Appeal No 374 of 1956
Appeal by special leave from the judgment and order dated December 19 1955 of the Assam High Court in Revenue Appeal No 33M of 1955
Civil Rule No 76 of 1955
Fakhruddin Ali Ahmed and K R Chaudhry for the appellant
D N Mukherjee for respondent No 1
section M Lahiri Advocate General of Assam and Naunit Lal for respondents Nos 2 and 3 62 480 1957
January 29
The Judgment of the Court was delivered by BHAGWATI J
This appeal with special leave  arises out of a judgment of the Assam High Court in Revenue Appeal No 33 M of 1955 and Civil Rule No 76 of 1955
The State of Assam respondent No 3 had settled the Charduar Brahmaputra Fishery with the respondent No I for a period of three years viz from April 1 1954 to March 31 1957 at an annual zama of Rs 19600 Under r 12 of the Fishery Rules
The Deputy Commissioner of Darrang respondent No 2 received some reports against the respondent No 1 alleging violation of cl
VI of the Fishery lease and also of certain other conditions of  the lease
He obtained reports from the Sub Deputy Collector and the Extra Assistant Commissioner in regard to these allegations and came to the conclusion that respondent No 1 had created under lease in favour of certain persons and cancelled the settlement of the fishery
It appears that after such cancellation respondent No 3 purporting to act again under r 12 settled the said fishery with the appellant with effect from May 4 1955 and respondent No 1 was directed to give up possession thereof with effect from that date
Respondent No 1 thereupon obtained a Rule from the Assam High Court alleging that the said settlement was absolutely illegal and the fishery had to be settled pro perly according to the rules under which these settlements are usually made
A Revenue Appeal was also filed against the order of respondent No 2 under rule 11 of section 1 of the Fishery Rules and both the Rule and the Revenue Appeal were heard together by the Assam High Court
The High Court had already on August 31 1955 delivered a judgment in Civil Rule NO
56 of 1955 Nuruddin Ahmed vs State of Assam 1 declaring r 12 of the Fishery Rules ultra vires the State Government and therefore invalid and unenforceable
It followed that judgment and held that the respondent No 3 had no jurisdiction to make a settlement under 1 AIR 1956 Assam 48
481 r 12 of the  Fishery Rules with the respondent No I and the order of cancellation should be upheld on that ground alone
The appeal of respondent No I was accordingly dismissed
In regard to the appellant also the High Court came to the same conclusion and held that the settlement made by respondent No 3 in his favour was entirely without jurisdiction
The Rule obtained by respondent No I was accordingly made absolute
The result was that the settlements made by respondent No 3 with respondent No I and the appellant were both set aside and the authorities were directed to make a fresh settlement of the fishery  in question according to the existing Fishery Rules
The State of Assam had not obtained any leave to appeal against the decision of the High Court in Nuruddin Ahmed vs State of Assam 1 and was apparently content with the decision that r 12 of the Fishery Rules was ultra vires
The appellant however obtained special leave to appeal against the decision of the High Court which set aside the settlement of the Fishery made by respondent No 3 along with him and impleaded the State of Assam as respondent No 3 along with respondent No 1
The appellant was interested in establishing that r 12 of the Fishery Rules was intra vires the State of Assam had acquiesced in the position that the rule was ultra vires but in so far as it was added as respondent No 3 in this appeal it took up the position that r 12 of the Fishery Rules was intra vires a position which it had not so far chosen to sustain by appealing against the decision of the High Court in Nuruddin Ahmed vs State of Assam 1 or in the present case but which it tried to support as it were by the back door by appearing in this appeal and supporting the appellant
Respondent No 1 appears to have been in a similar quandary
If the appellant gained his point and had it established that the rule was intra vires the settlement of the fishery by respondent No 3 with respondent No I would have been with jurisdiction and the cancellation by respondent No 2 would have been void and inoperative
This relief was however not 1 A 1
R 482 available to respondent No 1 inasmuch as it had not appealed against the judgment of the High Court
Nor did it suit it to adopt that position because not more than 21 months were left for the lease to run and at the end of that period it would have found itself in the same invidious position in which it was when the allegations in regard to the breach of the conditions of the fishery lease had been made against it
Respondent No 1 therefore at the hearing of the appeal adopted the peculiar attitude of supporting the judgment of the High Court and of contending that r 12 of the Fishery Rules was ultra vires
That was the only basis on which the settlement made by respondent No 3 with the appellant could be set at naught and no further comment is needed on the obviously inconsistent attitude adopted by respondent No 1
The issue which was therefore contested between the appellant supported as he was by respondent No 3 the State of Assam
and respondent No I was as to the intra vires character of 12 of the Fishery Rules
It will be appropriate at this stage to set out the relevant provisions of the Assam Land and Revenue Regulation 1886 Regulation I of 1886 and the rules for the settlement of fisheries made by the State of Assam thereunder Section 16
Right of fishery
The Deputy Commissioner with the previous sanction of the Provincial Government may by proclamation published in the prescribed manner declare any collection of water running or still
to be a fishery  and no right in any fishery so declared shall be deemed to have been acquired by the public or any person either  before or after the commencement of this Regulation except as provided in the Rules made under section 155 Provided that nothing in this section shall affect any express grant of a right to fish made by or on behalf of the British Government or any fishery rights acquired by a proprietor before the commencement of this Regulation or the acquisition by a proprietor of such rights in any fishery forming after the commencement of this Regulation in this estate
483 Section 155
Additional power to make rules
The Provincial Government may in addition to the other matters for which he sic is empowered by this Regulation to make rules consistent with this regulation relating to the following matters f the granting of licences or the farming of the right   to fish in fisheries proclaimed under section 16     Rule 12 of the Fishery Rules No fishery shall be settled otherwise than by sale except by the State Government
The order of settlement passed by the State Government shall be final Provided that the State Government may introduce the tender system of settlement of fisheries in place of sale by auction system whenever it is considered necessary
 This rule occurs in chapter X of the Assam Land Revenue Manual Vol
I 6th ed headed  Rules for settlement of fisheries 
This chapter is divided into four sections Section I General and settlement of fisheries
Section 11 Miscellaneous
Section III Sanctuaries and Section IV Rulesfor settlement of fisheries by tender system
The normal procedure for settlement of fisheries prescribed in r 3 of section I is by auction sales in regard to all registered fisheries held under leases expiring on the last day of the current year or which at the last previous auction were reserved for sale under r 9
After making provision for the place of sale condition  of sale execution of leases and confirmation of sale provision is made in r 1 1 for appeal to the Assam High Court against all orders of a Deputy Commissioner or Sub Divisional Officer passed under the rules and it is provided that there shall be no appeal against an order of settlement passed by the State Government under r 12
Then follows r 12 set out hereinabove which provides that no fishery shall be settled otherwise than by sale except by the State Government and a proviso is enacted to this rule enabling the State Government 484 to introduce the tender system of settlement of fisheries in place of the auction system whenever it is considered necessary
The rest of the provisions of section I and those of sections II and III are not necessary to be set out for the purpose of this appeal but reference may be made to the provisions of section IV which contains rules for settlement of fisheries by tender system
Rule 42 provides that the Government may from time to time select any fishery or fisheries to be settled by tender system and instruct the Deputy Commissioner to lease them out for any specified period and the procedure to be adopted in the Settlement of fisheries by tender system is therein provided
It will be seen from the above summary of the relevant rules that the normal procedure for settlement of fisheries is by holding auction sales
Power is however given to the State Government to introduce the tender system of settlement of fisheries in place of the auction system whenever it is considered necessary and if the Government selects any fishery or fisheries to be settled by tender system and instructs the Deputy Commissioner to lease them out for any specified period acting in exercise of that power section IV prescribes the procedure for settlement of fisheries by tender system
The question therefore which arises for our determination is whether there is any power conferred on the State Government by these rules to settle fisheries otherwise than by sale eg by individual settlements without a settlement thereof by auction system or by tender system
We May here dispose of an argument which was urged oil behalf of Respondent No I before us and which appears to have found favour with the High Court that r 12 of the Fishery Rules which is the source of that power was ultra vires and repugnant to section 16 of the Assam Land Revenue Regulation I of 1886
That section deals with the right of fishery and provides that the Deputy Commissioner with the previous sanction of the State Government may by a proclamation declare any collection of water to be fishery and no right in a fishery so declared shall be deemed to have been acquired by the public or by any person 485 except as provided in the rules made under section 155
The instances before us are not covered by the proviso and we shall therefore make no mention of the same
The only relevant enquiry is whether there was any rule validly enacted under section 155 which enabled the State Government to settle the fishery otherwise than by sale by making an individual settlement thereof with Respondent No I or the appellant in the manner in which it was done
There is absolutely nothing in the provisions of section 16 which would go to show what are the principles on which such rules for the acquisition of fishery rights by the public or any person have to be made nor is there anything therein to indicate any policy which has to guide the State Government in the making of such rules
The whole thing is left to the discretion of the State Government which is empowered by section 155 inter alia to make rules relating to the granting of licences and the farming of the right to fish in fisheries proclaimed under section 16 consistent with the Regulation
No doubt the State Government would also be bound by such rules and would not be entitled to make any settlement of fishery rights unless and until there was a rule made in that behalf under section 155
It would not be open to the State Government to contend that it had absolute property in these fishery rights and it was therefore entitled to settle them in any manner whatever
Unless therefore the action of the State Government could be justified by reference to any rule made under section 155 it would not avail the appellant
Reliance is accordingly placed on the provisions of r 12 of the Fishery Rules and it is submitted that under that rule specific power is given to the State Government to settle the fishery rights otherwise than by sale
The State Government is thereby invested with the power to settle fishery rights even by individual settlements without following the auction system or the tender system
Even though this power is not vested in the State Government by express provision made in that behalf the context of rule 12 sufficiently indicates the intention of the rule making authority
After having prescribed the procedure by way of auction sales in 486 rr1 to 11 of section 1 a prohibition against the settlement of fishery rights otherwise than by sale is enacted in r 12 except in the case of the State Government
No fishery is to be settled otherwise than by sale and that prohibition is general in terms but an exception is carved out in favour of the State Government in terms which are only capable of the construction that the State Government shall have the power of settling fishery rights otherwise than by sale
No limitation is placed on this power which is thus vested in the State Government and if the State Government is em powered to settle fishery rights otherwise than by sale it can do so by adopting the tender system if it thought it desirable to do so or even by entering into individual settlements if the circumstances of the case so warranted
Apart from the adoption of the tender system in place of the auction system circumstances may conceivably arise where either by reason of the cancellation or relinquishment of fishery lease before the expiration of the period thereof and having regard to the situation then obtaining it may not be feasible or desirable to sell fishery rights for the unexpired portion of such a lease either by public auction or by inviting tenders and the State Government may under those circumstances consider it desirable to enter into individual settlement of the fishery rights so as to earn for the State as much of revenue as possible
No fetter can be placed on the discretion of the State Government in this behalf and the State Government would be the best judge of the situation and would be in a position to determine what procedure to adopt in the matter of the settlement of fishery rights other
wise than by sale
There is nothing in the provisions of section IV containing rules for settlement of fisheries by tender system which militates against the above position
We are therefore of opinion that r 12 specifically empowers the State Government to settle the fishery rights otherwise than by sale and there is no conflict at all between the provisions of section 16 of the Assam Land and Revenue Regulation I of 1886 and r 12 of the Fishery Rules
The decision of this appeal turns 487 on the construction of r 12 and we fail to understand how the question of the intra vires or the ultra vires character of r 12 at all arises
The whole of the argument addressed before us on behalf of respondent
No I is based on a misconception and can not be sustained
The decision of this Court in State of Assam vs Keshab Prasad Singh 1 on which the learned judges of the Assam High Court apparently based their judgment in Nuruddin Ahmed vs State of Assam1 did not touch the present controversy and it follows that that was clearly wrong and cannot be supported
The result therefore is that this appeal will be allowed and the settlement of fishery rights by respondent No 3 with the appellant declared valid and operative
Logically enough respondent No 1 also would have been entitled to a similar relief but there are various questions of fact involved in the determination of the question whether the fishery lease in his favour was validly cancelled by respondent No 2
Respondent No I moreover has disclaimed such benefits by adopting the contention that r 12 of the fishery rights was ultra vires
We therefore do not think that respondent No 1 is entitled to any relief on the basis of this judgment
Respondent No 3 the only person vitally interested in the decision of this issue will in spite of its entry having been by the back door be entitled to the benefit of this judgment an un sought relief that it will get as a result of our decision on the main point in controversy
Under the peculiar circumstances of the case we feel that the proper order for costs should be that each party will bear and pay its respective costs of this appeal and we do order accordingly
Appeal allowed
1  2 AIR 1956 Assam 48


Summary:
Section 16 of the Assam Land Revenue Regulation 1 of 1886 defines  right of fishery  and section 155f empowers the Provincial Government to make rules for  the granting of licences or the farming of the right  to fish in the fisheries
The State Government accordingly framed the Fishery Rules and r 12 thereof provides that no fishery shall be settled otherwise than by sale except by the State Government
It was contended that r 12 was ultra vires the Provincial Government and was repugnant to section 16 of the Regulation
Held that r 12 is not ultra vires  and is not repugnant to section 16 of the Regulation
There is nothing in section 16 which indicates the principles or the policy on which the rules for the acquisition of fishery rights are to be framed
The whole thing is left to the discretion of the State Government
Held further that r 12 specifically empowers the State Government to settle the fishery rights otherwise than by sale eg by individual settlements
Nuruddin Ahmed vs State of Assam A I R overruled
State of Assam vs Keshab Prasad Singh  not applicable