Case: Karimbil Kunhikoman Vs. State Of Kerala

This principle cannot be applied in a case where a person is deprived of his property under the power of eminent domain for which he is entitled to compensation. There is no reason why when two persons are deprived of their property one richer than the other, they should be paid at different rates when the property of which they are deprived is of the same kind and differs only in extent. No such principle can be applied in a case where compensation is being granted to a person for deprivation of his property. Where one person owns property valued at Rs. 15,000/- while another owns property valued at Rs. 30,000/-, both are equally deprived of the property. When therefore it comes to a question of payment of compensation we can see no reason why a person whose compensation amounts to Rs. 1,500/- should get the whole of it or a large part of it while another person whose compensation amounts to (say) Rs. 30,000/- should get something less than the first person. It is not as if there is some difference in the nature of the property which might justify different payments of compensation. What the Act provides is to work out the purchase price or the market value first for the purpose of determining compensation land then make different cuts from the purchase price or the market value according in whether in one case the purchase price or the market value is Rs. 15000/- and in another case it is more than Rs. 15,000/-.No justification is pointed out for this discrimination except the principle on which the slab system for the purpose of income-tax is justified. That principle as we have just pointed out does not apply to a case of compensation. 32. Nor are we able to see any rational classification which would justify different cuts based simply on the amount of compensation worked out on the basis of purchase price or market value. The only thing we can see is that because a person is possibly richer he must be paid less for the same type of land while a person who is poorer must he paid more. This kind of discrimination in the payment of compensation cannot in our opinion be possibly justified on the objects and purposes of the Act. The object and purpose of the Act as we have already said, is to grant rights to cultivating tenants so that they may improve their lands resulting in larger production to the benefit of the national economy. Secondly, the object of the Act is to provide land for the landless and to those who may have little land by taking excess land from those who have large tracts of lands so that peasant proprietorship may increase with consequent increase in production due to greater interest of the cultivator in the soil. But these objects have no rational relation which would justify the making of different cuts from the purchase price or the market value for the purpose of giving compensation to those whose interests are being acquired under the Act.We can therefore see no justification for giving different compensation based on different cuts from the purchase price or the market value as provided in Ss. 52 and 64 of the Act. 33. We may in this connection refer to Kameshwar Singh v. State of Bihar, AIR 1951 Pat 91 (SB) in which a similar question with respect to compensation provided in the Bihar Land Reforms Act, 1950, came up for consideration. There the Act provided compensation at different rates depending upon the net income. The landowner having the smallest net income below Rs. 500/- was to get twenty times the net income as compensation while the landowner having the largest net income, i.e., above 1,00,000 /- was to get only three times of the net income. Intermediate slabs provided different multiples for different amounts of net income. That provision was struck down by the Special Bench of the Patna High Court as violative of Art. 14. It may be mentioned that that decision was given before the Constitution (First Amendment) Act adding Art. 31A and the Ninth Schedule to the Constitution was passed. Three learned Judges composing the Special Bench who heard that case were unanimously of the opinion that such difference in payment was violative of Art. 14 and that the principle of progressive taxation did not apply to compensation for land acquired. We are of opinion that the view taken in that case is correct and the same applies to the present case. We may point out that that case came in appeal to this Court (see State of Bihar v. Kameshwar Singh, 1952 SCR 889 ; (AIR 1952 SC 252 )). The appeal however was heard after Art. 31A and the Ninth Schedule had been introduced in the Constitution and therefore this Court had no occasion to consider whether such difference in payment of compensation would be violative of Art. 14.We are therefore clearly of opinion that the manner in which progressive cuts have been imposed on the purchase price under S. 52 and the market value under S. 64 in order to determine the compensation payable to land owners or intermediaries in one case and to persons from whom excess land is taken in another, results in discrimination and cannot be justified on any intelligible differentia which has any relation to the objects and purposes of the Act. As the provision as to compensation is all pervasive, the entire Act must be struck down as violative of Art. 14 in its application to ryotwari lands which have come to the State of Kerala from the State of Madras. 34. In view of what we have said above on the main points urged in the petitions, it is unnecessary to consider other subsidiary points attacking particular sections of the Act on the ground that they were unreasonable restrictions on the right to acquire, hold and dispose of property under Art. 19(1)(f).

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]3. The questionwhether the Bill which finally received the assent of the President on January 21, 1961, had lapsed because the legislative assembly which originally passed it was dissolved and a new legislative assembly which came into being after the general elections reconsidered and re-passed it under Art. 201 of the Constitutionhas been considered by us in Writ petition No. 105 of 1961 (SC)*,judgment in which has just been delivered and it has been held there that the bill did not lapse and therefore it validly became law when the President assented to it. The attack on the Act therefore on this ground must fail*See AIR 1962 SC 694  R. 161 which provides for eligibility for grants and loans. That rule in our opinion goes beyond the scope of S. 80 in so far as it provides for making of grants or loans to persons not affected by the Act. We may in this connection refer to R. 161(a)(i) and (ii) and R. 161(b)(i) and (ii) which are so framed as to take within their scope even persons not affected by the Act, though R. 161(a)(iii) and R. 161(b)(iii) are with respect to persons who may be affected by the Act. Rule 161(a)(i) and (ii) and R.161 (b)(i) and (ii) in so far as they take in persons not affected by the Act are ultra vires of the provisions of S. 80 and must be struck down on that ground and may have to be replaced by more suitable rules. But the rules which have been actually framed will not affect the provisions of S. 80 which clearly show that the fund is for the benefit of those who are affected by the Act, namely, those who are affected by Chapters II and III of the Act, i.e., those landowners whose rights have been acquired under Ss. 41 and 42 and those persons from whom excess land is taken away under S. 62. Section 80 thus clearly shows that any surplus that may arise is not taken away by the State for its own revenue purposes but is meant to be used for the benefit of those affected by the Act and therefore even the apparent result of the difference between Ss. 45 and 52 and Ss. 64 and 72 is taken away by the constitution of the fund under S. 80, and it cannot be said at all under the circumstances that any device has been employed in the Act to take away the moneys of the landowners or the persons from whom excess land is taken away for the purpose of adding to the revenue of the State. We are therefore of opinion that the Act cannot be struck down as a colourable piece of legislation which is beyond the competence of the State LegislatureIf a term therefore is defined in any existing law in a local area which corresponds to this basic idea of an estate that term would be a local equivalent of the word "estate" in that areaTherefore, when the Constitution came into force the ryotwari pattadars of South Canara were in the same position as the ryotwari pattadars of the rest of the State of Madras. Further, as the Act of 1908 was in force in South Canara also, though there may not be many estates as defined in that Act in this area it follows that in this area also the word "estate would have the same meaning as in the Act of 1908 and therefore ryotwari pattadars and their lands would not be covered by the word "estate". Further, there can be no question of seeking for a local equivalent so far as this part of the State of Kerala which has come to it from the former State of Madras is concerned. We are therefore of opinion that lands held by ryotwari pattadars in this part which his come to the State of Kerala by virtue of the States Reorganisation Act from the State of Madras are not estates within the meaning of Art. 31A(2) (a) of the Constitution and therefore the Act is not protected under Art. 31A (1) from attack under Arts. 14, 19 and 31of the ConstitutionMaking all the presumptions in favour of the classification made under S. 2(39) it is clear that there is nothing on the face of the law or the surrounding circumstances which has been brought to our notice in this case on which the classification contained in S. 2(39) can be said to be reasonably based. Considering the object and purpose of the Act and the basis on which exemption has been granted under Chapters II and III to plantations as defined in the Act, there appears to be no reason for making any distinction between tea coffee and rubber on the one hand and areca and pepper on the other in this particular case. It is not as if tea, coffee and rubber are grown only on a large scale while areca and pepper are mostly grown on a small scale. We find from the report of the Plantation Inquiry Commission, 1956, that small holdings exist in tea, coffee and rubber plantations also and are in fact the majority of such plantations. For example, in the report of the Plantation Inquiry Commission relating to coffee at pp. 9 and 14 we find that out of the total number of registered estates more than 4,500 are between 5 acres and 25 acres while only about 2,200 estates are above 25 acres. Further there are more than 24,000 estates below 5 acres. Similary at p. 97, Chap. XI, Part III of the Report dealing with rubber, out of the total of over 26,700 rubber estates, 23,300 are up to 5 acres, 1,900 up to 10 acres and only about 1,500 above 10 acres. So it appears that the large majority of plantations whether they be of coffee or rubber are below 10 acres and that is also the case with areca and pepper plantations. Thus there in no reason for giving preference to plantations of tea, coffee and rubber over plantations of areca and pepper for the conditions in the two sets of plantations whether for the purpose of ceiling under Chap. III or for the purpose of acquisition of landowners rights under Chap. II are the same. The reason therefore which calls for exemption of tea, coffee and rubber plantations equally apply to areca and pepper plantations and there is no intelligible differentia related to the object and purpose of the Act which would justify any distinction in the case of tea, coffee and rubber plantations as against areca and pepper plantations. We are therefore of opinion that the provisions relating to plantations are violative of Art. 14 of the ConstitutionThe discriminatory nature of the provision has to be judged from the results that follow from it and we have no doubt that the results which follow from this double provision as to ceiling are bound to be discriminatory. If the ceiling had been fixed with respect to one standard whether it be of an individual person or of a natural family by which we mean a family recognised in personal law, the results may not have been discriminatory. But where the ceiling is fixed as in the present case by a double standard and over and above that the family has been given an artificial definition which does not correspond with a natural family as known to personal law, there is bound to be discrimination resulting from such a provisionNo justification has been shown to us on behalf of the State for this discriminatory treatment of two individual persons; nor are we able to understand why such discrimination which clearly results from the application of the provisions of S. 58(1) is not violative of Art. 14 of the Constitution. Examples can be multiplied with reference to joint Hindu families also, which would show that in many cases discrimination will result on the application of these provisions to joint Hindu families. Similar would in our opinion be the case with Marumakhathayam and Aliyasanthana families where as we have already pointed out the husband and wife do not belong to the same family as known to personal law.Discrimination therefore is writ large on the consequences that follow from the provisions of S. 58 (1). We are therefore of opinion that S. 58 (1) is violative of the fundamental right enshrined in Art.14; as that Section is the basis of entire Chap. III the whole Chapter must fall with it. This would be an additional reason why Chap. III should be struck down as violative of Art. 14 in its application to ryotwari lands which have come to the State of Kerala from the State of MadrasThat would then raise the question of adequacy of compensation and unless the cut was so large as to make the compensation illusory the cut may be protected by Art. 31(2). But in the present case there is not a uniform cut on the purchase price or the market value for all persons, the cut is higher as the purchase price or the market value gets bigger and bigger after the first slab of Rs. 15,000/-. This difference in cut is being justified on behalf of the State on the same principle on which (for example) the slab system exists for purposes of income-tax. We are however of opinion that there is no comparison between the slab system of income-tax rates and the present cuts. Taxation is a compulsory levy from each individual for the purpose of the maintenance of the State. We may therefore reasonably expect that a rich man may be required to make a contribution which may be higher than what may be proportionately due from his income for that purpose as compared to a poor man.This principle cannot be applied in a case where a person is deprived of his property under the power of eminent domain for which he is entitled to compensation. There is no reason why when two persons are deprived of their property one richer than the other, they should be paid at different rates when the property of which they are deprived is of the same kind and differs only in extent. No such principle can be applied in a case where compensation is being granted to a person for deprivation of his property. Where one person owns property valued at Rs. 15,000/- while another owns property valued at Rs. 30,000/-, both are equally deprived of the property. When therefore it comes to a question of payment of compensation we can see no reason why a person whose compensation amounts to Rs. 1,500/- should get the whole of it or a large part of it while another person whose compensation amounts to (say) Rs. 30,000/- should get something less than the first person. It is not as if there is some difference in the nature of the property which might justify different payments of compensation. What the Act provides is to work out the purchase price or the market value first for the purpose of determining compensation land then make different cuts from the purchase price or the market value according in whether in one case the purchase price or the market value is Rs. 15000/- and in another case it is more than Rs. 15,000/-.No justification is pointed out for this discrimination except the principle on which the slab system for the purpose of income-tax is justified. That principle as we have just pointed out does not apply to a case of compensationNor are we able to see any rational classification which would justify different cuts based simply on the amount of compensation worked out on the basis of purchase price or market value. The only thing we can see is that because a person is possibly richer he must be paid less for the same type of land while a person who is poorer must he paid more. This kind of discrimination in the payment of compensation cannot in our opinion be possibly justified on the objects and purposes of the Act. The object and purpose of the Act as we have already said, is to grant rights to cultivating tenants so that they may improve their lands resulting in larger production to the benefit of the national economy. Secondly, the object of the Act is to provide land for the landless and to those who may have little land by taking excess land from those who have large tracts of lands so that peasant proprietorship may increase with consequent increase in production due to greater interest of the cultivator in the soil. But these objects have no rational relation which would justify the making of different cuts from the purchase price or the market value for the purpose of giving compensation to those whose interests are being acquired under the Act.We can therefore see no justification for giving different compensation based on different cuts from the purchase price or the market value as provided in Ss. 52 and 64 of the ActAs the provision as to compensation is all pervasive, the entire Act must be struck down as violative of Art. 14 in its application to ryotwari lands which have come to the State of Kerala from the State of Madras