Case ID: 1082

Judgment:
13 to 24	 42 and 46 to 54 of 1958. Petitions under Article 32 of the Constitution of India for enforcement of Fundamental Rights. M.C. Setalvad	 Attorney General for India	 Syed Mahmud	 J. B. Dadachanji	 section N. Andley	 Rameshwar Nath and P. L. Vohra	 for the petitioners in petitions Nos. 13 18	 and 46 54 of 1958. C.K. Daphtary	 Solicitor General of India	 Syed Mahmud	 J. B. Dadachanji	 section N. Andley	 Rameshwar Nath and P. L. Vohra	 for the petitioners in Petitions Nos. 19 24 of 1958. S.N. Andley	 Rameshwar Nath	 J. B. Dadachanji and P. L. Vohra	 for the petitioner in petition No. 42 of 1958. K.V. Suryanarayana Iyer	 Advocate General of Kerala and Sardar Bahadur	 for the respondents. December	 9. The Judgment of Sinha	 C.J.	 Jafer Imam	 Subba Rao and Shah	 JJ.	 was delivered 81 by Sinha	 C. J. Sarkar	 J.	 delivered a separate Judgment. SINHA	 C. J. In this batch of 22 petitions under article 32 of the Constitution	 the petitioners impugn the constitutionality of the Travancore Cochin Land Tax Act	 XV of 1955	 as amended by the Travancore Cochin Land Tax (Amendment) Act	 X of 1957	 which hereinafter will be referred to as the Act. The Act came into force on June 21	 1955	 and the Amending Act on August 6	 1957. The petitioners are owners of forest areas in certain parts of the State of Kerala	 which	 before the reorganisation of States	 formed part of the State of Madras. The respondents to the petitions are: (1) the State of Kerala and (2) the District Collector	 Palghat: These petitions are based on allegations	 which are	 more or less	 similar	 and the following allegations made in Writ Petition No. 42 of 1958 may be taken as typical and an extreme case	 which was placed before us in detail to bring into bold relief the full significance and effect of the legislation impugned in these cases. The petitioner in Petition 42 of 1958 is a citizen of India	 who owns forests in certain parts of Palghat Taluk in Palghat District	 which was part of the State of Madras before the reorganisation of States. These forests are now in the State of Kerala. Up to the time that these forests were in the State of Madras	 as it then was	 the Madras Preservation of Private Forests Act	 Madras Act XXVII of 1949	 governed these forests. Even after these areas were transferred to the State of Kerala	 the said Madras Act	 XXVII of 1949	 continued to apply to these forests. Under the said Madras Act the owners of forests	 like the petitioner	 could not sell	 mortgage	 lease or otherwise alienate any portion of their forests without the previous sanction of the District Collector; nor could they	 without similar permission	 cut trees or do any act likely to denude the forest or diminish its utility	 as such. The District Collector	 in exercise of the powers under the Act	 does not ordinarily permit the cutting of more than a small 82 number of trees in the forest. Thus the petitioner has not the right fully to exploit the forest wealth in his forest area and has to depend upon the previous permission of the Collector. In exercise of the powers given to the Collector under the Madras Act aforesaid	 the petitioner 's lessee was given permission to cut certain trees in his forest	 which brings to the petitioner by way of income from. the forest	 a sum of Rs. 3	100 per year. Under the Act	 a tax called land tax at a flat rate of Rs. 2 per acre has been imposed on the petitioner. In pursuance of the provisions of the Act	 as amended as aforesaid	 the District Collector of Palghat	 purporting to act under the provisions of section 5A of the Act	 issued a notice to the petitioner provisionally assessing the petitioner 's forest under the said Act to a sum of fifty thousand rupees per annum and informing the petitioner that	 if no representation was made within thirty days	 the said provisional assessment would be confirmed and a demand notice would be issued. As there has been no survey of the area of forest land in the petitioner 's possession	 the District Collector has conjectured the said area to be twenty five thousand acres. The Petitioner had made an application to the District Collector under the Madras Preservation of Private Forests Act for felling trees in an area of one thousand acres	 but the Collector was pleased to grant permission to out trees from 450 acres only in the course of five years at the rate of 90 acres a year. The petitioner has leased out that right to another person	 who made the highest bid of Rs. 3	100 per year	 as the landlord 's fee for the right to cut and remove the trees	 and other minor produce. Besides the demand aforesaid	 the revenue authorities have levied about four thousand rupees as tax on the surveyed portions of the forest. The petitioner 's forest has large areas of and rocks	 rivulets and gorges. The petitioner	 in those circumstances	 questions the constitutional validity of the Act	 the provisions of which will be examined hereinafter. These petitions have been opposed on behalf of the first respondent and the allegations and submissions 83 made in the petitions are sought to be controverted by a counter affidavit sworn to by an Assistant Secretary of the Kerala Gover nment in the Revenue Department. It is in similar terms	 as a matter of fact printed in most of these cases. It is contended therein on behalf of the respondent that the petitions are not maintainable in as much as no fundamental rights of the petitioners have been infringed; that the allegations about the income	 from the forest lands are not admi tted; and by way of submission	 it is added	 they are irrelevant for the purposes of these petitions. It is stated that the Act was passed with a view to unifying the system of land tax in the whole of the State of Kerala. It is submitted that the validity of the Act has to be determined in the light of article 265 of the Constitution and that articles 19 and 31 were wholly out of the way. It is denied that the tax imposed was harsh or arbitrary	 or has the effect of violating the petitioner 's right of holding property; and it was asserted that the allegations in respect of income from the forests are entirely irrelevant	 as the tax was not a tax on income	 but was an "impost on land". It is equally irrelevant whether the land is productive or not. It is also contended that	 in view of the provisions of article 31(5)(b)(i) of the Constitution	 article 31(2) could not be relied upon by the petitioners. The allegation of the petitioners that the Act is a device to confiscate private forests is denied. It is admitted that	 except in certain cases	 the entire area is unsurveyed and that steps are being taken for surveying those areas. It is also stated that the areas shown in the notices served on the petitioners are based on information available to the Collector of the District; and lastly	 it is stated that only notice has been issued calling upon the petitioners to make their representations	 if any	 to the proposed provisional assessments. The assessments have not yet been made	 and	 therefore	 there is no question of demand of tax being enforced by coercive processes. Finally	 it is suggested that the Act has been enacted for the legitimate revenue purposes of the State. Before entering upon a discussion of the points in 84 controversy	 it is convenient at this stage to indicate briefly the relevant provisions of the Act which is impugned by the petitioners as ultra vires the State Legislature. The preamble of the Act is in these terms: "Whereas it is deemed necessary to provide for the levy of a low and uniform rate of basic tax on all lands in the State of Travancore Cochin. " Basic tax has been defined as "the tax imposed under the provisions of this Act". Section 3 lays down that the arrangement made under the Act for the levy of the basic tax shall be deemed inter alia to be a general revenue settlement of the State	 notwithstanding anything in any statute	 grant	 deed or other transaction subject to certain provisos not material for our present purposes. The charging section is section 4	 which is in these terms: "Subject to the provisions of this Act	 there shall be charged and levied in respect of all lands in the State	 of whatever description and held under whatever tenure	 a uniform rate of tax to be called the basic tax. " Section 5 lays down the rate of the tax which	 by the Amendment	 has been raised to Rs. 2 per acre (two pies per cent. of land per annum) and the basic tax charged and levied at that rate shall be the tax payable to the Government in lieu of any existing tax in respect of land. Section 6 lays down that any stipulation in any contract or agreement or lease or other transaction to pay land revenue assessment of any land shall be construed as stipulation for the payment of the amount. of basic tax	 as charged and levied under the Act. Section 7 is in these terms: "This Act is not applicable to lands held or leased by the Government or any land or class of lands which the Government may	 by notification in the Gazette	 either wholly or partially exempt from the provisions of this Act." Sections 8 and 9 provide for the continuance of the liability to pay certain dues in respect of existing tenures in addition to the basic tax in respect of lands covered by those tenures. Section 10 abolishes the 85 irrigation assessment charged on certain tank beds and other water reservoirs named and described therein. Section 11 preserves the right of the Government to levy certain irrigation and water cesses and lays down that the Act shall not affect the power of the Government to levy any rate or alter any existing rate of irrigation or water cess on any land	 as they deem fit. Cesses	 other than those mentioned in section 11	 are also abolished by section 12. Section 13 authorises the Government to appoint such officers as they deem necessary for the purpose of the Act. Section 14 lays down the bar of suits against the Government in respect of anything done or any order passed under the Act. Section 15 saves the right of the Government which accrued to it before the Act came into force as also the conditions of any agreement. grant or deed relating to any land	 except to the extent indicated in the Act. Section 16 vests the Government with the power to make rules for carrying into effect the provisions of the Act	 with particular reference to the power to make rules for the apportionment of the basic tax charged on certain kinds of holdings	 for defining the powers and duties of the officers appointed under the Act and for determining the kist instalments and the due date for the payment thereof. These in short are the provisions of the Act. The Act	 as indicated above	 was amended by Act X of 1957 which substituted the words "State of Kerala" for the words "State of Travancore Cochin" and made certain other consequential changes. The Amending Act introduced section 5A	 which has been very much assailed in the course of the argument before us and it is	 therefore	 necessary to set it out in full. It is in these terms: "section 5A. Provisional assessment of basic tax in the case of unsurveyed land8. (1) It shall be competent for the Government to make a provisional assessment of the basic tax payable by a person in respect of the lands held by him and which have not been surveyed by the Government	 and upon such assessment such person shall be liable to pay the amount covered in the provisional assessment. 86 (2)The Government after conducting a survey of the lands referred to in sub section (1) shall make a regular assessment of the basic tax payable in respect of such lands. After a regular assessment has been made	 any amount paid towards the provisional assessment made under sub section (1) shall be deemed to have been paid towards the regular assessment and when the amount paid towards the provisional assessment exceeds	 the amount payable under the regular assessment	 the excess shall be refunded to the person assessed. " By section 9	 section 3 of the Madras Revenue Recovery Act	 1864	 has been substituted in these terms: "3. Landholder when and to whom to pay kist. Every landholder shall pay to the Collector or other officer empowered by 'him in this behalf the land tax due from him on or before the day fixed for payment under the rules framed under section 16 of the Land Tax Act	 1955. " From a review of the provisions of the Act	 as amended as aforesaid	 it will be clear that the provisions of the Act lay down in barest outline the policy to impose a uniform and	 what is asserted to be	 a low rate of land tax on all lands in the State of Kerala. Unlike other taxing statutes	 it does not make any provision for issue of notice to the assessee	 nor is there any provision for submission of a return by the assessee. By section 5A	 it authorises the Government to make a "provisional assessment" in respect of land	 which has not been surveyed	 and such provisional assessment is made payable by the person made liable under the Act. It does not make any provision for any appeals in cases where the assessee may feel dissatisfied with the assessment. The Act does contemplate the making of "a regular assessment of the basic tax". But it does not indicate as to when the regular assessment would be made	 except indicating that it can be made only after a survey has been made in respect of the land assessed. The Act could not have been cast in more general terms and the proceedings under the Act could not have been more summary. It has thus the merit of brevity as also of simplicity	 derived 87 from the fact that a tax is levied at a flat rate	 irres pective of the quality of the land and consequently of its productive capacity. Under the Act	 the charge has to be levied	 whether or not any income has been derived from the land. The Legislature was so much in earnest about levying and realising the tax that it could not even wait for a regular survey of the lands to be assessed with a view to determining the extent and character of the land. Such are the provisions and the effect of the Act	 which has been assailed on a number of grounds on behalf of the petitioners. It is contended	 in the first instance	 that inequality is writ large in the provisions of the Act	 which is clearly discriminatory in character and effect and thus infringes article 14 of the Constitution. As the Act does not have any regard to the quality of the land or its productive capacity	 and a tax at a flat rate of Rs. 2 per acre is proposed to be levied under the Act	 it is further contended	 it imposes very unreasonable restrictions on the right to hold property and is thus an invasion on the rights guaranteed to the petitioners under article 19(1)(f) of the Constitution. The Act does not lay down any provision calling for a return from the assessee	 for any enquiry or investigation of facts before the provisional assessment is made or for any right of appeal to any higher authority from the order of provisional assessment; in fact	 there is no provision for hearing the assessee at any stage. The Act is of an arbitrary character and is thus wholly repugnant to the guaranteed rights of the petitioners. Section 7 quoted above gives uncanalised	 unlimited and arbitrary power to the Government to pick and choose in the matter of grant of total or partial exemption from the provisions of the Act. It also suffers from the vice of discrimination. It has also been vehemently argued that the Act	 though it purports to be a tax on land	 is really a law relating to forests in possession of the petitioners and would not come within the purview of entry 18 read by itself or in conjunction with entry 45 of List II	 but is law relating to forests under entry 19. If we tear the veil in which the real 88 purpose and effect of the Act has been shrouded	 'it will I appear that the true character and effect of the Act is not to levy a tax on land	 but to expropriate the private owners of the forests without payment of any compensation whatsoever. Lastly	 it has been urged that the whole Act has been conceived with a view to confiscating private property	 there being no question of any compensation being paid to those who may be expropriated as a result of the	 working of the Act. This last argument is based on the assertion that the tax proposed to be levied on private property in the State of Kerala has absolutely no relation to the paying capacity of the persons sought to be taxed	 with reference to the income they could derive	 or actually did derive from the property. On behalf of the State of Kerala	 the learned Advocate General has argued that	 though in most of the cases	 that is to say	 except in seven petitions (Petitions 21	 22	 47	 49	 50	 51 and 54) the lands have not been surveyed	 the areas mentioned in the notices proposing provisional assessment have been ascertained through the local agencies of the Government. It was further contended that the State had only declared the liability to the payment of the tax at a flat rate of Rs. 2 per acre in respect of land	 irrespective of the income to be derived therefrom. Hence there was no necessity for making provision for a detailed enquiry or investigation. The rate of the tax being known	 and the area of the land to be taxed having been locally ascertained	 even though without any regular survey	 what remained was merely quantifying the tax	 which was of a purely administrative character. The local agencies estimated the land in possession of particular persons. Those persons were called upon to pay provisionally at the rate fixed by the statute. The State has	 by executive action	 appointed authorities who are expected to act in accordance with the principle of natural justice. There was	 therefore	 no need for laying down any elaborate procedure as in other instances of taxing statutes. There is a presumption that the authority appointed by the Government would act bona fide and in a 89 proper manner. If there was any case of unfair dealings	 the matter could be brought to the Court. It was greatly emphasised that as a flat rate of taxation had been envisaged by the Act and as ultimately the tax at that rate would be realised from land found to be in possession of particular persons after a regular survey	 the regular survey to be ultimately made would automatically determine the amount of tax to be paid and the adjustment of the taxes already paid could be made on that basis. On the legal aspect of the controversy raised on behalf of the petitioners	 it was argued that the Act has its justification in article 265 of the Constitution	 which was not subject to the provisions of Part III of the Constitution and that	 therefore	 articles 14	 19	 31 could not be pressed in aid of the petitioners. It was also contended that even if the Act is	 in effect	 confiscatory	 it cannot be questioned	 being a taxing statute. Finally	 it was urged that the question of the amount of income derived by the petitioners from the property sought to be taxed is wholly irrelevant	 because the Act was not a tax on income but it was a tax on the property itself. The most important question that arises for consideration in these cases	 in view of the stand taken by the State of Kerala	 is whether article 265 of the Constitution is a complete answer to the attack against the constitutionality of the Act. It is	 therefore	 necessary to consider the scope and effect of that Article. Article 265 imposes a limitation on the taxing power of the State in so far as it provides that the State shall not levy or collect a tax	 except by authority of law	 that is to say	 a tax cannot be levied or collected by a mere executive fiat. It has to be done by authority of law	 which must mean valid law. In order that the law may be valid	 the tax proposed to be levied must be within the legislative competence of the Legislature imposing a tax and authorising the collection thereof and	 secondly	 the tax must be subject to the conditions laid down in article 13 of the Constitution. One of such conditions envisaged by article 13(2) is that the Legislature shall not make any law which 90 takes away or abridges the equality clause in article 14	 which enjoins the State not to deny to any person equality before the law or the equal protection of the laws of the country. It cannot be disputed that if the Act infringes the provisions of article 14 of the Constitution	 it must be struck down as unconstitutional. For the purpose of these cases	 we shall assume that the State Legislature had the necessary competence to enact the law	 though the petitioners have seriously challenged such a competence. The guarantee of equal protection of the laws must extend even to taxing statutes. It has not been contended otherwise. It does not mean that every person should be taxed equally. But it does mean that if property of the same character has to be taxed	 the taxation must be by the same standard	 so that the burden of taxation may fall equally on all persons holding that kind and extent of property. If the taxation	 generally speaking	 imposes a similar burden on every one with reference to that particular kind and extent of property	 on the same basis of taxation	 the law shall not be	 open to attack on the ground of inequality	 even though the result of the taxation may be that the total burden on different persons may be unequal. Hence	 if the Legislature has classified persons or properties into different categories	 which are subjected to different rates of taxation with reference to income or property	 such a classification would not be open to the attack of inequality on the ground that the total burden resulting from such a classification is unequal. Similarly	 different kinds of property may be subjected to different rates of taxation	 but so long as there is a rational basis for the classification	 article 14 will not be in the way of such a classification resulting in unequal burdens on different classes of properties. But if the same class of property similarly situated is subjected to an incidence of taxation	 which results in inequality	 the law may be struck down as creating an inequality amongst holders of the same kind of property. It must	 therefore	 be held that a taxing statute is not wholly immune from attack on the ground that it infringes the equality clause ill 91 article 14	 though the Courts are not concerned with the policy underlying a taxing statute or whether a particular tax could not have been imposed in a different way or in a way that the Court might think more just and equitable. The Act has	 therefore	 to be examined with reference to the attack based on article 14 of the Constitution. It is common ground that the tax	 assuming that the Act is really a taxing statute and not a confiscatory measure	 as contended on behalf of the petitioners	 has no reference to income	 either actual or potential	 from the property sought to be taxed. Hence	 it may be rightly remarked that the Act obliges every person who holds land to pay the tax at the flat rate prescribed	 whether or not he makes any income out of the property	 or whether or not the property is capable of yielding any income. The Act	 in terms	 claims to be "a general revenue settlement of the State" (section 3). Ordinarily	 a tax on land or land revenue is assessed on the actual or the potential productivity of the land sought to be taxed. In other words	 the tax has reference to the income actually made	 or which could have been made	 with due diligence	 and	 therefore	 is levied with due regard to the incidence of the taxation. Under the Act in question we shall take a hypothetical case of a number of persons owning and possessing the same area of land. One makes nothing out of the land	 because it is arid desert. The second one does not make any income	 but could raise some crop after a disproportionately large investment of labour and capital. A third one	 in due course of husbandry	 is making the land yield just enough to pay for the incidental expenses and labour charges besides land tax or revenue. The fourth is making large profits	 because the land is very fertile and capable of yielding good crops. Under the Act	 it is manifest that the fourth category	 in our illustration	 would easily be able to bear the burden of the tax. The third one may be able to bear the tax. The first and the second one will have to pay from their own pockets	 if they could afford the tax. If they cannot afford the tax	 the property is 92 liable to be sold	 in due process of law	 for realisation of the public demand. It is clear	 therefore	 that inequality is writ large on the Act and is. inherent in the very provisions of the taxing section. It is also clear that there is no attempt at classification in the provisions of the Act. Hence	 no more need be said as to what could have been the basis for a valid classification. It is one of those cases where the lack of classification creates inequality. It is		 therefore	 clearly hit by the prohibition to deny equality before the law contained in article 14 of the Constitution. Furthermore	 sec. 7 of the Act	 quoted above	 particularly the latter part	 which vests the Government with the power wholly or partially to exempt any land from the provisions of the Act	 is clearly discriminatory in its effect and	 therefore	 infringes article 14 of the Constitution. The Act does not lay down any principle or policy for the guidance of the exercise of discretion by the Government in respect of the selection contemplated by a. 7. This Court has examined the cases decided by it with reference to the provisions of article 14 of the Constitution	 in the case of Shri Ram Krishna Dalmia vs Shri Justice section B. Tendolkar and others (1). section R. Das	 C. J.	 speaking for the Court has deduced a number of propositions from those decisions. The present case is within the mischief of the third proposition laid down at pages 299 and 300 of the Report	 the relevant portion of which is in these terms: "A statute may not make any classification of the persons or things for the purpose of applying its provisions but may leave it to the discretion of the Government to select and classify persons or things to whom its provisions are to apply. In determining the question of the validity or otherwise of such a statute the Court will not strike down the law out of hand only because no classification appears on its face or because a discretion is given to the Government to make the selection or classification but will go on to examine and ascertain if the statute has laid down any principle or policy for the guidance of the exercise of discretion by the Government in the matter of the selection or classification. 93 After such scrutiny the Court will strike down the statute if it does not lay down any principle or policy for guiding the exercise of discretion by the Government in the matter of selection or classification	 on the ground that the statute provides for the delegation of arbitrary and uncontrolled power to the Government so as to enable it to discriminate between persons or things similarly situate and that	 therefore	 the discrimination is inherent in the statute itself" (p. 299 of the Report). The observations quoted above from the unanimous judgment of this Court apply with full force to the provisions of the Act. It has	 therefore	 to be struck down as unconstitutional. There is no question of severability arising in this case	 because both the charging sections	 section 4 and section 7	 authorising the Government to grant exemptions from the provisions of the Act	 are the main provisions of the Statute	 which has to be declared unconstitutional. The provisions of the Act are unconstitutional viewed from the angle of the provisions of article 19(1)(f) of the Constitution	 also. Apart from the provisions of sections 4 and 7 discussed above	 with reference to the test under article 14 of the Constitution	 we find that section 5(A) is also equally objectionable because it imposes unreasonable restrictions on the rights to hold property	 safeguarded by article 19(1)(f) of the Constitution. Section 5(A) declares that the Government is competent to make a provisional assessment of the basic tax payable by the holder of unsurveyed land. Ordinarily	 a taxing statute lays down a regular machinery for making assessment of the tax proposed to be imposed by the statute. It lays down detailed procedure as to notice to the proposed assessee to make a return in respect of property proposed to be taxed	 prescribes the authority and the procedure for hearing any objections to the liability for taxation or as to the extent of the tax proposed to be levied	 and finally	 as to the right to challenge the regularity of assessment made	 by recourse to proceedings in a higher Civil Court. The Act merely declares the competence of the Government to make 94 a provisional assessment	 and by virtue of section 3 of the Madras Revenue Recovery Act	 1864	 the land holders may be liable to pay the tax. The Act being silent as to the machinery and procedure to be followed in making the assessment leaves it to the Executive to evolve the requisite machinery and procedure. The whole thing	 from beginning to end	 is treated as of a purely administrative character	 completely ignoring the legal position that the assessment of a tax on person or property is at least of a quasi judicial character. Again	 the Act does not impose an obligation on the Government to undertake survey proceedings within any prescribed or ascertainable period	 with the result that a land holder may be subjected to repeated annual provisional assessments on more or less conjectural basis and liable to pay the tax thus assessed. Though the Act was passed about five years ago	 we were informed at the Bar that survey proceedings had not even commenced. The Act thus proposes to impose a liability on land holders to pay a tax which is not to be levied on a judicial basis	 because (1) the procedure to be adopted does not require a notice to be given to the proposed assessee; (2) there is no procedure for rectification of mistakes committed by the Assessing Authority; (3) there is no procedure prescribed for obtaining the opinion of a superior Civil Court on questions of law	 as is generally found in all taxing statutes	 and (4) no duty is cast upon the Assessing Authority to act judicially in the matter of assessment proceedings. Nor is there any right of appeal provided to such assessees as may feel aggrieved by the order of assessment. That the provisions aforesaid of the impugned Act are in their effect confiscatory is clear on their face. Taking the extreme case	 the facts of which we have stated in the early part of this judgment	 it can be illustrated that the provisions of the Act	 without proposing to acquire the privately owned forests in the State of Kerala after satisfying the conditions laid down in article 31 of the Constitution	 have the effect of eliminating the private owners through the machinery of the Act. The petitioner in petition 42 95 of 1958 has been assumed to own 25 thousand acres of forest land. The liability under the Act would thus amount to Rs. 50	000 a year	 as already demanded from the petitioner on the basis of the provisional assessment under the provisions of section 5(A). The petitioner is making an income of Rs. 3	100 per year out of the forests. Besides	 the liability of Rs. 50	000 as aforesaid	 the petitioner has to pay a levy of Rs. 4	000 on the surveyed portions of the said forest. Hence	 his liability for taxation in respect of his forest land amounts to Rs. 54	000 whereas his annual income for the time being is only Rs. 3	100 without making any deductions for expenses of management. Unless the petitioner is very enamoured of the property and of the right to hold it may be assumed that he will not be in a position to pay the deficit of about Rs. 51	000 every year in respect of the forests in his possession. The legal consequences of his making a default in the payment of the aforesaid sum of money will be that the money will be realised by the coercive processes of law. One can	 easily imagine that the property may be sold at auction and may not fetch even the amount for the realisation of which it may be proposed to be sold at public auction. In the absence of a bidder forthcoming to bid for the offset amount	 the State ordinarily becomes the auction purchaser for the realisation of the outstanding taxes. It is clear	 therefore	 that apart from being discriminatory and imposing unreasonable restrictions on holding property	 the Act is clearly confiscatory in character and effect. It is not even necessary to tear the veil	 as was suggested in the course of the argument	 to arrive at the conclusion that the Act has that unconstitutional effect. For these reasons	 as also for the reasons for which the provisions of sections 4 and 7 have been declared to be unconstitutional	 in view of the provisions of article 14 of the Constitution	 all these operative sections of the Act	 namely 4	 5A and 7	 must be held to offend article 19(1)(f) of the Constitution also. The petitions are accordingly allowed with costs against the contesting respondent	 the State of Kerala. 96 SARKAR	J. These petitions were filed under Art.32 of the Constitution	 challenging the validity of the Travancore Cochin Land Tax Act	 1955	 as amended by Act X of 1957. The principal Act was passed by the legislature of the State of Travancore Cochin and the Amending Act	 by the legislature of the State of Kerala	 in which the State of Travancore Cochin had been merged. The petitioners are owners of lands in the State of Kerala. The Act as amended and hereafter referred to as the Act	 levied a certain basic tax on all lands in the State of Kerala. The petitioners say that the levy is illegal and violates their fundamental rights. It appears from the preamble that the Act was passed as it was deemed necessary to provide for the levy of a low and uniform rate of basic tax on all lands in the State. The Act provides that the arrangement made by it for the levy of the basic tax is to be deemed to be a general revenue settlement of the State. Section 4 of the Act is the charging section and it lays down that there shall be charged and levied in respect of all lands in the State	 of whatever description and held under whatever tenure	 a uniform rate of tax to be called the basic tax. Section 5 fixes the rate of the tax at 2 n. P. per cent which works out at Rs. 2 per acre per annum. This section also provides that the basic tax shall be the tax payable to the Government in lieu of any other existing tax in respect of land. Section 12 abolishes all cesses on land except irrigation cess. The first ground on which the validity of the Act is challenged is that it offends the provision as to the equal protection of the laws contained in article 14 of the Constitution. The Act applies to all lands in the State and it imposes an uniform rate of tax	 namely	 Rs. 2 per acre. It is said that all lands in the State have not the same productive quality; that some are waste lands and others	 lands of varying degrees of fertility. The contention is that the tax weighs more heavily on owners of waste lands than on owners of fertile lands. It is said that it is bound to happen that some owners make no income out of their lands 97 or make a small income and they would have to pay the tax out of their pocket while the owners of better classes of lands yielding larger income would be able to pay the tax out of the income from the lands. It is contended that the Act therefore discriminates between several classes of owners of lands in the State and is void as infringing the equality clause in the Constitution. It may be conceded that all lands in the State are not of the same degree of fertility. I am however unable to see that because of that	 the Act can be said to discriminate between the owners of them. What is really said appears to be that the Act makes a classification of the owners of lands according to areas. Assume that the Act does so. The question then is	 is such a classification illegal? The equal protection clause in the Constitution does not mean that there shall be no classification for the purpose of any law. It has been said by this Court in Budhan Choudhury vs The State of Bihar(1): "It is now well established that while article 14 forbids class legislation	 it does not forbid reasonable classification for the purposes of legislation. In order	 however	 to pass the test of permissible classification two conditions must be fulfilled	 namely	 (i) that the classification must be founded on an intelligible differential which distinguishes persons or things that are grouped together from others left out of the group and (ii) that differential must have a rational relation to the object. Bought to be achieved by the statute in question". On the argument of the petitioners	 the Act makes a classification between owners of lands using as the differentia	 the area of the land held by them. The question then	 is	 is that differentia intelligible and has that differentia a rational relation to the object of the Act? Now it seems to me that both the tests are satisfied in the present case. The tax payers are classified according to the area of lands held by them. That is quite an intelligible basis on which to make a classification; holders of varying areas of land can (1) ; 1049. 13 98 quite understandably be placed in different classes. Next	 has such a basis of classification	 a rational relation to the object of the Act? The Act is a taxing statute. It is intended to collect revenue for the governmental business of the State. It says that one of its objects is to provide a low and uniform rate of basic tax. Another object mentioned is to replace all other dues payable to the Government in respect of the ownership of the land by a uniform basic tax. Why is it to be said that the use of the area of land held as the basis of classification has no rational relation to these objects. I find no reason. The object is to tax land held in the State for raising revenues. It is the holding of the land in the State that makes the owner liable to pay tax. It would follow that the quantum of the tax can be reasonably linked with the quantum of the holding. Why is it said that the classification on the basis of area is bad? It is only because it imposes unequal burden of the tax on the owners of land; because owners of less productive land would have a larger burden put on them. Now if this argument is right	 then tax on land can be imposed only according to its productivity. I have not been shown any authority which goes to this length. I am further unable to see how productivity as the basis of classification could be said to have a more rational relation to the object of a statute collecting revenue by taxing land held in the State. The tax is not levied because the land is productive but because the land is held in the State. Again if the tax which could be imposed on land had to be correlated to its productivity	 then the State would have no power to tax unproductive land and the provision in the Constitution that it would have power to tax land would	 to that extent	 be futile. It seems to me that a contention leading to such a result cannot be accepted. Reliance was placed for the petitioners on Cumberland Coal Company vs Board of Revision on Tax Assessments (1) in support of the contention that a tax on land not based on its productivity	 violates article 14. (1) ; 99 I am unable to hold that this case supports the contention. What had happened there was that a certain statute had imposed a tax ad valorem on all coal situated in a certain area and in assessing the tax	 the coal of the Cumberland Coal Company had been assessed by the authorities concerned at its full value while the coal of the rest of the class liable to the tax had been assessed at a lower value. Thereupon it was held that "the intentional systematic undervaluation by State Officials of taxable property of the same class belonging to other owners contravenes the con stitutional right of one taxed on the full value of his property. " On this view of the matter the Supreme Court of America directed readjustment of the assessments. The statute with which this case was concerned had levied the tax ad valorem which	 it may be	 is the same thing as a tax correlated to productivity. The case had therefore nothing to do with the question that a tax on coal otherwise than ad valorem would be unconstitutional. In fact this case did not declare any statute invalid. Then it seems to me that if the contention of the petitioners is right	 and land could be taxed only on its productivity	 for the same reason	 taxes on all other things would have to be correlated to the income to be derived from them. The result would be far reaching. I am not prepared to accept a contention producing such a result and no authority has been cited to lead me to accept it. It may be that as lands are not of equal productivity	 some tax payers may be able to pay the tax out of the income of the land taxed while others may have to find the money from another source. To this extent the Act may be more hard on some than on others. But I am unable to see that for that reason it is unconstitutional. All class legislation puts some in a more disadvantageous position than others. If the classification made by the law is good	 as I think is the case with the present Act	 the resultant hardship alone cannot make it bad. It was said in Magonn vs Illinois Trust and Savings Bank(1)	 "It is hardly (1) ; 	 1043. 100 necessary to say that hardship	 impolicy	 or injustice of state laws is not necessarily an objection to their constitutional validity. " It is then said that sub sec. (1) of section 5A	 which was introduced into the Act by the Amending Act	 offends article 14. The impugned provision is in these terms: S.5A. (1) It shall be competent for the Government to make a provisional assessment of the basic tax payable by a person in respect of the lands held by him and which have not been surveyed by the Government	 and upon such assessment such person shall be liable to pay the amount covered in the provisional assessment. This section was enacted as at the date of the Act	 all lands had not been surveyed and so the areas of all holdings were not known. In the absence of such knowledge the tax which was payable on the basis of the areas of the holdings could not be assessed on unsurveyed lands	 so the section provides that pending the survey	 the Government will have power to make a provisional assessment on unsurveyed lands. This provision was necessary as the survey was bound to take time. The contention is that a. 5A(1) gives arbitrary power to the Government to make a provisional assessment on any person it chooses	 leaving out others from the provisional assessment. I am unable to read the sub section in that way. It may be that it leaves it to the Government to make a provisional assessment if it chooses. This does not result in any illegal classification. The surveyed lands and unsurveyed lands are distinct classes of properties and may be differently treated. Again	 all unsurveyed lands would on survey have to pay tax from the beginning. It would follow that the holders of both classes of lands are eventually subjected to the same burden. As to the contention that under this section the Government has the right to levy the provisional assessment at its choice on some and not on all holders of unsurveyed lands	 I am unable to agree that this is a proper reading of the section. In my view	 the 101 expression "a person" in the section does not lead to that conclusion. That expression should be read as "all persons" and it is easily capable of being so read. The section says	 "It shall ' be competent for the ' Government to make a provisional assessment of the basic tax payable by a person". Now the basic tax is payable by all persons holding land. So the provisional assessment	 if made	 has to be on all persons holding lands whose lands have not been surveyed. The Government cannot	 therefore	 pick and choose. A statute is intended to be legal and it has therefore to be read in a manner which makes it legal rather than in a manner which makes it illegal. If the Government did not make the provisional assessment in the case of all liable to such assessment	 then the Government 's action could be legitimately questioned. It has however not in fact been said in these petitions that in deciding to make the provisional assessment the Government has made any discrimination between the persons liable to such assessment. Section 5A(1) is also attacked on the ground that it is against rules of natural justice in that it does not say that in making the provisional assessment	 any hearing would be given to the person sought to be assessed or requiring a return from him or giving him a right of appeal in respect of the provisional assessment made. It is true that the ' section does not expressly provide for a hearing being given. It seems to me however that if according to the rules of natural justice the assessee was entitled to a hearing	 an assessment made without giving him such a hearing would be bad. The Act must be read so as to imply a provision requiring compliance with the rules of natural justice. Such a reading is not impossible in the present case as there is nothing in the Act indicating that the rules of natural justice need not be observed. It was said in Spack man vs Plumstead Board of Works (1) where a statute requiring an architect to give a certain certificate which did not provide the procedure as to how the architect was to conduct himself	 came up for consideration that	 "No doubt	 in the (1) 10 A.C. 229	 240. 102 absence of special provisions as to how the person who is to decide is to proceed	 the law will imply no more than that the substantial requirements of justice shall not be violated." Again in Maxwell on Statutes (10th ed.) p. 370 it has been said	 "In giving judicial powers to affect prejudicially the rights of person or property	 a statute is understood as silently implying	 when it does not expressly provide	 the condition or qualification that the power is to be exercised in accordance with the fundamental rules of judicial procedure	 such	 for instance	 as that which requires that before its exercise	 the person sought to be prejudicially affected shall have an opportunity of defend ing himself." In so far as this Act confers a power on the Government to discharge the judicial duty of making a provisional assessment	 which the petitioners say	 it does	 it must imply that the judicial process has to be observed. As regards the return	 that seems to me not to be of much consequence. If the assessee is entitled to be heard	 the fact that he is not asked to make a return	 would not constitute a departure from the rules of natural justice. Likewise	 the absence of a right of appeal is not something on which the petitioners can rely. Rules of natural justice do not require that there must always be a right of appeal. Under the Act it is the Government which makes the assess ment and it would not be unreasonable to hold that in view of the high authority of the person assessing	 the absence of a right of appeal is not likely to cause any miscarriage of justice. I am therefore unable to hold that in the absence of express provisions laying down the procedure according to which the provisional assessment is to be made	 the Act has to be held invalid. It may here be stated that in those instances where	 in the present cases	 provisional assessments had been made	 the	 assessees had either themselves supplied the area of the lands held by them or the area had been determined after giving them a hearing. After the area has been determine 	 the amount of the tax payable is decided by a simple calculation at the rate 103 of Rs. 2 per acre of land held and with regard to this	 no hearing is required. Then again sub see. (2) of section 5A provides that the Government after conducting a survey of the lands mentioned in sub sec. (1) under which provisional assessment is to be made	 shall make a regular assessment and adjustments would have to be made in regard to tax already paid on the basis of the regular assessment. A point is made that there is no time limit fixed within which the regular assessment is to be made and so the Act leaves it to the arbitrary decision of the Government when to make the regular assessment. I do not think that this contention is correct. Properly read	 the section in the absence of any indication as to time	 means that regular assessment would have to be made as soon after the survey	 as is reasonably possible. It is also said that section 7 of the Act offends article 14. This section gives power to the Government to exempt from the operation of the Act such lands or class of lands as the Government may by notification decide. This section does not indicate on what grounds the exemption is to be granted. It therefore seems to me that it gives arbitrary power to the Government and offends article 14. But the section is clearly severable from the rest of the Act. If the section is taken out of the Act	 the operation of the rest of the Act will not in the least be affected. The only effect will then be that the Government will have no power to exempt any land from the tax. That will not in any way affect the other provisions of the Act. The invalidity of this section is therefore no reason for declaring the entire Act illegal. It may be pointed out that it is not alleged in the petitions that the Government has exempted any lands or class of lands from the operation of the Act. It is contended that section 8 of the amending Act also shows the arbitrary nature of the Act. That section provides that if any difficulty arises in giving effect to the provisions of this Act	 the Government may by order do anything not inconsistent with such provisions which appears to it to be necessary or expedient 104 for removing the difficulty. This is a common form of provision now found in many Acts. The power given under it cannot be said to be uncontrolled for it must be exercised consistently with the Act and to remove difficulties arising in giving effect to the Act. In any event	 this provision is contained in the amending Act only. Even if the section be held to be invalid that would not affect	 the rest of the amending Act or any question that arises on these petitions. The validity of the Act is also challenged on the ground that it infringes article 19	 cl. (1)	 sub cls. (f ) & (g). This challenge seems to me to be wholly untenable. Apart from the question whether a taxing statute can become invalid as offending article 19	 as to which the position on the authorities does not seem to be very clear	 it is plain that article 19 permits reasonable restrictions to be put on the rights mentioned in subcls. (f ) & (g). Now there is no dispute that the rate of tax fixed by the Act is a very low rate. It has not been said that the rate fixed is unreasonable. It clearly is not so. The restrictions on these rights under article 19(1)	 (f) & (g) put by the Act	 if any	 are clearly reasonable. These rights cannot therefore be said to have been infringed by the Act. The lands of the petitioners are lands on which stand forests. It is said that under the Madras Preservation of Private Forests Act	 (Act XXVII of 1949)	 which applies to the lands with which we are concerned as they are situated in an area which previously formed part of the State of Madras	 the owners of the forests can work them only with the permission of the officer mentioned in that Act. It is said that the control imposed by the officer has been such that the income received from the forest is much less than the tax payable under the Act in respect of the land on which the forest stands. Taking by way of illustration Petition No. 13	 it is pointed out that the income from the forest with which that petition is concerned was Rs. 8	477 for the year 1956 57 while the tax payable under the Act for more or less the same period was Rs. 1	51	000. I am unable to hold that because of this the Act offends article 19(1)	 (f) and (g). 105 It is not stated that the land is not capable of producing any income other than the income from the forest standing on it. There is nothing to show that in all times to come the income from the land including the income from the forest	 will be less than the tax imposed on it by the Act. The area of the land concerned in Petition No. 13 is enormous being about 75	500 acres. I am further unable to hold the impugned ' Act to be invalid because of action that may be taken under another Act	 namely	 the Madras Act XXVII of 1949. The validity of the Act is challenged also on the ground that it offends article 31 of the Constitution. I am unable to see any force in this contention. If the statute is otherwise valid	 as I have found the present Act to be	 it cannot	 even if it deprives any person of property	 be said to offend article 31(1). It has been held by this Court in Ramjilal vs Income tax Officer	. Mohindargarh (1) that "clause (1) of article 31 must be regarded as concerned with deprivation of property otherwise than by the imposition or collection of tax	 for otherwise article 265 becomes wholly redundant." No question of cl. (2) of article 31 being violated arises here for the Act does not deal with any acquisition of property. It is also said that the Act is a colourable piece of legislation	 namely	 that though in form a taxing statute it	 in effect	 is intended to expropriate lands	 held by the citizens in the State by imposing a tax too heavy for the land to bear. As was said in Raja Bhairebendra Narayan Bhup vs The State of Assam (2) "The doctrine of colourable legislation is relevant only in connection with the question of legislative competency". In the present case	 there being in my view	 no want of legislative competency in the legislature which passed the Act in question	 the Act cannot be assailed as a piece of colourable legislation. I may add that I do not accept the argument that the Act is in its nature expropriatary or that the tax imposed by it is really excessive. (1)[1951] S.C.R. 127	 136. (2) [1956] S.C.R. 303. 14 106 I come now to the last argument advanced by the petitioners. It is said that the Act was beyond the legislature competence of the State Legislature. It is conceded that the State Legislature has power to impose a tax on land under entry 49 of List 2 in the Seventh Schedule to the Constitution	 but it is said that land as mentioned in that entry does not include lands on which forests stand. It is contended that the State Legislature has power to legislate about forests under entry 19 of that List and also as to land under entry 18. There is however no power to impose a axon forests while there is power under entry 49 of that list to tax land. Therefore	 it is said	 that there is no power to impose tax on lands on which forests stand and the Act in so far as it imposes tax on lands covered by forests	 which the lands of the petitioners are	 is hence incompetent. It is not in dispute that a State Legislature has no power to impose a tax on a matter with regard to which it has the power to legislate but has been given no express power to impose a tax. Therefore	 I agree	 that a State Legislature cannot impose tax on forests. I am however not convinced that "land" in entry 49 is not intended to include land on which a forest stands. No doubt	 a forest must stand on some land. In Shorter Oxford Dictionary	 one of the mean ings of "forest" is given as an extensive tract of land covered by trees and undergrowth	 sometimes intermingled with pastures. The concepts of forest and land however are entirely different. The principal idea conveyed by the word "forest" is the trees and other growth on the land. Under entry 19 there may no doubt be legislation with regard to land in so far it is necessary for the purpose of the forest growing on it. It is well known that entries in the legislative lists have to be read as widely as possible. It is not necessary to cut down the plain meaning of the word 	land in entry 49 to give full effect to the word "forest" in entry 19. In my view	 the two entries namely	 entry 49 and entry 18 deal with entirely different matters. Therefore	 under entry 49 taxation 107 on land on which a forest stands is permissible and legal. For these reasons I would dismiss these petitions. BY COURT: In accordance with the opinion of the majority of the Court	 these Petitions are allowed with costs against the contesting Respondent	 the State of Kerala. Petitions allowed.

Summary:
The Travancore Cochin Land Tax Act	 1955 was passed by the legislature of the State of Travancore Cochin and was amended by Act 10 of 057	 by the State of Kerala. By section 4 Of the Act all lands in the State of whatever description and held under whatever tenure were to be charged and levied a uniform rate of tax to be called the basic tax. Section 7 gave power to the Government to exempt from the operation of the Act such 78 lands or class of lands which the Government may	 by notification	 decide. Section 5A which was introduced into the Act by the Amending Act enabled the Government to make a provisional assessment of the basic tax in respect of the lands which had not been surveyed by the Government and provided that the Government after conducting the survey shall make a regular assessment and make the necessary adjustments in respect of the amounts paid already. There was	 however	 no time fixed for the conduct of the survey. The petitioners who owned forest in the State	 challenged the constitutional validity of the Act on the grounds that the provisions of the Act contravened articles 14	 19(i)(f) and 31(1) of the Constitution of India inasmuch as (1) the Act did not have any regard to the quality of the land or its productive capacity and the levy of a tax at a flat rate of RS. 2 per acre imposed very unreasonable restrictions on the right to hold property	 (2) the. Act did not lay down any provision calling for a return from the assessee for an enquiry or investigation of facts before the provisional assessment was made or any right of appeal to any higher authority and	 in fact	 did not make any provision for hearing the assessee at any stage	 (3) section 7 gave arbitrary power to the Government to pick and choose in the matter of grant of total or partial exemption from the provisions of the Act	 and (4) the tax proposed to be levied had absolutely no relation to the production capacity of the land sought to be taxed or to the income they could derive	 and therefore the Act had been conceived with a view to confiscating private property	 there being no question of any compensation being paid to those who may be expropriated as a result of the working of the Act. The petitioners also challenged the legislative competence of the legislature of the State to levy a tax on lands on which forests stood. The case on behalf of the State of Kerala	 inter alia	 was that the Act had its justification in article 265 Of the Constitution of India	 which was not subject to the provisions of Part III of the Constitution and that	 therefore	 articles 14	 19 and 31 could not be pressed in aid of the petitioners. 	 Held	 (Sarkar	 J.	 dissenting)	 that the Travancore Cochin Land Tax Act	 1955	 infringed the provisions of article 14 Of the Constitution of India. The Act obliged every person who held land to pay the tax at the flat rate prescribed	 whether or not he made any income out of the property	 or whether or not the property was capable of yielding any income. Consequently	 there was no attempt at classification in the provisions of the Act and it was one of those cases where the lack of classification created inequality. It was therefore hit by the prohibition to deny equality before the law contained in article 14. Section 5A of the Act which enabled the Government to make a provisional assessment of the basic tax payable by the 79 holder of unsurveyed land imposed unreasonable restrictions on the rights to hold property safeguarded by article 19(1)(f) of the Constitution	 inasmuch as (1) the Act did not impose an obligation on the Government to undertake survey proceedings within any prescribed or ascertainable period	 with the result that a landholder might be subjected to repeated annual provisional assessments on more or less conjectural basis and liable to pay the tax assessed	 and (2) the Act being silent as to the machinery and procedure to be followed in making the assessment left it to the Executive	 completely ignoring the legal position that the assessment of a tax on a person or property was at least of a quasijudicial character. Section 7 of the Act which vested the Government with the power wholly or partially to exempt any land from the provi sions of the Act did not lay down any principle or policy for the guidance of the exercise of discretion by the Government in respect of the selection contemplated by the section	 and was	 therefore	 discriminatory in effect and offended article 14. The section was not severable from the rest of the Act as both the charging sections	 section 4 and section 7	 authorising the Government to grant exemptions from the provisions of the Act were the main provisions of the statute. Shri Ram Krishna Dalmia vs Sri justice section R. Tendolkar; 	 	 relied on. The Act was also confiscatory in character inasmuch as the provisions of the Act had the effect of eliminating the private owners through the machinery of the Act	 without proposing to acquire the privately owned forests in the State after satisfying the conditions laid down in article 31 of the Constitution. Per Sinha	 C.J.	 Imam	 Subba Rao and Shah	 JJ. Article 265 of the Constitution which provided that the State shall not levy or collect a tax except by authority of law referred to a valid law	 and in order that the law might be valid	 the tax proposed to be levied must be within the legislative competence of the Legislature imposing a tax and authorising the collection thereof and	 secondly	 the tax must be subject to the conditions laid down in article 13	 by which all laws inconsistent with or in derogation of the fundamental rights in Part III shall be void. Per Sarkar	 J. (1) The object of the Act was to tax land in the State for raising revenues by providing for a low and uniform rate of basic tax replacing all other dues payable to the Government and the tax payers were classified according to the area of lands held by them. Such a classification had an intelligible basis and had a rational relation to the object of the Act. As tax was to be levied not because the land was productive but because the land was held in the State	 the classification did not offend article 14 Of the Constitution	 even though it might impose unequal burden of the tax on the owners of land on account of owners of less productive land being put on a larger burden. 80 (2)Section 5A did not offend article 14 and in the absence of express provisions laying down the procedure according to which the provisional assessment was to be made	 the Act could not be held invalid on the ground that it was against the rules of natural justice. (3)Section 7	 even if it were considered invalid on the ground that it gave arbitrary power to the Government and offended article 14	 was severable from the rest of the Act and would not affect the other provisions of the Act. (4)The Act did not infringe the fundamental rights in article 19(1)(f) as the rate of tax fixed by the Act was a very low rate and the restrictions on those rights were reasonable. (5) The Act was not in its nature expropriatary and did not offend article 31. As there was no want of legislative competence	 theAct could not be assailed as a piece of colourable legislation on the ground that though in form a taxing statute it	 in effect	 was intended to expropriate lands by imposing a tax too heavy for the land to bear. (6)The word "land" in Entry 49 of List II	 Sch. 7	 of the Constitution	 included "land on which a forest stands" and	 therefore	 under that Entry taxation on land on which forests stood was permissible and legal. The Act	 therefore	 could not be challenged as being beyond the legislative competence of the State Legislature.