Case: Kannan Devan Hills Produce Company Limited Vs. State of Kerala &amp; Another

2. The petitioner is in possession of an area of approximately 1,27,904 acres, commonly known as the Concession Area lying contiguously in the Kannan Devan Hills village. The petitioner grows and manufactures tea in the plantation set up and developed by it. The petitioners predecessor-in-title was one Mr. John Deniel Munro, who obtained, what is called, the first Pooniat Concession from Punhatil Kavikal Kela Varma Valuja Raja, on July 11, 1877 (Mithunam 20, 1052). This Concession recited that an application was made for the grant of the above property to the Raja for coffee cultivation. The Concession conveyed the properties in consideration of Rs.5,000/-. It was further stipulated in the Concession that you shall clear and remove the jungles, and reclaim the waste lands within the said boundaries, and cultivate them with coffee up to the year 1958 and from the year 1959, pay our rent collector a yearly rent at the rate of 3,000 British Rupees. Various other conditions were mentioned but it is not necessary to refer to them because this Concession was superseded by another agreement called the Second Pooniat Concessionthat H. H. the Maharaja executed a deed of ratification, dated November 28, 1878, by which the Government ratified the First Pooniat Concession dated July 11, 1877. This deed of ratification laid down the terms and conditions in regard to Government assessment and other matters under which the Government permitted the grantee to hold the land. These terms and conditions were declared in the Deed to be independent of any rents or payments due to the Poonjar Chief under the Grantees Agreement with him4. Clause 5 of the Deed of Ratification, is important. It provides, inter alia, that the grantee can appropriate to his own use within the limits of the grant all timber except the following and such as may hereafter be reserved namely, Teak, Cole Teak, Bhackwood, Ebony, Karoonthaly, Sandalwood; should he carry any timber without the limits of the grant it will be subject to the payment of Kooteekanom, or Customs DutyThe eleventh clause reads:The land granted shall be held in perpetuity as heritable or transferable property, but every case of transfer of the grant by the grantee shall be immediately made known to the Sircar, who shall have the right of apportioning the tax, if a portion of the holding is transferredThe twelfth clause stipulates:The discovery of useful mines and treasures within the limits of the grant shall be communicated to the Sircar, and the grantee shall in respect to such mines and treasures, abide by the decision of the SircarThe sixteenth clause provides:The grantee shall be bound to preserve the forest trees growing on the banks of the principal streams running through the tract to the extent of fifty yards in breadth on each side of the stream, the underwood only being permitted to be cleared and coffee planted instead. Similarly he shall also be bound to preserve the trees about the crest of the hill to the extent of a quarter of a mile on each side5. On August 2, 1886, the agreement called the Second Pooniat Concession was entered into modifying the previous deed of ratification. It appears that by this time a company called the North Travancore Land Planting and Agricultural Society, Ltd. had acquired the rights in the said land from John Daniel Munro. The Land Revenue Manual (Vol. 3, Part I Revised Edition 1936, p. 7) summarises the main provisions6. For our purposes we may only mention the following provisions of the deed:(1) Assessment of one-half of a British Rupee per annum on every acre of land, other than, grass land, which is opened up for the purpose of cultivation or otherwise(2) Assessment of two annas and eight pies per annum on every acre of grass land brought under cultivation or taken up for homesteads and farmsteads, or reserved as shooting reserves or for the grazing of cattle or for any other purposes(6) The Society may use and appropriate to its own use within the limits of the Concession all timber except teak, cole-teak, blackwood, ebony (Karunthaly) and sandalwood, but should not fell any timber beyond what is necessary for clearing the ground for cultivation or for building, furniture and machinery, within the limits of the grant. No unvalued timber or articles manufactured therefrom should be carried outside the limits of the grant except in conformity with the rules of the Forest and Customs Departments for the time being in force(10) The land is to be held in perpetuity as heritable or transferable property but every case of transfer of the grant by the Society should be immediately made known by the Society to the Government(11) On the discovery by the Society of any useful or valuable mines, minerals or treasures within the limits of the grant, the same should at once be communicated to the Government and the Society should, in respect to such mines, minerals and treasures, abide by the decision of the Government7. A Royal Proclamation was made on September 24, 1899 (Kanni 9, 1075). It recites:Whereas we deem it expedient to clearly declare the position of this State in respect of that tract known as Anjanad and Kannan Devan Hills, we are pleaded to declare as follows:(1) The tract known as Anjanad and Kannan Devan Hills is an integral portion of our territory and all rights over it belong to and vest to us(2) The inhabitants of the said tract and all other whom it may concern are hereby informed and warned that they are not to pay any taxes, rents or dues, or make any other payment to the Poonjar Chief or his representatives or to any person other than an officer of our Government authorised in this behalf in respect of anything in, upon or connected with the said tract, with the exception, however, of a payment of rupee three thousand per annum from the successors in interests of the late Mr. J. D. Munro of London and Peermade now being paid to the said Chief in virtue of a Lease deed executed by the said Chief in favour of the said late Mr. J. D. Munro on the 11th July, 1877, and which we are pleased to permit the said Chief to continue to receive(3) The lands within the said tract will be dealt with by our Government in the same manner as lands in other parts of our territory with such modifications as the circumstances and conditions of the said tract may require and all taxes, rents and dues hitherto paid, and that may hereafter be imposed by our Government shall, with the exception of the sum of rupees three thousand aforesaid, be paid by the occupants of lands within the said tract whose occupation has been or may be recognized or confirmed by our Government, and of such portions of the said tract as may from time to time hereafter, with the permission of our Government, be occupied, to the officers of our Government who maybe authorised in this behalf8. According to the Land Revenue Manual (Vol. III Pt. I page 9) this Proclamation was the outcome of an arrangement made by the Government, with the Poonjar Chief for the surrender of certain proprietary rights which he had been exercising over the tract known as Anjanad and Kannan Devan Hills.

Court's reasoning:
29. It seems to us clear that the State has legislative competence to legislate on Entry 18, List II and Entry 42 List III. This power cannot be denied on the ground that it has some effect on an industry controlled under Entry 52, List I. Effect is not the same thing as subject-matterIf a State Act, otherwise valid, has effect on a matter in List I does not cease to be a legislation with respect to an entry in List II or List III.The object of Sections 4 and 5 seems to be to enable the State to acquire all the lands which do not fall within the categories (a), (b) and (c) of S.4 (1). These provisions are really incidental to the exercise of the power of acquisition. The State cannot be denied a power to ascertain what land should be acquired by it in the public interest35. The fact that the plantation is run as an integrated unit was strongly relied on but this cannot impinge upon and take away the legislative power of the State in respect of List II, Entry 1844. For the reasons mentioned above we have come to the conclusion that the State Legislature was competent to enact the impugned Act and that it is not repugnant to the Tea Act52.It seems to us that on the material placed before us it is difficult to resist the conclusion that the lands in dispute all within the expression janmam right.If, as stated in Travancore Land Revenue Manual Vol. IV, there are no lands that do not belong to a Janmi and the Sircar becomes a Janmi by gift, escheat, confiscation or otherwise, the effect of the Royal Proclamation of 1899 must be that the Sircar became the Janmi. We are not concerned here with lands which were held by the Full Bench of the Kerala High Court in Sukapuram Sabhayogam v. State of Kerala, AIR 1963 Kerala 101 to be held under Ryotwari tenure after the introduction of the Ryotwari Settlement in the Malabar area of Kerala State58. It seems that if it is held that the land does not fall within the expression janmam right it may possibly be covered by the decision of this Court in Purshothaman Nambudiris case, (1962) Supp 1 SCR 753 = (AIR 1962 SC 694  ) but as arguments were not addressed to us on this point we do not express our final opinion64. If the State were to use lands for purposes which have no direct connection with the promotion of agriculture or welfare of agricultural population the State could be restrained from using the lands for those purposes. Any fanciful connection with these purposes would not be enough65. It seems to us that if we read these two purposes to mean that these include only common purposes, which were sustained by this Court and purposes similar thereto it would be difficult to say that they are not for agrarian reform. In a sense agrarian reform is wider than land reform. It includes besides land reform something more and that something more is illustrated by the definition of common purpose,67. These observations must be understood in the light of the provisions of the Uttar Pradesh Zamindari Abolition and Land Reforms Act, 1950, for the impugned Act in that case (U. P. Act No. 1 of 1964) had amended Section 3 (8) of that Act of 1950. This grant in the nature of the jagir stood in the same position as all the big zamindaris and jagirs in Uttar Pradesh. It has never been urged that the Act of 1950 was not a measure of agrarian reform68. The third object - settlement of agriculturists and agricultural labour - it seems to us, is clearly covered by the expression agrarian reforms. The main object of agrarian reforms has been to acquire excess land and settle landless labourers and agriculturists69. We are accordingly of the opinion that the three purposes - the first two read as we have indicated - are covered by the expression agrarian reform and the legislation is protected from challenge by Article 31-A.