# SUBBA RAO v. NALLA RAJA REDDY & ORS

- **Citation:** [1967] 3 S.C.R. 28
- **Court:** Supreme Court of India
- **Decided:** 1967-02-28
- **Case number:** Civil Appeals Nos. 40-46, 48-68, 70-74 and 76-86 of 1966
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/subba-rao-v-nalla-raja-reddy-ors-4048
- **Pages:** 22

## Headnote

[K.
STATE OF ANDHRA PRADESH & ANR.
J
I
SUBBA RAO,
v.
NALLA RAJA REDDY & ORS.
February 28, 1967
C.J., J. C. SHAH, J. M. SHELAT, V. BHARGAVA
AND G. K. MITTER, JJ.]
The Andhra Pradesh Land Revenue (Additional Assessment)
and
Cess Revision Act 22 of 1962, ss. 3, 4, 6 and 8-Providing for additional assessment to land revenue at minimuni flat rate without refer~
ence to productivity of land or duration of water
supply-Additional
assessment to be levied as land revenue-No procedure prescribed in the
A
B
Act-Whether Act discriminatory and vlolalive of Art. 14.
C
The Andhra Pradesh Land Revenue (Additional
Assessment)
and
Cess. Revision Act, 1962 (Act 22 of 1962) was passed with the object
of bringing uniformity in assessment of land revenue in the Telengana
and Andhra areas of the State. It also provided for additional levies on
certain classes of land. When the assessment
of
land revenue
was
sought to be collected from the respondents, they filed· writ petitions in
the High Court challenging the constitutional validity of the Act and the
D
petitions were allowed.
In appeal by the State to this Court,
HELD : The Act offended Art. 14 of the Constitution and was therefore void.
Both in Andhra as well as Telengana area under the Ryotwari system,
the land revenue which was a share of the produce of the land commuted
in money value varied according to the classification of so·1 based upon
its prodUctivity; the soils of similar grain values were bracketed together
in orders called 'taran1s' or 'Bhagana' and the rates were
further
adjusted in the dry land having regard to the water supply, But in both
the. cases, the quality and the grade of the soil divided in 'Taralns' or
'BhaganaS was the main basis for assessment. [37 E-GJ
SeCtions.. 3 and 4 of the Act, in fixing the minimum fiat rate for dry
or wet lands, ignored the well-establishetl. taram principle;
and in the
case of wet lands an, attempt had been made to classify different systems
on the basis of the ayacuts; but this test was unreasonable and had no
relation to either the duration of water supply or to the quality or the
productivity of the soil.
The classification attempted in either case had
no reasonable relation to the objects sought to be achieved, namely, imposition of fair assessments and rationalisation
of th~ revenue assessment structure.
An arbitrary method has been introduced
displacing
one of the most equitable and reasonable methods
adopted for many
years in the revenue administration of the State. [44 C-E]
Further, the imposition of assessment was left to the arbitrary discretion of the officers not named in the Act without giving any notice,
opportunity or remedy to the assessees for questioning
the correctness
of any of the important stages in the
matter of assessment, such as
ayacut tatam, rate or classification or even in regard to the calculation
of the figures. It is not possible to read into the section the entire series
of the Standing Orders of the Board of Revenue which deal with
the
mode of assessment; for if it was the intention of the Legislature that
E
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
29
the Standing Orders of the Board of Revenue should
be brought into
the Act by incol',Poration, it would have certainly used appropriates words
to convey that idea. [45 D-E; 48 E-FJ
Kunnathat Thath11nni Moopil Nair v. The State of Kera/a, [1961) 3
S.C.R. 77, East India Tobacco Co. v. State of Andhra Pradesh, [1963] 1
S.C.R. 404 and Khandige Sham B/1111 v. The
Agricultural Income-tax
Officer, [1963] 3 S.C.R. 809, applied.
C. V. Rajagopalachariar v. State of Madras, A.LR. 1960 Mad. 543
and H. H. Yislni:uslza Tliirtha
Swaniiar of Sri
Pejavar Mutt v. The
State of Mysore, [1966] 1 Mys. L.J. 351, distinguished.

## Text

_Characters 0–39,816 of 55,386. This is a partial read: ask again with offset=39816 for what follows._

[K.
STATE OF ANDHRA PRADESH & ANR.
J
I
SUBBA RAO,
v.
NALLA RAJA REDDY & ORS.
February 28, 1967
C.J., J. C. SHAH, J. M. SHELAT, V. BHARGAVA
AND G. K. MITTER, JJ.]
The Andhra Pradesh Land Revenue (Additional Assessment)
and
Cess Revision Act 22 of 1962, ss. 3, 4, 6 and 8-Providing for additional assessment to land revenue at minimuni flat rate without refer~
ence to productivity of land or duration of water
supply-Additional
assessment to be levied as land revenue-No procedure prescribed in the
A
B
Act-Whether Act discriminatory and vlolalive of Art. 14.
C
The Andhra Pradesh Land Revenue (Additional
Assessment)
and
Cess. Revision Act, 1962 (Act 22 of 1962) was passed with the object
of bringing uniformity in assessment of land revenue in the Telengana
and Andhra areas of the State. It also provided for additional levies on
certain classes of land. When the assessment
of
land revenue
was
sought to be collected from the respondents, they filed· writ petitions in
the High Court challenging the constitutional validity of the Act and the
D
petitions were allowed.
In appeal by the State to this Court,
HELD : The Act offended Art. 14 of the Constitution and was therefore void.
Both in Andhra as well as Telengana area under the Ryotwari system,
the land revenue which was a share of the produce of the land commuted
in money value varied according to the classification of so·1 based upon
its prodUctivity; the soils of similar grain values were bracketed together
in orders called 'taran1s' or 'Bhagana' and the rates were
further
adjusted in the dry land having regard to the water supply, But in both
the. cases, the quality and the grade of the soil divided in 'Taralns' or
'BhaganaS was the main basis for assessment. [37 E-GJ
SeCtions.. 3 and 4 of the Act, in fixing the minimum fiat rate for dry
or wet lands, ignored the well-establishetl. taram principle;
and in the
case of wet lands an, attempt had been made to classify different systems
on the basis of the ayacuts; but this test was unreasonable and had no
relation to either the duration of water supply or to the quality or the
productivity of the soil.
The classification attempted in either case had
no reasonable relation to the objects sought to be achieved, namely, imposition of fair assessments and rationalisation
of th~ revenue assessment structure.
An arbitrary method has been introduced
displacing
one of the most equitable and reasonable methods
adopted for many
years in the revenue administration of the State. [44 C-E]
Further, the imposition of assessment was left to the arbitrary discretion of the officers not named in the Act without giving any notice,
opportunity or remedy to the assessees for questioning
the correctness
of any of the important stages in the
matter of assessment, such as
ayacut tatam, rate or classification or even in regard to the calculation
of the figures. It is not possible to read into the section the entire series
of the Standing Orders of the Board of Revenue which deal with
the
mode of assessment; for if it was the intention of the Legislature that
E
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
29
the Standing Orders of the Board of Revenue should
be brought into
the Act by incol',Poration, it would have certainly used appropriates words
to convey that idea. [45 D-E; 48 E-FJ
Kunnathat Thath11nni Moopil Nair v. The State of Kera/a, [1961) 3
S.C.R. 77, East India Tobacco Co. v. State of Andhra Pradesh, [1963] 1
S.C.R. 404 and Khandige Sham B/1111 v. The
Agricultural Income-tax
Officer, [1963] 3 S.C.R. 809, applied.
C. V. Rajagopalachariar v. State of Madras, A.LR. 1960 Mad. 543
and H. H. Yislni:uslza Tliirtha
Swaniiar of Sri
Pejavar Mutt v. The
State of Mysore, [1966] 1 Mys. L.J. 351, distinguished.
CIVIL APPELLATE JURISDICTION : Civil Appeals Nos. 40-46,
48-68, 70-74 and 76-86 of 1966.
Appeals from the judgment and order dated September 2, 1955
of the Andhra Pradesh High Court in Writ Petitions Nos. 96, 281,
303, 836, 1029, 1130, 1219 and 1497 of 1963, and 79, 94, 111,
112, 141, 142, 148, 149, 159, 167, 171, 172, 173, 183, 256,
267,286,443,491,497,549,571,591,611,616,680,695, 700,
720, 725, 737, 760, 1148, 1464 and 1789 of 1964 respectively.
S. V. Guple, Solicitor-General and A. V. Rangam, for the
appellants in (C.A. No. 40 of 1966) .
P. Ram Reddy, A. V. V. Nair and A. V. Rangam, for the
appellants (in C.A. Nos. 41-46, 48-68, 70-74 and 76 to 86).
P. A. Choudhury, and R. Thiagarajan for K. Jayaram, for the
respondents Nos. 1-12, 14-19, 21-40, 42-57, 59-113, 115, 116,
118 to 143, 145-156, 159-168, 170, 172-175, 177, 186, 188.
190-196, 197 to 219, 221, 223-233, 235-240, 242-259, 261-330.
332-381, 384-387, 389-391, 393-445, 447-453, 455-472, 474476, 479-485, 494-514 and 556 (In C.A. No. 48 of 1966) and
respondents Nos. I, 4-21, 23-36, 38-43, 45-55, 57-62, 64-76, 79.
80, 82, 83, 85, 87-92, 94, 96-99, 101-104, 106, 108, 109, 111157, 159-198, 200, 202-207, 209-212. 214, 219, 221 to 272,
274-277, 279-299 and 301-324 (In C.A. No. 57 of 1966).
K. B. Krishnamurthy, K. Rajendra Chaudhuri and K. R.
Chaudhuri, for respondent No. (In C.A. No. 42 of 1966) respondents (in C.A. No. 45 of 1966) respondents Nos. 1-80, 82-96.
98-129, 132-150, 152-207, 209-210 (In C.A. No. 46 of 1966)
and respondents Nos. 1-29, 31-110 (In C.A. No. 68 of 1966).
K. R. Chaudhuri and K. Rajendra Clzaudlwri, for respondent1
Nos. 1-7 and 9 (in C.A. No. 53 of 1966), re1pondents Nos. 1-3.
5-9, 11, 12, 14, 17-21, 23 and 24 (in C.A. No. 54 of 1966) and
respondents Nos. 1, 2, 4-9. 11-16, 19-28. 30-33, 35-150, 152,
153, 155, 157, 197, 199-328, 330-357, 359-360 and 362-535 (In
C.A. No. 44 of 1966).
G. S. Rama Rao, for the respondent (in C.A. No. 66 of
1966).
30
SUPREME COURT REPORTS
[1967] 3 S.C.R.
B. R. L. Iyengar, S. P. Nayyar, for R. H. Dhebar, for the
intervener.
The Judgment of the Court was delivered by
Sobba Rao, C.J. These 44 appeals by certificate are preferred
against the common judgment of a Division Bench of the Andhra
Pradesh High Court allowing the petitions filed by the respondents
under Art. 226 of the Constitution for directing the State of Andhra
Pradesh and other appropriate authorities to forbear from collecting
the assessment of land revenue under the provisions of the Andhra
Pradesh Land Revenue (Additional Assessment) and Cess Revision
Act, 1962 (Act 22 of 1962), hereinafter called the Principal Act,
as amended by the Andhra Pradesh Land Revenue (Additional
Assessment) and Cess Revision (Amendment) Act, 1962 (Act 23
of 1962), hereinafter called the Amending Act.
For convenience
of reference the Principal Act a5 amended by the Amending Act
will be called in the course of the judgment as "the Act".
The
appellants raised the question of the constitutional validity of the
relevant provisions of the Act.
•
The Principal Act was passed on September 27, 1962 and it
came into force on July 1, '1962; and the Amending Act was passed
on December 24, 1962, and it came into force on July 1, 1962.
We are concerned in these appeals only with the Act, i.e. Principal
Act as amended by the Amending Act.
It is said that the main object in passing the Principal Act was
to rationalize the land revenue assessment in the State by bringing
uniformity between Telengana and Andhra areas and to raise the
rate of revenue in view of the rise in prices and to make the ryots
bear equitably their share of the burden of the plans.
With that
view, as the long title of the Principal Act indicates, the said Act
was passed to provide for the levy of additonal assessment on
certain classes of land in the State of Andhra Pradesh and for the
revision of the assessments leviable in respect of such lands and
matters connected therewith. The relevant provisions of the Act,
i.e., the Principal Act as amended by the Amending Act, read
thus:
Section 3. In case of dry land in the State, an additional assessment at the rate of seventy-five per cent of
the assessment payable for a fasli year for that land shall
be levied and collected by the Govermnent from the
person liable to pay the assessment for each fasli year
in respect of that land :
Provided that the additional
assessment together
with the assessment payable in respect of any such land
shall in no case be less than fifty naye paise per acre per
fasli year.
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
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A
Section 4. In the case of wet land in the State which
is served by a Government source of irrigation specified in classes I, II, and III of the Table below, an additional assessment at the rate of one hundred per cent
and in the case of wet land in the State which is served
by a Government source of irrigation specified in Class
e
IV thereof, an additional assessment at the rate of fifty
per cent, of the assessment payable for a fasli year for
that land shall be levied and collected by the Government from the person liable to pay the assessment for
each fasli year in respect of that land :
Provided that the additional
assessment together
c
with the assessment payable per acre per fasli year for
any wet land specified in column (1) of the Table below
shall, in no case, be less than the minimum, or exceed
the maximum, specified in the corresponding entry
against that land-
(a) in column (2) of the Table in the case of a single
D
crop wet land, and
(b) in column (3) of the Table in the case of a
double-crop wet land.
THE TABLE
- ----
Rate of assessment
Rate of assessment
E
Description of Wet Land
pa.yable for !irgle
crop wet land, per
payable for double
crop wet land,
acre.
per acre.
(I}
(2)
(3)
----
Number of
MiniMaxiMiniMaxiClass of, and
Settlement
extent of
settlement classification
mum
mum
mum
mum
ayacut under
taram
or
F
Government
Bhagana
source of
irrigation.
(a)
(b)
(C)
(a)
(bl
(a)
(b)
Rs.nP.
Rs.nP.
Rs.nP.
R•.nP.
l. 30,000 acres (a) I to S
16 to 12
20.r:f)
24.UO
311,(\()
36.00
and above
(b) 6to8
lit to 9
JS.CO
l8.1JO
22.SO
27.00
(C) 9 and
St and
12.00
ll.00
18.UO
22.SO
G
above
below
Jl. 5,000 acres
(a) I to S
16 to 12
ll.00
18.-lO
22.SO
27.00
and above,
(b) 6 and
lit and
12.00
IS.00
18,00
22•50
but below
above
below
3D,OOO acres.
111. s·l acres and All tarams
All bhaga9.00
14.00
3.SO
21.00
above but
nas.
H
below 5,000
acres.
JV. Below 50
All tarams All bhagad.00
12.00
9.00
18.00
acres.
nas.
---------
32
SUPREME COURT REPORTS
[1967) 3 S.C.R.
Explanation.-In this Table,-
(a) The expression 'Government source of irrigation'
does not include a well, spring channel, parrekalava or
cross-bunding;
(b) taram and bhagana classification shall be as registered in the revenue and settlement records;
(c) where no such taram or bhagana classification is
recorded in the revenue and settlement records, in respect of any land, that land shall be deemed to bear the
taram or bhagana classification which a similar land in
the vicinity bears.
Section 8. ( 1) The District
Collector, shall, from
time to time, by notification published in the Andhra
Pradesh Gazette and the District Gazette, specify the
Government sources of irrigation falling under classes
I, II and IV of the Table under section 4 and may in
like manner, include in, or exclude from, such notifica·
tion any such source.
(2) Any person aggrieved by a notification published
under sub-section ( 1) may, within forty-five days from
the date of publication of the notification in the Andhra
Pradesh Gazette
and the District Gazette,
prefer an
appeal to the Board of Revenue whose decision thereon
shall be final.
We will analyse the provisions of the said section at a bter
· stage of the judgment.
The High Court in deciding against the
constitutional validity of the said provisions gave in effect the
following findings : (1) Under s. 3 of the Act there is no classification at all in the case of dry lands. (2) The ayacut basis adopted in the Table under s. 4 of the Act has no rational relation
to the taram or quality of the land or the nature of the irrigation
source.
(3) The minimum fixed by the proviso in many ~as~s ;,
more than 100 per cent increase fixed by tl1e section and thus the
proviso has exceeded the section.
( 4) The Au is silent <Ls to the
machinery for making the asses;ment. the criteria for fixation of
the assessment. within the range of a fixed maximum and a
minimum, the rights and remedies of the assessees and the obligation of the Government to survey the lands.
Jn short, the High
Court struck down the said provisions on the ground that they
offend Arts. 14 and 19 of the Constitution for three reasons, namely
(i) in the cose of c!rv lands there is no reasonable classification at
all as the fiat minimum rate of SOnP. per acre has no rebLion to
the fertility of the land, (ii) in regard to wet land there is no reasonable relation between the quality of the land and the ayacut to
A
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
3 3
which it belongs, and (iii) the procedure prescribed for the ascertainm~nt of the rate is arbitrary and uncontrolled.
The High
Court, though it elaborately considered the question whether the
revenue assessment was by authority of law within the meaning
of Art. 265 of the Constitution, did not express a final opinion
thereon.
Mr. S. V. Gupte, learned Solicitor General, who appeared in
one of the appeals filed by the State, contended broadly that the
High Court went wrong in coming to the conclusion that the
revenue assessment made under the Act had no reasonable relation
to the quality of the soil and pointed out that what the Legislature
did was nothing more than imposing a surcharge on previous
rates fixed on the basis of tarams in the case of lands in Andhra
and bhagana in the case of lands in Telengana.
Mr. P. Ram Reddy, learned counsel for the State in the other
appeals, while adopting the arguments of the learned Solicitor
General, argued in greater detail contending that though the
classification under s. 4. of the Act was apparently based upon
ayacut, there was a correlation between the extent of the ayacut
and the duration of water supply and that on that basis the classification could be sustained as it had a reasonable relation to taram
or bhagana, as the case may be, and also to the duration of water
supply.
He took us through various statistical data to support
the said connection between the extent of ayacut and the duration
of water supply. On the question whether. there was any procedure
for assessment, he strongly relied upon s. 6 of the Act and contended that the said section, by reference, incorporated the preexisting procedure for assessment in Andhra under the Board's
Standing Orders and in Telengana under the relevant Acts.
Mr. P. A. Chowdhury, learned counsel for some of the respondents, argued that from time immemorial land assessment, both
in Andhra and in Telengana, was scientifically settled on the basis
of taram or bhagana, as the case may be, depending upon the
quality and the productivity of the soil and that the Act in adopting
the maximum and the minimum rates in respect of both dry and
wet lands had ignored the said basis and instead adopted a
thoroughly arbitrary method of fixing rates on the basis of ayacut
which had no relevance at all to the quality or productivity of the
land in respect of which a particular assessment was made. He
further contended that the Act omitted the entire machinery for
assessment which would be found in almost every taxation statute
and conferred an arbitrary and uncanalized power on the appropriate authority to impose assessments and contended that the want
of reasonable relation between the quality and fertility of the soil
ind the ayacut and the conferment of arbitrary power of assess·
34
SUPREME
COURT
REPORTS
[1967) 3 s.c.R.
ment would infringe the doctrine of equality enshrined in Art. 14
of the Constitution, both in its substantive and procedural aspects.
Mr. Krishnamurthy, learned counsel appearing for the respondents in some of the appeals, advanced an additonal argument
m respect of lands fed by Yeleru river, vi~ .. that in any event the
Act would not apply to the said land as they did not fall under
any of the three categories covered by the Act, namely, dry land,
~ingle-crop wet land and double-crop wet land and that, therefore,
no assessment under the Act could be imposed in respect of the
said lands.
Before we consider the said arguments it would be necessary to
know briefly the nature and scope of the previous revenue settlements in Andhra and Telengana. After some experiments in the
Madras State it was decided in 1865 that a general revision of
assessment shou Id be made based on accurate survey and classilication of soils.
This is known as Ryotwari Settlement.
The
Ryotwari Settlement was conducted in seven stages: (1) demarcation of boundaries, (2) survey, (3) inspection, (4) classification of
soils, (5) assessment, (6) matters subsequent to assessment, and
( 7) records of settlement.
The first two items were done by the
Survey Department and the items Nos. 3 to 7 by the Settlement
Department. It will be enough for the purposes of those appeals
if we describe briefly how this classification of soils was done and
the assessment made on that basis. Before proceeding to the detailed classification of soils in each village, there was a preliminary
grouping of villages so as to bring together those which were similarlv situated having regard to proximity to market, facility of communication and climate.
Thereafter the soil was classified into
·'series", such as ( 1) Alluvial islands in rivers and permanently improved soils; (2) Regar or regada, the so-called 'black cotton soil,'
(3) Red ferruginous soil; (4) Calcareous-chalk or lime and; (5)
Arenaceous. Every soil of the said series was again divided into
classes on the basis of the variety and physical situation, such as
pure clay or half sand or more than 2/3rd sand etc. The classes
were again divided into sorts such as good or bad or ordinary or
worst.
Briefly stated land was classified into series, series into
classes, and classes into sorts. In the case of wet land in addition
to the sorts, other distinctions were borne in mind in grading the
soil such as (I) whether the land was close to the irrigation main
channel and had good level and drainage, (2) whether the land
was less favourably situated in these respects, (3) whether the land
was imperfectly supplied with water; or whether the level was
inconvenient. and drainage bad, and (4) whether the land was so
situated that the water could not be let to flow on to it, but had to
be raised by baling it out.
After the said classification the next
stage was to ascertain the amount of crop each different class and
A
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A. P. STATE v. NALLA It.EDDY (Subba Rao, C./.)
35
sort of soil could produce. After deducting the cost of cultivation
the net produce was valued in money and the said amount was.
divided into proper percentages, one such percentage fixed by the
Rules would be the Government revenue.
On the basis of this
classification a table of class and sort rates called Taram, which
would apply equally to several soils was drawn up. We have
gathered the necessary particulars from "Land Systems of British
India" by Baden Powell, Vol. 3.
The principles of settlement of ryotwari land and the manner
the Government demand was arrived at is found in the Standing
Orders of the Board of Revenue Vol. I, Paras 1 and 2.
They
are as follow$ :
(1) The assessment shall be on the land, and shall
not depend upon the description of produce, or upon the
claims of certain classes such as Brahmans, Mahajanas,
Purakkudis and others to reduced rates.
(ii) The classification of soils is to be as simple as
possible, and is to be alike everywhere instead of each
village having its own;
(iii) The assessment is to be fixed so as not to exceed
half the net produce after deducting the expenses of culti·
vation, etc.
(iv) No tax is to be imposed for a second crop on dry
land, but wet. lands which in all ordinary seasons have
an unfailing supply of water for two crops are to be registered as double crop, the charge for the second crop
being generally half the first crop assessment.
Remissions may be given when the supply of water fails. In
cases where water is raised by baling an abatement of
half a rupee per acre is allowed :
(v) The Tahsildar, or in the course of a resettlement,
the Special Settlement Officer or Special Assistant Settlement Officer may allow the charge for second crop to be
compounded in respect of all irrigated lands of which
the supply of water is not ordinarily unfailing. The
rates of composition will be as follows :
For wet land irrigated from a second-class irrigation
source, one third :
For wet land irrigated from a third-class irrigation
H
source, one fourth;
For wet land· irrigated from a fourth-crass irrigation
source, one fifth;
36
SUPREME COURT REPORTS
[1967] 3 S.C.R.
For wet land irrigated from a fifth-class irrigation
source, one-sixth.
Where the irrigation is precarious and the supply is
supplemented by wells, the divisional officer, or in the
course of a re-settlement, the Special Settlement Officer,
or Special Assistant Settlement Officer, may allow the
charge for second crop to be compounded at one-half
of the rates referred to above, except under sources
grouped in Class I or 2 for settlement purposes. Composition at such favourable rates may be allowed to lands
for which the charge for second crop has already been
compounded at the ordinary rates. If the wells however
fall into disrepair, the land should be transferred from
· compounded double crop to single crop wet.
Ryots
may be permitted to compound at any time and to any
extent even after the settlement.
(2) In carrying out the settlement with reference. t.o
the foregoing principles, the Settlement Department d1v!-
des the soils into certain classes with reference to their
. mechanical composition, sub-divides them into sorts or
grades with reference to their chemical .and physical .P;operties and other circumstances affectmg thetr fertthty,
and attaches a separate grain value to each grade after
numerous examinations of the actual outturn of the staple products in each class and sort of soil.
The gr~in
value is then converted into money at the commutation
price, based generally on the average of the 20-nonfamine years immediately preceding the settlement, for
the whole district, with some abatement for trader's
profits and for the distance the grain has usually to be
carried to the markets, and from the value of the gross
produce thus determined, the cost of cultivation and a
certian percentage on account of vicissitudes of season
and unprofitable areas is deducted, and one-half of the
remainder is the maximum taken as assessment or the
Government demand on the land. After this, soils of
similar grain values, irrespective of their classification,
are bracketed together in orders called Taramg, each
with its own rate of assessment. These rates are further
adjusted with reference to the position of the villages in
which the lands are situated and the nature of the sources of irrigation. For this purpose villages are formed
into groups, in the case of dry lands, with reference to
their proximity to roads and markets, and, in the case
of wet lands, with reference to the nature and quality of
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.).
37
the water supply. This accoums for ~~rent r~tes of
assessment being imposed on lands of smular sods, but
situated in different groups or under different classes of
irrigation."
The broad principles of Ryotwari system may be stated thus :
(1) Under that system the soil itself is taxed and the assessment
is fixed on.the lal!d; (2) Lands are classed into two general heads,
namely wet and dry; (3) The soils of similar grain values are
bracket~d together in orders called "Tarams" each with its own
rate of assessment; ( 4) The rates are further adjusted, in the case
of dry lands, with reference to the nature ~d ~ality of .water•
supply. This system had been followed from time immemorial and
had the general approval of the public. It has a scientific basis
and throws equitable burden on the different classes of land.
The system foilowed in Telengana which formed part of tlte
erstwhile Hyderabad State was as follows.
The relative scale of
soils in respect of classification was in annas or "annawari". The
existing or the former rates were taken as the basis and were adjust·
ed having regard to altered circumstances, the rise or fall of prices,
increase in population, means of support and other advantages. No
attempt was made to fix the assessment at a certain fraction of net
assets for determining the money value of the produce of the field
crop. But experiments were made by the Settlement Officers and
with the results obtained therein the rates fixed were checked in
order to ascertain what profit would be left to the cultivators.
It will be seen that both in Andhra as well as Telengana area
under the Ryotwari system, the land revenue which was a share of
the produce of the land commuted in money value varied according
to the classification of soil based upon its productivity.
Both in
Andhra and Telengana areas under the Ryotwari system the soils
of similar grain values were bracketed together in orders called
'Tarruns' or Bhagana and the rates were further adjusted in the dry
land having regard to the grouping and in wet lands having regard
to the water supply.
But in both the cases, the quality and the
grade of the soil divided in 'Tarams' or 'Bhaganas' as the case
may be, was the main basis for assessment.
It appears that the Ryotwari Settlements were abandoned in
the year 1939.
In the Report of the Land Revenue Reforms Commit!~_of the Government of Andhra Pradesh, Hyderabad at page
30 1t 1s stated :
"Re-settle~ent operations were never popular with
th~ ryots, as m all cases due to the steady increase in
prices, resettlements always led on to an increase in land
revenue assessment.
They were finally ordered to be
abandoned in 1939."
••
JS
SUPREME COURT REPORTS
[1967] 3 S.C.R.
•
But the Andhra Pradesh Land Revenue Assessment (Standar·
A
dization) Act, 1956 and the Hyderabad Land Revenue (Special
Assessment) Act, 1952 were passed in order to standardize the
rates on the basis ol price level.
They increased the rates by way
of surcharge. In the year 1958 the Government of Andhra Pradesh
appointed Land Revenue Reforms Committee to examine the
existing system and rates of land revenue assessment and ir;igaB
tion charges obtaining in the various regions of the State and to
make suitable recommendations for their rationalisation.
The relevant recommendations of the Land Revenue Reforms
Committee of the Government of Andhra Pradesh in regard to
fixation of rates are contained in Ch. XV of Part II Vol. (iii) of
its Report. They are :
C
"No. 51. Land Revenue should be fixed as a per·
centage of the net produce.
No. 5 3. As periodical settlements or re-settlements
are not recommended and as revisions in future will be
based on prices and other relevant factors, it is not
necessary to give an opinion as to what percentage of the
net produce, the share of the Government should be.
No. 71. In future, the assessment on irrigated land
should be fixed on the basis of the dry land potential and
the charge for irrigation should be on the basis of a
charge, for service, by the Government.
No. 72. The productivity of the soils, the capacity
of the source based on the duration of supply and the
ability of the ryots to bear the charge, are the chief factors which should be considered in determining the water
charges.
No. 73. In future, the assessment on irrigated land
should consist of dry assessment depending on the. quality
of soil and the charge for irrigation, based on the quantum of service rendered by the Government.
Even
though, the income from irrigated land is several times
that of dry land, still for the service done, it is not suggested to levy a uniform rate, but graduated rates, related to the soil value of the lands, on which the yields
would depend."
It will be seen from the said recommendations that the Committee
did not recommend Ryotwari settlements but suggested that assess·
ments should be based on the quality and productivity of soils,
the duration of supply of water and the prices. · It may be noticed
that the Committee did not make ayacut the basis of the assessment.
D
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
39
Let us now analyse the provisions of the Act.
Under ss. 3
and 4 of the Act and the Table attached to s. 4, which have been
extracted earlier, a completely new scheme has been laid down.
Under s. 3, an additional assessment at the rate of 75 per cent of
the earlier assessment is imposed and under the proviso the total
assessment should not be less than 5 0 np. per acre for a fasli year.
That is to say, irrespective of the quality and productivity of the
soil, every acre of dry land has to bear a minimum assessment of
50 np. per acre for a fasli year. Coming to wet lands, under the
Table appended to s. 4, they are divided into 4 categories depending upon the extent of the ayacuts. Ayacuts of 30,000 acres and
above fall under the first class, 5,000 acres and above but below
30,000 acres, under the 2nd class, 50 acres and above but below
5,000 acres, under the 3rd class, and below 50 acres, under the
4th class.
A maximum and a minimum rate of assessment per
acre are fixed for lands under ayacuts under each of the said
classes. Further, under class 1 the tarams and bhaganas are divided into 3 groups and different maxima and minima rates of as.sessment are fixed for each such group. In the 2nd class, tarams and
bhaganas are put into two groups and different maxima and minima
r.ates are fixed in respect of the two groups; in classes 3 and 4
no distinction is made on the basis of tarams. Briefly stated, the
whole classification is based on the extent of ayacut and in the
case of classes 1 and 2 groups of tarams are relied upon only for
introducing differences in the maximum and minimum rates. But
the distinction between different tarams in each of the groups is
effaced without any appreciable reason for such effacement. The
minimum flat rates fixed for dry lands as well as for wet lands are
not based upon the quality and productivity of the soil and in the
case of wet lands the minimum rate is mainly founded on the
extent of ayacut.
Prima facie we do not see any reasonable ,relation between
the extent of the ayacut and the assessment payable in respect of
an acre of land forming part of that ayacut. The system of periodical ryotwari settlement held by the British Government on a
scientific basis of quality and productivity of the soil with marginal
adjustments on the foot of the duration of water supply in the
case of wet lands and grouping of villages in the case of dry
lands was given up.
The scheme of surcharge on pre-existing
rates, earlier accepted, was not adopted. The recommendation of
the Committee that the assessment should be based on the duration of water supply among others was not followed. Instead the
Act introduced in the case of both dry and wet lands an unscientific
~d arbi~rary method of assessment imposing a minimum flat rate
mespecttve of the tarams. In the case of wet lands an additional
irrational factor is laid down, viz., the rate is linked with the
extent of the ayacut.
In the case of wet land, a minimum flat
40
SUPllEME COURT REPORTS
[1967] 3 S.C.R.
rate with some variations within different groups in classes I and
A
II and a minimum flat rate in respect of the groups in classes ill
and lV is fixed without any rational connection between the two.
Mr. P A. Choudhury contended that the scheme accepted by the
Act was' hit by Art. 14 of the Constitution inasmuch as it gave
up practically the prineiple of tarams and bhaganas and accepted
a fiat rate irrespective of the quality and productivity of the land
B
and. therefore, suffered from want of reasonable classification. He
further contended that the alleged justification for the classification,
namely, the extent of the ayacut, had no reasonable relation to the
objects sought to be achieved by the Act, namely, rationalisation of
the revenue assessments on land in the entire State.
Mr. P. Ram Reddy, on the other hand, made a strenuous
attempt to sustain ss. 3 and 4 of the Act on the basis of reasonable
classification. He said that in the case of dry land the minimum
rate of 50 np. was so low that in most of the cases 75 per cent
of the previous assessment per acre would not be more than 5 np.,
and, therefore, the mere fiict that in a few cases the 75 per cent
of the assessment would fall on the other side of the line could not
· affect the validity of the classification for it would almost be impossible in any scheme of classification to avoid marginal cases.
So too, in the case of wet lands, he argued, in regard to classes
I and II, the duration of supply of water corresponded to the
extent of the ayacut in most of the cases and, therefore, though
the classification was based upon the extent of the ayacut, it was
really made on the basis of the duration of the water supply. As
regards different groupings of the tarams and bhaganas in, the
first two classes, it was contended that, as the differences between
the tararns in each group were not appreciable and, therefore, if
the rate of assessment was integrally connected with the duration
of the water supply, the said groupings of the tarams would not
affect the reasonableness of classifications. In the case of classes
II and IV, he contended, that in respect of lands falling under the
said two classes the difference in the rates between the different
tarams was not appreciable and, therefore, that could be ignored.
In short he maintained that there was an equation between the
duration of supply of water and the extent of the ayacut and that
the difference in the duration of water supply in the context of
assessment of various lands has a reasonable relation to the aforesaid object of the Act sought to be achieved.
Now let us test the contentions of Mr. Ram Reddy with the
facts placed before us.
Wet Lands.---Some tabular statements under the headings
"average test" and "majority test" have been placed before us in
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
41
support of the contention.
The following are the figures under
the "Average test" :-
SL
No.
Name of Taluk
I. Anantapur
2. Dharmavaram
3. Tadipartri
4. Gooty
S.
Kalyanadurga
6. Rayadurg
7. Mabakasira
8. Penukonda
9. Hindupur
10. Kadiri
Averaa:e or Taluks
1.
Ichapuram
2.
Pathapattanam
3. Chipurapalli
4. Srikakulam
S.
Sompcta.
6. Salur
7. Babbili
8. Palkonda
9. Narasannapet .
10. Parvathipuram
Average ofTaluks
SI.
No.
Name of Taluk
!. Mahabooba
2.
Mulu11
·'.-\" AVERAGE TEST
Average
for less
than 3
months
Average
for between 3
and 5
months
Average
for between 5
and 8
months
26·4
50·5
120·8
13·7
49·0
120·1
16·4
62·0
126·0
9·5
48·3
152·8
10·2
52·9
152·5
22·0
59·7
162·0
15·2
55·4
143·2
10·9
60·6
186·4
15·1
58·3
108·7
9·9
43·9
147·9
Average
for more
than 8
months
---------------.
14·9
54·1
142·2
Average
for less
than 3
months
4·8
25· I
Average
for between 3
and 5
months
8·3
24·7
2·5
6·4
6·6
13-8
19·5
8·2
Average
for between 3
and 5
months
26·8
171 ·6
Average
for between S
and 8
months
69·6
47·4
139·3
84·9
80·8
37·8
35·5
84·2
57·9
Average
for bet
ween 5
and 8
months
60·6
Average
for more
than 8
months
370· 8
6086·46
The averages mentioned under different columns are the average
extent of the ayacuts in each taluk correlated with particular
months of water supply. If we take the average for less than 3
months in respect of different taluks in the Rayalaseema area, which
is part of the Andhra, the extents of the ayacuts vary from 9 acres
to 26 acres.
In regard to the duration of water supply between
3 and 4 months, they vary from 43 to 62 acres. In regard to the
duration of water supply between 5 and 8 months, they vary betM4SupCl-67--4
42
SUPRBMB
COUltT
REPORTS
(1967] 3 S.C.R.
ween 108 and 152 acres.
So too in some of the taluks of the
A
Andhra area the same variations are found.
It is, therefore, not
possible from the average test to hold that particular months of
supply corresponded with particular extent of the ayacut.
The following tabular form represents the "Majority test" :
"B" MAJORITY TEST
------------------------------
SI.
No.
Name of Taluk
I, Anantpur
2 .. Dbaramavaram
3. Tadapatri
4. Gooty
S. Kalyandurg
6. Kayadurg
7. Madakasira
8. Pandukonda
9. Hindupur
10. Kadiri
SI.
No.
Name of Taluk
I. Jchapuram .
2. Pathapatnam
3. Cheepurapalli
4. Srikakulam
S. Sompeta
6. Salur
7. Bobbili
8. Palkonda
9. Narasannapet
10. Paravatbipuram including Karupum Section.
I, Mahabooha Taluk
(P. 14S6 to 14S7 upto 10
acres)
2.
Mulugu
Do.
~tween S months dura· Between S and 7 month!I
ti on
No. of irri- Total No. of No. of irrigation
irrigation
gation
sources
sources f'
sources
below SO
between SO
acres ayacut
and 5000
IS
23
7
31
38 s
37
S4
113
379
30
32
9
34
SI
9
62
BS
us
407
acre!'
19
14
I s
14
2
2S
32
30
18
Total No. of
irrigation
sourcc!t
19
14
I s
14
2
2S
32
30
18
Below S months duration
Between S & 8 months
No. of irrlga- Total No. of No. of irri- Total No. of
tion
irrigation
gation
irrigation
sources
sources
sources
sources
below SO
between SO
acres ayacut
and SOOO
16S
927
1,799
465
1,082
594
1,629
Ill
179
166
l,OS4
1,905
470
1,099
614
1,771
111
231
acres
35
147
39
127
125
178
192
135
90
12
No. of Irrigation Sources Between
5000 & 30,000 acres for more than 8
montbs.2
Total No. of Irrigation sources
do-3
79
'70
39
129
131
290
1.214
152
90
12
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A. P. STATE v. NALLA REDDY (Subba Rao, C.J.)
43
By majority test it is meant to convey that in each taluk the majority of the irrigation sources with a particular duration have a
proportionate relation to the different extent of the ayacut mentioned in the Act. But the aforesaid tabular form does not support that assertion. In regard to water sources of below 5 months
duration with an ayacut of below 50 acres, a comparison of the
first two columns shows that, except in a few cases, the test completely fails.
No doubt in regard to irrigation sources supplying
water for between 5 and 8 months of ayacut of 5,000 to 50,000
acres. the test appears to be satisfied. But the table itself is confined only to the Rayalaseema area of the Andhra Part of the
State and even in regard to that area there is no unanimity, as the
test fails in regard to sources within 5 months duration. Similar
tests in Srikakulam district which is a part of the Andhra area of
the State, shows that in many cases the majority test thoroughly
breaks. Nothing can, therefore, be built upon the said tests.
Further, the statements filed in the case showing the area irrigated
for different durations clearly indicates that in many cases the
additional assessment is more than 100 per cent or 50 per cent,
as the case may be, of the original assessment showing thereby
that the increase is on the basis of the flat minimum rate and not
on the basis of the duration of the irrigation sources. Further water
sources which supply water for more than 5 months but Jess than
8 months and have regist.ered ayacuts below 5,000 acres fall under
class IV. Some of the tanks which supply water for more than
8 months fall under different classes having regard to the ayacut
which they serve.
For instance, Kumbum tank has a registered
ayacut of 10,000 acres, Bukkaepatnam tank has a registered ayacut
of 184 acres; and though both supply water for 8 months or more,
the former falls under class II and the latter under class III. A
cursory glance through the statistics of the various districts tells
the same tale.