LexVIJAY MILLS C'OMPANY LIMITED ETC. ETC. versus STATE OF GUJARAT AND ORS.
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A B VIJAY MILLS C'OMPANY LIMITED ETC. ETC. v. STATE OF GUJARAT AND ORS. DECEMBER 4, 1992 (P.B. SAWANT AND N. VENKATACHALA, JJ.] Bombay Land Revenue Code, 1879-Section 214-Amendment-Ef- f ect-V alidating provisions retrospectively-Legislative intention-What is. C Gujarat Land Revenue Rules, 1972-Rule 8(2)-Rate of assessment of non-agricultural lands-Enhancement--Opportunities to raise objections-- Principles of natural justice whether ignored. D Bombay Land Revenue Code, 1879-Section 48-Land revenue-As- sessment-Different rates on the basis of gradations of land-Legality of. The appellant-Company held a parcel of land admeasuring about 2 lakh square metres. Prior to 1st August, 1976, these lands were assessed as non-agricultural lands, at the rate of 2 paise per square metre under Rule 8(2) of the Gujarat Land Revenue Rules, 1972. The Rules were made under Section 214 of the Bombay Land Revenue Code, 1879, as applicable E to the State of Gujarat. F The Company paid a total land revenue of Rs. S,823.23 per annum. It also paid in addition to the land revenue, local fund cess and education cess each of which was calculated at the rate of SO per cent of the amount of the land revenue. On 21st July, 1976, the State Government published draft rules amending 1972 Rules. The rate of the assessment of the non- agricultural land was raised to 15 paise per square metre. G The State Government invited objections to the draft rules before 30th July, 1976. Since no objections were received, the State Government made the draft rules final and published them on 31st July, 1976 bringing them into force w.e.f. 1st August, 1976. Several writ petitions challenging the Amendment Rules were tiled H in the High Court. 324 .·• • • VUAYMILLSCO. v. STATEOFGUJARAT 325 One of the contentions in the petitions was that sufficient time was A not given to raise objections to the draft rules. During the pendency of the writ petitions, the State Government on 28th June, 1977 withdrew the notification dated 31st July~ 1976 and granted time of one month from 28th June, 1977 to object to the draft rules published on 21st July, 1976. After considering the objections received, the State Government issued a fresh notification on 24th January, 1978 issuing final rules which were brought into force with retrospective effect from 1st September, 1976. Under the 1977 Rules, the rate of assessment was increased from 2 paise to 10 paise per square metre. On 10th December, 1980, by an ordinance, the State Government also amended Section 214 of the Code to enable the Government to give B c the rules made thereunder a retrospective effect. The ordinance became an D Act on 24th February, 1981. The writ petitions were filed before the High Court challenging the validity of 1977 Rules. The High Court held that the Amendment Rules of 1977 were not E ultra vires of Section 48 and/or Section 45 and/or Section 52 of the Code or Article 14 of the Constitution. It further held that the attempt to validate the levy, assessment and collection of the non-agricultural assessment by the Gujarat Ordinance No. 20 of 1980 or for that matter by the Gujarat Act No. 2 of 1981 was not to all intent and purposes abortive. But the High Court struck down Rule 81(2) of the Amendment Rules of 1977. Against the decision of High Court the present appeals were filed before this Court. F The appellants contended that the 1977 Rules promulgated on 24th - January, 1978 and brought into force retrospectively from 1st September, G 1976 were ultra vires and void to the extent that they retrospectively im110sed a higJ-er rate of land revenue on land used for industrial purpose; that Section 214 of the Code did not give the State Government power to frame rules with retrospective effect; that the Bombay Land Revenue (Gujarat Amendment and Validation) Ordinance (which later became an H 326 SUPREME COURT REPORTS [1992] SUPP. 3 S.C.R. A Act) amending Section 214 of the Code though gave the State Government a power to make rules with retrospective effect, Section 214 itself was not substituted with retrospective effect but only came into force on 24th February, 1981; that the validation of the Section was ineffective in so far as it sought to confer power on the State Government to make rules with B retrospective effect from a date anterior to 24th February, 1981; that the retrospective impo~ition of land revenue was arbi
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