- (1.) The short question which arises in this appeal filed on certificate by Godavari Sugar Mills Ltd. and its two shareholder directors against the judgment of the Bombay High Court is the constitutional validity of Maharashtra Agricultural Lands (Ceiling on Holdings) Act 1961(Maharashtra Act No. 27 of 1961) (hereinafter referred to as the principal Act) as amended by Maharashtra Acts Nos. 16 of 1968 33 of 1968, 37 of 1969 and 27 of 1970. The High Court has upheld the validity of the Act on the ground that it is protected by Articles 31A and 31B of the Constitution.
(2.) The principal Act came into force on January 26, 1962. According to its long title, it was an Act to impose a maximum limit (or ceiling) on the holding of agricultural land in the State of Maharashtra to provide for the acquisition and distribution of land held in excess of such ceiling; and for matters connected with the Purposes aforesaid. Section 3 of the Act deals with ceiling on holding of agricultural land. According to that section, in order to provide for the more equitable distribution of agricultural land amongst the peasantry of the State of Maharashtra (and in particular, to provide that landless persons are given land for Personal cultivation) on the commencement of the Act, there shall be imposed to the extent, and in the manner hereinafter provided, a maximum limit (or ceiling) on the holding of agricultural land throughout the State, Section 4 provides, that no person shall hold land in excess of the ceiling area while Section 5 specifies as to what area would constitute ceiling area under each class of land in specified local area. Returns have to be submitted to the Collector in respect of surplus land under Section 12 of the Act. Section 14 gives power to, the Collector to hold an enquiry for determining as to what area in respect of the holding of a person should be declared to be in excess of the ceiling area. On completion of the enquiry if the Collector finds the holding of a person in excess of the ceiling area, the Collector shall make a declaration under Section 21 of the Act about the area, description and full particulars of the land which is delimited as surplus land. The declaration is then notified under Section 21 (2) in the official Gazette. According to sub-section (4) of that Section, the Collector shall after the publication of the notification under sub-section (2) take in the prescribed manner possession of the land which is delimited as surplus land. It is further provided that the surplus land shall with effect from the date on which the possession there of taken as aforesaid be deemed to be acquired by the State Government for the purpose of the Act and shall accordingly vest free Government. Section 27 makes provision for the distribution of the surplus land. Section 28 of the Act makes provision in respect of land taken over from industrial undertaking to ensure supply of raw material. The Section as it stood before its amendment by Act 33 of 1968 read as under: "28. (I) Where any land held by an industrial undertaken is acquired by, and vests in the State Government under Section 21, such land being land which was being used for the purpose of producing or providing raw material for the manufacture or production of any goods, articles or commodities by the undertaking, the State Government shall take particular care to ensure that the acquisition of the land does not affect adversely the production and supply of raw material from the land to the undertaking. (2) Notwithstanding anything contained in section 27, but subject to any rules made in this behalf for the purpose of so ensuring the continuance of the supply of such raw material to the undertaking, and generally for the full and efficient use of the land for agriculture and its efficient management, the State Government (a) may, if it is in the opinion of that Government necessary for the purpose aforesaid (such opinion being formed after considering the representation of persons interested therein) maintain the integrity of the area so acquired, in one or more compact blocks, and (b) may, subject to such terms and conditions [including in particular, conditions which are calculated to ensure the full and continued supply of raw material to the undertaking at a fair price), grant the land or any part thereof to a joint farming society (or a member thereof) consisting as far as possible, of (i) persons who had previously leased such land to the undertaking, (ii) agricultural labour (if any) employed by the undertaking on such land. (iii) technical or other staff engaged by the undertaking on such land. or in relation to the production or supply of any raw material. (iv) adjoining landholders who are small holders (v) landless persons:Provided that the State Government may - (a) for such period as is necessary for the setting up of joint farming societies as aforesaid being not more than three years in the first instance (extensible to a further period not exceeding two years) from the date of taking possession of the land, direct that the land acquired, or any part thereof, shall be cultivated by one or more farms run or managed by the State, or by one or more corporations (including a company) owned or controlled by the State; (b) grant to the landlord so much of the surplus land leased by him to the undertaking, which together with any other land held by him does not exceed the ceiling area (but if the landlord be a public trust and the major portion of the income from the land is being appropriated for purposes of education or medical relief, grant the entire land to the public trust) on condition that the landlord, or as the case may be, the public trust lease the land to a farm or corporation described in clause (a) aforesaid, and thereafter, in the case of a landlord (not being a public trust) that he becomes a member of the joint farming society, and in the case of a public trust, that it leases the land to a joint farming society. (3) The State Government may provide that. (a) for the breach of any term or condition referred to in clause (b) of sub-section (2), or (b) if the landlord to whom the land is granted fails to lease the land to the farm or corporation or to become a member of a joint farming society: (c) if it considers after such inquiry as it thinks fit, that the production and supply of raw material to the undertaking is not maintained at the level or in the manner which, with proper and efficient management it ought to be maintained, or (d) for any other reason it is undesirable in the interest of the full and efficient cultivation of the land that the joint farming society should continue to cultivate the land. the grant shall, after giving three months' notice of termination thereof and after giving the other party reasonable opportunity of showing cause be terminate and the land resumed.Thereafter, the State Government may make such other arrangements as it thinks fit for the proper cultivation of the land and maintenance of the production and supply of raw material to the undertaking."
(3.) At this stage we may advert to the facts giving rise to the present appeal. The appellant company owns two factories for the manufacture of sugar and allied products. The company held large areas of land in Ahmednagar district for the cultivation of sugarcane for its factories. On March 1, 1963 Special Deputy Collector respondent No. 2 declared an area of 8468 acres 26 1/2 gunthas in village Sakarwadi held by the appellant company to be in excess of the ceiling area. On March 7, 1963 Special Deputy Collector respondent No. 1 passed an order declaring 3677 acres 16 gunthas of appellant company's land situated in Lakshmiwadi to be in excess of the ceiling area. Thus a total area of 12146 acres 1/2 guntha was declared to be surplus. Appeals against the aforesaid orders were filed by the appellant company to the Maharashtra Revenue Tribunal. The appellants and some others also filed petitions challenging the constitutional validity of the principal Act. A Division Bench of the Bombay High Court as per judgment dated October, 25, 1963 delivered in a petition filed by another party upheld the constitutional validity of all the provisions of the principal Act, except Section 28 which was struck down. It was held that the provisions of the Act other than Section 28 were a measure of agrarian reform and as such protected by article 31A of the Constitution. Section 28 was held to be violative of article 14 of the Constitution.;