1.This appeal is by the appellant who was the Petitioner and is directed against the Order dated 2-9-1974 of Venkataramaiah, J. (as he then was) disposing of his Writ Petition No. 793 of 1973 which is since reported as 1975(1) Karnataka Law Journal 208.
2. Among others, the appellant who is now dead and is represented by his legal representatives was the owner of lands bearing Sy. Nos. 2, 3, 5, 14, 15, 16, 17, 18, 19/1, 20, 24, 25 and 86 of K. Hunasavalli Village, Kerehalli Hobli, Hosanagar Taluk, Shimoga District classified as wet or garden as the case may be. On the said lands land revenue assessment was levied and collected under the Mysore Land Revenue Code, 1888 (Mysore Act IV of 1888) ('the Code') till that Code was in force in the old Mysore area. Land revenue fixed for the lands under the code also included the water rate payable to Government for supply of water from an irrigation work maintained by Government.
3. The uniform Karnataka Irrigation (Levy of Betterment Contribution and Water Rate) Act, 1957 (Karnataka Act 28 of 1957) ('the Act') enacted by the new State to regulate the levy of betterment contribution and water rate in the State, came into force on 31-10-1957 replacing the corresponding provisions in the Code and other laws that were in force in the other integrating areas of the State.
4. We will notice only those provisions that relate to levy of water rate under the Act with which alone we areconcerned in this case.
5. Section 2(e) of the Act exhaustively defines the term 'irrigation work', Section 10 of the Act authorises the levy of water rate for the supply of water from irrigation works in accordance with the rates to be fixed by Government in accordance with the Rules made thereto under the Act. For the said purpose, Government framed the KarnatakaIrrigation (Levy of Water Rates) Rules, 1965 ('the Rules') which came into force from 1-7-1965. The Rules regulated the levy of water rates from irrigation works in the State, theirdetermination and collection. Rules 3 of the Rules regulated the levy of water rate for different classes of lands in the State.
6. In Writ Petitions NO. 2333 of 1970 and connected cases ( Achutha Rao-v.- State of Karnataka and others) the Petitioner and several others, challenged the vires of Section 10 of the Act and the Rules under Article 226 of theConstitution. On 9-2-1971 a Division Bench of this Court allowed the said Writ Petition and struck down Rule 3 of the Rules as violative of Article 14 of the Constitution, which however did not prevent Government from framing a fresh Rule on the same topic. In that view, Government framed the Mysore Irrigation (Levy of Water Rates) (Amendment) Rules, 1971 ('new Rule') on 13-7-1971 expressly giving it retrospective effect from 1-7-1965.
7. On the basis of the new Rule and the purported compliance of the Rules, the Tahsildar, Hosanagar ('Tahsildar') issued a demand notice to the Petitioner on 9-10-1972 (Exhibit-B) calling upon him to pay a sum of Rs. 4,522-55 as arrears of water rate on the aforesaid lands for a period of 7 years from 1965-66 to 1971-72. In Writ Petition No. 793 of 1973 the Petitioner again challenged the new Rule and the said demand notice issued by the Tahsildar. A few other land owners of the District had also challenged the new Rule and similar demand notice received by them. On 2-9-1974 Venkataramaiah, J. (as he then was) disposed of all those Writ Petitions by a common order, in which His Lordship upheld the validity of Rule 3 but reserved liberty to the Petitioners to file appeals against the demand notices before Assistant Commissioner of the area ('AC') to be disposed of on merits. Without availing the liberty reserved to him, the appellant has filed this appeal reiterating the very contention urged by him before the learned Judge.
8. Sri T. S. Ramachandra, learned Counsel for the appellant contends that the reasoning and conclusion of the learned Judge for upholding the new Rule 3 of the Rules, was erroneous and that Rule was violative of Article 14 of the Constitution.
9. Sri S. Rajendra Babu, learned Government Advocate appearing for the Respondent sought to justify the order of the learned Judge.
10. We may at this stage read the new rule which reads thus :
'3. Levy of water rates for the use of water from irrigation works : (1) In respect of water supplied made available or used from an irrigation work for growing the crops specified in column (2) of the table below , water rates at the rate specified in the corresponding entries in column (3) thereof shall, in respect of each such crop grown, be levied :
Sl. No. Crops Water rate per acre 1 2 3
ForSugarcane crop :
(a) to be harvested within a period of twelvemonths.
(b) to be harvested after a period of twelvemonths but before a period of eighteen months.
Forany crop of Jowar, Maize, Ragi Navane, Sajje, Pulses, Green Gram, Wheat,Cotton, Groundnut, Vegetables, Chillies, Potatoes, Sweet Potatoes, Gingelly,Onions, Tobacco or Corriander.
Five Rupees and fifty paise
Forany manurial crop such as a Sanuhemp or Sesbania.
Forany crop of Arecanut, Plantain, Betel leaves, Turmeric, Lime, Oranges,Pomegranates, Coconut, Pepper, Mulberry or any Fruits.
(2) 'Where water is supplied, made available or used from any irrigation work for irrigating any land on which any of the cropsspecified in S1. Nos. 2 and 3 of the table to sub-rule (1) is grown twice in a revenue year, water rate on the second crop of such crops also shall be levied at the rate of -
(i) five rupees and fifty paise per acre, where the crop grown is paddy ;
(ii) two rupees and seventy five paise per acre, in other cases.
(3) Where water supplied or made available from any irrigation work cannot be used for irrigating any land without bailing or using a mechanical contrivance and the water supplied or made available is used for irrigation after such bailing or using mechanical contrivance, water rates shall be levied at half the rates specified in sub-rules (1) and (2).
(4) Where water is supplied, made available or used for irrigating any land which had not been irrigated by water before coming into force of these rules, water rates shall be levied at the following concessional rates during the first three years of irrigation of such lands, namely: -
(i) for the first year ...........Nil
(ii) for the second year .........One-fourth of the rates specified in sub rules (1) and (2)
(iii) for the third year .. One half of the rates specified is sub-rules (1) and (2).'
This rule fixes rates with reference to the nature of crops grown on lands. The rates have been fixed with due regard to whether the crop grown like sugarcane was a commercial crop or not and the use of water thereto for the same.
11. In examining the validity of the Rule, the learned Judge has kept before him, the correct legal principles and has found that the same was not violative of Article 14 of the Constitution. We are of the view that the reasoning and conclusion of the learned Judge to sustain the validity of the impugned rule is unexceptionable.
12. The water rates fixed by Government in the Rule is really in the nature of a tax and the measure is relly ataxation measure. When we so examine the Rule, as that should be, on the principles stated by Hidayatullah, CJ. speaking for the majority of the Supreme Court in The Twyford Tea Company Limited and Another-v.- The State of Kerala and Another, : 3SCR383 there is hardly any ground for this Court to hold that the new Rule is violative of Article 14 of theConstitution. From this it follows that there is no merit in this contention of Shri Ramachandra and we reject the same.
13. Sri Ramachandra next contends that even if the new Rule was upheld, then also the finding of the learned Judge upholding the recoveries for periods prior to the determination made by the Tahsildar and the issue of notice of demand by him thereto was erroneous. In support of hiscontention Sri Ramachandra strongly relies on the ruling of the Supreme Court in City Municipal Council, Mangalore-v.-Frederick Pais Etc., : 2SCR751
14. Sri Babu contends that when once the levy is fixed in the Rules from 1-7-1965, the determination and recovery must be in conformity with the same and not in conformity with the earlier rates, if any, prevailing in the area.
15. We have carefully read the reasoning and conclusions of the learned Judge on this aspect. Before us thiscontention has been projected and developed by both sides in a slightly different manner. We, therefore, consider it proper to independently examine the same.
16. Earlier, we have noticed that the new Rules have come into force from 1-7-1965.
17. Section 11(3) of the Act empowers Government to make a rule retrospectively in exercise of which Government had given retrospective effect to the new Rule from 1-7-1965. Sri Ramachandra does not dispute the power of Government to give retrospectivity to the new Rule.
18. Even the very heading of the new Rule which gives a clue to its understanding, states that what is done is levy of water rates for use of water from irrigation works in the State. In clear and express terms, the new Rule levies or fixes water rates in the State under the Act from 1-7-1965.
19. The term levy is not a term of art that carries one and only meaning in every context but has different meanings in different contexts. In taxation measure 'Levy' is generally understood as the 'levy', charge or rate fixed by the competent legislative authority. On this aspect Lord Dunedin in Hitney-v.- Commissioners of Inland Revenue, (1926) 10 Tax Case 88 at 110 speaking for the House of Lords has very neatly and tersely explained thus:
'My Lords, I shall now permit myself a general observation. Once that it is fixed that there is liability , it is antecedently highly improbable that the statute should not go on to make that liability effective. A statute is designed to be workable and the interpretation thereof by a Court should be to secure that object unless crucial omission or clear direction makes that end unattainable. Now, there are three stages in theimposition of a tax; there is the declaration of liability, that is the part of the statute which determines what person in respect of what property are liable. Next, there is the assessment. Liability does not depend on assessment. That ex-hypothesi, has already been fixed. But, assessment particularises the exact sum which a person liable has to pay. Lastly, come the methods o frecovery, if the person taxed does not voluntarily pay.'
If one examines the new Rule in the context, scheme and object of the Act, as that should be, it is crystal clear that the same levies or fixes water rates in the State from 1-7-1965. Whatever be the action or inaction of the authoritiesfunctioning under the Act and the Rules, the legal effect of the new Rule is that There is a levy made under the Act in the State from 1-7-1965. When once there is a levy under the Act from 1-7-1965, it is that levy that holds the field from that date and not the earlier levies under the previous laws that were in force in the several integrating areas of the State. From this it follows that the 2nd proviso to Section 12 of the Act does not really help the appellant.
22. What the Tahsildar or the other competent Authority does under Rule 4 of the Rules is only the determination, assessment or quantification and no more. The power exercised under Rule 4 of the Rules is entirely different to the power conferred and exercised by Government under the Act in levying or fixing the water rates under the Act. In this view, no reliance can be placed on Rule 4 of the Rules.
21. In Frederick Pais's case the Court was examining the validity of a demand made by the Municipal. Councilwithout imposition of levy under the relevant law for the relevant period. But, that is not the position in the present case. Hence, the ratio in Frederick Pais's case, does not really bear on the point.
22. On the above discussion, we hold that water rate levied or fixed from 1-7-1965 under the new Rule can be determined or assessed by the authority under the Act and then recovered in accordance with law. From this it follows that the conclusion of the learned Judge on this aspect does not call for our interference though not for the very reasons given by His Lordship but for the reasons given by us.
23. On the contention of the Petitioner, that the Tahsildar before determining the water rate due by him, should have afforded him an opportunity of hearing, the learned Judge had expressed that such an opportunity can be provided by the AC, if he were to file an appeal under Rule 4 of the Rules. Under Rule 4, if the determination made by the Tahsildar is objected to by the land owner in an appeal, then the AC is required to hold an inquiry and provide an opportunity of hearing to the land owner and then determine all question of fact and law that arise in such an appeal. We are of the view that this conclusion of the learned Judge is in accord with the Rules and therequirements of the principles of natural justice that provide for a post decisional hearing and the same does not call for our interference.
24. While pursuing this appeal before this Court, the appellant had not availed the concession extended tohim, by the learned Judge and has not filed an appeal before the AC. For various reasons with which we are not concerned, this appeals some what regretfully, has not been heard and decided for over ten years. But, the long pendency of this appeal itself cannot affect the interests of the Petitioner. Sri Babu in our opinion, very rightly states that if an appeal is filed by the Petitioner within 30 days from this day the AC will deal with the same on merits.
25. In the light of our above discussion, we dismiss this appeal. But, we however, declare that it is open to the appellant to file an appeal against the notice dated 9-10-1972 (Exhibit-3) of the Tahsildar before the AssistantCommissioner, Sagar, within 30 days from this day and if such an appeal is filed before him, within that time, then thatauthority is directed to dispose of the said appeal on merits in accordance with law and the observations, made by us and the learned Judge on that aspect.
26. Writ appeal is disposed of in the above terms. But, in the circumstances of the case we direct the parties to bear their own costs.
27. Let this order be communicated to the respondents and also the Assistant Commissioner, Sagar Sub-Division, Sagar, Shimoga District within - 15 days from this day.