Case: Ratna Sugar Mills Co. Ltd Vs. State Of U.P. And Others

This judgment would dispose of four civil appeals Nos. 1076 to 1079 of 1971 which have been filed by special leave by Ratna Sugar Mills Ltd. against the judgment of Allahabad High Court affirming on appeal the decision of the learned single Judge whereby the appellants four petitions under article 226 of the Constitution of India to challenge the order dated December 18, 1963 of the Board of Revenue directing the levy of holding tax under the U.P. Large Land Holdings Act, 1957 (U.P. Act No. 31 of 19 57) (hereinafter referred to as the Act) on the land of the appellant for the assessment years 1365, 1366, 1367 and 1368 Fasli had been1951 the appellant acquired land measuring 277.08 acres situated in village Argupur Kalan, tehsil Shahganj, district Jaunpur. According to the appellant, the said land was acquired for the purpose of setting up a factory for the production of paper and pulp. A licence was granted to the appellant in that connection. The appellant filed an application under section 143 of the U.P. Zamindari Abolition and Land Reforms Act for treating its land situated in village Agrupur Kalan as industrial land. In the course of those proceedings, the Tahsildar submitted a report o n August 24, 1959 asregards Argupur Kalan the whole area is recorded as sirdari of Ratna Sugar Mills and they pay Rs. 1495/- as annual land revenue. It is recorded in the Mills from before Zamindari Abolit ion and Mills Authorities continue to pay the recorded land revenue to Government. The whole area is lying Banjir and lies on both the sides of the railway line and Belwai Station. It has not at all been brought under cultivation nor the Mill has derived any benefit from it. It is really meant for industrial purposes but due to financial difficulties, they could not use it asSub-Divisional Officer, however, rejected the application filed on behalf of the appellant under section 143 of the U.P. Zamindari Abolition and Land Reforms Act. The result was that the land in dispute could not be declared to be land for industrial purpose. Appeal filed by the appellant against the order of the Sub-Divisional Officer was dismissed by thethe proceedings under section 143 of the U.P. Zamindari Abolition and Land Reforms Act were pending, the Commissioner held for assessment years 1365 and 1366 Fasli in an appeal filed by the appellant that the land in dispute was meant for industrial purposes and had on that account remained uncultivated. The appellant was held not liable to pay holdings tax for the land in dispute for the assessment years 1365 and 1366 Fasli. Two revisions were filed by the State against the above order of the Commissioner. Subsequently for the years 1367 and 1368 Fasli the Commissioner held that the appellant was liable to pay holdings tax for the land in dispute under the Act. The appellant filed two revisions to the Board of Revenue against that order of the Commissioner. The four revisions, two filed by the State and two filed by the appellant, were decided by the Board of Revenue by a common order dated December 18, 1963. The revisions filed by the State were accepted by the Board, while those filed by the appellant were rejected. The Board held that as the land held by the appellant was sirdari and not Bhumidari land, it could not be declared to be meant for industrial purposes. The appellant was held liable to pay holdings tax for the land in question. Four petitions under article 226 of the Constitution were thereupon filed by the appellant to challenge the order of the Board of Revenue. The learned single Judge held that the land in dispute constituted land as defined in the Act and the appellant was liable to pay holdings tax for the same. The order of the learned single Judge, as already mentioned, was affirmed on appeal by the Division Bench.Before dealing with the question involved in these appeals, it would be appropriate to refer to the relevant provisions as well as the objects and reasons.

Court's reasoning:
The land in dispute is shown to be Banjar land in the revenue records. Although the appellant acquired the land in 1951 for the purpose of setting up a factory, somehow the factory could not be set up and the land remained uncultivated. The appellant holds the land as a sirdr. An application was filed by the appellant for permission to use the land in question for industrial purposes, but that permission was not granted, the order of the Sub-Divisional Officer in this respect was affirmed on appeal by the Collector. A sirdar under section 146 of the U.P. Zamindari Abolition and Land Reforms Act, has the right to the exclusive possession of the land and entitled to use it for any purpose connected with agriculture, horticulture or animal husbandry which includes pisciculture and poultry farming. It is, therefore, apparent that after the order which was made on the appellants application under section 143 of the U.P. Zamindari Abolition and Reforms A ct, the appellant cannot be said to hold the land in dispute for industrial purpose. The purpose for which the appellant could after that date use the land was agriculture, horticulture or animal husbandry including pisciculture and poultry f arming. The fact that the appellant did not cultivate the land in question would not warrant exemption from the liability to pay the holding tax. The definition of the "land" includes uncultivated land held by a land-holder as such. The High Court held that the words "as such" did not pertain to the purpose for which the land is held but have reference to the land being held by the land holder in his capacity as a landholder. We see no sufficient ground to take a different view. In any ca se even if the words "as such" be construed to mean that the land should be held for the purpose of agriculture, horticulture, animal husbandry, pisciculture or poultry farming, the land in question should be taken to satisfy that requirement, because those are the only purposes for which the said land can now be used. The word "lands" used in the Act, as mentioned in the case of Raja Jagannath Baksh Singh v. State of Uttar Pradesh &Anr., is wide enough to include all lands whet her agricultural or not. The object of the Act, as mentioned in the objects and reasons, is more efficiency exploitation of agricultural land for increased food production. The appellant, in our opinion, cannot escape liability for payment of holding tax by keeping the land in question uncultivated.