K.T. Plantation Pvt. Ltd. & ANR. Vs. State of Karnataka
J U D G M E N T
K.S. RADHAKRISHNAN, J.
1. The constitutional validity of Roerich and Devika Rani Roerich Estate (Acquisition & Transfer) Act, 1996 (in short the "Acquisition Act"), the legal validity of Section 110 of the Karnataka Land Reforms Act, 1961 (in short "Land Reforms Act"), the Notification No. RD 217 LRA 93 dated 8th March, 1994 issued by the State Government there under and the scope and content of Article 300A of the Constitution of India, are the issues that have come up for consideration in these civil appeals.
2. We propose to deal with the above issues in three parts. In Part-I, we will deal with the validity of Section 110 of the Land Reforms Act and the validity of the notification dated 8.3.1994 and in Part-II, we will deal with the constitutional validity of the Acquisition Act and in Part-III, we will deal with the claim for enhanced compensation and the scope of Article 300A of the Constitution. PREFACE
3. Dr. Svetoslav Roerich, a Russian born, was an internationally acclaimed painter, artist and recipient of many national and international awards including Padma Bhushan from the President of India in the year 1961. Smt. Devika Rani Roerich, grand niece of Rabindranath Tagore had made valuable contributions and outstanding services to the Indian Motion Pictures and Film Industry, was known to be the "First Lady of the Indian Screen". She was awarded Padmashri by the President of India in the year 1958 and was the recipient of the first Dada Saheb Phalke Award and the Soviet Land Nehru Award in the year 1989.
4. Dr. Roerich and Mrs. Devika Rani Roerich had owned an Estate called Tatgunni Estate covering 470.19 acres at B.M. Kaval Village of Kengeri Hobli 3and Manvarthe Kaval Village of Uttarhalli Hobli, Bangalore South Taluk, out of which 100 acres were granted to them by the State Government in the year 1954 for Linaloe cultivation vide G.O. dated 16.3.1954 read with Decree dated 19.4.1954. When the Land Reforms Act came into force, they filed declarations under Section 66 of the Act before the Land Tribunal, Bangalore South Taluk-II stating that they had no surplus lands to surrender to the State since the entire area held by them had been used for the cultivation of Linaloe which was exempted under Section 107(1)(vi) of the Land Reforms Act. The Land Tribunal, Bangalore vide order dated 15.3.82 dropped the proceedings instituted under the Act against them holding that the land used for cultivation of Linaloe did not attract the provisions of the Land Reforms Act.
5. Dr. Roerich, it was stated, had sold 141.25 acres (which included 100 acres granted by the Government for Linaloe cultivation) to M/s K.T. Plantations Pvt. Ltd. (the first appellant herein, 4in short `the Company') by way of a registered Sale Deed dated 23.3.91 for a sale consideration of Rs.56,65,000/-. It was stated that Mrs. Devika Rani Roerich had also sold an extent of 223 acres 30 guntas to the Company on 16.2.1992 for a sale consideration of Rs.89,25,000/- by way of an unregistered sale deed, a transaction disputed by Mrs. Devika Rani. The Company, however, preferred a suit OS 122/92 for a declaration of title and injunction in respect of that land before the District and Civil Judge, Bangalore which is pending consideration.
6. The Company sought registration of the sale deed dated 16.02.92 before the Sub Registrar, Kingeri, who refused to register the sale deed. The Company then preferred an appeal before the District Registrar, but when the appeal was about to be taken up for hearing, one Mary Joyce Poonacha who claimed rights over the property on the strength of an alleged will preferred a Writ Petition No.2267 of 1993 before the Karnataka High Court and a learned Single Judge of the High Court dismissed the writ petition. On appeal, the Division Bench confirmed the order, against which she had approached this Court vide C.A.No.3094 of 1995 and this Court vide its judgment dated 18th April, 1995 directed the District Registrar not to proceed with the matter till the suit is disposed of by the Civil Court. The judgment is reported in (1995) Suppl. 2 SCC 459.
7. Dr. Roerich and Mrs. Devika Rani had no issue and due to old age and other ailments it was reported that they were staying at Hotel Ashok, Bangalore for a couple of years before their death. It was alleged that some of the persons who were associated with the couple, had an eye on their properties, including the land used for linaloe cultivation, valuable paintings, jewellery, artefacts etc., and began to create documents to grab those properties.
8. The Chief Secretary of the State of Karnataka noticing the above facts and circumstances convened a meeting on 1.4.92 in the presence of the Director of Archaeology to take effective and proper steps to preserve the paintings, artefacts and other 6valuables. For that purpose, they met Smt. Devika Rani and Dr. Roerich on 03.04.92 and a letter was handed over to Dr. Roerich on behalf of the State Government expressing the Government's willingness to purchase the paintings and other valuables so as to set up a Roerich Gallery. The State Cabinet in its meeting held on 09.04.92 also discussed about the desirability of acquiring the landed properties of Roerichs and also for setting up an Art Gallery-cum-Museum, in public interest. Following that meeting, the Roerich and Devika Rani Roerich Estate (Acquisition and Transfer) Ordinance, 1992 was drafted, but could not be issued.
9. The Deputy Commissioner, Bangalore Rural District had reported on 26.6.1993 that though Roerichs had owned 470.19 acres of land including the land used for Linaloe cultivation they had filed declarations only to the extent of 429.26 acres. Out of the extent of 470.19 acres of land owned by them, they had raised Linaloe cultivation to the extent of 356.15 acres and the remaining extent of 114.04 acres was agricultural land. As per the 7ceiling provisions of the Land Reforms Act they were entitled to hold an extent of 54 acres of agricultural land. As such, the excess of 60.04 acres ought to have been surrendered by them to the Government. The view of the Law Department was sought for in that respect and the Law Department on 18.11.93 stated that the earlier order dated 15.03.82 of the Land Tribunal, Bangalore be re-opened and the action under Section 67(1) be initiated for resumption of the excess land. The Deputy Commissioner was requested to issue suitable instructions to the Tahsildar, Bangalore South Taluk to place the matter before the Land Tribunal, for review of the earlier order dated 15.03.82 by invoking the provisions of Section 122A of the Land Reforms Act.
10. The Deputy Commissioner reported that Dr. Roerich had sold an extent of 137.33 acres of land comprising of survey nos. 124, 126 of B.M. Kaval and survey No. 12 of Manavarth Kaval of Bangalore South Taluk on 23.3.1991 to M/s K.T. Plantations Private Limited and it was reported that the request for 8mutation in respect of those lands was declined by the local officers and the lands stood in the name of late Dr. Roerich in the Record of Rights.
11. The Commissioner and Secretary to the Government, Revenue Department taking note of the above mentioned facts sought the legal opinion of the Department of Law and Parliamentary Affairs as to whether valuable lands held by the late Roerichs could be resumed by the State before lands changed hands, by withdrawing the exemption given to the lands used for Linaloe cultivation.
The Department of Law and Parliamentary Affairs in their note No.108:/L/11/94 dated 1.3.1994 opined that the exemption given under Section 107 of the Land Reforms Act, 1961 can be withdrawn by the Government by issuing a notification as per Section 110 of the Land Reforms Act. Consequently the Commissioner and Secretary to the government proposed to issue a notification to that effect for which approval of the Cabinet was sought for. The Cabinet accorded sanction in its meeting held on 04.03.1994 and the Government issued a notification dated 08.03.1994 in 9exercise of powers conferred by Section 110 of the Land Reforms Act, withdrawing the exemption granted for the lands used for cultivation of Linaloe under clause (vi) of Sub-section 1 of Section 107 of the Act. Notification was published in the Government Gazette on 11.03.1994.
12. The Assistant Commissioner, Bangalore sub-division later issued a notice no.LRF:CR 17:93-94 dated 28.03.94 to the company to show cause why 137.33 acres of land be not forfeited to the Government, since it had purchased the above mentioned lands in violation of Section 80 and 107 of the Land Reforms (Amendment) Act, 1973. An enquiry under Section 83 of the Land Reforms Act was ordered for violation of the provisions of the Act. The Company, aggrieved by the above mentioned notice, filed Writ Petition No.12806/94 before the High Court of Karnataka, which was allowed to be withdrawn giving liberty to the petitioner to take recourse to the remedies under law. Due to the status quo order passed, by this Court in these appeals the proceedings pending before the Asst. 10Commissioner, Bangalore following the show-cause notice dated 28.03.1994 was kept in abeyance.
13. Mary Joyce Poonacha, the appellant in Civil Appeal No. 6538 of 2003 had, in the meanwhile, filed W.P. No. 11149 of 1994 before the Karnataka High Court claiming rights over some of the articles belonging to Roerichs' couple on the strength of a will dated 4.3.1994. The writ petition was dismissed by the High Court holding that the articles claimed by the appellant stood vested in the State in view of the Acquisition Act. Against that judgment, Mary Joyce Poonacha has approached this Court and filed Civil Appeal No. 6538 of 2003.
14. The Company, through its Managing Director, filed Writ Petition No. 32560 of 1996 before the Karnataka High Court challenging the constitutional validity of the Acquisition Act, Section 110 of the Land Reforms Act, the notification dated 08.03.1994 issued thereunder and also sought other consequential reliefs. The writ petition was dismissed by the High Court upholding the validity of the Acquisition Act as well as Section 110 of the Land Reforms Act and the notification issued there under except in relation to the inclusion of certain members in the Board of Directors constituted under the Acquisition Act. Aggrieved by the same the Company has come up before this Court in Civil Appeal No.6520 of 2003.
15. Mary Joyce Poonacha and others had also challenged the constitutional validity of the Acquisition Act by filing Writ Petition Nos. 32630-32646 of 1996 before the Karnataka High Court, which were also dismissed in view of the judgment in Writ Petition No. 32560 of 1996. Aggrieved by the same, they have preferred Civil Appeal Nos. 6521-6537 of 2003.
16. When the Civil Appeals came up before a bench of this Court on 28.07.04 and this Court passed an order framing the following substantive questions of law:-
i. Whether Section 110 of the Karnataka Land Reforms Act, 1961, as amended by the Karnataka Land Reforms amendment Act, 1973, (Act 1 of 1974), which came into effect from 01.03.1974, read with Section 79 B of the said Act, introduced by amending Act 1 of 1974, violates the basic structure of the Constitution, in so far as it confers power on the Executive Government, a delegatee of the Legislature, of withdrawal of exemption of Linaloe plantation, without hearing and without reasons?
ii. Whether the Roerich and Devika Rani Roerich (Acquisition and Transfer) Act, 1996, (the Acquisition Act), is protected by Article 31C of the Constitution?
iii. Whether the true interpretation of Article 300A of the Constitution, the said Act is violative of the said Article in so far as no specific compensation prescribed for the acquisition of 468 acres of Linaloe plantation, and, after deduction of liabilities and payment of compensation for the artefacts, no balance may and/or is likely to exist for payment of such compensation, as a result of which, whether the Act really is expropriatory in nature?
iv. Whether on true interpretation of Article 300A of the Constitution, the said Act is violative of Article 300A as the said Article is not, by itself, a source of Legislative power, but such power of the State Legislature being traceable only to Entry 42 of List III of Schedule VII to the Constitution viz., "Acquisition and Requisition of Property", which topic excludes expropriation and confiscation of property?
v. If Article 300A of the Constitution is construed as providing for deprivation of property without any compensation at all, or illusory 13 compensation, and hence providing for expropriation and confiscation of property, whether the said Article would violate the rule of law and would be an arbitrary and unconscionable violation of Article 14 of the Constitution, thus violating the basic structure of the Constitution? Part-I We will first examine the validity of Section 110 of the Land Reforms Act and the notification dated 08.03.94, issued thereunder.
17. Mr. T.R. Andhyarujina, Senior Advocate appearing for the Company submitted that it had purchased the lands from Roerich couple when those lands stood exempted from the provisions of the Land Reforms Act by virtue of Section 107(1)(vi) of the Act. Learned senior counsel submitted that the State Government cannot, in exercise of its powers under Section 110 of the Act, issue notification dated 08.03.94 to withdraw the exemption granted by the Legislature which is essentially a legislative policy. Learned senior counsel also submitted that Section 110 gave unfettered and unguided power to the Executive to take away the exemption granted 14by the Legislature and hence that Section is void for excessive delegation of legislative powers on the State Government. In support of his contention, reliance was placed on the judgments of this court In Re: The Delhi Laws Act, 1912, the Ajmer-Merwara (Extension of Laws) Act, 1947 and the Part C States (Laws) Act, 1950 (1951) 2 SCR 747, Rajnarain Singh v. The Chairman, Patna Admnistration Committee, Patna& Another, AIR 1954 SC 569, Vasantlal Maganbhai Sanjanwala v. State of Bombay and Ors. AIR 1961 SC 4, Hamdard Dawakhana (Wakf) Lal Kuan, Delhi & Another v. Union of India & Others (1960) 2 SCR 671.
18. Learned senior counsel also submitted that the State Government cannot take away retrospectively the vested rights of persons to hold lands used for Linaloe cultivation from 01.03.1974 onwards, without assigning any reasons. Further, it was also submitted that the exemption under Section 107(1)(vi) was granted with respect to the lands used for the cultivation of Linaloe, and not for any specific individual, and there is no bar in 15alienating the land to third parties. In support of the above contention, learned counsel placed reliance on the decisions of this Court in Bakul Cashew Co. and Ors. v. Sales Tax Officer, Quilon and Anr. (1986) 2 SCC 365, Income Tax Officer, Alleppy v. M.C. Ponnoose and Ors. (1969) 2 SCC 351, Regional Transport Officer, Chittoor and Ors. v. Associated Transport Madras (P) Ltd. and Ors. (1980) 4 SCC 597, Cannanore Spinning and Weaving Mills Ltd. v. Collector of Customs and Central Excise, Cochin and Ors. (1969) 3 SCC 112, Hukam Chand etc. v. Union of India (UOI) and Ors. (1972) 2 SCC 601.
19. Shri Andhyarujina also submitted that the show cause notice dated 28.03.1994 was ex facie illegal and that the prohibition of transfer of land under Section 80 of the Act cannot act retrospectively in respect of lands already stood exempted under Section 107(1)(vi) of the Act.
20. Learned senior counsel also refuted the contention of the State that, under Section 107(2) of the Land Reforms Act, there can be only 10 units of land used for Linaloe cultivation exempted under 16Section 107(1)(vii) of the Act. Learned senior counsel submitted that it would be anomalous for the Legislature, by amending the Act, on the one hand, to exempt the lands for cultivation of Linaloe from operation of the Land Reforms Act, without any limit of holding and, at the same time, deprive the existing cultivators of Linaloe, except to the extent of 10 units on 1.3.74. Learned counsel submitted that Section 107(1)(vi) does not put a limit of 10 units of Linaloe lands.
21. Learned senior counsel also submitted that the State Government has also not followed the procedure laid down in Section 140 of the Land Reforms Act and, in any view, the mere laying of the notification before the State Legislature would not cure the infirmity of excessive delegation. Learned counsel also submitted that though the Land Reforms Act was placed in the 9th Schedule which saves its provisions from the challenge of Articles 14, 19 and 31, a challenge to a provision of the Act for excessive delegation of legislative power is still 17available and the Land Reforms Act cannot be protected by Article 31B. Shri Andhyarujina also submitted that the State Govt. was led to deprive the appellants of their property even by-passing the Act when it resorted to withdrawing the exemption available under Section 107(1)(vi) of the Land Reforms Act, by issuing its notification dated 08.03.1994 by withdrawing the exemption and making the Company ineligible to hold the agricultural land under Section 79B of the Land Reforms Act which also provided inadequate compensation.
22. Mr. Basavaprabhu S. Patil, senior counsel for the State of Karnataka submitted that the validity of Section 110 of the Act was never questioned before the High Court on the ground of excessive delegation and hence, the appellants are precluded from raising that contention before this Court. Learned senior counsel submitted that the validity of Section 110 was challenged on the ground of violation of the fundamental rights which was rightly negatived by the High Court since the Land Reforms Act was placed in the IXth Schedule. Learned senior counsel also submitted that the Land Reforms Amendment Act (Act 1 of 1974) was also placed in the IXth Schedule and, hence immune from attack on the ground of violation of Articles 14 or 19 of the Constitution and, hence, the notification dated 8.03.1994 issued under Section 110 of the Act is also immune from challenge. Learned senior counsel submitted that the constitutional validity of the amended Act was also upheld by this Court in H.S. Srinivasa Raghavachar and Ors. v. State of Karnataka and Ors. (1987) 2 SCC 692.
23. Learned senior counsel also submitted that the appellants have no locus standi to maintain these writ petitions since they have not perfected their title over the properties in question. Further, Mrs. Devika Rani Roerich had also disputed the execution of the sale deed dated 16.02.92 and a suit disputing title is pending consideration before the Civil Court. Learned senior counsel also submitted that the company had illegally acquired 141 acres 25 guntas of land in excess of the ceiling prescribed under Section 107(2) of the Land Reforms Act and the 19Act mandates that no person shall, which includes a Company also, after the date of commencement of the Land Reforms Act, i.e., 01.03.74, acquire land in any manner for cultivation of Linaloe to an extent which together with the land cultivated by Linaloe, if any, already held by him exceed 10 units notwithstanding anything contained in sub-section (1) of Section 107.
24. Learned senior counsel further submitted that the provisions of Sections 66 to 76 also shall apply mutatis mutandis, in respect of every acquisition contrary to Section 107(2). Learned senior counsel also submitted that in any view Section 110 of the Land Reforms Act does not suffer from the vice of excessive delegation of legislative powers. Learned senior counsel submitted that Section 110 of the Land Reforms Act is guided by the policy laid down by the state legislature which is discernible from the scheme of the Land Reforms Act, its objective, provisions in Chapter-VIII, history of the amendment substituting Section 107 (1)(vi) etc. Learned counsel also submitted that exemption under Section 20107(1)(vi) was granted to Roerichs' for cultivation of Linaloe, while the Company is statutorily disentitled to hold the land and, hence, the claim for exemption from the provisions of Land Reforms Act is opposed to the policy of the Act. Further nobody can claim the exemption from the provisions of the Land Reforms Act, as a matter of right, much less a Company which is statutorily barred from holding excess agricultural land. By withdrawing the exemption the State Govt. was only giving effect to the underlying legislative policy.
25. Learned senior counsel submitted, but for the exemption granted, Roerichs' would not have held the land used for the cultivation of Linaloe. Exemption was granted to Roerichs subject to Section 110 of the Land Reforms Act and it was with that statutory limitation the Company had purchased the land. Learned senior counsel cited the following judgments of this Court in Municipal Corporation of Delhi v. Birla Cotton, Spinning and Weaving Mills, Delhi and Another AIR 1968 SC 1232; Delhi Cloth & General Mills Ltd. v. Union of India & Others. 21(1983) 4 SCC 166; Premium Granites and Anr. v. State of Tamilnadu and Ors. (1994) 2 SCC 691; Registrar of Co-operative Societies, Trivandrum and Anr. v. Kunjabmu and Ors. (1980) 1 SCC 340.
26. Learned senior counsel also submitted that there is no provision for providing hearing or recording reasons before issuing the notification dated 08.03.1994, while exercising powers under Section 110 of the Act. Learned senior counsel submitted that exercise of powers under Section 110 of the Act is in the nature of subordinate legislation and no opportunity of hearing or recording of reasons are warranted. In support of his contention learned counsel placed reliance on the decisions of this Court in Shri Sitaram Sugar Co. Ltd. and Another v. Union of India and Others (1990) 3 SCC 223; Union of India and Another v. Cynamide India Ltd. and Another Etc. (1987) 2 SCC 720; H.S.S.K. Niyami & Another v. Union of India & Another (1990) 4 SCC 516; Laxmi Khandsari and Ors. v. State of U.P. and Ors. (1981) 2 SCC 600; J. K. 22Industries & Another v. Union of India & Others (2007) 13 SCC 673. 27. Learned senior counsel also submitted that requirement of placing the notification dated 08.03.94 before the State Assembly is not a mandatory requirement once the State Government publishes the notification in the official gazette. Reference was made to the judgment in Jan Mohammad Noor Mohammad Bagban v. State of Gujarat and Anr., AIR 1966 SC 385. Learned senior counsel submitted that in any view of the matter, as per the order of this Court dated 24.2.2011 the State Govt. have already taken steps for placing the notification before both the Houses of the State Legislature. Consequently, the defect, if any, of non-laying the notification, has been cured.
27. The Land Reforms Act was enacted by the Karnataka State Legislature to have a uniform law relating to land reforms in the State of Karnataka, relating to agrarian relations, conferment of ownership on tenants, ceiling on land holdings etc. Chapter II of the Act deals with general provisions 23relating to tenancies, Chapter III deals with conferment of ownership on tenants. Ceiling on land holdings is dealt with in Chapters IV and Chapter V deals with restrictions on holding or transfer of agricultural lands. Chapter VIII of the Act deals with exemptions and Chapter XI deals with the miscellaneous provisions.
28. Appellants in these appeals have challenged the validity of Section 110 of the Act primarily on the ground of excessive delegation of legislative powers on the State Government. To examine that contention it is necessary to refer to certain provisions contained in various Chapters referred to above, the scheme of the Act, its object and purpose, legislative policy underlying in the provisions of the statute etc.
29. Chapter V of the Act, as we have already indicated, imposes certain restrictions on holding or transfer of agricultural lands. Section 79B(1) of the Act prohibits holding of agricultural land by certain persons which says that with effect on and from the date of commencement of the Amendment Act 24(Act 1/74) w.e.f. 1.3.1974, no person other than a person cultivating land personally shall be entitled to hold land; and that it shall not be lawful for, a company inter alia to hold `any land'.
Further sub-section (2) of Section 79B states that the company which holds lands on the date of the commencement of the Amendment Act and which is disentitled to hold lands under sub-section (1), shall within ninety days from the said date furnish to the Tahsildar within whose jurisdiction the greater part of such land is situated a declaration containing the particulars of such land and such other particulars as may be prescribed; and which acquires such land after the said date shall also furnish a similar declaration within the prescribed period. Sub-section (3) of Section 79B states that the Tahsildar shall, on receipt of the declaration under sub-section (2) and after such enquiry as may be prescribed, send a statement containing the prescribed particulars relating to such land to the Deputy Commissioner who shall, by notification, declare that such land shall vest in the State 25Government free from all encumbrances and take possession thereof in the prescribed manner.
Sub-section (4) of Section 79B states that in respect of the land vesting in the State Government under that section an amount as specified in Section 72 shall be paid. Explanation to Section 79B states that for the purpose of that section it shall be presumed that a land is held by an institution, trust, company, association or body where it is held by an individual on its behalf. Section 80 bars transfer of any land to non-agriculturists, which says that no sale, gift or exchange or lease of any land or interest therein etc. shall be lawful in favour of a person who is disentitled under Section 79A or 79B to acquire or hold any land.
30. The first appellant being a company was, therefore, prohibited from holding any agricultural land after the commencement of the Act. If the company was holding any land with Linaloe cultivation on the date of the commencement of the Act, the same would have vested in the State 26Government under Section 79B(3) of the Act and an amount as specified in Section 72 would have been paid. Section 104, however, states that the provisions of Section 38, Section 63 other than sub-section (9), thereof, Sections 64, 79-A, 79-B and 80 shall not apply to plantations and is not made subject to the provisions of Section 110.
31. Section 107 states that the provisions of the Act would not apply to certain lands mentioned therein, but made subject to the provisions of Section 110. Section 107, to the extent it is relevant for the purpose, is extracted below for easy reference: "107. Act not to apply to certain lands.- (1) Subject to the provisions of Section 110, nothing in this Act, except Section 8, shall apply to lands,- xxx xxx xxx xxx xxx xxx (vi) used for the cultivation of linaloe; xxx xxx xxx xxx xxx xxx (2) Notwithstanding anything in sub- section (1), no person shall, after the date of commencement of the Amendment Act acquire in any manner for the 27 cultivation of linaloe, land of an extent which together with the land cultivated by linaloe, if any, already held by him exceeds ten units. (3) In respect of every acquisition contrary to sub-section (2), the provisions of Section 66 to 76 shall mutatis mutandis apply." Section 107, we have already indicated, is made subject to Section 110, which reads as follows: "110. Certain lands to be not exempt from certain provisions.- The State Government may, by notification direct that any land referred to in [Section 107 and 108] shall not be exempt from such of the provisions of this Act from which they have been exempted under the said sections."
32. The question that is canvassed before us is whether Section 110 is invalid due to excessive delegation of legislative powers on the State Government. Before we examine the scope and ambit of the above quoted provision, reference may be made to few of the decided cases of this Court on the power of delegation of legislative functions.
33. In re: The Delhi Laws Act, 1912 (supra), this Court held that legislatures in India have been held to possess wide powers of delegation but subject to 28one limitation that a legislature cannot delegate essential legislative functions which consists in the determination of the legislative policy and of formally enacting that policy into a binding rule of conduct. In Maharashtra State Board of Secondary and Higher Secondary Education and Anr. v. Paritosh Bhupeshkumar Sheth and Others (1984) 4 SCC 27, this Court declared that while examining whether a particular piece of delegated legislation - whether in the form of a rule or regulation or any other type of statutory instrument - was in excess of the power of subordinate legislation conferred on the delegate, has to be determined with reference only to the specific provisions contained in the relevant statute conferring the power to make the rule, regulation etc. and the object and purpose of the Act as can be gathered from the various provisions of the enactment.
It was held that the Court cannot substitute its own opinion for that of the legislature or its delegate as to what principle or policy would best serve the objects and purpose of the Act or sit in judgment over the wisdom and 29effectiveness or otherwise of the policy laid down by the regulation making body and declare a regulation to be ultra vires merely on the ground that, in the opinion of the Court, the impugned provisions will not help to serve the object and purpose of the Act. It is exclusively within the province of the legislature and its delegate to determine, as a matter of policy, how the provision of the Statute can best be implemented and what measures, substantive as well as procedural would have to be incorporated in the rules or regulations for the efficacious achievement of the objects and purposes of the Act. It is not for the Court to examine the merits or demerits of such a policy because its scrutiny has to be limited to the question as to whether the impugned regulations fall within the scope of the regulation-making power conferred on the delegate by the Statute.
34. Law is settled that the Court shall not invalidate a legislation on the ground of delegation of essential legislative functions or on the ground of conferring unguided, uncontrolled and vague 30powers upon the delegate without taking into account the preamble of the Act as also other provisions of the statute in the event they provide good means of finding out the meaning of the offending statute. The question whether any particular legislation suffered from excessive delegation, has to be determined by the court having regard to the subject-matter, the scheme, the provisions of the statute including its preamble and the facts and circumstances and the background on which the statute is enacted. See Bhatnagars & Co. Ltd. v. Union of India AIR 1957 SC 478; Mohmedalli and Ors. v. Union of India and Ors., AIR 1964 SC 980.
35. Further, if the legislative policy is formulated by the legislature, the function of supplying details may be delegated to the executive for giving effect to the policy. Sometimes, the legislature passes an act and makes it applicable, in the first instance, to some areas and classes of persons, but empowers the government to extend the provisions thereof to different territories, persons or commodities, etc. So also there are some statutes which empower the government to exempt from their operation certain persons, commodities, etc. Some statutes authorise the government to suspend or relax the provisions contained therein. So also some statutes confer the power on the executive to adopt and apply statutes existing in other states without modifications to a new area.
36. In Brij Sunder Kapoor v. I Additional District Judge and Ors. (1989) 1 SCC 561 this Court held that the Parliament decided as a matter of policy that the cantonment areas in a State should be subject to the same legislation relating to control of rent and regulation of housing accommodation as in force in other areas of the State and this policy was given effect to by empowering the Central Government to extend to a cantonment area in a State the tenancy legislation as in force as in other areas of the State including future amendments and that there was no abdication of legislative functions by Parliament.
37. Chapter VIII of the Land Reforms Act deals with exemption provisions. Section 104 of the Act 32deals with plantations, which says, that the provisions of Section 38, Section 63, other than sub-section (9), thereof, Sections 64, 79-A, 79-B and 80 shall not apply to plantations, but the power to withdraw the exemption in respect of the plantations, has not been conferred on the State Government, but evidently retained by the Legislature. Legislative policy is therefore clearly discernible from the provision of the Statute itself, that, whenever the Legislature wanted to confer the power to withdraw the exemption to the State Government it has done so, otherwise it has retained the power to itself.
38. Section 110 of the Land Reforms Act empowers the State Government to withdraw the exemption granted to any land referred to in Sections 107 and 108. Section 107 itself has been made "subject to" Section 110 of the Act. The words `subject to' conveys the idea of a provision yielding place to another provision or other provisions to which it is made subject. In Black Law Dictionary, 5th Edn. At p.1278, the expression "subject to" has been defined 33as under: "Liable, subordinate, subservient, inferior, obedient to; governed or effected by; provided that; provided; answerable for."Since Section 107 is made subject to Section 110, the former section conveys the idea of yielding to the provision to which it is made subject that is Section 110 which is the will of legislature. Reference may be made to the decisions of this Court in Punjab Sikh Regular Motor Service, Moudhapara, Raipur v. Regional Transport Authority & Another AIR 1966 SC 1318, Joginder Singh & Others v. Deputy Custodian-General of Evacuee Property & Others AIR 1967 SC 145 and Bharat Hari Singhania & Others v. Commissioner of Wealth Tax (Central) & Others (1994) Supp. 3 SCC 46, Ashok Leyland Ltd. v. State of T.N. & Another (2004) 3 SCC 1, Printers (Mysore) Ltd. v. M. A. Rasheed & Others (2004) 4 SCC 460, South India Corporation (P) Ltd. v. Secretary, Board of Revenue, Trivendrum & Another AIR 1964 SC 207, Commissioner of Wealth Tax, Andhra Pradesh, Hyderabad v. Trustees of H.E.H. Nizam's Family (Remainder Wealth Trust), Hyderabad (1977) 3 SCC 362 34and Chandavarkar Sita Ratna Rao v. Ashalata S. Guram (1986) 4 SCC 447.
39. The Legislature's apathy in granting exemption for lands used for cultivation of Linaloe is discernible from the language used in sub-section (2) of Section 107, which says that no person shall after the commencement of the Amendment Act acquire in any manner for the cultivation of Linaloe, land of an extent which together with the land cultivated by Linaloe, if any, already held by him exceeds ten units. Legislature, therefore, as matter of policy, wanted to give only a conditional exemption for lands used for Linaloe cultivation and the policy was to empower the State Government to withdraw the same especially when the law is that no person can claim exemption as a matter of right. The legislative will was to make Section 107 subject to Section 110 and not the will of the delegate, hence, overriding effect has to be given to Section 110. Further, the Land Reforms Act including Section 110 was placed in IXth Schedule in the year 351965 and, hence, immune from challenge in a court of law.
40. Dr. Roerich and Mrs. Devika had got only the conditional exemption from the provisions of the Land Reforms Act for the lands used for Linaloe cultivation and, hence, they also would have lost ownership and possession of the lands once the exemption had been withdrawn and the land would have vested in the State. The land was purchased by the Company with that statutory condition from Roerichs and, hence, was bound by that condition. We, therefore, reject the contention that Section 110 is void due to excessive delegation of legislative powers.
41. The State Government issued the notification dated 8.3.1994 in exercise of the powers conferred by Section 110 of the Land Reforms Act which was published in the official gazette on 11.3.94. Section 2(22) of the Act defines `Notification' to mean a notification published in the official gazette. Section 23 of the General Clauses Act 1897 36also states that the publication in the official gazette of a rule or by-law purported to have been made in exercise of power to make rules or by-laws after previous publication shall be conclusive proof that the rule or by-law has been duly made.
42. This Court in B.K. Srinivasan and Ors. v. State of Karnataka and Ors. (1987) 1 SCC 658 held as follows:- "Unlike Parliamentary legislation which is publicly made, delegated or subordinate legislation is often made unobtrusively in the chambers of a minister, a secretary to the Government or other official dignitary. It is, therefore, necessary that subordinate legislation, in order to take effect, must be published or promulgated in some suitable manner, whether such publication or promulgation is prescribed by the parent statute or not. It will then take effect from the date of such publication or promulgation."
43. So far as this case is concerned, the State Government has already followed the legal requirement of publication of the notification dated 08.03.1994 which came into effect on 11.03.94.
44. Mr. T.R.Andhyarujina, learned counsel appearing for the appellants submitted that the respondent State has not followed the procedure laid 37down in Section 140 of the Act and that the approval of the notification by the State Legislature is an important circumstance to be taken into account in determining its validity. Learned counsel submitted that laying of notification under Section 140 is not a mere laying but is coupled with a negative/affirmative resolution of the Legislature; the failure to lay the notification is an illegality which cannot be cured.
45. Following is the procedure generally followed when an order or notification is laid before the Legislature:-
1) Laying which requires no further procedure;
2) Laying allied with the affirmative procedure; and
3) Laying allied with negative procedure.
46. The object of requirement of laying provided in enabling Acts is to subject the subordinate law making authority to the vigilance and control of the Legislature. The degree of control the Legislature wants can be noticed on the language used in such laying clause.
47. We have in this case already found that there 38has not been any excessive delegation of legislative powers on the State Government and we may now examine whether the failure to follow the procedure laid down under Section 140 of the Act has affected the legal validity of the notification. Facts would indicate that, in the instant case, the notification has not been laid before the Legislature, but looking at the language of Section 140, it has not affected the validity or the effect of the notification. For easy reference Section 140 is extracted hereunder: "Section 140. Rules and notifications to be laid before the State Legislature.-
Every rule made under this Act and every notification issued under Sections 109, 110 and 139 shall be laid as soon as may be after it is made or issued before each House of the State Legislature while it is in session for a total period of thirty days which may be comprised in one session or in two successive sessions, and, if, before the expiry of the session in which it is so laid or the session immediately following both Houses agree in making any modification in the rule or notification or both Houses agree that the rule or notification should not be made, the rule or notification shall thereafter have effect only in such modified form or be of no effect, as the 39 case may be; so however that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or notification." (Emphasis supplied)
48. The Constitution Bench of this Court in Jan Mohammad Noor's case (supra) examined the effect of sub-section 5 of Section 26 which provides that the rules shall be laid before each House of the provisional Legislature, for giving effect. Interpreting that provision the Court held that Section 26(5) of Bombay Act 29 of 1939 does not prescribe that the Rules acquired validity only from the date on which they have been placed before the House of Legislature. The Court held that the Rules are valid from the date on which they are made under Section 26(1). The Court noted that the Legislature has prescribed that the Rules shall be placed before the House of the Legislature, but held that the failure to place the rules before the House of Legislature does not effect the validity of the rules and merely because they have not been placed before the House of the Legislature, the provision cannot be regarded as mandatory.
49. This Court in Atlas Cycle Industries Ltd. & Others v. State of Haryana (1979) 2 SCC 196 examined the question relating to the non-compliance with sub-section (6) of Section 3 of the Essential Commodities Act, 1955 which provides that every order made under the section shall be laid before both Houses of Parliament as soon as may be, after it is made. The Court held that non-compliance with the Laying Clause did not affect the validity of the order and make it void. In Quarry Owners' Association v. State of Bihar & Others (2000) 8 SCC 655, this court while examining the scope of Section 28(3) of the Mines and Minerals (Regulation and Development) Act 1957, stated that when a statue required the placement of a notification before the State Legislature it is the obligation of the state to place the same with the specific note before each House of State Legislature. Even if it had not been done, the State could place the same before the House at the earliest and the omission to comply with it would not affect the validity of the 41notifications and their coming into force. Direction was issued to the State Government to lay notifications at the earliest.
50. Section 140 does not require the State Legislature to give its approval for bringing into effect the notification, but a positive act by the Legislature has been contemplated in Section 140 to make the notification effective, that does not mean that failure to lay the notification has affected the legal validity, its effect or the action taken precedent to that notification. We, therefore, hold that non-laying of the notification dated 08.03.1994 before the State Legislature has not affected its validity or the action taken precedent to that notification. We have now, vide our order dated 24.02.2011, directed the State Government to place the notification before both the Houses of the State Legislature following the judgment in Quarry Owners' case (supra). Therefore, the defect, if any, of not placing the notification has been cured.
51. We may also consider the effect of Section 80 of the Land Reforms Act on Section 79-B. 42Section 80 prohibits transfer of any land to non-agriculturalist. Section 80(1)(iv), states that it shall not be lawful to sell, gift, exchange or lease of any land, in favour of a person, who is disentitled under Section 79-B, to acquire or hold any land. The expression "land" has been defined under Section 2(18) which is all comprehensive and takes in agricultural lands, that is land which is used or capable of being used for agriculture, but for the exemption granted under Section 107(1)(vi) lands used for the cultivation of linaloe would have fallen under Section 2(18). But, so far the company is concerned, the prohibition was total and complete since Section 79-B states that it would not be lawful for a company to hold "any land", with effect and from the date of the commencement of the amending Act. The Company, therefore, could not have held the land used for the cultivation of Linaloe on the date of the commencement of the Act. Further on withdrawal of exemption vide notification dated 08.03.94 the Company was disentitled to hold the land belonging to Roerichs' since the same would 43be governed by the provisions of the Land Reforms Act.
52. We also find no force in the contention that opportunity of hearing is a pre-condition for exercising powers under Section 110 of the Act. No such requirement has been provided under Section 107 or Section 110. When the exemption was granted to Roerichs' no hearing was afforded so also when the exemption was withdrawn by the delegate. It is trite law that exemption cannot be claimed as a matter of right so also its withdrawal, especially when the same is done through a legislative action. Delegated legislation which is a legislation in character, cannot be questioned on the ground of violation of the principles of natural justice, especially in the absence any such statutory requirement. Legislature or its delegate is also not legally obliged to give any reasons for its action while discharging its legislative function. See - State of Punjab v. Tehal Singh and Ors. (2002) 2 SCC 7; West Bengal Electricity Regulatory Commission v. CESC Ltd. etc. etc. (2002) 8 SCC 44715; Pune Municipal Corporation and Anr. v. Promoters and Builders Association and Anr. (2004) 10 SCC 796; Bihar State Electricity Board v. Pulak Enterprises and Ors. (2009) 5 SCC 641.
53. We, therefore, repel the challenge on the validity of Section 110 of the Karnataka Land Reforms Act as well as the notification dt.8.3.1994 and we hold that the land used for linaloe cultivation would be governed by the provisions of the Land Reforms Act which is protected under Article 31B of the Constitution having been included in the IXth Schedule. PART-IIConstitutional Validity of the Acquisition Act
54. The State Government after withdrawing the exemption granted to the lands used for Linaloe cultivation, felt the necessity to take effective and proper steps to manage the estate, its tree growth, preserve paintings, artefact and other valuables of Roerichs' and their transferees and to establish an Art Gallery-cum-Museum. For the said purpose initially the State issued an ordinance, namely, the Roerich and Devika Rani Roerich Estate (Acquisition and Transfer) Ordinance 1992, which was sent for the approval of the President of India. In the meanwhile Roerich couple passed away and the ordinance was returned to make sufficient amendments. After necessary amendments ordinance of 1995 was issued. However, the ordinance was returned by the Government of India informing that it had no objection to introduce legislation as a bill and hence the same with requisite amendments was placed before the Legislative Assembly and the Legislative Council. The Acquisition Act was then passed and subsequently got the assent of the President on 15.11.96 and was brought into force on 21.11.1996.
55. The Act was questioned by filing a writ petition before the High Court of Karnataka on the ground that enactment providing for compulsory acquisition of Titgunni Estate was not for public purpose and the compensation provided thereunder was illusory. During the pendency of the writ petition the Act was amended by the Amendment Act 2001, w.e.f. 01.11.96 by inserting a new Section 19A to 46provide clarity for payment of amount to the owners/interested persons. The challenge against the validity of the Act and its provisions were repelled by the High Court except in relation to certain provisions, providing for the inclusion of certain members in the board of directors constituted under the Act.
56. Shri Andhyarujina, submitted that the impugned Act does not contain any provision for protection of agrarian reforms and hence not protected by the provisions of Article 31A and hence not saved from challenges on the ground of violation of Articles 14 and 19 of the Constitution. Learned counsel also pointed out that the management and protection of land used for linaloe cultivation and the preservation of artefacts, paintings etc. are not part of agrarian reforms. Learned senior counsel submitted that concept of agrarian reforms is a dynamic one and this Court in various decisions examined its meaning and content. Reference was made to the judgments of this Court in State of Kerala v. Gwalior Rayon Silk Manufacturing (Wvg.) 47Co. Limited (1993) 2 SCC 713, Kavalappara Kottarathil Kochuni & Others v. State of Madras & Others (1960) 3 SCR 887, P. Vajravelu Mudaliar v. Special Deputy Collector, Madras and Another (1965) 1 SCR 614, Balmadies Plantations Ltd. & Others v. State of Tamil Nadu (1972) 2 SCC 133.
57. Shri Andhyarujina, also submitted that the impugned Act is ex-facie repugnant to the provisions of Land Acquisition Act, 1894 and hence void under Article 254(1) due to want of Presidential assent on repugnancy. Learned Counsel elaborately referred to the various provisions of the impugned Act and the Land Acquisition Act to bring home his point on repugnancy between both the Legislations, the former being a State Legislation and the latter being a Central Legislation. Learned Counsel specifically pointed out that the procedure and the principle for the acquisition of land as well as determination of compensation, etc., under both the Acts are contrary to each other and hence the impugned Act can be saved only if Presidential assent is obtained under Article 254(2) of the constitution. Learned Counsel 48submitted that the Acquisition Act is in pith and substance a law on acquisition and presidential assent under Article 254(2), was warranted to save that Legislation.
58. Shri K.N. Bhat, learned senior counsel appearing for the appellants in CA No.6521-6537 of 2003 submitted that Article 300A is almost a replica of Article 31(1), hence, all the judicial pronouncements rendered by this Court on Article 31(1) would equally apply when we interpret Article 300A. Learned counsel also referred to the view expressed by Justice Subba Rao in P. Vajravelu Mudaliar's case (supra) and also referred to Subodh Gopal Bose v. Bejoy Kumar Addya and Others (1973) 2 SCC 105 and few other decisions. Learned counsel submitted that the concept of eminent domain has to be read into Article 300A, which is an over-arching principle. Learned counsel also submitted that the concept of reasonableness, could be the touchstone while interpreting a statute enacted to deprive a person of his property under Article 300A. Learned counsel also referred to the Judgment of this Court 49in Kavalappara Kottarathil Kochuni's case (supra) and submitted that a person can be deprived of his property only by a valid law which can be tested in the light of Articles 14 and 21.
59. Shri Dushyant R. Dave, learned senior counsel appearing for the appellants in CA No.6520 of 2003 also supported the arguments of Shri Andhyarujina and submitted that the concept of eminent domain be read into Article 300A of the Constitution and the impugned Act is unconstitutional for not providing adequate compensation to the transferors. Reference was made to several decisions of this Court including the decisions in P. Vajravelu Mudaliar v. Special Deputy Collector, Madras & Anr. (1965) 1 SCR 614; Rustom Cavasjee Cooper (Banks Nationalisation) v. Union of India (1970) 1 SCC 248; Deputy Commissioner and Collector, Kamrup & Ors. v. Durga Nath Sharma (1968) 1 SCR 561 and Reliance Energy Limited & Anr. v. Maharashtra State Road Development Corporation Ltd. & Ors. (2007) 8 SCC 1 etc.
60. Shri Andhyarujina, referring to the letter dated 20.09.1996 submitted that the State of Karnataka had sought the assent of the President only for the specific purpose of Clause(a) of Clause (1) of Article 31-A of the Constitution and not for any other purpose and the assent was given only in response to the said proposal of the State Government and there had never been any proposal pointing out the repugnancy between the impugned Act and the Land Acquisition Act and hence the impugned Act is void of ex-facie repugnancy between provisions of the existing Land Acquisition Act 1894 and the impugned Act. In support of his contentions learned counsel placed reliance on judgments of this Court in Gram Panchayat of Village Jamalpur v. Malwinder Singh & Others (1985) 3 SCC 661; Kaiser-I-Hind Pvt. Ltd. & Another v. National Textile Corporation (Maharashtra North) Ltd. & Others (2002) 8 SCC 182.
