Kannepalli China Venkata Chalamayya vs State of Madras

Subbaa Rao, C.J.—The following question has been referred to Full Bench by a Divisional Bench of this Court:

Whether the decision in Rajah of Bobbili (sic)te of Madras, 1952 1 Mad LJ 174: (AIR Mad 203) (A), in so far as it held that (sic)as Act XXX of 1947 does not offend (sic)st S. 899 of the Government of India Act is good law?

Before I proceed to consider the question will be convenient to notice briefly the notifications of Madras Estates Land (Reductions Rent) Act, XXX of 1947 (hereinafter referred TO AS ''the Act''), and the scope of the decision in Rajah of Bobbili v. State of Madras (A)'' (supra). The descriptive title of the Act iS "An Act to provide for the reduction of rents payable by ryots in estates governed by the Madras Estates Land Act, 1908, approximately to the level of the, assessments levied on, lands in ryotwari areas in the, neighbourhood (and for the collection of such rents exclusively, by the State Government)." The preamble-says: "Whereas the rents now payable by ryots in estates governed by the Madras Estates Land Act, 1908, are in many cases substantially higher than the assessments levied on lands in ryotwari areas in the neighbour hood; and whereas it is expedient to provide for the reduction of such rents approximately to the level of the ryotwari assessments in the neighbourhood; (and for the collection of such rents exclusively by the State Government)." The words in the brackets, both in the long title as well as in the preamble, were added by S. 2 of the Madras Estates Land (Reduction of Rent) Amendment Act, 1951 (Madras Act VII of 1951). Sections 2 and 3 prescribe the matter in which, the rents are Deduced to ryotwari level and fixed. The rent fixed shall take effect from the commencement of the fasli year 1357. Sub-section (4) of S. 3 provides that the rents due in respect of ryoti lands, with effect from the commencement of the fasli year 1357 as well as the rents which have fallen or may fall due in respect of such lands for any fasli subsequent to fasli 1357 until the commencement of the fasli year in which the estate may be finally taken over by the State Government shall be recovered by the State Government as if such rents were arrears of land revenue due to them. It also enjoins on the State Government to hand over to the landholder the amount so recovered after deducting there from the cost of such recovery as determined in accordance with such rules as may be made by the State Government in that behalf, and also the peshkash, cesses, and other moneys due from the landholder to the State Government, and constituting a charge on the estate. Under sub-s. (7) (which was added by Madras Act VII. of 1951), the landholder shall not be entitled to collect, and the provisions of Chs. V and VI of the Madras Estates Land Act, 1908, shall cease to apply to, any rents or interest recoverable by the State Government under sub-s. (4).. The said Act applies to all estates as defined in S. 3(2) of the Madras Estates Land Act, 1908. The effect of the aforesaid provisions is that, in regard to such estates, after the notified date, the rents are reduced to the ryotwari level in the manner prescribed; the landholder ceases to have any power to collect the rents there from; the State takes over the said power to collect the rents and collects them and pays the landholder the net amount after deducting the various amounts charged on the land.

The validity of this Act was questioned in 1952 1 Mad LJ 174: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, on the ground, among others, that ''it infringed the requirements of S. 299(2) of the Government of India Act, 1935, and also for the reason that it had become void under Art. 13 of the Constitution of India as being inconsistent with the fundamental rights declared.in Art. 31(2), Art. 19 and Art. 14 of the Constitution. Rajamannar, C.J. and Venkatarama Ayyar, J., considered the arguments in detail and expressed their opinion in clear terms., Rajamannar, C.J., summarised his view at p. 183 (of Mad LJ): (at p. 210 of AIR) thus:

''Now let us look at the Act now impugned. It provides (a) for the reduction of rents and

(b) for the collection of the reduced rents by the Government. I have no hesitation in holding that by reducing the rent payable by a tenant to a landlord, there cannot be an acquisition by the Government of any right or property of the landlord. Undoubtedly, a reduction of rent would adversely affect the landlord. It would deprive him of a part of the benefit which he had been deriving from his property. But that element alone would not render the legislation confiscatory or expropriatory. There is no transference of any right of the landlord, to the Government. There is no vesting in the Government of any right of the landlord. The provision merely regulates the relationship between the landlord and the tenant. The landlord is entitled to collect from his tenant only the lawful rent and the Act determines that lawful rent is

This collection must be deemed to be made only on behalf of the landholder, because the Government does not have any beneficial interest in the amount collected, except of course, to pay themselves the cost of the collection. The balance of the rents is payable to the landholder. The Government is, as it were, a statutory agent of the landholder for collection

There is no divesting of any right of the landholder and no corresponding vesting of the same in the agent.

The aforesaid passage brings out in clear terms why, in the view of the learned Judge, the provision of S. 299 of the Government of India Act were not violated by the passing of the above Act. He accepted the orthodox meaning of the word ''acquisition'' and confined it to transference of the landlord''s title to, and the vesting of the same in the Government. Dealing with the alternative argument, the learned Chief Justice was inclined to accept the following opinion expressed by Harlan, J., cited in St. Louis and S. F. R. Co. v. Gill, (1895) 156 US 6: 39 Law Ed 567 (B):

there is a remedy in the Courts for relief, against legislation establishing a tariff of rates which is so unreasonable as to practically destroy the value of the property of companies engaged in the carrying on of business, and that especially may the Courts of United States treat such a question as a judicial one and hold such acts of legislation to be in conflict with the Constitution of the United States as depriving the companies of their property without due process of law, and, as depriving them of the equal protection of the laws.

After citing that passage with approval, the learned Chief Justice proceeded to state at (sic)190 (of Mad LJ): (at pp. 214-215 of AIR)

I see no reason why this salutary principle enunciated in several American decision should not be applied in this country in constituing Arts. 14, 19 and 31 of the Constitution. Even applying these principles, I am, however, not persuaded by Mr. Vedantachariar to hold that the provisions of the Act as such inevitable transgress the limits allowed to the Legislature by conflicting with the provisions of Para III of the Constitution.

It is necessary, therefore, before and landholder can be given relief on the principle above mentioned, that he should allege and prove facts which conclusively show that as result of the reduced rates of rent fixed under the Act, he has been totally or substantial deprived of the net income available to him. Venkatarama Ayyar, J., summarised his vis. on the application of S. 299 of the Government of India Act at p. 200 (of Mad LJ): (at p. 2 of AIR) thus:

(1) For S. 299(2) to apply there must a transfer of land or interest in land;

(2) mere reduction of rent or enhaucem of assessment is not acquisition even those the value of the property might suffer dimition;

(3) an acquisition contemplated by S. 1 (2) is of the entire bundle of rights of the propriated owner but if all the substantial (sic) ments of rights have been taken away it (sic) be treated as an acquisition notwithstanding that some unessential ingredients of the riger are left unaffected; and

(4) a legislation which merely takes away the right of management without interfere with the title of the owner or his right to, come from the property is not within S. 299 (2).

Referring to the argument based on Art. 31 of the Constitution, the learned Judge stated at p. 203 (of Mad LJ): (at p. 223 of AIR) thus.

The objections put forward on the b(sic) of Art. 31(2) are identical with those urged connection with S. 299(2) of the Government of India Act 1935, and for the reasons already given they must be overruled.

Adverting to the objection based on Art. 11 (f) of the Constitution, the learned Judge inclined to hold that Art. 19(1) (f) had no application and, in any event, he was prepared to hold that the Act was saved by Art. 19 as a reasonable limitation on the rights of proprietor made in the interests of the pursued. The learned Judge dealt with the special a(sic) ment of Mr. Vendantachariar, viz., that by the (sic)cess embodied in the Act the Zamindar unjustly deprived of his property, as con(sic) only to the infringement of Art. 19(l)(f) which as, the learned Chief Justice met it in the text of Art. 31(2) also. The learned Judge; that the answer would depend upon an intigation of facts but they were concerned; with the validity of the legislation as a (sic)ind there was no legal basis to hold that it was Invalid.

Both the learned Judges agreed that the Act did not offend either S. 299(2) of the Government of India Act or Arts. 14, 19(1) (f) and 31(2) of the Constitution of India. While Rajamannar, C. J., held that the word ''acquitition'' involved a transfer of title to and the (sic)esting of it in the State Government, Venkataama Ayyar, J. did not specifically state, though I do not think that the learned Judge conseiously omitted that word, that it should (sic)est in the Government. Both the learned Judges concurred that the mere reduction of rent (sic)nd taking over management by the Government would not be acquisition within the meaning of that section. While the learned Chief justice held that if the effect of the reduction (sic) rents and the taking over of the right to collect such rents amounted to a total deprivation of the landlord''s title, it would offend Arts. 1, 19(1)(f) and 31(2) of the Constitution, Venatarama Ayyar, J., was of the view that it should offend Arts. 14 and 19(l)(f) of the Constitution.

Before I consider the impact of the two judgments of the Supreme Court on the reasoning and conclusion arrived by the learned Judges in the aforesaid decision, I should like to clear the ground. The relevant provisions of Art. 31 of the Constitution of In-(sic)a, as amended by The Constitution (Fourth) Amendment Act, 1955, may usefully be extracted at this stage:

(1) No person shall be deprived of his property save by authority of law.

(2) No property shall be compulsorily acquired or requisitioned save for a public purpose d save by authority of a law which provides compensation for the property so acquired requisitioned and either fixes the amount of the compensation or specifies the principles on which, and the manner in which, the compensation is to be determined and given; and no (sic)h law shall be called in question in any part on the ground that the compensation proposed by the law is not adequate.

(2A) Where a law does not provide for the transfer of the ownership or right to possession any property to the State, or to a corporation owned or controlled by the State, it shall be deemed to provide for the compulsory (sic)uisition or requisitioning of property notwithstanding that it deprives any person of his property.

** ** **

Nothing in cl. (2) shall affect - (a) the provisions of any existing law other on a law to which the provisions of cl. (6) (sic)ly, or

(b) the provisions of any law which the (sic) may hereafter make -

(i) for the purpose of imposing or levying tax or penalty;

(ii) for the promotion of public health or prevention of danger to life or property, or

(iii) in pursuance of any agreement enter to between the Government of the Dominion of India or the Government of India and the Government of any other country, or otherwise, with respect to property declared by law to be evacuee property.

X XX XX

31-A. (1) Notwithstanding anything contained in Art. 13, no law providing for -

(a) the acquisition by the State of any estate or any rights therein or the extinguishment or modification of any such rights, or

(b) the taking over of the management of any property by the State for a limited period either in the public interest or in order to secure the proper management of the property, shall be adeemed to be void on the ground that it is inconsistent with, or takes away or abridges any of the rights conferred by Art. 14, Art. 19 or Art. 31:

Provided that where such law is a law made by the Legislature of a State, the provisions of this Article shall not apply thereto unless such law, having been reserved for the consideration of the President, has received his assent.

The provisions of Art. 31-A do not apply to the Act by reason of the proviso, as this Act was not reserved for the consideration of the President and had not received his assent. Nor could Art. 31 be invoked as cl. (5) thereof could save from its operation provisions of an existing law, i.e., a law passed or made before the commencement of the Constitution by any Legislature having power to make such a law (see Art. 366), except a law enacted not more than 18 months before the commencement of the Constitution and submitted to the President within three months for his certificate and is certified by him. The Act was not one of the laws reserved for the certification of the President. The question of the validity of the Act, therefore, falls to be tested on the touch-stone of the provisions of S. 299 of the Government of India Act. The Constitution of India does not either expressly or by necessary implication, validate Acts that were void under the law existing before the Constitution. I will, therefore, proceed to consider the arguments of the learned counsel as regards the invalidity of the Act by reason of its infringing the provisions of S. 299 of the Government of India Act. The learned counsel contended that the substratum of the judgment of the learned Judges in Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, was that the word ''acquisition'' meant only transfer of interest from the owner and the vesting of it in the Government and the same was taken away or destroyed by the decision of the Supreme Court in The State of West Bengal Vs. Subodh Gopal Bose and Others, and Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, , and therefore, that decision in so far as it held that the process of reducing the rents and taking over possession by the Government under the Act was not acquisition within the meaning of S. 299 of the Government of India Act. 1935 was no longer good law. The learned Advocate-General, on, the other hand, broadly contended that the Supreme Court in the aforesaid two, decisions also held that the word ''acquisition'' involved the idea of transfer but that they only held that cls. (1) and (2) of Art. 31 of the Constitution must be read together as embodying the doctrine of eminent domain. As the arguments mainly turned upon the aforesaid two Supreme Court decisions, it is necessary, to consider the scope of the two decisions in the context of the meaning to be given to the word ''acquisition''.

Before I do so, it will be convenient to read the provisions of S. 299 of the Government of India Act and the relevant, provisions of Art. 31 of the Constitution in juxtaposition.

Section 299 of the Government of India Act.

Article 31 of the Constitution (Before the Constitution - (Fourth Amendment) Act, 1955.

(1) No person shall be deprived of his property in British India save by authority of law.

(2) Neither the Federal nor a Provincial Legislature shall have power to make any law authorising the compulsory acquisition for public purposes of any land, or any commercial or industrial undertaking or any interest in, or in any company owing, any commercial or industrial undertaking unless the law provides for the pay-ment of compensation for the property acquired and either fixes the amount of the compensation or specifies the principles, on which, it is to be deter-mined.

(5) In this section ''land'' includes immovable property of every kind and any rights in or over such property, and ''undertaking'' includes part of an undertaking.

(1) No person shall be deprived of his property save by authority of law.

(2) No property, mova-ble or immovable, including any interest in, or in any company owning, any commercial or industrial undertaking, shall be taken possession of or acquired for public pur-poses under any law jiuthorlsing the taking of such possession or such acquisition, unless the law provides for compensation for the property taken possession of or acquired and either fixes the amount of the compensation, or specifics. the principles on which, and the manner in which, the compensation is to be determined and given.

The only difference between the two provisions is that while S. 299(2) does not affect movable property, movable property is also brought within the scope of Art. 31(2) of the Constitution. While the words compulsory acquisition'' are used in S. 299, the words ''taken possession'' are introduced in Art. 31(2) of the Constitution. In other respects so far as it is material to the question now raised, there, is no substantial difference between the two provisions. It may be noticed that Art. 31(1) of the Constitution corresponds to S. 299(1) of the Government of India Act with the omission of the unnecessary words ''British India''.

Prima facie, there is no reason why conflicting or different meanings should be given to the word ''acquisition'' found in S. 299 of the Government of India Act and Art. 31 of the Constitution. Both the provisions are designed and intended to protect persons from being deprived of their property by the State with out paying compensation. Unless there are compelling reasons, there is no justification form accepting the argument that the word ''acqusition'' in Art. 31(2) is used in a sense different from that given to the same word in S. 299 of the Government of India Act.

The first decision of the Suprentendent Court is that of 1954 1 Mad LJ 314: (AIR 195 SC 92) (C). The 1st respondent therein purchased the entire Touzi No. 341 of the 24-Pa(sic) ganas Collectorate at a revenue sale held on 9th January 1942. As such purchaser, he acquired under S. 37 of the Bengal Revenue Sales Act, 1859, the right ''to avoid and annul all under-tenures and forthwith to eject all under tenants'' with certain immaterial exceptions. exercise of that right he gave notices of ejectment and brought a suit in 1946 to evict certain under-tenants, including the 2nd respondent and to recover possession of the lands. The suit was decreed against the second respondent and he preferred an appeal to the District Court contending that his under-tenure car(sic) within one of the exceptions referred to in 37. While the appeal was pending, the We Bengal Revenue Sales (West Bengal Amedment ) Act, 1950, was enacted and came in force on 15th March, 1950. By that Act, that scope of protection given to tenants by S. (sic) was enlarged and by S. 7 it was provided the all pending suits, appeals and other proceedings which had not already resulted in d(sic) very of possession should abate. The valid of that Act was questioned on the ground that it contravened the plaintiff''s fundamental rights under Art. 19(1) (f) of the Constitution On behalf of the State it was argued that respondent was deprived of his right under authority of law within the meaning of Art. of the Constitution and, therefore, such d(sic) rivation was lawful and could not be challenged. In that context, the learned Judges considered the scope of Art. 31 of the Constitution of India. Patanjali Sastri, C. J., at p. 323 Mad LJ): (at p. 98 of AIR), states the scope of Art. 31 thus:

The result is that Parliament alone co-authorise interference with the enjoyment private property. Blackstone also says that is the Legislature alone that can interpose compel the individual to part with his property. It is this limitation which the framer our Constitution have embodied in cl. (1) Art. 31 which is thus designed to protect rights to property against deprivation by State acting through its executive organ, Government. Clause (2) imposes two further limitations on the Legislature itself. It is exhibited from making a law authorising ex priation except for public purposes and payment of compensation for the injury twined by the owner. These important limitions on the power of the State acting through the executive and legislative organs, to a Way private property are designed to property the owner against arbitrary deprivation on property. Cls. (1) and (2) of Art. 31 are not mutually exclusive in scope and cor out should, in my view, be read together and under stood as dealing with the same subject, (sic)tamely, the prosecution of the right to property by means of the limitations on the State (sic)ower referred to above, the deprivation con-(sic)emplated in cl. (1) being no other than the acquisition or taking possession of property referred to in cl (2).

At p. 324 (of Mad LJ): (at p. 99 of AIR), the learned Chief Justice says that the word ''acquisition'' is not a term of art, and it ordinarily (sic)leans ''coming into possession of, obtaining, (sic)inning or getting as one''s own'', and it is in the general sense that the word has been used in Art. 19(1) (f) and not as implying any transfer or vesting of title. He makes it clearer at a after stage when he says:

to say that acquisition implies the transfer and vesting of title in the Government is (sic) overlook the real nature of the power of the State as a sovereign acting through its lesislative and executive organs to appropriate (sic) property of a subject without his consent, then the State chooses to exercise such power, creates title in itself rather than acquire it (sic)m the owner, the nature and extent of the (sic)le thus created depending on the purpose and (sic)iration of the use to which the property appopriated is intended to be put as disclosed the law authorising its acquisition. No for-(sic)ila of vesting is necessary.

In another place the same idea is re-stated us:

I am of opinion that the word ''acquisition'' (sic) its grammatical variations should, in the text of Art. 31 and the Entries in the Lists referred to above, be understood in their ordi-nary sense, and the additional words ''taking possession of or ''requisitioning'' are used in Art. 31(2) and in the Entries respectively, not contradistinction with, but in amplification the term ''acquisition'' so as to make it clear that the words taken together cover even those (sic)ds of deprivation which do not involve the (sic)tinued existence of the property after it is acquired. They would, for instance include (sic)truction which implies the reducing into session of the thing sought to be destroyed a necessary step to that end The expression ''taking possession'' can only mean taking (sic) possession as the property is susceptible and not actual physical possession, as ''the (sic)srest in, or in any company owning, any commercial or industrial undertaking'', which is (sic)ressly included in cl. (2) of Art. 31, is not acceptible of any actual physical occupancy or (sic)ure.

(sic)h to the same effect is the following pas-(sic)at p. 328 (of Mad LJ): (at p. 101 of AIR):

Under the Constitution of India, however, (sic) questions must be determined with referred to the expression ''taken possession of or (sic)lired'' as interpreted above, namely that it (sic)t be read along with the word ''deprived'' in (1) and understood as having reference to (sic) substantial abridgement of the rights of partnership as could amount to deprivation of the owner of his property. No cut and dried test can be formulated as to whether in a given case the owner is ''deprived'' of his property within the meaning of Art. 31; each case must be decided as it arises on its own facts.

On the facts of that case, the learned Judge found it difficult to hold that the abridgement sought to be effected retrospectively of the rights of a purchaser at a revenue sale, was so substantial as to amount to a deprivation of his property within the meaning of Art. 31(1) and (2).

Mahajan, J., for reasons given in his judgment in Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, which 1 will presently consider, agreed with the learned Chief Justice. Das, J differed from the learned Chief Justice on the interpretation of Art. 31 of the Constitution.

Ghulam Hasan, J., agreed with the learned Chief Justice. Jagannadbadas, J., expressed the view that though the words ''taking possession'' and ''acquisition'' amount to ''deprivation'', the converse does not follow in the particular context in which those words and phrases were used. The learned Judge also dissented from the view expressed by Das, J., in regard to the meaning attributable to the words ''acquisition'' and ''taking possession'' in Art. 31(2). The learned Judge observes thus:

I am unable to agree with my learned brother Justice S. R. Das that "acquisition'' and ''taking possession'' in "Art. 31(2) have to be taken as necessarily involving transfer of title or possession. The words or phrases appear to me to comprehend all cases where the title or possession is taken out of the owner and appropriated without his consent by transfer or extinction or by some other process, which in substance amounts to it, the possession in this context meaning such possession as the nature of the property admits and which the law recognises as possession.

The learned Judge concludes:

To my mind Art. 31(1), though part of an Article is in essence an independent provision to some extent overlapping with the requirements of the Law of Eminent Domain.

As some of the Judges were also parties to the decision in Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, it will be convenient to refer to that decision also for ascertaining the majority view on the interpretation of Art. 31(2) of the Constitution. There, the result of the provisions of the Sholapur Spinning and Weaving Mills (Emergency Provisions) Ordinance was that all the properties and effects of the company passed into the hands of persons nominated by the Central Government who were not members of the company or its share-holders, or in any way connected with It The combined effect of the provisions of Ss. 3, 4 and 12 was that the Central Government became vested with the possession, control and management of the property and effects of the company and the normal function of the company under the Articles and the Indian Companies Act came to an end. The Supreme Court, by majority, held that the effect of the said Ordinance was in effect a deprivation of the properties of the company within the meaning of Art. 31 of the Constitution without compensation and was not covered by the exception in cl. (5) (b) (ii) of that Article. Mahajan, J., who delivered the leading judgment expressing the majority view, after analysing the provisions of the Ordinance and the effect of the said Provisions on the company came to the conclusion that, in substance, the company and its shareholders as well as its directors and managing agents were completely deprived of possession of the property and effects of the company and its possession had been taken by the Central Government, i.e., the Union of India. On the basis of that finding the learned Judge considered the validity of the said Ordinance with reference to the provisions of Art. 31 of the Constitution. The learned Judge summarised his view of the combined effect of Art. 31(1) and (2) at p. 366 (of Mad LJ): at p. 128 of AIR) thus:

The result of the above discussion is that, in my opinion, Art. 31 is a self-contained provision delimiting the field of eminent domain and Art. 31(1) and (2) deal with the same topic of compulsory acquisition of property.

The meaning of the word ''acquisition'' in Art. 31(2) of the Constitution was elaborated by the learned Judge at p. 367 (of Mad LJ) : (at p. 128 of AIR) as follows:

The next contention of the learned counsel that the word ''acquisition'' in Art. 31(2) means the acquisition of title by the State and that unless the State becomes vested with the property there can be no acquisition within the meaning of the clause and that the expression ''taking possession'' connoted the idea of requisition cannot be sustained and does not, to my mind, affect the decision of the case. As above pointed, both these expressions used in cl. (2) convey the same meaning that is conveyed in cl. (1) by the expression ''deprivation''. As I read, Art. 31, It gives complete protection to private property as against executive action, no matter by what process a person is deprived of possession of it. In other words, the Constitution declares that no person shall be deprived of possession of private property without payment of compensation and that too under the authority of law, provided there was a public purpose behind that law. It is immaterial to the person who is deprived of property as to what use the State makes of his property or what title it acquires in it. The protection is against loss of property to the owner and there is no protection given to the State by the Article.

Then the learned Judge proceeded to consider whether the word ''acquisition'' had a larger concept than was conveyed by the expression ''taking possession''. After quoting with approval'' the view of Rich, J., who expressed the majority view in Minister of State for the Army v. Dalziel, 68 Com WLR 261 (E), he came to the conclusion that the true concept of the expression ''acquisition'' in our Constitution as well as in the Government of India Act was the one enunciated by Rich, J., and the majority of the Court in Dalziel''s case (E). Finally the learned Judge defined the word ''acquisition'' to meant the procuring of property or the taking over of it permanently or temporarily. The judgment of Mahajan, J., is, therefore, a clear authority for the position that the word ''acquisition'' both under the Constitution and under S. 299 of the Government of India Act has the same meaning and that it does not necessarily mean acquisition of title in whole or part of the property but takes in the procuring of property the taking over of it permanently or temporarily. Das, J., no doubt, accepted the narrow meaning given to the word ''acquisition'' b(sic) Bose, J., agreed with Mahajan, J., and expressed his concurrence thus:

In my opinion, the possession and acquisition referred to in cl. (2) mean the sort ''possession'' and ''acquisition'' that amounts ''deprivation'' within the meaning of cl. (1). (sic) hard and fast rule can be laid down. Each case must depend on its own facts. But if there substantial deprivation, then cl. (2) is, in (sic) judgment, attracted. By substantial deprivation I mean the sort of deprivation that substantially robs a man of those attributes of enjoyment which normally accompany rights (sic) or an interest in, property. The form is (sic) essential. It is the substance that we must seek.

Ghulam Hasan, J., said much to the same (sic) feet, though in different phraseology, at p. 3 (of Mad LJ): (at p. 139 of AIR):

Acquisition or taking possession (sic) different modes of deprivation and are comp(sic) hensive enough to include all forms of taking away rights of property.

The learned Chief Justice agreed with the majority view on the basis of the judgment The State of West Bengal Vs. Subodh Gopal Bose and Others,

A comparative study of the aforesaid two decisions of the Supreme Court clearly indicates that except Das, J., all the other learned Judges rejected the narrow meaning of word ''acquisition'', i.e., transfer of the title from the owner and vesting the same in the Stated and adopted the more comprehensive one, the procuring of property or taking of it permanently or temporarily by the State. State, by the process of acquisition, create title in itself rather than acquire it from owner. The ''word is wide enough to take property expropriated for the purpose of (sic)truction. The emphasis is more on what owner lost than what the State gained, more substance than on form. Every expropriate by the State depriving the owner of title possession is acquisition within the comprehensive meaning adopted by the Supreme Court This conclusion their Lordships deduced f(sic) a combined reading of Art. 31(1) and (2) by so reading equated acquisition and take possession to that of deprivation by the S(sic) Though Jagannadhadas, J., agreed with Das in some respects, he agreed with the majority in holding that taking possession and acq(sic) tion amounted to deprivation, though the verse might not follow in the particular ext in which those words and phrases were (sic)sed. It is, therefore, manifest that the Supreme Court did not give a wider connotation to the word ''acquisition'' because of the context in which that word was used in juxtaposition to (sic)king possession but because of the nature of (sic)le fundamental right declared by Art. 31.

According to the majority of the Judges, cls. (1) and (2) of Art. 31 of the Constitution were de-(sic)gned to protect the citizen''s right to property against both executive and legislative actions, article 31(1) declares that the executive can-(sic) deprive a citizen of his property save by authority of law, and cl. (2) prevents the Legislature from making any such law for depri-(sic)ng a person of his property except for a public purpose and only after providing for compensation for the same. If that was the construction of Art. 31(1) and (2), I do not see (sic)y justification for adopting a narrow meaning in construing S. 299(1) and (2) of the Government of India Act. So far as it is material in the present purpose both the clauses in sub-(sic)ance are in pari materia with cls. (1) and (2) Art. 31 of the Constitution. If cls. (1) and (2) of S. 299 of the Government of India Act, (sic)35, are read together as the Supreme Court (sic)ad cls. (1) and (2) of Art. 31 of the Constitution, there is no scope for giving a narrow meaning to the word ''acquisition'' in S. 299(2). section 299(1) was a guarantee against the privation of property by executive authority (sic)re by authority by law. This right created S. 299 was similar in content and scope as (sic) conferred by Art. 31(1) of the Constitution Clause (2), therefore, must be read as a exhibition against Provincial Legislature de-ving a person of the right conferred under (sic)(1) except for a public purpose and that on (sic)ing compensation. The word ''acquisition'' in (sic)(2), in view of the Supreme Court judgment, (sic)st be held to mean any deprivation of the property of a citizen, and therefore, such dep-(sic)ition could not be affected by any act with conforming to the limitations laid down under that section.

The Supreme Court in a later decision Saghir Ahmad Vs. The State of U.P. and Others, expressed the maty view in the aforesaid two decisions thus 729 (of SCR): (at p. 740 of AIR):

In view of that majority decision it must taken to be settled now that cls. (1) and (2) Art. 31 are not mutually exclusive in scope should be read together as dealing with same object, namely, the protection of the (sic)t to property by means of limitations, on State''s powers, the deprivation contemplate cl. (1) being no other than acquisition taking possession of the property referred (sic) cl. (2).

In Bhikaji Narain Dhakras v. State of Madhya Pradesh, 1955-2 SCR 589: (S) AIR SC 781 (G), the Supreme Court confirile comprehensive definition of the word ''action'' given by them in the aforesaid two (sic)eme Court decisions only to the said word (sic)in Art. 31(2) but in terms re-stated that the pre-existing narrow view of the word should be adopted in the case of S. 299 of the Government of India Act. There the Supreme Court held that in view of the Fourth Amendment Act of 1955, the C. P. and Berar Motor Vehicles (Amendment) Act, 1947, was constitutionally valid, but when the learned counsel for the petitioners therein sought to raise the question-as to the invalidity of the impugned Act even before the advent of the Constitution, their Lordships made the following observations at p..602 (of SCR): (at p.-786 of AIR):

Prior to the Constitution, when there were no fundamental rights, S. 299 of the Government of India Act, 1935, which corresponds to Art. 31 had been construed by the Federal Court in AIR 1944 62 (Federal Court) and in "other cases referred to in 1952-1 Mad LJ 174: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, and it was held by the Federal Court that the word ''acquisition'', occurring in S. 299 had the limited meaning of actual transference of ownership and not the wide meaning of deprivation of any kind that has been given by this Court in The State of West Bengal Vs. Subodh Gopal Bose and Others, to that word acquisition appearing in Art. 31(2) in the light of the other provisions of the Constitution. It is, therefore, not clear at all that the impugned Act was in conflict with S. 299 of the Government of India Act, 1935. Besides, this objection was not taken or even hinted at in the petitions and cannot be permitted to be raised at this stage.

Doubtless clear observations of the Supreme Court, though in the nature of obiter, deserve every respect. But I do not think in the present case the Supreme Court made any such clear observations expressing their view on the interpretation of the word ''acquisition'' in S. 299 of the Government of India Act. There was no necessity for them to decide the point as they were not permitting the counsel to raise the said point as it was not taken or even hinted at in the petitions. Nor the observations are definite to the effect that they accepted the limited meaning given to that word by the Federal Court for, if they did so, they would have rejected the contention based on S. 299 of the Government of India Act on merits. On the other hand, they disposed of that contention in the view they expressed on its maintainability with the observation that it was not clear at all that the impugned Act was in conflict with S. 299 of the Government of India Act, 1935. The Supreme Court in The State of West Bengal Vs. Subodh Gopal Bose and Others, and Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, clearly defined the meaning of the word ''acquisition'' in Art. 31(1) of the Constitution. The process of reasoning adopted for coming to that conclusion does not lose its vigour or potency in its application for the ascertainment of the meaning of the similar word used in S. 299(2) of the Government India Act. Though the heading ''Fundamental Rights'' was not given to Ch. II of the Government of India Act wherein S. 299 found a place, the right conferred under S. 299(1) was not in any way less in scope and content than that conferred by Art. 31(1). Jagannadhadas, J., in Dhirubha Devisingh Gohil Vs. The State of Bombay, equated the right conferred under S. 299 of the Government of India Act with that conferred under Part III of the Constitution. At p. 695 (of SCR): (at p. 49 of AIR), the learned Judge observed thus:

One of the rights secured to a person by Part III of the Constitution is a right that his property shall be acquired only for public purposes and under a law authorising such acquisition and providing for compensation which is either fixed by the law itself or regulated by principles specified by the law. That is also the very right which was previously secured to the person under S. 299 of the Government of India Act. The challenge ceases to be in substance anything other than a challenge in respect of the violation of the said right notwithstanding that under S. 299 of the Government of India Act the right is secured in terms Which restricts the power of the Legislature and operates, as a restraint on its competency. What under the Government of India Act was a provision relating to the competency of the Legislature, was also clearly in the nature of a fundamental right of the person affected.

This appears from the Report of the Joint Parliamentary Committee on Indian Constitutional Reform, Volume 1, Part 1, paragraphs 366 and 369.

The aforesaid observations indicate without any ambiguity that the nature of the content of the right conferred under S. 299 (1) and (2) has not been enlarged by the Constitution of India but only was recognised and clarified by assigning to it a nomenclature and placing it in the Chapter under Fundamental rights. In the circumstances I find it difficult to Be bound by the observations of the Supreme Court in regard to a matter they refused to decide and in respect of facts they felt a doubt in their application to them.

The judgment of the Federal Court referred to by the Supreme Court is that of AIR 1944 62 (Federal Court) There the Central Provinces Revision of the Land Revenue of Estates Act which was passed in 1939, enacted that with effect from July 1, 1938, the land revenue payable to the Government in respect of certain estates, mentioned in the schedule to the Act, should, notwithstanding anything contained in the Central Provinces Land Revenue Act of 1917, be enhanced to the amount shown in the said Schedule; and by an Amending Act of 1941 it was further provided that these amounts should be deemed to have been assessed, offered and accepted under the Central Provinces Land Revenue Act of 1917. The proprietor affected by those Acts filed a suit questioning its validity on the ground that the said Act had extinguished or deprived him of his contractual as well as statutory rights in his zamindaris and further amounted to an acquisition or expropriation of his rights as provided by S. 299 of the Government of India Act, 1935. The Federal Court rejected that plea with the following observations:

His rights over his land or his rights in no over his immovable property remain exactly the same, only his liability for payment of takoli is increased. It is, we think impossible to hold that the mere increase of an assessment for land revenue involves any acquisition of the land or any rights in or over immovable property. It further seems to us that the word ''acquisition'' implies that there must be an actual transference of, and it must be possible to indicate some person or body to whole is or are transferred, the land or rights referred to. It is impossible, in our view, I suggest that when the land revenue is in creased, there is any transference to the Provincial Government or any other person in any land or rights in or over immoveable property, which remain in the same possession ownership as immediately before the increa(sic) of the assessment.

In the first place, the Federal Court held that the increase of the tax did not amount to a acquisition of the land or any rights in or over immovable property. It was not contendent nor was there evidence to suggest that the in crease of the tax in effect and substance (sic) prived the landholder of his right. It is true the second observation was widely express indicating that the word ''acquisition'' implied transference of the land or rights therein from one person to another. It was not argued that case nor was it necessary to contend the the word ''acquisition'' was of wider can not at and might take in even a deprivation of property otherwise than by transference. Inder Patanjali Sastri C. J., and Mahajan J., was whom the majority of the Judges concurred clearly negatived that concept. In the would of Patanjali Sastri C. J., when the State choose to exercise its power as a sovereign act. through its legislative and executive organs creates title in itself rather than acquire from the owner. In the words of Mahajan (as he then was), acquisition does not necessarily imply the acquisition of legal title the State in the property taken possession but takes in proper procuring of the proper or the taking of it permanently or temporal Actual transference or a right from one another, from the owner to the Government or to a third party, may be one kind of privation but it does not exhaust other kind varying from taking possession to destruction of the property. The last view is the (sic) view accepted by the Supreme Court, and not think I am justified in ignoring it on observations made by the Supreme Court Bhikaji Narain Dhakras and Others Vs. The State of Madhya Pradesh and Another,

If so, it follows that, if the impu(sic) Act in substance deprived the landholder his property, it would infringe the provision of S. 299 (1) and (2) of the Government of India Act, and, therefore, void. The provision of the Act do not necessarily or inevitably to any such conclusion. The leading object The Act was to standardise rents in the State and to bring down the rents payable by a ryot of a landlord in an estate governed by the Act a the level of rents obtaining in ryotwari (sic)racts. Regulation of rents by the State is necessary to prevent rack-renting. It is indeed the duty of, a State to maintain stability (sic)nd equilibrium in the economic life of the country. Rack-renting is one of the disturbing (sic)lements in society and any legislation within reasonable limits cannot be struck out on the round of infringing any of the fundamental rights guaranteed under the Constitution. The supreme Court in Satya Dev Bushahri Vs. Padam Dev and Others, definitely laid down that a law regulating the relation of a landlord with his tenant not one which takes property within the leaning of Art. 31 (2) even though it has the (sic)lect of reducing his rights. In that case the petitioners who are jagirdars of Marwar sought (sic) impugn the constitutional validity of Ss. 81 of 86 of the Marwar Land Revenue Act which (sic)modied a scheme for fixing fair and equit-(sic)le rents payable by cultivating tenants on the ground that they infringed their fundamental rights under Arts. 14, 19(1)(f)(1) (f) and 19(2) of the Constitution. Adverting to the argument based on Art. 31 (2) of the Constitution, Venkatarama Ayyar J., who delivered the judgment on behalf of the Court, observed at age 539 (of SCR): (at p. 798 of AIR), thus :

It is well settled that a law which Regulates the relation of landlord with his tenant is not one which takes property within Art. 31 (2), even though it has the effect of (sic)ducing his rights.

The learned Judge followed the observations in AIR 1943 29 (Federal Court) where-the question arose for decision whether the provisions of Act 17 of 1939, United Provinces, under which the rent payable to a landlord became diminished were obnoxious to (sic)299 (2) of the Government of India Act, (sic)35. On appeal the Privy. Council observed in AIR 1946 127 (Privy Council) thus :

in the present case there is no question of confiscatory legislation; To regulate the relations of landlord and tenant and there(sic)diminish rights, hitherto exercised by the landlord in connection with his land, is different from compulsory acquisition of the land.

It is not necessary to multiply decisions. A statute merely regulating rents is not confiscatory legislation. The second circumstance relied upon by the learned counsel for the petitioner, namely, the taking over of the management by the Government and the collector of rents with a prohibition imposed on the landlord to collect the same, also in my (sic)w will not bring the legislation within the (sic)schief of S. 299. Under the provisions of the (sic)t, the State only collects the rents, pays it-(sic)of the taxes charged on the estate and the (sic)penditure incurred by it and pays to the landholder the net rent collected. This process confers on the State the status of a statutory agent. It does not do anything more than collect the rent on behalf of the landholder, and as likely as not. the State is always in a better position with the sanctions behind it to collect, the rents more effectively than a landholder can possibly do. The only thing that can be said by the landholder is that he has a right to mismanage his estate and that a State cannot compel him to hand over the duty of collection to it. This loss of a right to collect rents, personally is not, in my view, of I such substance as to amount to a deprivation of the property. In short, the Act does not affect the title of the landholder he can sell mortgage or otherwise alienate his interest in the property.. It preserves his right to receive the rents and to exercise the power to collect them. The Divisional Bench of the Madras High Court discussed this aspect at considerable length and I do not think it is necessary to cover the ground over again.

For the aforesaid reasons even under the wider interpretation given to the word "acquisition'' the Act does not deprive the petitioner of his property within the meaning of S. 299 of the Government of India Act.

The remaining question is whether the fundamental right conferred under Art. 19 of the Constitution of India is violated. The relevant provisions of the Article read :

19 (1). All citizens shall have the right - (f) to acquire hold and dispose of property. (5) Nothing in sub-cls. (d), (e) and (f) of the said clause shall affect the operation of any existing law in so far as it imposes, or prevent the State from making any law imposing, reasonable restrictions, on the exercise of any of the rights conferred by the said sub-clause either in the interests of the general public or for the protection of the interests of any scheduled tribe.

Though the Act was validly passed, a notification issued there under may under certain circumstances, infringe the fundamental right conferred by the Constitution. Under, Art. 13 (3) of the Constitution, the word ''law'' is defined to include also an order or notification, and under Art. 13 (1) a law in force, in so far as it is inconsistent with the provisions of Part III of the Constitution would be void.

Therefore, when the purpose of the Act was to regulate the relationship between the landlord and tenant, the authority entrusted with the duty of carrying out its terms might, in the name of regulation, deprive a landlord of his property wholly or substantially. In such an event, the said order or notification over-steps the boundary of reasonable restriction and encroaches upon the field of deprivation. The question, therefore, falls to be considered on the facts of each case whether an over or a notification issued under the Act reducing the rents would offend the provisions of Art. 19 (1) (f) of the Constitution. To illustrate, a landholder before the Act was getting Rs. 1080/-towards rent. When paying the lawful taxes, he was getting an income of Rs. 500/-. The State may reduce the rents to such a level that, after deducting the legal charges and the expenditure fixed on an arbitrary basis, there may be nothing left to the landholder. In such a case in the name of regulation of rents and collection thereof, the State takes the grain and gives the husk to the landholder. To put it differently, while he was getting a substantial income from his tenants, the adoption of the procedure laid down in the Act reduced the income to a cipher. Though in form the rents are regulated, in substance the property is lost to the landholder. It ceases to have any market-value for it yields no income. In the present case, if the facts alleged in the affidavit are true - the Government denies the said facts - the landholder was getting a net income of Rs. 3,875/- before the notification, and under the Act, as amended, he would get a net loss of Rs. 655/4/4. If this be the result in a particular case, and there is no other reasonable income preserved to the zamindar or other landholder from his estate, the order or notification would not be imposing any reasonable restriction for regulating the relationship between the landlord and the tenant but would be depriving the landlord of his property to the exclusive benefit of the tenant and thus offending the fundamental right conferred upon the landlord to hold property.

When this argument was advanced before the Division Bench of the Madras High Court, Rajamannar C.J. appreciated the force of it but pointed out at p. 190 (of Mad LJ): (at p. 214 of AIR), that the case would not be decided on hypothetical calculations but should be left to be decided on the facts of each case. The learned Chief Justice also pointed out the following considerations that should weigh with a Court in coming to a conclusion whether in a particular case the provisions offend Art. 31 of the Constitution of India.

The sources of income on one zamindari are not necessarily the same as those of the other zamindaries. Besides zamindaries, major inams are also covered by the Act. Different Considerations would arise in the case of these inams many of which are either revenue free or are subject only to a nominal quit rent or jodi.

Mere hypothetical calculations of the kind which Mr. Vedantachariar wanted to make cannot form the basis of a generalisation covering all the estates to which the Act applies. As the learned Advocate-General rightly pointed out, the income from the ryoti lands is not the only source of income for the landholder. Homefarm lands, minerals, forest produce are some of other sources of income. These sources vary largely with each estate. I am therefore not prepared to hold that the Act itself is void, on the ground it virtually deprives the landholder of all beneficial enjoyment of his property.

The learned Judge after citing the decision in Convington and Lexington Turnpike Road Co. v. Sandford, (1896) 164 US 578: 41 Law. Ed. 560 (M), proceeded to observe thus :

''It is necessary, therefore, before any landholder can be given relief on the principle abovementioned, that he should allege and prove facts which conclusively show that as a result of the reduced rates of rent fixed under the Act, he has been totally or substantially deprived of the net income available to him. Each case must properly be presented in the pleadings and there must be opportunity to the Government to traverse the allegations in such cases. In the absence of a detailed statement of the relevant facts, an application founded on mere general allegations must be dismissed.

Though the aforesaid observation were made in the context of Art. 31 (2) of the Constitution of India, they apply with equal force to a question arising under Art. 19 of the Constitution. If, having regard to the afore said circumstances, a Court comes to the conclusion that in a particular case a person has been substantially or totally deprived of the he income available to him, it must be held that in that contingency, a citizen''s fundaments right to hold property is transgressed by lay and, therefore, to that extent the law is void under Art. 13 of the Constitution.

In the result, I hold that though the limited meaning given by Rajamannar C. and Venkatarama Ayyar J. to the word acquisition in 1952 1 Mad LJ 174: AIR 195 Mad 203 (A), is no longer good law in view of the later decisions of the Supreme Court the conclusion arrived at by the learned Judges still holds the field as the provision of the Act only regulate the relationship of the landlord and tenant and are not hit at being S. 299 of the Government of India Act.

I also hold that the view expressed be Rajamannar C. J., and Venkatarama Ayyar J that if in a particular case the result of that reduced rates of rent had the effect of total or substantially depriving the landlord of the net income it would offend Art. 19 of the Constitution is also sound. I would answer the question accordingly.

Viswanatha Sastry, J.

The Question referred to the Fu(sic) Bench for an answer is

Whether the decision in 1952 1 Mad L 174: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, in so far as held that Madras Act 30 of 1947 does not offend against S. 299 of the Government India Act, 1935, is good Law?

It was urged before the Division Bench which made the reference that the decision of the Madras High Court had to be reconsidered the light of the subsequent pronouncements the Supreme Court in The State of West Bengal Vs. Subodh Gopal Bose and Others, and Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others,

The impugned legislation is the Madras Estates Land (Reduction of Rent) A (30 of 1947) as amended by Madras Act 7 of 1951 hereinafter referred to as "the Act" unnecessary to quote the provisions of these facts which have now become familiar to landholders and ryots. The Act reduced rents payable by ryots in ''''estates" governed by the Madras Estates Land Act to the level of the assessments levied on lands in ryotwari areas in the neighbourhood.

It provided for the appointment of a special Officer for the purpose of recommending a fair and equitable rate of cash rent for (sic)ie ryoti lands in his area. The Act also laid down the basis for determining the extent to which the rents for each class of ryoti land in village or group of villages in the estate would be reduced and the rate of rent payable for each such class after reduction.

It was further provided by the Act that the Provincial Government (now the State) (sic)ter considering the recommendation of the (sic)ecial Officer and the remarks of the Board Revenue thereon should by order published in the Official Gazette, fix the rates of rent payable in respect of each class of ryoti land each village in the estate. In no case was (sic)rent payable by the ryot to be enhanced.

Once an order of the Government fixing (sic) rent payable in respect of ryoti lands in (sic) estate or part thereof was published, a it was not bound to pay rent at a rate higher (sic)m that fixed by the order, notwithstanding (sic) provisions of the Madras Estates Land Act. (sic)e rents payable by the ryots according to (sic) rates prescribed by the order of the Government aforesaid, were made recoverable by (sic) Government and the amount so recovered each fasli was made payable to the land-holder after deducting the peishcush, cesses (sic) other sums due from him to the Government as well as collection charges on a scale (sic)d by rules made by the Government.

By the further amendment of the Act in (sic) it was made clear that it was the Government and not the landholder that had the (sic)lusive right to realise the rents from the (sic)s and the provisions of Chapters V and VI the Madras Estates Land Act empowering landholder to realise arrears of rent by (sic)raint, sale of the ryot''s holding and suit, (sic) abrogated.

It was argued that the impugned Act the effect of substantially and in some (sic)s drastically reducing the rent payable by ryots to the landholder; that it deprives the holder of the possession of his estate though the possession consisted only of a right to fact rents from the ryots who had the right (sic)emain in actual or physical possession of lands so long as they paid the rents; and it denies to the landholder the right to (sic)se the rents from the ryots and imposes (sic) him a liability for collection charges (sic)h he might not have to incur if he were (sic)elf collecting the rents.

It is said that the impugned Act relates ecquisition of land'' within the meaning of (sic)9 (2) and (5) of the Government of India 1935 and is in contravention of S. 299 (2), as it does not provide for payment of compensation to the landholders. It might here be pointed out that the validity of Madras Act 30 of 1947 has to be judged in the light of the Government of India Act, 1935 which was in force at the time.

Though Madras Act 7 of 1951 which amended Act 30 of 1947 received the assent of the President on 17-4-1951, still the Amending Act by itself cannot remain in force, if for any reason, Act 30 of 1947 is held to be invalid, for the two Acts are so interwoven as to be inextricable.

It may be stated at the outset that neither Art. 31-A nor Art. 31-B of the Constitution would be effective to validate the Act, if it had been enacted in violation of S. 299 (2) of the Government of India Act, 1935, because the Act does, not satisfy the requirements of Art. 31-A or 31-B of the Constitution. It was neither reserved for the certification of the President nor was it included in the Ninth Schedule to the Constitution.

At the same time the Act cannot how be challenged on the ground of its being a contravention of Art. 31 (2) of the Constitution by reason of Art. 31 (5) which provides that nothing in Art. 31 (2) shall affect the provisions of any existing law, subject to an exception, which is not now material. Madras Act 30 of 1947 would be an existing law if it had been validly enacted under the provisions of the Government of India Act, 1935. The arguments were, therefore, directed to the question whether Madras Act 30 of 1947 contravened S. 299 (2) of the Government of India Act, 1935 by reason of its having authorised the compulsory acquisition of land for public purposes without providing for the payment of compensation. Section 299 of the Government of India Act, 1935, so far as it is now material ran thus :

Section 299 (1). No person shall be deprived of his property in British India save by authority of law.

(2) Neither the Federal nor the Provincial Legislature shall have power to make any law authorising the compulsory acquisition for public purposes of any land unless the law provides for the payment of compensation for the property acquired and either fixes the amount of the compensation or specifies the principles on which, and the manner in which, it is to be determined.

(5) In this Section ''land'' includes immovable property of every kind and any rights in or over such property.

The controversy really centres round the connotation of the word ''acquisition'' in S. 299 (2). When 1952-1 Mad LJ 174: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, was decided by the Madras High Court, not only was there no conflict of authority but there was a decision of the Federal Court and of the Judicial Committee explaining the meaning and effect of S. 299 (2) of the Government of India Act in a case where the rights of landholders were sought to be cut down by legislation.

Since the decision of the Madras High Court was given, there has been a proliferation of concurring and dissenting opinions of the learned Judges of the Supreme Court regarding the true interpretation of Art. 31 of the Constitution whose language and purpose are similar to those of S. 299 of the Government of India Act, 1935.

In Rajah of Bobbili v. The State of Madras (A) (supra), the learned Chief Justice was of the opinion that the term ''acquisition'' in S. 299 (2) of the Government of India Act involved the idea of divesting and a vesting of property or any interest in property or in other words, the idea of the Government gaining something of which the owner was deprived. ''''Acquire" meant "gain by oneself and for oneself" and involved the idea of transference of rights in property.

Madras Act 30 of 1947, though it adversely affected landholders by a reduction of rent and a deprivation of part of the benefit which they had been deriving from their property, effected no transference of any right, of the landholders to the Government and there was no vesting in the Government of any right of the landholder. The learned Chief Justice expressed his conclusion thus:

Now let us look at the Act now impugned. It provides (a) for the reduction of rents and (b) for the collection of the reduced rents by the Government I have no hesitation in holding that by reducing the rent payable by a tenant to a landlord, there cannot be an acquisition by the Government of any right or property of the landlord.

Reliance was placed by the learned Judges on two decisions of the Federal Court in AIR 1943 29 (Federal Court) and AIR 1944 62 (Federal Court) , the decision of the Judicial Committee in AIR 1946 127 (Privy Council) and the decision of the Patna High Court in Sir Kameswar Singh v. State of Bihar, ILR 29 Pat 790: AIR 1950 Pat 392 (SB) (N) in support of this conclusion.

In Kunwar Lal Singh v. Central Provinces and Berar (H) (supra), there was an increase of assessment of land revenue and the landholder was adversely affected by the legislation which had the effect of reducing his net income from the land. The Federal Court held that the increase of the assessment did not involve the acquisition of any land or 0r any right in or over immoveable property which, in spite of the increase, continued to remain in the same ownership and possession.

Referring to S. 299 (2) of the Government of. India Act, 1935, Spens C. J. observed that the word ''acquisition'' in the Section implied ''''that there must be an actual transference of and it must be possible to indicate some person or body to whom is or are transferred, the land or rights referred to.

In Jagannatha Baksh Singh v. United Provinces (K) (supra), the constitutional validity of Provincial Legislation cutting down the rights of landholders and reducing the rent recoverable by them from their tenants with out any provision for compensation was affirmed by the Federal Court and its decision was upheld by the Judicial Committee in Jagannath Singh v. United Provinces (L) (supra) According to Gwyer C. J. in the Federal Court.

a law which regulates the relations of landlord and tenant and thereby diminished the rights which the landlord has hither(sic) exercised in connection with his land does not authorise the compulsory acquisition of the land for public or any other purposes; are therefore the question of compensation do not arise.

Lord Wright, delivering the judgment of the Judicial Committee, overruled the objection that the legislation was repugnant to S. 2 (2) of the Government of India Act in the words:

''In the present case there is no question of confiscatory legislation. To regulate to relations of landlord and tenant and there diminish rights, hitherto exercised by the landlord in connection with his land, is different from compulsory acquisition of land.

It is worthy of note that the Judicial Committee distinguished between confiscatory a regulatory legislation in considering the applicability of S. 299 (2) of the Government India Act and did not rest their decision the dictionary meaning of the word ''acquisition in S. 299 (2) as involving a transference title to the Government.

In ILR 29 Pat 790: AIR 1950 Pat 39(sic) (SB) (N), the validity of a Bihar Act similar in scope to the Act now impugned, was upheld by a majority of the Judges. Sinha J., was described the Bihar Act as "a mixture of (sic) traint on the power of alienation of land by proprietor or a tenure-holder, a suspension his rights of management without acquisition of any rights by the Government to be exercised for the benefit of the public or any particular section of the public", upheld the valid of the Act on the ground that as there was acquisition 01 any rights in property by Government, the absence of any provision compensation'' to the dispossessed proprietor tenure-holder was not fatal to the Act. Shea J., agreed with the conclusion of Sinha, J.

Article 19(1)(f) read with Art. 19 and Art. 31(1) and (2) read with Art. 31(50) the Constitution relate to the extent of protection which the Constitution of India cords to ownership of private property am the powers of the Legislature to deprive interfere with, the right of a person to and enjoy his property.

Though we are here concerned with this terpretation of S. 299(2) of the Government India Act, 1935. a reference to these provisions of the Constitution and the manner which they have been interpreted by the ions of the Supreme Court has become necessary because these two statutory provisions, (sic) spite of some difference in form and expression, are in pari materia. See Mahajan, J., (sic) 1954 1 Mad LJ 355 at p. 368: (AIR 1954 SC 19 at p. 129) (D). Jagannadhadas, J. delivered the judgment of the Supreme Court in Dhirubha Devisingh Gohil Vs. The State of Bombay, observed:

One of the rights secured to a person by art III of the Constitution is a right that his property shall be acquired only for public purposes and under a law authorising such acquision and providing for compensation which is other fixed by the law itself or regulated by principles specified by the law. That is also (sic)le very right which was previously secured to the person under S. 299 of the Government of india Act. The challenge now made to the validity of the impugned Act is based on the (sic)leged violation of that right.

Nor does this challenge cease to be in sub-(sic)ance anything other than a challenge in res-(sic)ect of the violation of the said right, notwithstanding that under S. 299 of the Government India Act, the right is secured in terms which District the power of the Legislature and ope-(sic)ites as a restraint on its competency. What under the Government of India Act was a precision relating to the competency of the Legislature, was also clearly in the nature of a fundamental right of the person affected.

In view of these pronouncements, the interpretion of Art. 31(1) and (2) of the Constitution of the decisions of the Supreme Court has a material bearing on the construction of the corresponding provisions of S. 299(1) and (2) of Government of India Act.

Article 31 of the Constitution, as it (sic)od before its amendment and so far as it relevant for our present purpose, ran as follows:

(1) No person shall be deprived of the property save by authority of law.

(2) No property, movable or immovable including any interest in or in any company (sic)ning any commercial or industrial undertaking shall be taken possession of or acquired public purposes under any law authorising (sic) taking of such possession or acquisition, less the law provides for compensation for the property taken possession of or acquired (sic)d either fixes the amount of the compensation or specifies the principles on which, and (sic) manner in which, the compensation is to determined and given.

(5) Nothing in cl. (2) shall affect

(b) the provisions of any law which the (sic)te may hereafter make -

(i) for the purpose of imposing or levying (sic) tax or penalty, or

(ii) for the promotion of public health or (sic) prevention of danger to life or property will be observed that Art. 31(1) and (2) of the Constitution above extracted are similar the provisions of S. 299(1) and (2) of the Government of India Act, 1935, except in a few particulars. Article 31(2) includes movable within its scope and provides for cases where property is taken possession of. The interpretation of Art. 31 has been the subject of dissenting opinions delivered by the learned Judges of the Supreme Court and all that this Court can do, is to ascertain and follow that view of the law on which there is the greatest measure of common agreement among the learned Judges.

According to the opinion of the majority of the learned Judges of the Supreme Court in 1954 1 Mad LJ 314: AIR 1594 SC 92 (C) and Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, guarantees protection to private property not only by enacting that no person could be deprived of his property without legislative sanction but also by a further provision that even the Legislature cannot deprive a person of his property unless there is a public purpose and compensation is paid. The only exceptions to this rule are found enumerated in Art. 31 (5) which covers all forms of deprivation of property by the State without payment of compensation. Other forms of deprivation of property which are outside the ambit of Art. 31 (5) fall within the mischief of Art. 31(2). Though Art. 31 does not contain an express provision like S. 299(5) of the Government of India Act, 1935, still it is clear that the word ''property'' in Art. 31(1) and (2) would include rights in or over property, indeed Art 31(2) refers to ''any interest in or in any Company owning any commercial or industrial undertaking'' as property. In State of West Seagal v. Subodh Gopal Bose (C) (supra), Patanjali Sastri, C. J., observed:

Now, the word ''property'' in the context of Art. 31 which is designed to protect private property in all its forms, must be understood both in a corporeal sense as having reference to all those specific things that are susceptible of private appropriation and enjoyment as well as in its juridical or legal sense of a bundle of rights which the owner can exercise under the municipal law with respect to the user and enjoyment of these things to the exclusion of all others.

Referring to Art. 19(1) (f) relating to the ''right to acquire, hold and dispose of property'' the Supreme Court observed that there was no reason why the word property as used in that clause should not be given a liberal and wide connotation so as to include those well-recognised types of interest which have the insignia or characteristics of proprietary sight. See The Commissioner, Hindu Religious Endowments, Madras Vs. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt.,

What is meant by the word ''acquisition'' of property in Article 31(1) (2)? In Chiranjit Lal Chowdhuri Vs. The Union of India (UOI) and Others, Mookherjea, J., observed:

It cannot be disputed that acquisition means and implies the acquiring of the entire title of the expropriated owner, whatever the nature or extent of that title might be. The entire bundle of rights which are vested in the original holder would pass on acquisition to the acquirer. In taking possession on the other hand, the title to the property admittedly remains in the original holder though he is excluded from possession or enjoyment of the property

In the context in which the word ''acquisition'' appears in Article 31(2) it can only mean and refer to acquisition of the entire interest of the previous holder by transfer of title.

In that case the Attorney-General''s argument was that "taking possession" also involved a deprivation of the entire property of of the totality of the rights of the person dispossessed and if some rights, however insignificant, still remained in him, there could not be any dispossession as contemplated by Article 31(2). This argument was, however, not accepted by Mukherjea, J., as might be seen from the following passage in his judgment:

It is difficult, in my opinion,'' to accept the contention formulated in such broad terms. The test would certainly be as to whether the owner has been dispossessed substantially from the rights held by him or the loss is only with regard to some minor ingredients of the proprietary rights.

Kania C.J. agreed with the "Line of reasoning and conclusion" of Mukherjea, J., while Fazl Ali J. adopted his conclusions, without committing himself "to the acceptance of all his reasonings." Patanjali Sastri, J., considered it unnecessary to consider the applicability of Articles 19 and 31 to the case. Das J. was of the opinion that if the substantial bulk of the rights constituting a person''s "property" is taken away by an enactment and the rights left untouched, are illusory and practically valueless, then there could be no question that in effect and substance the property had been taken, away. When the Madras High Court decided 1952 Mad L J 174: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, the learned Judges, particularly Venkatarama Ayyar J., relied on the observations of Mookerjea J. above cited in support of the conclusion that the taking over by the State of right to collect rents from ryots in "estates", under S. 3 (4) of the impugned Act, could not be regarded as an ''acquisition'' of land or any right or interest therein within the meaning of S. 299(2) of the Government of India Act.

Later decisions of the Supreme Court taking a different view of the scope and effect of Art. 31(1) and (2) of the Constitution have now to be considered. In The State of West Bengal Vs. Subodh Gopal Bose and Others, , the validity of S. 7 of the West Bengal Land Revenue Sales (Amendment) Act, 1950, providing retrospectively for abatement of eviction proceedings against under tenants by purchasers of lands at revenue sales and also preventing their eviction in future was upheld by the Supreme Court.

The view expressed by Patanjali Sastri, C. J., in this case that Art. 19(1) (f) was concerned only with the abstract right and capacity to acquire, hold and dispose of property and had no reference of relation to any right in any particular property or concrete property rights, was dissented from by two of his col leagues and was not shared by the others. I was also not accepted by the Court in The Commissioner, Hindu Religious Endowments, Madras Vs. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt., On the points which is now material the opinion of the learned Chief Justice was accepted by the majority of his colleagues and the following passages from his judgment in The State of West Bengal Vs. Subodh Gopal Bose and Others, are relevant:

Clauses (1) and (2) of Art. 31 are thus not mutually exclusive in scope and content but should, in my view, be read together an understood as dealing with the same subject namely, the protection of the right to property by means of the limitations on the State power referred to above, the deprivation contemplaced in cl. (1) being no other than the acquisition or taking possession of property referred to in cl. (2) (p. 323 of Mad LJ): (at p. 98 AIR)

I see no sufficient reason to construe the words ''acquired or taken possession of used in cl. (2) of Art. 31 in a narrow technical sense (p. 324 of Mad LJ): (at p. 99 of AIR The word ''acquisition'' is not a term of art and it ordinarily means coming into possesion of obtaining, gaining or getting as one own. it is in this general sense that the would has been used in Arts. 9, 11 and 19(1)(f) and not as implying any transfer or vesting of title (Page 324 of Mad LJ): (at p. 99 of AIR)....

To say that acquisition implies the transferred and vesting of title in the Government is overlook the real nature of the power of the State as a sovereign acting through its legislative and executive organs to appropriate the property of a subject without his consent. When the State chooses to exercise such power, creates title in itself gather than acquire it from the owner, the nature and extent of the till thus created depending on the purpose and duration of the use to which the property a propriated is intended to be put as disclosed in the law authorising its acquisition. No formula of vesting is necessary (p. 324 of M LJ): (at p. 99 of AIR).

According to the learned Chief Justice acquisition implies ''such an appropriation of the property of abridgement of the incident of its ownership as would amount to a deprevation of the owner'' (p. 325 of Mad LJ): ( p. 99 of AIR). Referring to the wide contentation of the term ''property'', the learned Chief Justice adverted to the difficulty of determining whether an impugned enactment is a derivation of property within the meaning of Art. 31, in view of the possibility of any restriction imposed on the use and enjoyment of proper being regarded as a deprivation of one or m(sic) of the rights therefore exercised by the owner (p. 327 of Mad LJ): (at p. 101 of AIR). I(sic) ter referring to the observation of Holmes, in Pennsylvania Coal Co. v. Mahon, (1915) 2 US 393 (Q), ''that the general rule at least, that while property may be regulated to a c(sic) ain extent, if regulation goes too far, it will be recognised as a taking'' within the meaning of the Fifth Amendment, Patanjali Sastri, C.J., summed up his conclusion thus:

No cut and dried test can be formulated (sic)s to whether in a given case the owner is deprived'' of his property within the meaning of Art. 31; each case must be decided on its own facts. Broadly speaking it may be said that an abridgement would be so substantial as (sic) amount to a deprivation within the meaning of Art. 31, if, in effect, it withheld the property from the possession and enjoyment of the owner, or seriously impaired its use and enjoyment (sic)y him, or materially reduced its value" (p. 28 (of Mad LJ): (at p. 101 of AIR)). Mahajan and Ghulam Hasan, J J., expressed their concurrence with the Chief Justice. Das, adhered to the view which he had taken in Chiranjit Lal Chowdhuri Vs. The Union of India (UOI) and Others, that a per-(sic)n might be lawfully deprived of his property (sic) legislative enactment without payment of compensation except in the case of acquisition (sic) taking possession of property for a public purpose under Art. 31(2). Das, J also held following Mukherjea, J., in Charanjitlal v. Union of India (P) (supra), that the word ''aclisition'' had become as it were, a word of (sic)t having a long and adopted legislative meaning implying the transfer of title and it was wrong not to give the word such meaning in Art. 31(2). Jagannadhadas, J., differed from Chief Justice and agreed with Das, J., to this (sic)tent that the words ''deprivation of property'' Art. 31(1) and the word ''acquisition'' and taking possession'' in Art. 31 (2) did not in sub-(sic)ince mean the same thing and that ''deprivation'' had a wider connotation than ''acquisition'' ''taking possession'' which alone required to compensated under Art. 31(2). At the same the Jagannadhadas, J., dissented from the (sic)w of Das, J., that ''acquisition'' and ''taking possession'' in Art. 31(2) necessarily involved transfer of title or possession, and observed:

The words or phrases appear to me to (sic)prehend all cases where the title or possession is taken out of the owner and appropriated (sic)hout his consent by transfer or extinction by some other process, which, in substance, counts to it, the ''possession'' in this context (sic)aning such possession as the nature of the property admits and which the law recognises possession.

The next decision of the Supreme court that is relevant in this context is Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, where the learned Judges reached the same conclusion of or the same reasons. Ordinance II of (sic) as a result of which the properties and facts of the Sholapur Spinning and Weaving ltd., passed into the hands of persons approprited by the Central Government to control, (sic)sage and run the textile mill in the place of (sic)ctors elected by the share-holders for the purpose, was held to be a deprivation of property without compensation and therefore void under Art. 31. The argument of the Attorney-General in that case was that the Ordinance did not fall within the mischief of Art.31(2) because the State had not acquired title in the property of the company under its provisions, that whatever possession and control had been taken had been assumed for the purpose of managing the company''s property on the company''s behalf and that the property had not been requisitioned for any State purpose. It was said that Art. 31(2) applied only to two cases where the State acquired title in, the property or where the State temporarily commandeered if and all other forms of taking property were outside the fundamental right guaranteed by Art. 31(2) and did not require to be compensated. This contention was repelled by Mahajan, J., with whom the Chief Justice, Bose and Ghulam Hasan, JJ., concurred. Mahajan, J., expressed the view that by reason of Art. 31(2) the Legislature cannot deprive a person of his property unless there was a public purpose and payment of compensation and that ''acquisition'' and ''taking possession'' in Art. 31(2).conveyed the same meaning as ''deprivation'' in Art.31(1). The following extracts from the judgment disclose the grounds of decision:

Article 81 deals with the field of Eminent Domain and the whole boundary of that field is demarcated by this Article. In other words, the State''s power to take the property of a person is comprehensively delimited by this Article (p. 364 (of Mad LJ): (at p. 126 of AIR)).

Only that form of legislation which promotes public health or prevention of danger to life or property is saved from the provisions of Art. 31(2) (by Art. 32(5)) while other laws made in exercise of the power of social control, if they deprive a person of property, are not saved from the operation of Art. 31(2).

(p. 365 (of Mad LJ): (at p. 107 of AIR)).

It is immaterial to the person who is deprived of property as to what, use the State makes of his property or what title it acquires in it. The protection given by Art. 31 is against loss of property to the owner and there is no protection given to the State by the Article It has no fundamental right as against the individual citizen. Article 31 states the limitations on the power of the State in the field of taking property and those limitations are in the interests of the person sought to be deprived of his property

(p. 367 (of Mad LJ): (at p. 128 of AIR)).

From the language employed in the different sub-clauses of Art. 31 It is difficult to escape the conclusion that the words ''acquisition'' and ''taking possession'' used in Art. 31 (2) have the same meaning as ''deprivation'' in Art. 31(1)

(p. 365 (of Mad LJ): (at p. 127 of AIR)).

The true concept of the expression, ''acquisition'' in our Constitution as well as in the Government of India Act (1935) is the one enunciated by Rich, J., and the majority of the Court in 68 Com WLR 261 (E). With great respect, I am unable to accept the narrow view that ''acquisition necessarily means acquisition of title in whole or part of the property.

The word ''acquisition'' is quite a wide concept, meaning the procuring of property or taking possession of it permanently or temporarily. It, does not necessarily imply the acquisition of legal title by the State in the property taken possession of.

(p. 368 (of Mad LJ): (at.p. 129 of AIR)

The correct approach in such cases should be this; what in substance is the loss or injury caused to the owner and not what manner and method has been adopted by the State in taking the property

(p. 368 (of Mad LJ): (at p. 129 of AIR)). Bose and Ghulam Hasan, JJ., delivered separate but concurring judgments. Bose, J., observed:

The provisions in the Constitution touching fundamental rights must be construed broadly and liberally in favour of those on whom the rights have been conferred.

The possession and acquisition referred to in cl. (2) mean the sort of ''possession'' and ''acquisition'' that amounts to deprivation within the meaning of cl. (1). No hard and fast rule can be laid down. Each case must depend on its own facts. But if there is substantial deprivation, then cl. (2), is, in my judgment, attracted. By substantial deprivation I mean the sort of deprivation that substantially robs a man of those attributes of enjoyment which normally accompany mights to, or an interest in, property. The form is unessential. It is the substance that we must seek.

(p. 382 (of Mad LJ): (at p. 138 of AIR)). Ghulam Hasan, J., also said:

Acquisition or taking possession in Art. 31 (2) are different modes of deprivation and are comprehensive enough to include all forms of taking away rights of property. Having regard, to the setting in which Art. 31 is placed the word ''property'' used in this Article must be construed in the widest sense as connoting a bundle of rights exercisable by the owner in respect thereof and embracing within its purview both corporeal and incorporeal rights.

Whether the facts in a given case amount to deprivation of property within the meaning of Art. 91 Will depend on the circumstances of each case and it is not possible, in the nature of things, to lay down any inflexible test which may be universally applicable. When it can be shown that the statute substantially interferes with the right of enjoyment of property, it will be hit by Art. 31 (2) and declared void, unless compensation is provided.

The views expressed by Patanjali Sastri C.J. in 1954 1 Mad LJ 314: AIR 1954 1954 SC 92 (C), and by Mahajan J. in Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, were accepted and the opinions of Mookherjea and Das JJ. in Chiranjit Lal Chowdhuri Vs. The Union of India (UOI) and Others, and of Das J. in State of West Bengal v. Subodh Gopal Bose (C) (supra), were finally discarded by the Supreme Court in Saghir Ahmad Vs. The State of U.P. and Others, where Mookherjea J. delivering the judgment of the Court refer�red to the two cases of Subodh Gopal Bose (C (supra) and Sholapur Spinning and Weaving Co. Ltd. (D) (supra) and observed:

In view of that majority decision, it must be taken to be settled now that Cls. (1) an (2) of Art. 31 are not mutually exclusive in scope but should be read together as dealing with the same subject, namely, the protection of the right to property by means of limitation on the State''s powers, the deprivation co: templated in CL (1) being no other than the acquisition or taking possession of the property referred to in Cl. (2).

In this case an enactment depriving owners motor vehicles of their business of running them for hire on public roads without payment of compensation was held to conflict with Art. 31 (2) and therefore invalid, even though the State had not acquired or taken possessible of the motor vehicles. Substantial deprivation without compensation of a person''s intangible property, such as the right to carry on business, without any transference of title to possession of his business assets to the State was held to be hit at by Art. 31 (2).

It follows from this review of the decisions of the Supreme Court that legislation authorising a substantial deprivation by the State of a person''s property (using the wo ''property'' in a wide sense as connoting bundle of rights exercisable by the owner a embracing both corporeal and incorporation rights) without payment of compensation the owner is hit at by Art. 31 (2) even though there is no transference of title in the proper to the State.

Substantial deprivation of proprietary right is what is meant by the word ''acquisition occurring in Art. 31 (2) of the Constitution and S. 299 (2) of the Government of India Art. From the point of view of the person who deprived of his property, it may not be material whether the State acquires title to it makes use of the property or allows another person to enjoy its benefit.

It must therefore be held that the decision in 1952-1 Mad LJ 174 : AIR 1952 Mad 2 (A), in so far as it upholds the validity of impugned Act on an interpretation of the was ''acquisition'' in S. 299 (2) of the Government of India Act, 1935, as meaning a transfered of title to the State in the property acquired cannot be supported. It is no doubt true that support for the view of the learned Judge was found in the decision of the Federal Court in 1944 1 Mad LJ 510 at p. 515: AIR 1944 62 at pp. 65-66 (H).

As already observed, the Judicial Committee in 1946 2 Mad LJ 29: AIR 1946 127 (L), rested its judgment not on narrow interpretation of the word ''acquisition S. 299 (2) of the Government of India as meaning or involving a transference of but on the ground that the enactment in question was not a confiscatory legislation nor providing for compulsory acquisition but a regulating the relations of landlord and ter though it impugned on the rights of the land-holders in some respects.

Whether a law is confiscatory and deprives the landholder of substantial rights of property without compensation or whether it is merely Regulatory and secures the legitimate rights of tenants in various respects depends upon the sue nature and scope of the legislation and (sic)s effect on the rights of the landholder.

If a law authorises a substantial deprivation of the rights of the landholder without compensation, the later decisions of the supreme Court require us to hold that it would be a violation of S. 299 (2) of the Government of India Act corresponding to Art. 31 (2) of the Constitution, even though there is no transfer of any title to or vesting of any proetary rights in the State.

Under Art. 141 of the Constitution the law declared by the Supreme Court that is to may, by the majority of the Judges, is binding of this Court.

The impugned Act provides for the (sic)duction of rents payable by ryots in "estates" (sic)id for the collection of the reduced rents by the Government. The rent payable by the (sic)ot to the landholder of an estate is reduced the level of the assessment on the Government lands in neighbourhood. The collection the reduced rents is vested in the Government subject to the obligation to pay over to a landholder whatever remains out of the reflections after deducting the revenue payable him to the Government and collection charges fixed by Rules at 10 per cent.

There is no doubt that the Act effects a (sic)rtailment of the rights of the landholders to the extent but it was observed by the Judicial Committee in 1946 2 Mad LJ 29: AIR 46 PC 127 (L), affirming the constitutional (sic)iidity of the United Provinces Tenancy Act, 59 (17 of 1939) in the face of S. 299 (2) of the Government of India Act, 1935, that the (sic)t regulates and secures the rights of the (sic)ants in various respects on lines sufficiently (sic)ailiar in modern agricultural legislation.

It is not contested that in doing so it images on the powers which, but for such a asure, the talukdars might have exercised (sic)hin their estates". In The State of West Bengal Vs. Subodh Gopal Bose and Others, which affirmed the constitutional validity of the West Bengal and Revenue Sales (Amendment) Act, 1950, under Art. 31 of the Constitution, Patanjali (sic)tri C. J. observed:

This amendment is in line with the traditional tenancy legislation in this country (sic)rding relief whenever the tenancy laws (sic)e found, due to changing conditions, to ope-(sic) harshly on the tenantry.

It may be mentioned that the Act in question that case curtailed the rights of purchasers revenue sales to annul under-tenures and (sic)t under tenants. In 1956 SCJ 48: ( (S) (sic) 1955 SC 781) (G), the validity of the (sic)tral Provinces and Berar Motor Vehicles (Amendment) Act of 1948 under S. 299 (Z) of the Government of India Act came in for consideration.

The Act authorised the Provincial Government to exclude all motor transport operators from the field of transport business. Das J. who delivered the judgment of the Supreme Court held that in view of Saghir Ahmad Vs. The State of U.P. and Others, the impugned Act should be held to have become invalid under Art. 31 of the Constitution ''(Before the amendment of 1951). On page 51 (of SCJ): (at p. 783 of AIR), of the report Das J. stated that "it has been conceded that the Amending Act, was, at the date of its passing, a perfectly valid piece of legislation." Later on at page 55 (of SCJ): (at p. 786 of AIR), the learned Judge observed :

Prior to the Constitution, when there were no fundamental rights, S. 299 of the Government of India Act, 1935, which corresponds to Art. 31 had been construed by the Federal Court in AIR 1944 62 (Federal Court) and in other cases referred to in Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, and it was held by the Federal Court that the word ''acquisition'' concurring in S. 299 had the limited meaning of actual transference of ownership and not the wide meaning of deprivation of any kind that has been given by this Court in The State of West Bengal Vs. Subodh Gopal Bose and Others, to that word acquisition appearing in Art. 31 (2) in the light of the other provisions of the Constitution. It is, therefore, not clear at all that the impugned Act was in conflict with S. 299 of the Government of India Act, 1935.

This observation which leaves the matter at large, cannot be taken as a decision which affects the authority of the earlier decision of the Supreme Court discussed above. Only two days earlier, Venkatarama Iyer J., who wqs one of the Judges who took part in. the case last cited, had delivered the Judgment of the Supreme Court in Shri Kishan Singh and Others Vs. The State of Rajasthan and Others, affirming the constitutional validity of the Marwar Land Revenue Act, 1949 (40 of 1949) reducing the rents payable to landholders on much the same lines as the impugned Act.

The learned Judge observed that the fundamental right which a citizen has to hold and enjoy property imports only a right to recover reasonable rent when the lands are cultivated by a tenant and that a legislation whose object is to fix a fair and equitable rent cannot be said to invade that right. He did not depart from the interpretation put on Art. 31 by Patanjali Sastri C. J. and Mahajan, J. in the earlier cases cited above. The following observations of the learned Judge are pertinent:

''The argument in support of the contention that S. 86 is repugnant to Art. 31 (2), is that to the extent that it gives retrospective operation, it deprives the landlord of the right to rent which had accrued prior to the settlement, and that is taking property without payment of compensation. But it is well settled that a law which regulates the relation of landlord with his tenant is not one which takes property within Art. 31 (2), even though it has the effect of reducing his rights.

The learned Judge then relied on the decision of the Federal Court and of the Judicial Committee in AIR 1946 127 (Privy Council) to which reference has already been made.

In the light of the decisions of the Privy Council and the Supreme Court referred to in the previous paragraph, it must be held that the impugned Act is only regulatory and adjusts the relations between landholders and ryots by authorising the fixation of a fair and equitable rent. In view of the observation of the Supreme Court that the fundamental right of the landholder is to collect from his tenant only a "reasonable rent", the impugned Act which purports to fix a fair and reasonable or equitable rent cannot be said to be confiscatory or involve a substantial deprivation of the rights of the landholder.

The reduction of the rents payable by ryots of estates to the level of ryotwari assessments gives the landholder and the ryot what, in the opinion of the Legislature, is fairly and justly due to each of them. As the State Legislature (formerly the Provincial Legislature) has been empowered to regulate the relation between the landlord and tenant, due weight must be given to the legislative judgment in regard to what is the lawful sent or fair and reasonable rent.

The Legislature has proceeded on the assumption that the ryotwari assessment is fair and reasonable and the impugned Act has provided for the fixation of rents payable by ryots in estates on that basis. Landholders in estates had no right to the possession of the lands but could only collect the rents lawfully payable by the ryots. The State took over the collection of rents evidently because it was apprehended that in spite of the reduction of rents by legislation, landholders might continue to collect at higher rates and the ryots might helplessly be forced to submit to their exaction.

In some respects and in many cases, the constitution of the Government as a statutory agent for collection of rents was advantageous to the landholders. In any case the Government did not gain any advantage at the expense of the landholder by taking up the collection of rents and there was therefore no substantial invasion of the rights of the landholder by the Interposition of the agency of the Government.

For these reasons, it must be held that 1952 1 Mad LJ 174: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, was rightly decided and though a part of the reasoning in that case is no longer valid in view of the later decisions of the Supreme Court to which reference has already been made the correctness of the conclusion reached by the learned Judges that the impugned Act did not contravene S. 299 (1) of the Co deminent of India Act has to be accepted.

It does not, however, follow from what I have said that if the ''''fair and reasonable rent" fixed under the Act is so unreasonably low as to work a practical destruction of the rights, of the landlord, this Court powerless to grant him relief. Under the guise of regulating the relations of landlord and tenant, it is not permissible for the Government or the authorised official to regulating the landholder out of his property.

The right to hold property guaranteed In Art. 19 (1) (f) of the Constitution is subject to any law imposing reasonable restrictions of the exercise of the right in the interests general public. I have already referred to the decisions of the Supreme Court where the word ''property'' has been interpreted in a wi(sic) sense. It cannot be disputed that the right the landholder is a right of ownership subject to the right of the ryot to remain in possession of the land so long as he paid the rent lawfully payable on it.

It is no doubt too late in the day to argue that legislation authorising the fixing of moderate and reasonable rent payable tenants who form a large section of the porpolation is not in the public interest. At (sic) same time, it cannot be maintained that (sic) power of imposing "reasonable restrictions" the enjoyment of landed property by the own justifies the practical extinction or confisition of his right.

The phrase "reasonable restriction" of (sic)notes that the limitation imposed on a person in enjoyment of the right should not be and trary or of an excessive nature beyond was is required in the interests of the public Chintaman Rao Vs. The State of Madhya Pradesh,

The learned Chief Justice of the Madras High Court in Rajah of Bobbili v. State Madras (A), adverted to this aspect of case and referred to the decisions of Supreme Court of America empowering judicial review of statutes and administral orders affecting the proprietary rights of (sic) sons. It is unnecessary for me to refer those decisions except to the following pass cited by Mr. Justice Hoarlan in (1895) 156 6: 39 Law Ed 567 (B) :

There is a remedy in the Courts of re against legislation establishing a tariff of (sic) which is so unreasonable as to practice destroy the value of the property of company engaged in the carrying on business, and (sic) especially may the Courts of the United State treat such a question as a judicial one hold such acts of legislation to be in con(sic) with the Constitution of the United State as depriving the companies of their prop(sic) without due process of law, and, as depriv(sic) them of the equal protection of the laws.

After citing this and other cases the learned Chief Justice observed :

I see no reason why this salutary principle enunciated in several American decisions should not be applied in this country in contruing Arts. 14, 19 and 31 of the Constitution.

Where legislation has been struck down as being unconstitutional, it will be found that the entire legislation has been declared (sic)oid except in cases where the offending provisions are severable from the rest and have been split up by the Legislature itself. Where however.

"a law purports to authorise" the imposition of restrictions on a fundamental right in language wide enough to cover restrictions both within and without the limits of constitutionally permissible legislative action affecting such right, it is not possible to uphold it (sic)ven so far as it may be applied within the constitutional limits as it is not severable. So (sic)ng as the possibility of its being applied to purposes not sanctioned by the Constitution cannot be ruled out, it must be held to be wholly non constitutional and void." Romesh Thappar v. state of Madras, 1950 SCJ 418: (AIR 1950 SC 24) (S). See also 1950 SCJ 571: (AIR 1951 SC 18) (R).

How I am upholding the validity of the Act because it is not inconsistent with the provisions of Part III of the Constitution. It seems (sic) me that the Act cannot be treated as valid (sic)ith reference to some cases and void as regards the rest, both falling within its ambit and (sic)ope. If a legislation offends Art. 19 (1) (f) (sic)d (5) in respect of some cases falling with-(sic) its terms, it has to be declared to be void (sic)en though it may not be open to such criti-(sic)sm in other similar cases.46. If under the guise of fixing a fair and reasonable rent under the Act, the rights of (sic)le landholder are practically destroyed, say, (sic)r fixing a pepper corn rent, it could, in my opinion, be regarded as a fraudulent exercise the statutory power conferred by the Act, (sic)e fraud consisting not in any moral turpi-(sic)de, but in the exercise of the power for purposes foreign to those for which it was, by (sic)w, intended.

If the Act is sought to be used as a sort a cloak or cover for confiscating the rights the landholder, that is to say for a purpose (sic)it within its intendment, if under colour of proceedings for fixing a fair and reasonable (sic)nt, the rights of the landholder are in effect (sic)tinguished, it would be the duty of this court to quash the proceedings taken under the court. The learned Chief Justice in 1952 1 Mad 174, 190, 191: Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, , observed:

The decision of the question would ultimately depend upon the circumstances of each (sic)ate. Rents which may be reasonable and (sic)st with respect to one estate may be unreasonable and unjust with respect to another is necessary, therefore, before any landholder can be given relief on the principle (sic)ve mentioned, that he should allege and (sic)ve facts which conclusively show that as a (sic)ult of the reduced rates of rent fixed under the Act, he has been totally or substantially deprived of the net income available to him.

I respectfully adopt this statement which has also been accepted by my Lord and would only add that relief in such cases should be given to the injured landholder, not by declaring the Act void by reason of its repugnancy to Art. 19 (1) (f) but by declaring illegal the notification made by the Government under the Act fixing the rent, which notification is also a "law" as defined in Art. 13 (3) of the Constitution.

Krishna Rao, J.

I agree with the conclusion of my Lord the Chief Justice and Viswanatha Sastri J. that Madras Act 30 of 1947 does not infringe the requirements of S. 299 of the Government of India Act, 1935. The gist of the argument before us, as I understand it, is that the content of the word ''acquisition'' in S. 299 (2) of the Government of India Act, 1935, includes all expropriation or deprivation of property, whether or not it results in any right to the property being taken by the State.

It appears, to me that there is nothing in the pronouncements of the Supreme Court in The State of West Bengal Vs. Subodh Gopal Bose and Others, and Dwarkadas Shrinivas of Bombay Vs. The Sholapur Spinning and Weaving Co. Ltd. and Others, which compels us to the view that the word ''acquisition'' used in S. 299 (2) has the same extended meaning as it bears in the context of Art. 31 (2)of the Constitution. Indeed in State of West Bengal v. Subodh Gopal Bose (C) (supra), Patanjali Sastri C. J. indicated in clear terms that the word had a narrower meaning in legislation like the Government of India Act which was enacted prior to the Constitution, for he said:

The Constitution marks a definite break with the old order and introduces new concepts in regard to many matters, particularly those relating to fundamental rights, and it cannot be assumed the ordinary word acquisition'' was used in the Constitution in the same narrow sense in which it may have been used in pre-Constitution legislation relating to acquisition of land.

No doubt in Dwarkadas Shrinivas v. Sholapur Spinning and Weaving Co. (supra), Mahajan J. said:

In my judgment, the true concept, of the expression ''acquisition'' in our Constitution as well as in the Government of India Act is the one enunciated by Rich J. and the majority of the Court in 68 Com-W LR 261 (E). The majority view referred to by him was that the takingly the Common-wealth (of Australia) for an indefinite period of the exclusive possession of property constituted an acquisition of property.

The subsequent discussion in the judgment of the learned Judge is only with reference to the concept of acquisition in our Constitution. In other words, so far as the Government of India Act is concerned, all that can be said is that the expression ''acquisition'' has been construed by Mahajan J. as being not confined to cases of acquisition of title by the State but also extending to cases where the state took exclusive possession of property for an indefinite period.

This is consistent with the phrase "confiscatory legislation" used by the judicial Committee in AIR 1946 127 (Privy Council) because confiscation connotes appropriation by the State. Deprivation of the owner''s right of possession, by the State taking over possession of the property, is, therefore, comprehended within the "acquisition" referred to in S. 299 (2).

But it would not follow that all other forms of deprivation of property coming within the ambit of Art. 31 (2). whether or not they are confiscatory and involved appropriation by the State, also constitute acquisition within the meaning of S. 299 (2). On the analogy of the rule of "contemporanea expositio", when the meaning is not plain and unequivocal but obscure or of doubtful import, we should incline to the interpretation authoritatively put upon the language by Courts at the time the statute was alive.

In my opinion, therefore, the correctness of the reasoning in Raja of Bobbili v. State of Madras (A) (supra), namely, that in S. 299 (2) acquisition imports the idea of transference of some of the owner''s rights in property, remains unaffected by the decision of the Supreme Court cited before us.

(Note :- After the opinion expressed by the Full Bench, the petition came on for hearing before Hon''ble Mr. Justice Bhimasankaram, J. It was urged before him that the rate fixed by the Government was unreasonable as between the landlord and the tenant. As in the opinion of Hon''ble Mr. Justice Bhimasankaram, this question deserved further consideration by a Bench, the petition came on for hearing before the Division Bench consisting of the Hon''ble Mr. K. Subba Rao, C.J. and the Hon''ble Mr. Justice Jaganmohan Reddy. After hearing the arguments, the following order was made on 11-9-1957 by Subba Rao, C.J. on behalf of the Division Bench.)

ORDER

Subba Rao, C.J.

Subsequent to the answer given by the Full Bench to the question referred to it the petition was posted before Bhimasankaram J. for final disposal. But the learned Judge, in view of the argument advanced before him, namely, that what the Government itself collects from a tenant must be considered to be a reasonable rate, thought that the question raised deserved further consideration and, therefore, directed the petition to be posted before a Division Bench of this Court.

The learned Advocate-General has placed before us the particulars of the net income which the petitioner derived before the rent was reduced and those of that he received after the rent was reduced under the Rent Reduction Act. The particulars disclose that, prior to the reduction of the rent under the Act, the petitioner was receiving a cash rent of Rs. 1,000/- and a grain rent of Rs. 3,900/- and that, after deducting a sum of Rs. 1,025/- towards expenditure, he was getting and income of Rs. 3,875/-.

After the rents were reduced under the Act, ''the petitioner was getting a sum of Rs. 570/- towards grain rent and Rs. 229-2-0 towards cash rent, and deducting Rs. 341-4-0 towards the expenditure, the petitioner was getting an income of Rs. 457/13/8. The result is that, while he was getting a net income of Rs. 3,875/- prior to the reduction of the rent he is now getting only Rs. 457/13/8, which is far below one-fourth of the previous new income.

The learned Advocate-General contends that the grain rent of Rs. 3,900/- represents the commuted value of the grain received by the petitioner, whereas, after reduction under the Madras Estates Land (Reduction of Rent) Amendment Act 1951 (Madras Act 7 of 1951), the petitioner is getting the rent at the highest rate prevailing in the ryotwari area in the district and that it cannot be said that reducing the rent to the highest ryotwari level is an unreasonable restriction with in the meaning of Art. 19 of the Constitution of India. This question was raised before the Madras High Court in Rajah Sri Ravu Sweta, Chelapathi Ramakrishna Ranga Rao Bahadur, Rajah of Bobbili Vs. The State of Madras, . Rajamannar C. J. who delivered the judgment on behalf of the Bench observed at page 187 (of Mad LJ): (at p. 21 of AIR), thus :

Prima facie reduction of the prevailir rents to the ryotwari level cannot be said be unreasonable. Where in a particular case the actual reduction effected is so drastic and there are other circumstances which lead the inference that the landholder is practical deprived of all enjoyment of his property, they it may be in that case there has been an unreasonable restriction.

With great respect, we adopt the aforesaid observations. Though, ordinarily, reduction the rent to the ryotwari level may be reasonable, there may be circumstances in a particular case to hold that the reduction is (sic)drastic that it would be an unreasonable re(sic) triction. One of us delivering the judgment of the Full Bench of this Court noticed the aspect of the case, and attempted to illustrative the circumstances under which the reduction the rent might amount to be an unreasonable restriction. It was stated therein thus :

The State may reduce the rents to suit a level that, after deducting" the legal charge and the expenditure fixed on an arbitrator basis, there may be nothing left to the land holder. In such a case, in the name of regulation of rents and collection thereof, the St(sic) takes the grain and gives the husk to landholder.

See the opinion of Subba Rao C. J., para. -Ed.

Though it is easy to state the principle, it difficult to apply the same to the facts of e(sic) case. What are the circumstances under which it can be held that the reduction is drastic that the landholder is substantially deprived of his income? We should think, having regard to the object of the Rent Reduction Act, that, if the income of the landholder after reduction of the rent did not fall below 65 per cent of his previous income it could be held that the reduction was not an unreasonble restriction within the meaning of Art. 19 (1) of the Constitution of India. In the pre-(sic)ent case, from the particulars furnished to (sic)s, it is manifest that the income of the landholder fell far below 25 per cent, of the income which he was getting before reduction.

We therefore, quash the notification sued by the Government of Madras and allow this petition. The respondent will pay the costs of the petitioner. Advocate''s fee fixed of Rs. 100/-