailing in other parts of the State were comparable to those existing in Marwar; the petitioners did not succeed in making such a showing. The Court then referred to the decision in Bowman v. Lewis, reported as 101 U.S. 22, 25 Law. Ed. 989, to illustrate that the provision in the Act allowing assessment of rents based on a portion of the area covered by the legislation does not violate Article 14. To hold otherwise would make it impossible for any State to conduct its settlement operations. The Court also applied the principles laid down in Biswambhar Singh v. The State of Orissa and others, [1964] S.C.R. 842, and Thakur Amar Singhji v. State of Rajasthan, [1955] 2 S.C.R. 303. The Court explained that a landlord’s fundamental right to hold property, in the context of tenanted land, is essentially the right to receive reasonable rents, and no law aimed at fixing fair and equitable rents can be said to contravene Article 19(1)(f) of the Constitution even if it operates retrospectively. Accordingly, the provision in section 86 of the Act empowering the Settlement Officer to give retrospective effect to rent rates does not infringe Article 19(1)(f), and therefore the question of whether such a provision is of a regulatory nature and consequently barred by Article 19(5) does not arise. It is well settled that a statute regulating the relationship between a landlord and his tenant does not constitute a taking of property within the meaning of Article 31(2), even though it may diminish the landlord’s rights; consequently there is no breach of Article 31(2). The Court cited Thakur Jagannath Baksh Singh v. United Provinces, [1943] 6 F.L.J. 55, A.I.R. 1943 F.C. 29, and Thakur Jagannath Buksh v. United Provinces, L.R. 73 I.A. 123, in support of this proposition.

The Court further observed that section 86 of the Act does not grant an absolute or uncontrolled discretion to the Settlement Officer, and that the power conferred does not amount to an encroachment on the right to hold property as defined in Article 19(1)(f). The Court distinguished the earlier decision in Thakur Baghubir Singh v. Court of Wards, Ajmer and another, [1953] S.C.R. 1049, to clarify the scope of the statutory power. The judgment concerned original jurisdiction petitions numbered 621, 655 and 678 of 1955, filed under Article 32 of the Constitution for the enforcement of fundamental rights. Counsel for the petitioners appeared, assisted by two additional counsel. The Attorney-General for India, assisted by two counsel, represented respondent No. 1. Additional counsel represented the respondents in petition numbers 655 and 678. The Court delivered its judgment on 27 September 1955, with Justice Venkatarama Ayyar presiding. These applications, filed under Article 32, were brought by certain jagirdars of Marwar who challenged the constitutional validity of sections 81 to 86 of the Marwar Land Revenue Act No. XL of 1949 on the ground that those sections infringed the petitioners’ fundamental rights under Article 14, Article 19(1)(f) and Article 31(2) of the Constitution. The challenged provisions dealt with fixing fair and equitable rent payable by tenants and prescribed the procedure to be followed in doing so.

In the present case the petitioners contended that the provisions of the Act which were being relied upon infringed the guarantees of article 14, article 19(1)(f) and article 31(2) of the Constitution. Those constitutional provisions, the petitioners argued, protected the right to hold property, the right to acquire, hold and dispose of property, and the right to be compensated when property was taken away. The sections of the Act that were challenged, namely sections 81, 82, 84 and 86, were intended to fix a fair and equitable rent payable by tenants and to prescribe the procedure for fixing such rent. Section 81 required that whenever a local area was brought under settlement operations by a notification made under section 64, a Settlement Officer or an Assistant Settlement Officer had to inspect every village in the area, divide the villages into soil-classes and assessment circles, select appropriate rent-rates for the area and publish those rates in the manner prescribed by law. The officer was also required to consider any objections that were filed against the proposed rates and to submit a report of his findings to the Board of Revenue. The Board of Revenue possessed authority to sanction the proposals either as they stood or with modifications, and it could further direct that an enquiry be made into any aspect of the proposals that required clarification.

Section 82 directed the Settlement Officer, in order to achieve fair and equitable rates, to take into account the rent and cesses that had been collected in the ten years preceding the settlement, while excluding any years that the Government, by notification in the Official Gazette, declared abnormal. The officer had to consider the average prices of agricultural produce during the same ten-year period, the nature of the crops grown, the quantity of produce harvested and the value of that produce. Section 82(2) capped the rent rates so that they could not exceed one-third of the value of the produce of unirrigated lands and could not exceed one-fourth of the value of the produce of irrigated lands. Under section 84 the Settlement Officer was empowered to determine rents, whether by abatement, enhancement or commutation, for all holdings occupied by tenants, based on the rates that the Board of Revenue had sanctioned. Section 86 provided that any rent fixed by order of the Settlement Officer would become payable from the first day of July following the date of the order, unless the Settlement Officer, for reasons of his own choosing, directed that the rent be payable from an earlier date. Acting under the authority of section 81, the Settlement Officer prepared proposals concerning the rent rates applicable to the villages that formed part of the petitioners’ jagirs, and those proposals were published in the Gazette on 12 December 1953. The petitioners filed objections to the published rates on 12 January 1954. On 13 October 1954 the Additional Settlement Commissioner submitted his final proposals to the Settlement Officer, who then forwarded them to the Board of Revenue for approval. After conducting further enquiry, the Board issued an order on 4 December 1954 that determined the rent rates payable. Subsequently, an order made under section 86 brought the sanctioned rates into operation from 1 July 1954. The order made under section 86 was not the subject of challenge in these proceedings, because Petition No. 621 of 1954 had been filed on 24 November 1954, i.e., before that order was issued, and the later petitions merely reiterated the same allegations.

Petitions numbered 655 and 678 of 1954 merely reproduced verbatim the allegations set out in Petition No. 621 of 1954. Before the Court, the petitioners acknowledged that they were not challenging the correctness of the order issued under section 86 insofar as that order gave effect to the rent rates from 1 July on its merits; instead, they contended that the section itself was invalid, and they used that contention as a step toward establishing that the entire scheme of the Act, of which section 86 formed an integral part, infringed their fundamental rights protected under articles 14, 19 and 31(2) of the Constitution. Consequently, the Court had to examine whether sections 81 to 86 of the Act were void for violating those constitutional provisions. The petitioners advanced the argument that sections 81 to 86 were repugnant to article 14 because the Act applied only to the territory that had previously been the State of Marwar, whereas the present State of Rajasthan encompassed Marwar and seventeen other former States that had merged into it, and thus the Act, being directed solely against jagirdars in one part of the State and not the whole, was discriminatory and void. The Court found this contention untenable. Article 14 bars unequal treatment of persons who are similarly situated, and therefore the petitioners bore the burden of showing that the conditions prevailing in other parts of Rajasthan were comparable to those in Marwar. No such allegation or proof was offered. On the contrary, the respondents, in paragraph 10 of their statement, observed that tenants in the Marwar jagirs paid substantially higher rents and cesses than tenants in the Khalsa area of the State; they further explained that, to remove the inequality between these two classes of tenants, a law had been enacted in 1943 to provide for the settlement of rent, and that another law dated 10 January 1947 had abolished all cesses and fixed the maximum share of rent payable in kind. These special features, the respondents argued, justified separate legislation for that region. The respondents also pointed out that the other former States each possessed their own rent laws suited to their specific conditions. The Court found no material upon which it could hold that the impugned Act was discriminatory in nature, and it declined to strike it down merely because it did not extend to the entire State of Rajasthan. The Court noted that a similar issue had been resolved in Bowman v. Lewis, where the United States Supreme Court held that a state’s differentiation of judicial procedures among its various regions did not offend the equal-protection clause of the Fourteenth Amendment.

The Court observed that the argument that the legislation offended the equal-protection clauses of the Fourteenth Amendment was misplaced. It quoted the United States Supreme Court, which had stated that each State possessed the authority to divide its territory into political subdivisions for municipal purposes and to regulate the local governments of those subdivisions. Regarding the administration of justice, a State could establish one system of courts for cities and a different system for rural districts, or could have one system for one portion of its territory and another system for another portion. The Court noted that convenience, and at times necessity, frequently required such arrangements, and that to deny a State this power would seriously interfere with its ability to regulate its internal affairs. The quotation continued by illustrating that if a Mexican State were acquired by treaty and annexed to an adjoining State or part of a State in the United States, the newly formed State could lawfully permit Mexican law and judicature to continue unchanged in the acquired portion, while retaining the common-law system and its corresponding judicature in the other portion. Such a dual arrangement, the Court explained, would not be prohibited by any fair construction of the Fourteenth Amendment, because it would be based on municipal considerations rather than on any respect of persons or classes, and it would consider the welfare of all classes within the particular territory or jurisdiction.

The Court further noted that it had repeatedly held that classification on a territorial basis was permissible when it was germane to the purpose of the enactment. Considering that the conditions of tenants varied from one locality to another, the Court expressed no hesitation in holding that a tenancy law limited to a portion of a State could not, on that ground alone, be said to contravene Article 14 of the Constitution. The petitioners had raised a second ground, contending that Article 14 was infringed because the settlement of rent was to be undertaken only with reference to the portions of the area to which the Act applied, rather than the whole State. They argued that the rent rate would be fixed on the basis of the average of the ten years preceding the settlement, and that if proceedings commenced for different areas on different dates, the resulting rates could differ, thereby creating inequality prohibited by Article 14. The Court could not agree with this argument. It observed that settlement operations required a specialised staff possessing technical knowledge and administrative experience, and that it might be beyond the capacity of the State to conduct such operations for the entire area simultaneously. Accepting the petitioners’ contention would, in effect, prevent the State from carrying out settlement operations at all.

In this case the Court observed that the principle articulated in the earlier decisions would also apply to the present dispute. Accordingly the Court rejected the argument that the impugned provisions contravene article 14 of the Constitution. The petitioners further contended that the provisions were repugnant to article 19(1)(f) because they allegedly deprived landlords of a free and unhindered right to realise rent from tenants and represented an encroachment on their right to hold property. Particular attention was directed to section 82, which requires the Settlement Officer, while determining the average rent collected over the preceding ten years, to exclude from consideration those years that the Government has notified as abnormal. The petitioners characterized this exclusion as a device intended to reduce the rent payable to landlords and as an invasion of their property rights. The Court found no merit in this contention. It held that the constitutional right to hold and enjoy property encompasses only the entitlement to recover a reasonable rent when a tenant cultivates the land, and that a statute whose object is to fix a fair and equitable rent does not invade that right. Such legislation, as indicated in (1) [1954] S.C.R. 842, 845 and (2) [1955] 2 S.C.R. 303, does not constitute an intrusion on the property right. The Court further explained that the claim that section 82(1)(a), which excludes abnormal years as specified in the Gazette, is calculated to reduce rent is unfounded. A year may be declared abnormal not only when there are bumper crops but also when the yield is very low, and the provision is intended to benefit both tenant and landlord. This type of provision is common in tenancy legislation and is neither unreasonable nor unfair.

The petitioners also challenged section 86, arguing that it confers on the Settlement Officer the power to bring rent rates into operation from a date earlier than the succeeding year and even retrospectively to a date prior to the settlement, and that such a power is repugnant to both article 19(1)(f) and article 31(2). Relying on article 19(1)(f), they contended that section 86 encroaches on the right to hold property and can be valid only if it falls within the regulatory exception of article 19(5). They further argued that a law of a regulatory character protected by article 19(5) must relate only to rights to be exercised in the future, and that a law giving retrospective operation lies outside article 19(5). The Court rejected this assumption, noting that the question of validity under article 19(5) arises only when there is an actual violation of the substantive right guaranteed by article 19(1)(f). Since, as the Court has held, the right to hold property is limited to the right to recover reasonable rent from a cultivating tenant, that right cannot be said to have been invaded by a law fixing a reasonable rent, even when the law operates retrospectively.

In the present dispute, the Court observed that fixing a reasonable rent by way of a law could not be said to invade the right to hold property protected by article 19(1)(f), even when the law operated retrospectively. The Court explained that if a rent determination is reasonable for a period after the settlement, it must also be reasonable for the period before the settlement. Consequently, a settlement that does not infringe on the holder’s future rights could not be said to infringe on past rights. The Court therefore concluded that it was unnecessary to decide whether a law falling under article 19(5) must be of a regulatory character or whether a law with retrospective effect could be considered regulatory; such a consideration was irrelevant to the controversy before it.

The Court also examined the contention that section 86 was inconsistent with article 31(2) because its retrospective operation allegedly deprived a landlord of rent that had accrued before the settlement, thereby amounting to taking property without compensation. The Court noted that it is well settled that a statute regulating the relationship between landlord and tenant does not amount to a taking within article 31(2), even though it may lessen the landlord’s rights. The Court referred to the decision in Thakur Jagannath Baksh Singh v. United Provinces, where the Federal Court had held that provisions of Act XVII of 1939, which reduced the rent payable to a landlord, were not obnoxious to section 299(2) of the Government of India Act, 1935. The Privy Council affirmed that decision, observing that the appellant relied on section 299, which prohibited deprivation of property without law and barred compulsory acquisition of land without compensation. However, the Council emphasized that the present case involved no confiscatory legislation; the regulation of landlord-tenant relations and the consequent reduction of rights previously exercised by the landlord were distinct from compulsory acquisition of land.

Finally, the Court addressed the argument that section 86 was unconstitutional because it authorised the Settlement Officer to give retrospective effect to rent rates without any prescribed rules or conditions, thereby leaving the discretion arbitrary and uncontrolled. The Court cited the ruling in Thakur Raghubir Singh v. Court of Wards, Ajmer, which had held that a power exercisable at the absolute discretion of an authority amounted to an encroachment on the right to hold property under article 19(1)(f) and was not saved by article 19(5). The Court noted, however, that section 86 expressly required the Settlement Officer, when deciding to bring rates into operation from a date earlier than 1 July, to do so for reasons, thereby providing some basis for the exercise of discretion. The Court indicated that the contention that section 86 failed to lay down the circumstances under which such an order could be passed did not carry force in the present case.

In that earlier decision, the Court relied on the case to support the contention. The issue in that case concerned whether a power given to the Court of Wards to assume management of an estate when a landlord habitually infringed a tenant’s right was valid. Under the statute, determining whether the condition of habitual infringement existed was left to the subjective satisfaction of the Chief Commissioner, and that determination was final and not open to review by civil courts. The Court held that a power that could be exercised at the absolute discretion of an authority constituted an encroachment on a citizen’s right to hold property under article 19(1)(f) and that the provision was not saved by article 19(5).

However, in the present matter, section 86 of the Act expressly provides that when a Settlement Officer decides to make rent rates operative from a date earlier than the first of July, the officer must give reasons for such a decision. The argument that section 86 fails to specify the circumstances in which such an order may be made is rejected, because the nature of the power necessarily entails a broad discretion for the officer. A wide discretion is not automatically arbitrary. The Court noted that section 233 of the Act bars civil courts from examining the reasonableness of the order, but that restriction stems from the principle that revenue and settlement matters fall within the exclusive jurisdiction of revenue courts. Moreover, under section 62 of the Act, the Board of Revenue possesses revisional jurisdiction over all settlement orders. Accordingly, the Court found that the authority granted to the Settlement Officer to fix an earlier date for the operation of rent rates is reasonable and constitutionally valid (1) [1953] S.C.R. 1049, and it does not infringe the landlord’s fundamental rights. Consequently, the Court concluded that the scheme embodied in sections 81 to 86 of the Act does not violate any constitutional limitation and is valid. The petitions were therefore dismissed, without costs.