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The Gwalior Agriculture Co. Ltd. Vs. the State of Madhya Pradesh and ors. - Court Judgment

LegalCrystal Citation
SubjectCivil
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. No. 291 of 1967
Judge
Reported inAIR1971MP51; 1970MPLJ331
ActsMadhya Pradesh, Sinchai (Jalkar Manyatakaran) Adhiniyam, 1964 - Sections 3, 3(2) and 3(3); Madhya Pradesh Extension of Laws Act, 1958 - Sections 6; Madhya Bharat Irrigation Act, 1950; Constitution of India
AppellantThe Gwalior Agriculture Co. Ltd.
RespondentThe State of Madhya Pradesh and ors.
Appellant AdvocateR.K. Tankha, Adv.
Respondent AdvocateK.K. Dubey, Govt. Adv.
Cases ReferredUdai Ram Sharma v. Union of India
Excerpt:
- - it was also alleged that the adsali variety of sugar-cane cultivation was well-known to the petitioner company, and the assessment made was proper. union of india, air 1968 sc 1138. 6. in order to appreciate the contentions raised before us, it would be proper to refer to certain material provisions of the madhya bharat irrigation act of 1950, as well as the act of 1964 passed by the madhya pradesh state legislature. when the act of 1964 clearly lays down in sub-section (2) of section 3 that the water rate prescribed for adsali sugarcane by the notification specified in the schedule as item 4 shall be and shall always be deemed to have been prescribed and operative with effect from the 1st april, 1954 (vide ann......pradesh legislature passed the act of 1964 to validate prescription, and assessment etc. of the water rates under the madhya bharat act of 1950. thereafter, the respondents initiated proceedings against the petitioner company for recovery of the levy of water used by them from the canal at the rate prescribed for irrigating adsali sugar-cane crop, provided by the aforesaid notifications, which, according to the petitioner company are illegal as the act of 1964 passed by the legislature is ultra vires of the powers of the state government.3. the respondents, on the other hand, have averred that the act of 1964 passed by the madhya pradesh state legislature was within their competence, and the assessment and collection of dues at the rates prescribed is proper with effect from 1-4-1954,.....
Judgment:

Surajbhan, J.

1. This is a writ petition by the Gwalior Agriculture Company, Limited, Dabra (hereinafter called the Company) under Articles 226 and 227 of the Constitution of India, challenging the validity of the Madhya Pradesh Sinchai (Jal Kar Manyatakaran) Adhiniyam 1964 (Act No. 27 of 1964), (hereinafter called the Act of 1964) for the reasons mentioned in paragraph 10 of the petition, and praying for the issuance of a suitable writ and direction restraining the respondents from recovering the charges and penalty imposed on the petitioner under the aforesaid Act of 1964 and for such incidental reliefs as may be found proper.

2. The petitioner is a registered company at Dabra and is engaged in the cultivation of sugar-cane besides other crop. Prior to the merger of the United States of Gwalior, Indore and Malwa (i.e. the erstwhile State of Madhya Bharat) into the new State of Madhya Pradesh, the State of Madhya Bharat had passed the Irrigation Act, Samvat 2007 (Act No. 39 of 1950) (hereinafter called M. B. Act of 1950). Section 39 of this Act prescribed a levy for canal water supplied for purposes of irrigation to the occupiers of land, and for this purpose rules were to be framed by the Government, but the erstwhile State of Madhya Bharat had not framed any rules in accordance with the provisions of this Act, but instead, two notifications, viz. M. B. Government, Jan Karya Vibhag Notification No. 1100: 8/Irr./140: 51 dated 10-1-1954 (Ann. A) and Notifn. No. 6942/8/Irrig./566/ 54 dated 29-9-56 (Ann. B) were issued by the Madhya Bharat State Government in the name of Rajpramukh, prescribing the rate of charges for water to be supplied from canal for irrigating sugar-cane crop. The petitioner company had been using the canal water for irrigating their sugarcane-crop, and for that, it was charged the rate meant for Adsali sugar cane crop, viz- at the rate of Rs. 28/2/-per acre, as per the provisions of the notifications issued in the name of Rajpramukh, on 29-9-1956 (Ann. B). After the merger of the State of Madhya Bharat into the new State of Madhya Pradesh, the Madhya Pradesh Extension of Laws Act, 1958, was passed and came into force with effect from the 1st January 1959. Section 6 of this Act deals with 'Repeal and Savings'. The 'Proviso' under this Section runs as under -

'Provided further that, subject to the preceding proviso, anything done or any action taken (including any appointment or delegation made, notification, order, instruction or direction issued, rule, regulation, form, bye-law or scheme framed, certificate obtained, patent, permit or licence granted or registration effected) under any such law shall be deemed to have been done or taken under the corresponding provision of the Act as now extended to that region, and shall continue to be in force accordingly, unless and until superseded by anything done or any action taken under the said Act.'

In the year 1964, the Madhya Pradesh Legislature passed the Act of 1964 to validate prescription, and assessment etc. of the water rates under the Madhya Bharat Act of 1950. Thereafter, the respondents initiated proceedings against the petitioner Company for recovery of the levy of water used by them from the canal at the rate prescribed for irrigating Adsali sugar-cane crop, provided by the aforesaid notifications, which, according to the petitioner company are illegal as the Act of 1964 passed by the Legislature is ultra vires of the powers of the State Government.

3. The respondents, on the other hand, have averred that the Act of 1964 passed by the Madhya Pradesh State Legislature was within their competence, and the assessment and collection of dues at the rates prescribed is proper with effect from 1-4-1954, as the Act was retrospective in its application. It was also alleged that the Adsali variety of sugar-cane cultivation was well-known to the petitioner company, and the assessment made was proper.

4. Shri R. K. Tankha, the learned counsel for the petitioner, has raised three contentions before us. The first is, that the Act of 1964 passed by the new State of Madhya Pradesh is ultra vires of the legislature on the ground that the Madhya Bharat Act of 1950 had made no provision for assessment, and further, no rules were framed by the Madhya Bharat Legislature, as were provided by that Act, and the notifications issued in the name of the Rajpramukh (Annexures A and B) could not be deemed to be the rules framed under the aforesaid Act. For this contention, he relied on Shri Prithvi Cotton Mills Ltd. v. Broach Borough Municipality 1969-2 SCC 283 = (AIR 1970 SC 192). The second contention of the learned counsel was, that as the petitioner company had not entered into any written agreement with the Irrigation Department, no penalty could be imposed. Lastly he urged that the notification dated 29-9-1956 prescribing water rate for irrigating the Adsali sugar-cane crop from canal water, was effective from 1-10-1956, and so the respondents were not legally competent to charge this rate with retrospective effect from 1-4-1954, as there was no such provision or order for charging this rate between the period from 1-4-1954 to 1-10-1956.

5. Shri K. K. Dube, the learned Additional Government Advocate, on behalf of the respondents, on the other hand, urged before us that it was competent for the State legislature to pass the Irrigation Act of 1950 and prescribe rates for the supply of water for irrigating the sugar-cane crop and other grains, and therefore, the Act of 1964 was proper, and the rates charged and duesassessed thereunder are proper, the Act being retrospective in application. In support he cited the ruling in Udai Ram Sharma v. Union of India, AIR 1968 SC 1138.

6. In order to appreciate the contentions raised before us, it would be proper to refer to certain material provisions of the Madhya Bharat Irrigation Act of 1950, as well as the Act of 1964 passed by the Madhya Pradesh State Legislature. Section 34 of the Madhva Bharat Act of 1950 provides that in the absence of any written contract or so far as any such contract does not extend, every supply of canal water shall be deemed to be given at the rates and subject to the conditions prescribed by the rules to be made by the Government in respect thereof, and Section 39 is the charging section, which provides that the rates to be charged for canal water supplied for the purposes of irrigation to the occupiers of land, shall be determined by the rules to be framed by the Government, and such occupiers as accept the water, shall pay for it accordingly.

7. It is true that no rules were framed by the erstwhile Government of Madhya Bharat as laid down by the Act of 1950. In Section 39, relating to the water rates to be charged, and instead, there were issued two Government notifications under the name of the Rajpramukh, prescribing such rates as aforesaid. It is true that these were executive orders and could not be deemed to be the rules framed under the Act by the legislature. After the merger of the State of Madhya Bharat into the new State of Madhya Pradesh, Madhya Pradesh Extension of Laws Act, 1958, came into force and Section 6 of this Act, as aforesaid, saved Orders, notifications instructions etc., which were issued under the repealed Madhya Bharat Irrigation Act of 1950. Section 2 of the Act of defines 'Adsali sugarcane', and Section 3 deals with the validation of the water rates. Sub-section (2) of Section 3 and Sub-section (3) of Section 3 which are material for our purpose, read as under:--

'3 (1) x x xx xx (2) Notwithstanding any judgment, decree or order of any Court, the water rate prescribed for Adsali Sugarcane by the Notification specified in the Schedule as Item 4 shall be and shall always be deemed to have been prescribed and operative with effect from 1-4-1954.

(3) The validity of the order and the notification specified in the Schedule as modified under Sub-section (2) with respect to operation of the notification shall not be called in question in any Court on any ground whatsoever.' In short, it validates the notifications (Annexures A and B) issued in the name of the Rajpramukh on the 10th February 1954 and 29th September 1956.

8. Now the question that arises. Is whether it was ultra vires of the State Legislature to pass the aforesaid Act.

9. It is quite clear from Entry No. 17. List II (State List) in Schedule VII (II) of the Constitution of India, which runs' as follows:--

'Water, that is to say, water supplies, irrigation and canals, drainage and embankments, water storage and water power subject to the provisions of Entry 56 of List I.'

that it empowers the State Legislature to pass an enactment on the subject, and If the Legislature had the power over the subject-matter and competence to make a valid law, it could at any time make such a valid law and make its application retrospective so as to bind even the past transactions, and this is what the Madhya Pradesh Legislature has done. See AIR 1968 SC 1138. In paragraph 25 of the aforesaid ruling, their Lordships have observed as follows -

'The power to legislate for validating actions taken under statute which were not sufficiently comprehensive for the purpose is only ancillary or subsidiary to legislate on any subject within the competence of the legislature and such validating Acts cannot be struck down merely because Courts of law have declared actions taken earlier to be invalid for want of jurisdiction. Nor is there any reason to hold that in order to validate action without legislative support the Validating Act must enact provisions to cure the defect for the future and also provide that all actions taken or notifications issued must be deemed to have been taken or issued under the new provisions so as to give them full retrospective effect. No doubt legislatures often resort to such practice but it is not absolutely necessary that they should do so, so as to give full scope and effect to the Validating Acts.'

The ruling cited by Shri Tankha is distinguishable from the facts of the instant case, and in principle supports the view we have taken of the matter. Simply because the Government of Madhya Bharat did not frame any rules under the Act of 1950, and only issued notifications in question (viz. Annexures A and B) in the name of Rajpramukh which are in the nature of executive orders, it cannot be said now after the enactment of the Act of 1964, that the respondents were not competent to charge the rates for water used for Adsali sugarcane crop as prescribed by the Act. It is also worthy of note that we were shown three agreements executed by the Company, and one is of 20th October 1954, which mentions Adsali sugarcane, which means that this was already known to the Company. Thus, this contention of Shri Tankha has no substance.

10. As regards his second contention. Chapter 9 of the Madhya Bharat Irrigation Act of 1950 deals with the offences and penalties, and the penalty has to be imposed by a Magistrate under the circumstances in accordance with the provisions contained therein- There is no such case here. No agreement has been brought on record to show that in case of any breach, the petitioner company was to become liable for a penalty. So, in the absence of both the conditions, we are of the view that the respondents were not competent under the law to impose any penalty on the petitioner company.

11. The last contention raised by the learned counsel for the petitioner, has also no force. When the Act of 1964 clearly lays down in Sub-section (2) of Section 3 that the water rate prescribed for Adsali sugarcane by the Notification specified in the Schedule as Item 4 shall be and shall always be deemed to have been prescribed and operative with effect from the 1st April, 1954 (vide Ann. B, dated 29-9-1956), the respondents are surely entitled, according to law, to charge that rate.

12. In the result, therefore, the writ petition is allowed only to the extent that the penalty levied in the assessment of water rate charges is quashed. There shall be no order as to costs. The petitioner company shall be entitled to the refund of the security deposit in accordance with the rules.


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