- (1.) JUDGMENT :- This appeal by special leave arises from the judgment of the Division Bench of Bombay High Court passed in Writ Petition No. 1509 of 198 1/11/1989. The primary question is : whether the State legislature has power to levy rates of cess on use of flowing water from the river 'Wana'.
(2.) THE facts are as under. THE appellant had installed a mill in the year 1898 and has been drawing water for industrial purpose from the said river by installing water pumps at its bank with the help of artificial contrivance. Under Section 70 of the Maharashtra Land Revenue Code, 1966, (for short, 'the Code'), the Government of Maharashtra passed the following Resolution on 5/06/1972 thus : "In exercise of the power conferred in it by Section 70 of the Maharashtra Land Revenue Code, 1966, the Government is pleased to sanction the following rates for the use of water (the right to which vest in Government and in respect of which no rate is liable under any law in force in any part of the State) for non-agriculture purpose. JUDGEMENT_12_6_1997Html1.htm THE Collector or such other officer as may be authorised in that behalf should fix the water rates in accordance with rates sanctioned above. THEse orders supersede all the prevalent orders for practice in regard to the quantum or the rates chargeable under Section 70 of the Maharashtra Land Revenue Code, 1966. THEse orders were issued with the concurrence of the Finance Department vide in Official reference No. 7041 dated 29/04/1972." The Tehsildar of Hinganghat on the appellant levied cess in the sum of Rs. 18,348.30 for the period from 1967-68 to 1973-74 on the use of water for industrial purpose. The appellant, feeling aggrieved, filed an application under Section 20(2) of the Code before the Sub-Divisional Officer, Hinganghat, challenging the demand of cess, dated 19/12/1974, inter alia, contending that he had easementary right to draw flowing water from the river, Wana, uninterruptedly and continuously since he had been so drawing the water for over 70 years; that it had perfected as his prospective right to draw water from the flowing river, and the Government is, therefore, devoid of any power to levy cess on the use of water. The Sub-Divisional Officer dismissed the application after considering necessary evidence. The appeal filed by the appellant against the order of the Sub-Divisional Officer also was dismissed. The Commissioner, Nagpur dismissed the revision. Thereafter, the appellant after filing unsuccessful revision petition before Revenue Tribunal, filed a writ petition in the High Court. The High Court has found that the Government has power to levy cess on water; the resolution, therefore, passed by the Government under Section 70 of the Code is within the legislative competence under Article 246 of the Constitution of India. Accordingly, it upheld the action of the respondent. On leave being granted and a reference having been made to three-Judge Bench, the matter has come up before us.
(3.) SHRI Sanghi, learned counsel for the appellant contends that the Code envisages collection of land revenue from agriculturists for use of water for cultivation purpose. Admittedly, the use of water by the appellant, is for industrial purpose. By operation of Section 70 read with Section 20 of the Code, land revenue is relatable to levy on land of cess on the water used for agricultural purpose. Therefore, the Resolution is clearly illegal. Even if it is construed that the Resolution is valid, the legislature lacks competence to enact law since neither Entry 18 nor Entry 45 or Entry 49 of List are available to sustain the demand under Section 70; therefore, it cannot be construed that Section 70 is law made under any of the Entries. As a consequence, he is entitled to the relief. He further contends that in view of the fact that the High Court has recorded a finding that the appellant has a natural right to draw water from the flowing river, the appellant cannot be made to make payment which has no legislative sanction. Alternatively, as the last straw on the camel's back, learned counsel for the appellant contends that the Collector has no power to levy cess with retrospective effect. Shri Andhyarujina, learned Solicitor General, on the other hand, contends that though the appellant has been using the water for industrial purpose, he is using the water by artificial contrivance, drawing water from the flowing river; the levy of cess stands vested in the State; and, therefore, the State has power to regulate the payment of cess. The Resolution came to be passed in exercise of the power under Section 70 of the Code relating to the mode of payment and the manner in which the land revenue or cess can be computed. Sub-sections (2) and (3) of Section 20, are the essential provisions providing for the appellate remedy which the appellant has availed of. List II Entries, namely, Entries 18, 45 and 49 are to be read with reference to the use to which land and water are put. Water is nothing but integral part of land; without land, water does not exist. Section 70 would come within Entry 45 since it relates to the use of land or water regulated in the rural India. Entry 49 relates to use of land or water in the urban area. Since the factory of the appellant is situated in a rural area, Entry 45 is the appropriate Entry and is required to be broadly interpreted so as to bring back within the legislative competence under Article 246 of the Constitution. He further contends that though the appellant had been using the water for a period of 70 years, he does not have a natural right which right is exercised with the help of artificial contrivance for carrying on industrial activity. That finding of the High Court is not correct since the appellant has been using the water for industrial purpose. The levy as land cess can be used by operation of Section 70 read with Section 20 and the definition of the word 'land' and 'land revenue' respectively under the Code. He also contends that though the demand can be made under Section 70 read with the Resolution passed by the Government, since the Legislature has authorised under Section 70 the Collector to levy and collect the demand and the Collector having made the impugned demand in the year 1972, the demand could only be prospective and it cannot be given retrospective effect.;