| Citation | 1953 AIR 375, 1954 SCR 1 |
| Date of Judgement | 29th May, 1953 |
| Court | The Supreme Court of India |
| Case type | Civil Appeals Nos. 71 to 76 of 1953. |
| Appellant | K.C. Gajapati Narayana Deo and other |
| Respondent | The State of Orissa |
| Bench | Hon’ble Justice M. Patanjali Shastri (former-CJI),Hon’ble Justice B. K. Mukherjea, Hon’ble Justice N. H. Bhagwati,Hon’ble Justice S. R. Dass,Hon’ble Justice Ghulam Hasan, |
| Referred | Constitution of India,1950, Articles- 31(4), 31(2), 13(2), 14; Schedule VII; List II Entry 46, List III Entry 42.The Orissa Estates Abolition Act,1952, Sections- 23, 26(2), 27(1)(b), 37.The Bihar Land Reforms Act, 1950, Sections- 4(b) and 23(f)The Madras Estates Land (Amendment) Act, 1947, Section 5 |
FACTS OF THE CASE :
The Orissa Estates Abolition Bill was published on 3rd January, 1950., and introduced into the Legislature on 17th January, 1950. It was passed on 28th September, 1951 and on receiving the assent of the President, became law on 23rd January, 1952. The Orissa Agricultural Income-tax Amendment Bill of 1950, was published in the local Gazette on 8th January, 1950., but appears to have been actually introduced in the Legislative Assembly in August, 1950, after a fresh publication of an altered Bill on 22nd July, 1950. It was passed into an Act on 10th August, 1950 and received the assent of the Governor on 19th September, 1950. It was modelled on the provisions that any sum payable for agricultural income tax for the previous year should be deducted from the gross asset of an estate for the purpose of arriving at its income on the basis of which compensation was payable to the estate owners, similar Bills of other provinces providing for payment of some compensation (though inadequate) to the intermediaries and hoping that the legality of the Bill would be unassailable in view of Article 31(4) of the Constitution.
The changes proposed by this Amendment Act were not very material. The highest rate was enhanced from 3 annas to 4 annas in the rupee and the highest slab was reduced from Rs. 30, 000 to Rs. 20, 000. For some reason or other, however, this bill was dropped and a revised bill was published in the local gazette on 22nd July, 1950, the case thus lifted in the High Court of Orrisa. The provisions in the Bill itself provided only for inadequate compensation and so far as Agricultural Income-Tax as a deduction in calculating the net income was concerned & views were reflected in the first Orissa Agricultural Income-tax (Amendment) Bill, 1950, dated 8th January,1950. The acquisition of zamindaries made it clear that most of the recommendations in the Choudhury Committee’s Report were not implemented in the Bill. When he was succeeded by Sri N. K. Choudhury the Orissa Estates Abolition Bill was referred to a Select Committee on 3rd August,1950 and by that time it was clear to everyone that the acquisition of zamindaries was a certainty.
In relation to Madras Estates Land (Amendment) Act, 1947 that improper delegation of legislative power to Provincial Government and provision were against Article 14 of Constitution. Even if deductions stated in Bihar Act were improper it did not make Legislation invalid unless it was unrelated to facts upon which it was based – in relation to Madras Act contention were not relevant as provisions of Orissa Estates Abolition Act, 1952 relating to computation of gross asset on basis of rent payable was not illegal.
Later The Orissa High Court held that the enhanced Agricultural Income-tax Act was enacted with a fraudulent design as contended by the learned counsel for the petitioners. The Act in question is a fraud on Entry 46 of List II and applying the principles of the majority of the Judges in the State of Bihar v. Sir Kameshwar Singh, AIR 1952 S.C. 252, which held two provisions of the Bihar Land Reforms Act, 1950, Sections 4(b) and 23(f) to be unconstitutional on the ground, among others, that these provisions constituted a fraud on the Constitution. The other view is that its invalidity arises out of its infringement of the fundamental right guaranteed under Article 31(2) of the Constitution and consequently by virtue of Article 13(2) it would be invalid only ‘to the extent’ of the contravention.
ISSUE:
Whether Orissa State Estates Abolition Act, 1952 is a piece of colourable legislation?
ARGUMENTS OF THE PARTIES:
The appellants raised contentions by attacking the constitutional validity of the Act as a whole. The arguments that have been advanced by the learned counsel for the appellants can be conveniently divided under three heads:
- There has been an attack on the validity of the provisions of two other statutes, the Orissa Agricultural Income-tax (Amendment) Act, 1950, and the Madras Estates Land (Amendment) Act, 1947, in so far as they affect the calculation of the net income of an estate for the purpose of determining the compensation payable under the Act.
- The provisions of the Act have been challenged as unconstitutional to the extent that they are applicable to private lands and buildings of the proprietors, both of which vest as parts of the Madras Estates Land (Amendment) Act, 1947 under Section 5 of the Act.
- The manner of payment of compensation money, as laid down in Section 37 of the Orissa Agricultural Income-tax (Amendment) Act, 1950, has been challenged as invalid and unconstitutional.
Both the Orissa Agricultural Income-tax (Second Amendment) Act of 1950, (Orissa Act, 15 of 1950), and Section 27(1)(b) of the Orissa Estates Abolition Act of 1952, providing for deduction of Agricultural Income-tax from gross assets are individually as well as taken together valid, and not open to any constitutional objections. The main contention raised was the Orissa Agricultural Income-tax (Second Amendment) Act, 1950 (Act 15 of 1950), it is to be noticed that under Section 27(1)(b), any sum which was payable in respect of an estate as agricultural income-tax in respect of any agricultural income derived from such estate during the previous agricultural year, is one of the items of deductions from the gross assets as calculated under Section 26(2), in order to arrive at the basic net income with reference to which the compensation payable is calculated under Section 23, of the Act.
The respondent’s arguments put forward by the appellants are not grounds of attack on the validity of the Estates Abolition Act, which, is the subject-matter of dispute in the present case, and it is not suggested that the provisions of the Estates Abolition Act relating to the computation of gross asset on the basis of rents payable by raiyats is in any way illegal.
JUDGEMENT:
The provision contained in Section 37 of the Orissa Estates Abolition Act, 1950, for payment of compensation by 30 annual instalments is not a piece of colourable legislation. It comes clearly within entry 42 of List III of Schedule VII of the Constitution. In entry 46 of List ll of the VII Schedule to the Constitution and, as the State Legislature was competent to legislate on this subject, the Act was not void, and the fact that the object of the legislature was to accomplish another purpose.
The doctrine of colourable legislation does not involve any question of bona fides or mala fides on the part of the legislature. The whole doctrine resolves itself into the question of competency of a particular legislature to enact a particular law. If the legislature is competent to pass a particular law, the motives which impelled it to act are really irrelevant.
There is no substance in this contention and we have no hesitation in overruling it. The result is that all the points raised by the learned counsel for the appellants fail and the appeals are dismissed. Having regard to some important constitutional questions involved in these cases which needed clearing up, we direct that each party should bear his own costs in these appeals. The Orissa Estate Abolition Act 1952, is valid. It is an Act that abolished the zamindar system in Orissa. The court rejected the arguments of the zamindars that the Act was Colourable Legislation, that it violated the right to the property, and that it gave inadequate compensation. As the Act was protected by the Presidential assent and that the compensation was based on the payable by the tenants.
REFERENCE :
This case analysis is done by Miss. Rutuja Santosh Kokare of Ismailsaheb Mulla Law College, Satara, Legal Intern at Legal Vidhya.
