# •692 STATE OF GUJARAT ETC v. VAKHTSINGH11 SURSINGHJI VAGHELA & ORS. ETC

- **Citation:** [1968] 3 S.C.R. 692
- **Court:** Supreme Court of India
- **Decided:** 1968-04-08
- **Bench:** M. Hidayatullah, R. S. Bachawat, G. K. Mitter, C. A. Vaidialingam, K. S. Hegde
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/692-state-of-gujarat-etc-v-vakhtsingh11-sursinghji-vaghela-ors-etc-4334
- **Pages:** 14

## Headnote

Bombay Taluqdari Abolition Act 62 of 1949. ss. 7 and 14-Right to
'JJ(ly ;ania or land revenue at reduced rates-Whether a right for whicli
compensation 1) payable under s. 14-15% solatium whether pa,vable in
addition to conipensation for lands under s. 1-Method of 1vorking out
.contpensation for irrigation bunds, tanks and 1vells-Right to compensa-
--- tion for river, river beds, Bht4has.
Constitution of India, Art. 227-Scope of High Court's power to interfere with Tribunal's order and to give directions.
The respondcnts filed claims before the Collector
Ahmedabad for
compensation under ss. 11 and 14 of the Bombay Taluqdari Abolition
Act, 1949. Against the Collector's awards !hey appealed to the Revenue
Tribunal and thereafter filed petitions under Art. 227 before the High
·Court. From the High Court's orders the State of Gujarat appealed to
Ibis Court. The matters in dispute were: (i) whethel' the right to pay
.only 60% of the full jama or revenue assessment on their lands which
the respondents had been enjoying was a right for the extinguishment
of which compensation under s. 14 of the Act was pavable; (ii) whether
under the provisions of the Act the respondents were entitled to 15%
solatium in addition to the compensation which they were awarded for
their lands; (iii) what was the proper method of working out the value
·Of irrigational bunds, tanks and weUs for the purpose of compensation;
(iv) whether compensation was payable to the respondents in respect of
river and river beds. The Court had also to consider the scope of the
High Court's power under Art. 227 of the Constitution in the context of
the case.
HELD: (i) The taluqdari estates were liable to payment of jama.
As a matter of concession the jama was generally 60% of the survey
.....,sment. The taluqdars had no legal right to claim the concession on
the expiry of their current settlements, ·and at the next revisional settlement the Government had the right to withdraw the concession and
impoae full assessment The right of the taluqdars to pay the jama at
the concessional rate till the expiry of the current settlement was pre·
861"Ved by s. 5 of. the Abolition Act. The enhanced assessment which
they had to pay thereafter did not affect any contractual or statutolry
right vested in them.
Even assuming that it modified or extinguished
any right, such modification or extinguishment did not amount to trans.
ference to public ownership of land or any right in or owr land within
the meaning of s. 14 of the Abolition Act. The CoUector, the Revenue
Tribunal and the High Court therefore rightly rejected the claim of the
respondents for compensation for the difference in the jama and the full
a8'cssment. [698 C, 699 H, 700 A]
Rao Bahadur Kunwar Lal Singh v. The Central Provinces and Berar,
[1944] F.C.R, 284, applied.
Nalfllb Sardar f\larharsinghji lshvarshinghji v. The Secretarv of State
for India. 43 Born. L.R. 167, referred to.
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GUJARAT V. VAKHTSINGHJI
693
(ii) The Collector is required by s. 7(1)(b) ,to make an award in
the manner prescribed in s. 11 of the Land Acquisition Act, 1894. The
Collector has to make an award under s. 11 and having regard to s. 15
in determining the amount of compensation, he is guided by the provisions of s. 23 and s. 24. Section 23(1) requires an award of the market
value of the :and. Section 23(2) requires an additional award of a sum
of fifteen pee centum on such market value, in consideration of the com~
pulsory nature of acquisition.
It follows that under s. 7(1)(b) of the
Abolition Aet read with s. II of the Land Acquisition Act the taluqdars
a£e entitled to receive as compensation the market v.alue of all rights in
any property extinguished under s. 6 and in addition a sum of 15 per
cent on such market value.
Tho right is subject to the conditions and
exceptions enumerated in sub-els. (i), (ii) and
(ili)
of
s.
7(i)(b).
(701 C-FJ
(iil) In regard to irrigational bunds, tanks and weJls the High Court
rightly re

## Text

•692
STATE OF GUJARAT ETC.
v.
VAKHTSINGH11 SURSINGHJI VAGHELA & ORS. ETC.
April 8, 1968
[M. HIDAYATULLAH, C.J., R. S. BACHAWAT, G. K. MITTER,
C. A. VAIDIALINGAM AND K. S. HEGDE, JJ.J
Bombay Taluqdari Abolition Act 62 of 1949. ss. 7 and 14-Right to
'JJ(ly ;ania or land revenue at reduced rates-Whether a right for whicli
compensation 1) payable under s. 14-15% solatium whether pa,vable in
addition to conipensation for lands under s. 1-Method of 1vorking out
.contpensation for irrigation bunds, tanks and 1vells-Right to compensa-
--- tion for river, river beds, Bht4has.
Constitution of India, Art. 227-Scope of High Court's power to interfere with Tribunal's order and to give directions.
The respondcnts filed claims before the Collector
Ahmedabad for
compensation under ss. 11 and 14 of the Bombay Taluqdari Abolition
Act, 1949. Against the Collector's awards !hey appealed to the Revenue
Tribunal and thereafter filed petitions under Art. 227 before the High
·Court. From the High Court's orders the State of Gujarat appealed to
Ibis Court. The matters in dispute were: (i) whethel' the right to pay
.only 60% of the full jama or revenue assessment on their lands which
the respondents had been enjoying was a right for the extinguishment
of which compensation under s. 14 of the Act was pavable; (ii) whether
under the provisions of the Act the respondents were entitled to 15%
solatium in addition to the compensation which they were awarded for
their lands; (iii) what was the proper method of working out the value
·Of irrigational bunds, tanks and weUs for the purpose of compensation;
(iv) whether compensation was payable to the respondents in respect of
river and river beds. The Court had also to consider the scope of the
High Court's power under Art. 227 of the Constitution in the context of
the case.
HELD: (i) The taluqdari estates were liable to payment of jama.
As a matter of concession the jama was generally 60% of the survey
.....,sment. The taluqdars had no legal right to claim the concession on
the expiry of their current settlements, ·and at the next revisional settlement the Government had the right to withdraw the concession and
impoae full assessment The right of the taluqdars to pay the jama at
the concessional rate till the expiry of the current settlement was pre·
861"Ved by s. 5 of. the Abolition Act. The enhanced assessment which
they had to pay thereafter did not affect any contractual or statutolry
right vested in them.
Even assuming that it modified or extinguished
any right, such modification or extinguishment did not amount to trans.
ference to public ownership of land or any right in or owr land within
the meaning of s. 14 of the Abolition Act. The CoUector, the Revenue
Tribunal and the High Court therefore rightly rejected the claim of the
respondents for compensation for the difference in the jama and the full
a8'cssment. [698 C, 699 H, 700 A]
Rao Bahadur Kunwar Lal Singh v. The Central Provinces and Berar,
[1944] F.C.R, 284, applied.
Nalfllb Sardar f\larharsinghji lshvarshinghji v. The Secretarv of State
for India. 43 Born. L.R. 167, referred to.
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GUJARAT V. VAKHTSINGHJI
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(ii) The Collector is required by s. 7(1)(b) ,to make an award in
the manner prescribed in s. 11 of the Land Acquisition Act, 1894. The
Collector has to make an award under s. 11 and having regard to s. 15
in determining the amount of compensation, he is guided by the provisions of s. 23 and s. 24. Section 23(1) requires an award of the market
value of the :and. Section 23(2) requires an additional award of a sum
of fifteen pee centum on such market value, in consideration of the com~
pulsory nature of acquisition.
It follows that under s. 7(1)(b) of the
Abolition Aet read with s. II of the Land Acquisition Act the taluqdars
a£e entitled to receive as compensation the market v.alue of all rights in
any property extinguished under s. 6 and in addition a sum of 15 per
cent on such market value.
Tho right is subject to the conditions and
exceptions enumerated in sub-els. (i), (ii) and
(ili)
of
s.
7(i)(b).
(701 C-FJ
(iil) In regard to irrigational bunds, tanks and weJls the High Court
rightly rejected the claim for compensation based on reinstatement value.
This method should not be adopted when the market value deduced from
the income derived from the lands would fairly compensate
the owner
and in no case can re·instatement value be gi~n untess reinstatement in
some other place is bona fide intended. lo the present case the High
Court found that there was no intention to reinstate the bunds. (703 C-DJ
lbe value of irrigational bunds, tanks and wells is not what they cost
but what they yield in annual income. The High Court rightly adopted
the yield basis of valuation. The Himayat assessment
and the
water
tales adopted by the Collector and the Tribunal did not give the correct
yield.
The. High Court therefore rightly directed further inquiries into
this claim. [703 El
Raia Vyricherla Gajapatiraju v.
The .Revenue Divisional
Officer,
Viz;agapatam, 66 I.A. 104, Harish Chandra Neogy v. Secretary of State
for India, 25 C.W.N. 875 and Province of West Bengal v. Roja Jhargram,
A.I.It 1955 Cal. 392, referred to.
(
{iv) In regard to river and river beds, the taluqdars had no property
in running water. They were the owners of the river beds but the submerged river beds were of no value to them. They could rightly claim
compensation only for the Bhathas formed in the rivers and other portiOll.S of the river beds whe're crops could be raised during some parts of
the vear. [703 F-01
(v) Article 227 of the Constitution gives the High Court the power
of superintendenee over all courts and tribunals throughout the territories
~ ~ation to which it exercised jurisdiction. This jurisdiction cannot be
!muted or ~·~red .by any A71 of the . ~tate Legislature.
The High
Court had 1urisd1ct1on to revise the dec1S1on of the Tribunal in respect
of the ~olatill!" and irrigational bunds tanks and wells, when the Tribunal
on a mISreadmg of ss. 7 and 14 of the Abolition Act declined to do what
was by those l'rov!sions !t!cumbent on it. to d.o.
The High Coun could
not only set aside its dec1S1on. but also direct 11 to mak~ further inquiries
aftol' taking evidence. (705 B-GJ
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.edHari Vishnu Karnath v. Syed Ahmed /shaque, [1955] !$.C.R. J!()4,
re 1
on. _
.
. CML APPELLATE JURISDICTION :
Civil Appeals Nos. 517
to 534 of 1965,
Appeals from the judgment and decree dated January 12
1961 of ·the Gujarat High Court in Special Civil Application;
Nos. 78 to 83 and 96 to 101 of 1960.
694
SUPREME ccfthtT REPORTS
(1968] 3 S.C.R.
N. S. Bindra and S. P. Nayar, for the appellant (in C. A.
A
Nos. S 17 to 528 of 1965) and for respondent-State of Gujarat
(in CAs. Nos. 5~9 to 534 of 1965).
A. K. Sen, Bhuvanesh Kumari, I. B. Dadachanji, 0. c.
Mathur, Ravinder Narain and M. H. Chhatrapati, for respondent No. 1 (in C.As. Nos. 517 and 524 of 1965).
A. K. Sen, M. H. Chhatrapati, ·and Bhuvanesh Kumarl, for
respondent No. 1 (in C.As. Nos. 518 to 522 of 1965) and the
appellant (in C.A. No. 530 of 1965).
M. H. Chhatri[1ati and Bhuvanesh Kumari for respondent
No. 1 (in C.As. Nos. 523, and 526 to 528 of 1965) an.d appelB
lant (in C.A. No. 529 and 531 to 534 of 1965).
C
N. A. Palkhivala, M; H. Chhatrapati and Bhuvanesh Kumari,
for respondent No. 1 (in C.A. No. 525 of 1965).
"'
The Judgment of the Court was delivered by
Bachawat, J.-These appeals are directed against the orders
of ·the Gujarat High Court passed under Art. 227 of the ConstiD
tution revising the appellate orders of the Bombay Revenue
Tribunal modifying certain awards of the Special Deputy Collector, Ahmedabad.
Claims for compensation under secs. 7 and
14 of the Bombay Taluqdari Abolition Act, 1949 (Bombay Act
LXII of 1949) were filed before the Collector by the Taluqdars
of certain villages in the district of Ahmedabad. The Collector
J:
made his awards of compensation under secs. 7 and 14. The
claimants filed appeals before the Revenue Tribunal and later
petitions under Art. 227 of the Constitution to the High Court.
The present appeals are filed by the State of Gujarat and some
of the claimants.
The principal matters in oontroversy in these
appeals relate to the award of compensation under the heads :
I'
(1) difference in Jama and full assessment, (ii) solatium of
15 % .on the market value, (iii) irrigational bunds, tanks and
wells and (iv) river and river beds.
Excellent accounts of the history and incidents of the taluqdari tenures are given in Dr. Govind D. Patel's Agrarian Reforms in Bombay, 1950, Mr. J. B. Peile's Report, Government
G
Selection No. CVI New Series, p. 13, Mr. L. Robertson's Report
on the conditions of the taluqdars of the Ahmedabad district,
1903, statement of objects and reasoJ!S for Bill No. 6 of 1885
printed in Bombay Government Gazette, dated the 26th December, 1885, Part V, at p. 65 and Nawab Sardar Narharsinghji
Ishvarsinghjl v. The Secretary of State for India('). The origin
11
of the Gujarat taluqdars may be traced to Moghul and preMoghul times.
They are found
mainly in
the / districts of
(!) 43 Bom. L. R. 167.
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GUJARAT I'. VAKHTS!NGJIJI (Bachawat, J.)
695
Ahmedabad, Kaira, Broach and the Panchmahals. The leading
charac,'.eristics of the taluqdari tenure is that the taluqdari estate
is neither alienated nor unalienated but is proprietary.
Until
1862 the taluqdars were legally though incorrectly regarded as
mere lease holders.
From 1862 till 1888 they were full proprietors with unlimited powers of alienation.
From 1888 onwards ·they were full proprietors with restricted powers of alienation.
Their estates were subject to payment of a jama to the
Government. Originally th'e jama was regarded as a tribute but
later it beca,me a roughly calculated tax on the rental, then a
land tax and finally land revenue.
Acts were passed from time
to time for ameliorating the conditions of the taluqdars.
Since
1888 the taluqdari villages and estates were governed by the
provisions of the Gujarat Taluqdars' Act, 1888 (Bom. Act VI
of 1888).
Under sec. 2(1) (c) of this Act Jama meant land
revenue payable by the taluqdars to the Government.
Section
4 empowered the Government to direct a revenue survey of a
taluqdari estate under the provisions of the Bombay Land Revenue Code, 1879. Sections 22 and 23 deal with the taluqdar's
.iama :
"22(1). If a taluqdar's estate, or any portion thereof is not wholly or partially exemp'. from land-revenue
and its liability to payment of land revenue is not subject to special conditions or restrictions, the jama payable to (the Provincial Government) in respect
of
such estate or portion thereof shall, if a survey settlement has been extended thereto, be the aggregate of
the survey assessment of the lands composing such
estate or such portion thereof minus such deduction, if
any, as (the Provincial Government) shall in each case
direct.
(2) nte (Provincial Government) may
declare
the amount of jama so ascertained fixr.d for any term
not exceeding thitty years.
23 (1) Nothing in this Act shall . be deemed to
affect the validity of any agreement, heretofore, entered into by or with a taluqdar and still in force as to
the amount of his jama nor of any settlement of the
amoun'. -of jama made by or under the orders of the
(Provincial Government) for a term of years and still
i11 force. t
(2) Every such agreemen: and settlement
shall
. have effect a'.s·if this Act had not been passed:"
The iama was usually fixed ( uddhad) in respect of the estates
in Kaira and Broach but those in Ahmedabad and Panchmahals
8SupCl/6S-l
696
StlP.IUlME COURT lUlPOllTS
('968) 3 S.C.R.
were liable to revision at every revisional settlement. The
A.
ftuctuating jam.a in respect of these latter estates could
~ndcr
s. 22 be fixed at an amount equal to the full survey assessment
of all the lands comprised within the estate. In practice the
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jam.a of the claimants' estates in Ahmedabad was
limi~ to
about 60% of the full assessment. As a measure of. agrarian reform the Government decided to abolish the taluqdar tenures
It
altogether.
Accordingly the Bombay Taluqdari Tenure Abolition Aot, 1949 was passed on January 24, 1950. It came into•
force oil August 15, 1950. It extends to the districts of Ahmedabad, Kaira, Broach and Panchmahals.
It repealed the Gujarat
Taluqdars' Act of 18 8 8 and certain other ~ial Acts !elating
to taluqdars. Section 3 abolish.ed the taluqdari tenure and exI;
tinguished all incidents of the tenure attached to any land comprised in a taluqdari estate save as provided in the Act. Under
sec. 4 all revenue surveys and settlements made under sec. 4
of the Gujarat Taluqdars Act, 1888 are deemed to have been
made under Chapters VIII and VIlfA of the Land Revenue
Code.
By section 5 (1 )(a) all taluqdari lands are henceforth "
liable to the payment of land revenue in accordance with the
I>
provisions of the Land Revenue Code and the rules made thereunder. But this provision does not ,affect the right of any person
to hold any taluqdari land wholly or partially exempt from the
payment of land revenue under a special contract or any other
law for the time being in force [s. 5(2)(a)] nor the right of
any person to pay jama under any agreement or settlement reE.
cognised under sec. 23, or under a declaration made under sec·
tion 22 of the Gujarat Taluqdars' Act so long as such agieement, settlement or declaration remains in force [s~ 5 (2 }(b )].
Section 5 ( 1) (b) provides that a taluqdar holding any taluqdari
land shall be deemed to be an occupant within the meaning of
the Land Revenue Code or any other law for the time being in
,
force.
Section 6 provides that all public roads, !!Illes etc., ndf f
situate within the limits of the wantas belonging to a taluqdar
in a taluqdari estate shall vest in ·the Government and all rights
held by a taluqdar in such property shall be deemed to have been
extinguished.
Section 7 proV1des for payment of compensation
to taluqdars for extinguismnent of rights under section 6.
Sec- .
tion 14 provides for payment of compensation for extingwshG
ment or modification of any other right in any land where such
extinguishment or modification amounts to transference to public ownership of such land or any right in or over such land.
Section 17 makes applicable provisions of the Land Revenue
Code to all taluqdari lands with certa.in modifications. Sections
8 9 and 1 O provide for appeals from lhe Collector's award.
8
S::Won 12 provides that the awanl made by the Collector and
the decision of the ·Bombay Revenue Tribunal on appeal shall
be final and conclusive and shall not be questioned in any suit
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GU.JAR:'AT v. VilHTSINGHJl (Bachawat, /.)
697
or proceeding in any court.
The Act is protected by Art. 31B
of the Constitution. It was amended from time to time. ClaUS6
(a) of section 5(2) was deleted by Bombay Act 42 of 1953.
Section SA was inserted by Bombay Act I of 1955. Section SA
made a pennanent tenant and an inferior holder in possession
of, any taluqdari land an occupant in respect of such land on
payment of compensation to the taluqdar.
In these appeals the taluqdars claim compensation for the
loss of benefit of the difference between the jama and the full
assessment. The jama payable under the settlements made before
the.Abolition Act was 60% of the total assessment. Their right
to pliy the jama only under those settlements were not affected
in view of section 5 (2 )(b). They have obtained the full benefit of the concessional jama while the settlements remained in
force. The period of those settlements have now expired and
they are now liable to pay full assessment.
They have thus
suffeRld a loss of 40% of the land revenue of the villages. They
claim compensation for this loss under s. 14 (1 ) of the Abolition
Act which reads..:~
•
"14.(1). If any person is aggrieved by any of the
provisions of this Act as extinguishing or modifying
any of his rights in any land other than those in respect
of which provision for the payment of compensation
has been made under section 7 and if such person
proves that
such
extinguishment or modification
amounts to the transference to public ownership of
such land or any right in or over such land, such person
may apply to the Collector for compensation within a
pei-iod of twelve months from the date on which this
Act comes into force."
"Any person" in sec. 14( 1) includes a taluqdar. To get com·
pensation under the section the claimant must establish firstly
that his rights in any land other than those for which provision
for comJle'Ilsation is made under s. 7 has been extinguished or
modified and secondly' that such extinguishment or modificati9n
amounts fo .the transference to public ownership of such land or
any right in or over such land. The taluqdars contend that they
had the right to pay a jama not exceeding 60% of the survey
assessment ·of the lands comprised in the estate.
According to
them the Government had issued directions under section 22 (1 )
of. the Gujarat Taluqdars' Act, 1888 so limiting the jama. They
say that such direction is to be found in the memorandum of
the Government of Bombay issued on October 2,
1914 with
reference to the recommendation made by the Commissioner, .
Northern Division, in his letter dated April 13, 1914. The ltigh
Court has ref.erred to these documents in some detail. It appears
698
SUPREME COURT REPORTS
(1968) 3 S.C.R.
that the Gujarat Taluqdari Bill was then pending before the
A
Legislative Council. The memorandum shows the Government's
willingness to incorporate in the Bill suitable provision regarding
the fixation of olhe jama. In our opinion, the memorandum was
not a direction under sec. 22( 1) nor did it create a legal right
in the taluqdars to pay a jama of 60% of the survey assessment.
B
The taluqdari estates were always liable to payment of jama
or land revenue.
As a matter of concession the jama was generally 60% of the survey assessment of the lands comprised in
the esta1e.
The taluqdars had no legal right to claim the concession on the expiry of their current settlements.
At the next
revis1onal settlement the Government had the right to withdraw
C
the concession and to impose full assessment on the taluqdari
lands.
Section 5(1)(a) of the Abolition Act by imposing full
assessment on the taluqdari lands after the expiry of the period
of the current settlements did not extinguish or modify any vested right of the taluqdars.
Mr. Palkhiwala argu.ed that section 5 effected a transfer of
D
the proprietary rights of the taluqdars in their lands to the Government together with the advantage of paying reduced revenue
and a re-transfer of the occupancy rights in those lands to the
taluqdars and consequently there was extinguishment or modification of their rights amounting to transference to public ownership of rights in and over such lands. The argument, though
E
ingenious, does not bear scrutiny.
Before the High Court the
faluqdars made no claim for compensation generally for any loss
of proprietary right.
Mr. Palkhiwala therefore said that he did
not make any claim for compensation for the loss of proprietary
right other than the loss arising from the liability to pay full
assessmeni.
We have therefore to consider only the claim for·
compensation for the difference between the jama and the fn11
F
assessment.
In Rao Bahadur Kunwar Lal Singh v. The Central Provinces
and Berar(') the appellant Rao Bahadur Kunwar Lal Singh held
in Zamindari rights certain estates in the Central Provinces. The
land revenue in respect of the estates was settled in 1921 und.cr
the Central Provinces Land Revenue Act, 1917 for a period of
19 years from July 1, 1919 and July 1, 1920 and thereafter until
a fresh settlement was made.
Section 88 of the Act provided
that if the assessmeni of an estate, had been accepted under the
Act, · the proprietors would be bound to pay the land revenue
assessed thereon from such date and for such term as the Provincial Government might appoint in that behalf and if at the
expiry of wch term no new assessment had been made, until a
(1) [1944! P. C. R. 284.
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GUJARAT v. VAKHTSINGHJI (Bachawat, J.)
699
new assessment was made. . The Central Provinces Revision. of
the Land Revenue of Estates Act, 1939 enacted that with effect
from July 1, 1938 notwithstanding anything .contained in the
Act of 1917 the land revenue payable to the Government in respect of the estates would be enhanced to the amounts mentioned
in the Schedule to the Act of 1939. By an Amending Act of
1941 it was provided that those amounts would be deemed to
have been assessed, offered and accepted under the Act of 1917.
The appellant contended that as no. new settlement had been
made the Act of 1939 extinguished or deprived him of his contract~al as well as statutory right to hold his estates subject only
to the payment of the takoli fixed in 1921 and thus amounted to
an acquisition of his right in land in contravention of section
299(2) of the Government of India Act, 1935: The Federal
Court repelled this contention.
Spens, C.J. observed :-
"It is, we think, impossible to hold that the mere
increase of an assessment for land revenue involves
any acquisition ofthe 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 transferenee of, and it must be possible to indicate some person or body to whom is or are transferred, the land or righis referred to.
It is impossible,
in our view to suggest that when the land revenue is
increased, there is any transference to the PrOvincial
Government or .any other person of any land or rights
in or over immovable property, which remain in the
same possession or ownership as immediately before
the increase of the assessment. · In our judgment, the
attempt to bring the case within s.
299(2)
must.
fail."
.
It. will be noticed that the Zamindar in that case was bound
to pay only the fixed land revenue for the period of 19 years and
thereafter until a new settlement was made.
The increase in
land revenue made by the 1939 Act affected this right. Nevertheless it was held that the increase in land revenue did not involve any transference to ' the Government of any right in or
over any immovable property. The case of the taluqdars in
the. present case is \Yealcer.
Their. right to pay the jama only
while the . old settlements remained . m force was not affected by
section S.
The increase in land revenue on the expiry of. those
settlements was not due to any change in ownership.
The enhanced·. assessment did not affect any contractual or statutory
right vested in them. Even assU111ing that it modified or ex·
tingu~ any right, such modification or extinguishment did
not amount to transference to pμblic ownership of land or any
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[1968] 3 s.c.R.
right in or over land within the meaning of sec. 14 of the .Bom·
A
bay Taluqdari Tenure Abolition Act. The Collector, the Revenue Tribunal and the High Coun therefore rightly rejected the
claim of the taluqdars for compensation for the difference in the
jama and the full assessment.
The n¢xt claim is for payment of a solatium of 15 per cen·
tum on the market value awarded under .section 7 of the AboliB
tion Act.
The Collector and the Revenue Tribunal rejected
this claim.
The High Coun partially allowed it and directed
that an amount of 15 % should be added to the market value
awarded under section 7(1)(b)(ili). This ruling is challenged
by both the State of Gujarat and the taluqdars.
Section 7 (l)
reads :-
c
7.(1) Any taluqdar having any rights in such
property shall be entitled to compensation in the
manner
provided
in
the
following
paragraphs
namely:-
(a) within a period of twelve months from
the
date on which this Act comes into force, the taluqdar
shall apply in writing to the Collector stating the
nature of Iris right, the ground of his claim and the
amount of compensation claimed by him for the extinguishment of his right;
·
( b) the Collector shall hold a formal inquiry in
the manner provided in the Code and if the Collector
ia satisfied that the applicant had any rights in the
land and that such rights have been extinguished under
the last preceding section, shall make an award in the
manner prescribed in seciion 11 of the Land Acquisition Act, 1894 (l of 1894). subject to the following conditions :-
(i) if the property acquired is waste or uncultivated but is culturable land the amount of compensation shall not exceed three times the assessment of
the land;
Provided that if the land has not been assessed,
the amount of compensation shall not exceed such
amount of assessment as would be leviable in the same
village on the same extent of similar land used. for
the same purpose;
(II) if the property is land over which the public
has been enjoying or acquired a right of way or any
individual has any· right of easement, the amount of
compensation shall not exceed the amount of the
annual assessment leviable in the village for uncultiD
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GUJARAT v. VAKHTS!NGHJI (Bachawat, J.)
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vai.ed land in accordance with the rules made under
the Code or if such rules do not provide ,the levy of
such assessment, such amount as in the opinion of
the Collector shall be the market value of the right
or interest held by the claimant;
(iii) if there are any trees or structures on the
land, the amount of compensation shall be the market
value if such .trees or structures, as the case may be;
Explanation-For the purpose of this section the
"market value" shall mean the value as estimated in
accordance with the provisions of sections 23 and 24
of the Land Acquisition Act, 1894 (1 of 1894), in
so far as such provisions may be applicable."
Section 7 ( 1) gives compensation to taluqdars for extinguishment of rights in any property under sec. 6.
The Collector is
required by sec. 7 (1 )(b) to make an award in the manner prescribed in section 11 of the Land Acquisition Act, 1894. The
Collector has to make an award of compensation under sec. 11
and having regard to sec. 15 in determining the amount of compensation, he is guided by the provisions of secs.
23 and .24 ..
Section 23 ( 1) requires an award of the market value of the
land.
Section 23(2) requires an additional award of a sum of
fifteen per centum on such market value, in consideration of
the compulsory nature of acquisition. It follows that under sec.
7 ( 1 )(b) of the Abolition Act read with section 11 of the Land
Acquisition Act, the taluqdars are entitled to receive as compensation the market value of all rights in any property extinguished
under sec. 6 and in addition a sum of 15 per centum on such
market value. This right is subject to the conditions and exceptions enumerated in sub-clauses (i), (ii)
and
(iii) of section 7(l)(b). In cases falling under clause (i) and in some
cases under clause (ii) the amount of compensation is liniited.
In cases falling under clause (iii) and in some cases under clause
(ii)· the amount of compensation is the "market value" which
according to the explanation to sec.
7 (1 ) means. the value
estimated in accordance with sections 23 and 24 of the Land
Acquisition Act, 1894. The value so determined includes the
G
solatium of 15 per centum payable under sub-section
(2) of
s. 23. Where the legislature intended to exclude the application of sub-section (2) of sec. 23, it has said so, as in section
14(2) und<tr which compensation is determined in accordance
with the provisions of sub-section ( 1) of sections 23 and 24.
It follows that the taluqdar is entitled to the solatium of 15 per
centum on the market value, ( 1 ) under the main part of sec.
7 ( 1 )(b) subject to the provisions of the several sub-clauses
JI
thereof: (2) in cases falling under clause (iii) of section 7(1)(b)
and (3) in cases under clause (ii) of section 7(1)(b) where
•
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SUPREME COURT REPORTS
(1968) 3 S.C.R.
market value is awarded.
The direction of the High Court is
/'!,,
modified accordingly.
The next claim is with regard to irrigational bunds, tanks and
wejls.
The Collector awarded compensation .on the basis of
Hirnayat and water rates of assessment.
The Revenue Tribunal
confinned his award. The High Court set aside this award and
directed the Collector to award compensation after further inquiry on the basis of twenty-five iimes the annual profits derivable from the properties.
This ruling is
challenged
by
the
State of Gujarat and also by the Taluq·dars.
Mr. Bindra contended that the Tribunal's award should be restored. Mr. A. K.
Sen contended 1hat the compensation should be awarded on the
basis of reinstatement value.
In our opinion, both .these c:in·
tentions should be rejected.
The duty of the Collector is to
award the "market value".
The market value is the amount
which the laml if sold in the open market by u willing seller might
be expected to realise. ln the case of land the market value is
generally ascertained on a consideration of the prices obtained
by sale of adjaceni lands with similar advantages.
Where there
are no sales o1' comparable lands, the value must be found in
some other way.
One method is to take th.e
annual
income
which the owner is expected to obtain from the land and to
capitalise it by a number of years purchase.
The capitalised
value is then taken as the market value. which a willing vendor
mig:ht reasonably expefa to obtain from a willing buyer.
Tn
some special cases awards have been given on the basis of the
reinstatement value which is assessed according to the cost of
acquiring an equally convenient land or premises.
Cripps on
Compulsory Acquisition of Land. 11th ed., Arts. 4-203, p. 907
exrlains this method thus :-
"Before the Acquisition of Land Act, 1919,
reinstatement value, instead of market value, was sometimes given so as to give proper effect to the principle
of compensation on the basts ·Of value to the owner.
Generally it was only given in
respect of property
which was of such a nature (for example, a school.
church. hospital, hou~e of exceptional character, business premises in which the business could be carried
on under special conditions or by means of a special
licence) that there was no market or general demand
for such properiy; and a market value deducted from
the income derived would not constitute a fair basis
in assessing the value to the owner."
The measure of compensation for lands or premises taken
under the Lands Clauses Act, 1845 was their value to the owner.
Jn special cases reinstatement value enabling the O)Vner to
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GUJARAT v. VAKHTSINGHJI (Bachawat, /.)
703.
replace the lands or premises taken from him was taken to be the
correct measure of this value.
This principle was later enacted
in Rule 5 of section 2 of Acquisition of Land (assessment of
compensation) Act, 1919 which is now replaced by Rule 5 of
section 5 of the Land Compensation Act, 1961. In Raja Vyricherla Gajapatiraju v. The Revenue Divisional Officer,
Vii.agapatam (1) Lord Romer said that the general principles for determining compensation under section 23 of the Land Acquisition
Act, 1848 did not differ in any material respect from those upon
which compensation was awarded under the Lands Clauses Act
of 1845. In Harish Chandra Neogy v. Secretary of ·State for
India(') and Province of West Bengal v. Raja Jhargram(1 ) it was
suggested that in special cases the reinstatement value may be
awarded as compensation under section 23 of the Land Acquisition Act.
For the purpose of this case it is sufficient to say that
this method should not be adopted where the market value
deduced from the income derived from the ·lands would fairly
compensate the own.er and in no case can reinstatement value·
be given unless reinstatement in some other place is bona fide intended.
The High Court found that there was no intention to
reinstate the bunds.
The owners could be fairly compensated
· by giving the market value deduced from
1 the estimated yield ..
The High Court rightly rejected the reinstatement· method. The
value of irrigational bunds, tanks and wells is not what they cost
but what. they yield in annual income.
The High Court rightly
adopted the yield basis of valuation. The Himayat assessment
and water rates did not give the correct yield. The High Court
therefore directed further inquiries into this claim.
The next claim for compensation is with regard to river and
river beds.
The Collector and the. Tribunal rejected this claim·
but the High Court allowed it a.nd directed further inquiries. The
State of Gujarat challenges this ruling.
Now the taluqdars had
no property in running water.
They were the owners of the
river beds but the submerged river beds were of no value to
them.
Counsel for the taluqdars therefore conceded that the
High C~rt's ~g
canno~ be supported.
Before us they con'
fined their claun under thts head to Bhathas . formed in the
rivers and other portions of the river beds where crops could be
raised. during some parts . .;if the year particularly during summer.
<;o?nsel foF the State dtd not oppose further inquiries into this
ltmtted claim for compensation.
We therefore set
aside
the·
directions of .the High Court in respect of river and river beds.
W~ direct . the Spec!31 Deputy Coll~tor to inquire
into the
claim for comp_ensati?n for Bhathas, 1f any, formed in the rivers,
And other portions, 1f any, of the river beds where crops could'
be~.
(I) 66 J, A. 104 at 113. '
(2) 25 C. W. N. 875.
(3) A. J.R. 1965 Cal. 392.
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[1968] 3 s.c.R.
Counsel for the taluqdars sought to challenge the findings of
the High Court with regard to compensation for unbuilt village
sites, trees, siJn road and non-irrigation al tanks and wells.
We
find no error of principle in the award of compensation under
these heads.
There is no ground for our interference in respect
<>f these claiJns.
Mr. Bindra submitted that section 12 ·of the A\i<>lition Act
makes the decision of the Tribunal final and conclusive and the
High Court had no jurisdiction «> interfere with this decision,
particularly in respect of solatium of 15 per centum and nonirrigational bonds, tanks and wells.
We are unable to accept
this contention.
Article 227 of the Constitution gives the High
Court the power of superintendence over all courts and tribunals
throughou,l the territories in relation to which it eurcises jurisdictron. This jurisdiction cannot be limited or fettered by any
Act of thc State Legislature. The supervisory jurisdiction extends to keeping the subordinate tribunals within the limits of
their authority and to seeing that they obey the law. It was the
duty of the Revenue Tribunal to award compensation to the
Taluqdars in accordance with the provisions of secs. 7 and 14
1lf the Act.
The High Court had jurisdiction to revise ·the decision of the Tribunal where the Tribunal on a misreadipg of the
provisions of secs. 7 and 14 declined to do what was by those
provisions of law incumbent on it to do.
Tested in this light
it does not appear .that the High Court exceeded its jurisdiction
under Art.
227 in revising the. decision of the Tribunal in respect of the solatium and irrigational bunds, tanks and . wells.
Numerous cases were pending before the Ravenue Tribunal in
respect of corilpensation payable to the taluqdars under ·the Bombay Taluqdari Tenure Abolition Act.
To· prevent miscarriage
of justice it was necessary for the High Court to lay down general
principles on which compensation should be assessed so that the
Tribunal may act within the limits of their authority.
On finding that the Tribunal had misconceived its duties under secs. 7
and 14, the High Court could not only set aside its decision, but
also direct it to make further inquiries after taking evidence. As
pointed out in Hari Vishnu Kamath v. Syed Ahmed lshaque(')
the High Court in the exercise of its supervisory jurisdiction under
Art. 227 cannot only annul the decision of the Tribunal but
can also issue further direction in the matter.
In the result, in modification of the High Court's decision in
respect of solatium of 15 per centum on the market value, we
direct that in all these cases the taluqdars be awarded solatium
in accordance with this judgment.
We set aside the High Court's
-decision with .regard to river and river bedS.
Instead, we. direct
1hat 1the Special Deputy Collector will inquire into the cla.tm for
(I) (1955) I S. C.R. 1104 at 1120.
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GUJARAT v. VAKHTSINGHJI (Bachawat, !.)
705
compensation for Bhathas, if any, formed in the river and other
portions of the river beds, if any, where crops could be raised
lluring some parts of the year, particularly during the summer.
The Special Deputy Collector will make awards under these two
heads after giving opPOrtunity to the parties to adduoe evidence
Subject to these modifications, the appeals are dismissed and the
decision of the High Court in other respeots is confirmed. As
success is divided, there will be no order as to costs.
G.C.
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Appeals dimiissed with modifications.
'"