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REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.4123 OF 2012

Gohil Jesangbhai Raysangbhai & Ors.       …    Appellant (s)

            Versus

State of Gujarat & Anr.       …    Respondent (s)

WITH  

CIVIL APPEAL NO.4124 OF 2012  

CIVIL APPEAL NO.4125 OF 2012  

CIVIL APPEAL NO.4126 OF 2012  

CIVIL APPEAL NO.4127 OF 2012  

CIVIL APPEAL NO.4129 OF 2012  

CIVIL APPEAL NO.4130 OF 2012  

CIVIL APPEAL NO.4131 OF 2012  

CIVIL APPEAL NO.4132 OF 2012  

CIVIL APPEAL NO.4133 OF 2012  

CIVIL APPEAL NO.4134 OF 2012

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CIVIL APPEAL NO.4135 OF 2012  

J  U  D  G  E  M  E  N  T

H.L. Gokhale J.   

 All  these  Civil  Appeals  raise  the  questions  with  

respect to the validity of Section 43 of Bombay Tenancy and  

Agricultural  Lands  Act,  1948 as  applicable  to  the  State  of  

Gujarat,  now  known  in  the  State  of  Gujarat  as  Gujarat  

Tenancy and Agricultural Lands Act, 1948 (“Tenancy Act” for  

short).  This section places certain restrictions on the transfer  

of land purchased or sold under the said Act.  These appeals  

raise  the  questions  also  with  respect  to  the  validity  of  

resolution  dated  4.7.2008  passed  by  the  Government  of  

Gujarat to give effect  to this section,  and which resolution  

fixes  the  rates  of  premium  to  be  paid  to  the  State  

Government  for  converting,  transferring,  and  for  changing  

the use of land from agricultural to non-agricultural purposes.  

Thirdly,  these  appeals  seek  to  challenge  the  minimum  

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valuation of land as per the rates contained in the list called  

as “Jantri” prevalent since 20.12.2006.

2.  The Tenancy Act was passed way-back in the year  

1948,  as a beneficial  legislation and as  a  part  of  agrarian  

reform.   This  section  has  been  amended  twice  thereafter,  

first in 1960 and then in 1977.  The aforesaid challenge was  

first  taken  in  the  High  Court  of  Gujarat  by  filing  various  

Special Civil Applications (i.e. Writ Petitions) bearing Spl. C.A.  

No.12661 of 1994 and others which came to be dismissed.  

Thereafter  the  Letter  Patent  Appeals  bearing  Nos.1127  of  

2008 and others were filed against the judgments rendered  

by Single Judges in these different Special Civil Applications.  

The judgment rendered by a Division Bench dated 3.5.2011  

in a group of these Letter Patent Appeals and Special Civil  

Applications once again repelled the challenge.  This common  

judgment  has  led  to  this  group  of  12  Civil  Appeals.   The  

issues raised in these Civil Appeals are by and large similar,  

though there are some additional  points  in  some of  these  

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Civil  Appeals  depending  upon  the  facts  of  each  of  those  

cases.   

3. Mr.  Huzefa  Ahmadi  and  Mr.  P.H.  Parekh,  both  

senior counsel, and Mr. Bharat Patel, learned counsel, have  

amongst others appeared for the appellants.  Mr. Rohinton  

Nariman,  senior  counsel  and  Ms.  Hemantika  Wahi  have  

appeared for the State of Gujarat and its officers to defend  

the impugned judgment.

4. The above referred Section 43 of the Tenancy Act  

reads as follows:-

“43. Restriction  on  transfers  of  land  purchased or sold under this Act.- (1) No land  or  any  interest  therein  purchased  by  a  tenant   under section 17B, 32, 32F, 32-I, 32-O, 32U, 43-ID   or 88E or sold to any person under section 32P or   64 shall be transferred or shall be agreed by an   instrument  in  writing to  be transferred,  by sale,   gift,  exchange,  mortgage,  lease  or  assignment,   without the previous sanction of the Collector and  except  in  consideration  of  payment  of  such   amount as the State Government may by general   or special  order determine; and no such land or   any interest, there shall be partitioned without the   previous sanction of the Collector.

Provided that no previous sanction of the Collector   shall  be  required,  if  the  partition  of  the  land  is   among the members of the family who have direct   blood  relation  or  among  the  legal  heirs  of  the   tenant:

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Provided further that the partition of the land as   aforesaid  shall  not  be  valid  if  it  is  made  in   contravention of the provisions of any other law  for the time being in force;

Provided also that such members of the family or   the  legal  heirs  shall  hold  the  land,  after  the   partition,  on  the  same  terms,  conditions,   restrictions  as  were  applicable  to  such  land  or   interest thereat therein purchased by the tenant   or the person.

(1A) The sanction under sub-section (1) shall   be given by the Collector in such circumstances   and  subject  to  such  conditions,  as  may  be   prescribed by the State Government.  

(1AA) Notwithstanding  anything  contained in sub-section (1), it shall be lawful for   such tenant or a person to mortgage or create a   charge on his interests in the land in favour of the   State  Government  in  consideration  of  a  loan   advanced to him by the State Government under   the  Land  Improvement  Loans  Act,  1884,  the  Agriculturists’ Loan Act, 1884, or the Bombay Non- Agriculturists’ Loans Act, 1928, as in force in the   State  of  Gujarat,  or  in  favour  of  a  bank  or  co- operative  society,  and  without  prejudice  to  any  other remedy open to the State Government, bank   or co-operative society, as the case may be, in the   event of  his making default  in payment of  such   loan in accordance with the terms on which such   loan was granted, it shall be lawful for the State   Government, bank or co-operative society, as the   case may be, to cause his interest in the land to   be  attached  and  sold  and  the  proceeds  to  be   applied in payment of such loan.

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Explanation, - For the purposes of this sub-section,   “bank” means –

(a) the State Bank of India constituted under the  State Bank of India Act, 1955;

(b) any subsidiary bank as defined in clause (k)   of section 2 of the State Bank of India (Subsidiary   Banks) Act, 1959;

(c) any  corresponding  new bank  as  defined  in   clause (d) of section 2 of the Banking Companies   (Acquisition  and  Transfer  of  Undertakings)  Act,   1970;

(d) the Agricultural Refinance and Development   Corporation,  established  under  the  Agricultural   Refinance  and  Development  Corporation  Act,   1963.

(1B) Nothing  in  sub-section  (1)  or  (1AA)  shall   apply to land purchased under section 32, 32F or   64 by a permanent tenant thereof, if prior to the   purchase,  the  permanent  tenant,  by  usage,   custom, agreement or decree or order of a court,   held  a  transferable  right  in  the  tenancy  of  the   land.

(2) Any transfer or partition, or any agreement of   transfer,  or  any  land  or  any  interest  therein  in   contravention of sub-section (1) shall be invalid.”

5. The English  version  (as  incorporated  in  the  

impugned judgment)  of  Gujarat Government Resolution  

dated 4.7.2008 to  give  effect  to  this  section,  and which  

resolution lays down the rates of premium reads as follows:-

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“Regarding brining simplification in the procedure of   converting  the land of  new tenure  under new and  impartible tenure and under the restricted tenure of   Tenancy Act into old  tenure for  the agricultural  or   Non-agricultural purpose.

Government of Gujarat Revenue Department

Resolution No.NSJ-102006-571-J (Part-2) Sachivalaya Gandhinagar.

Dated 04/07/2008

Preamble:- The  prior  permission  of  the  Collector  shall  be   required to be obtained after making payment of the  consideration prescribed by the State Government,   by issuing special  or  general  order for  transferring   any land purchased by the tenants, under Sections-   17-kh,  32,  32-chh,  32-t,  32-d,  32-bh  &  43-1-gh  or   Section 88-ch or any land sold to any person under   Sections 32-g or 64, as per section-43 (1) of Bombay   Tenancy & Agricultural Lands Act 1948 or its interest,   sale,  gift,  transfer,  mortgage,  lease  or  transfer  of   name or executing written present for transfer or any  interest.   Without obtaining prior permission of the  Collector, partition of any such land or any interest   therein can not be made.  According to Section 43(1- A), the Collector is required to grant permission as   per the circumstances prescribed by the Government  and as per Section 73-kh of Bombay Land Revenue  Code, 1879, by virtue of this Act or by virtue of any   condition  connected  with  type  of  tenure,  without   prior permission of State Government, the Collector   or any officer authorized by the State Government,   any land holding can not be transferred in the name  of another person or its partition can not be made.   On making payment of the amount prescribed by the  State  Government  by  a  special  or  general  order,   such permission can be granted.

The prior permission of the Collector/Government is   required  to  be  obtained  for  transfer,  change  of   purpose or partition of the rented land (including the  land  allotted  to  the  Ex-armymen),  and  the  land  granted  or  re-granted  under  different  tenure  and   

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under Inami Abolition Act allotted for the agricultural   purpose vide different resolutions of the Government   and land reserved for cattle.  The State Government   has implemented the policy in respect of converting   such  land  in  old  tenure  so  that  there  may  be  simplification  in  transfer  of  land  known  as  new  tenure and in other transaction.

According to the resolution No.JMN/3997/83/A dated  15/01/98 of the department, at the time of granting  such  land  wherein  the  interest  of  Government  is   included for non-agricultural purpose, the procedure   of the assessment of the value of the land is being  conducted through the Committee at District  Level   and  Sate  Level.   Much  time  is  consumed  in  this   procedure  of  assessment  of  value  at  the  various   stages  and  the  time  limit  is  not  prescribed  for   assessment of value.  Considering all these facts, the   State  Government  had  decided  to  adopt  the   approach valuation based on Jantri  vide Resolution   dated 20/12/2006 No.NSHJ/102006/571/J.   The time  of  public  shall  be  saved  by  its  acceptance  and  uniformity in respect of valuation in the entire State  shall  be  maintained.   Thus,  it  was  under  consideration  of  the  Government  to  bring   simplification by applying the procedure of valuation   based  on  jantri  by  making  change  in  existing   valuation  procedure  and by  putting  into  force  one  resolution  in  this  regard  instead  of  different   resolutions.

-:: R E S O L U T I O N ::- On  the  basis  of  the  letter  No.STP/102008/174/H.1   dated 31/03/2008 of  the  Revenue Department,  for   the purpose of Stamp duty, a new Jantri has been put   into  force  by  issuing  the  Circular  No.  Stamp/   Technical/07/08/1512  dated  31/03/2008  with  effect   from 01/04/2008 by the Superintendent of Stamps,   Gandhinagar.  After  studying  and  careful   consideration,  the  Government  has  held  that  the  valuation of the land of new and impartible tenure  and of restricted tenure type of Tenancy Act is to be   

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done  as  per  the  rate  of  Jantri  (as  per  Annual   Statements  of  rates-2006  and  as  per  the  amendments made from time to time).

By  consolidating  all  resolutions/circulars  existing   instructions  in  respect  of  valuation,  it  has  been  decided to follow the following procedure.

1. The  new policy  of  the  rates  of  premium for   converting  and  transfer/  for  change  of  purpose  of   land of new and impartible and restricted tenure land  from  agricultural  to  agricultural  purpose  or  non- agricultural purpose, shall be as under.

Sr. No.

Purpose Area Tenur e

Rate of  premiu m

Transfer at  which type of  tenure

1 2 3 4 5 6 1 From  

Agricultural  to the  purpose of  agricultural  old tenure

The  entire  rural  area of the State  except  following  Urban  Areas,  East,  area under  ULC,  Mahanagar  Palika  area,  Urban  Development  Authority  area,  Municipality  area,  Notified  area,  cantonment area

After  15  years

Zero It  shall  be  transferred  for  the  purpose  of  agricultural  at old tenure,  but  premium  shall  be  liable  to  be  paid for non- agricultural  purpose.

2 From  Agricultural  to the  purpose of  agricultural  old tenure

The  entire  rural  area of the State  except  following  Urban  Areas,  East,  area under  ULC,  Mahanagar  Palika  area,  Urban  Development  Authority  area,  Municipality  area,  Notified  area,  

After  15  years

50% It  shall  be  transferred  for  the  purpose  of  agricultural  at old tenure,  but  premium  is liable to be  paid for non- agricultural  purpose

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cantonment area  3 For Non-

agricultural  purpose

The  area  of  the  entire State

After  15  years

80% The  land  shall  be  considered of  old  tenure  after  sale/transfer  or  change of  purpose

The aforesaid policy shall be equally applied in the   entire State except the exception of the following (A)   and (B).

(A) At the time of transfer, when the land of rural   area of new and impartible tenure or restricted type  of  tenure  is  allotted  as  a  gift  or  present  to  the   Educational  or  Charitable  institutes  for  non- agricultural purpose, 50% amount shall be recovered  as premium.

(B) The following rates shall  be applicable to the   land  holding  under  Kutch  Inami  Abolition  Act  and  new and impartible tenure.

Sr. No.

Purpose Area Tenure Rate of  premium

Transfer at which  type of tenure

1 2 3 4 5 6 1 From  

Agricultural  to the  purpose of  agricultural  old tenure

Rural  Area

After  15  years

Zero It  shall  be  transferred for the  purpose  of  agricultural  at  old  tenure,  but  premium  is  liable  to be paid for non- agricultural   purpose

2 From  Agricultural  to the  purpose of  agricultural  old tenure

Urban  Area

After  15  years

20 (twenty)  times  amount  of  assessment

It  shall  be  transferred for the  purpose  of  agricultural  at  old  tenure,  but  premium  is  liable  to be paid for non- agricultural   purpose

3 For Non- The After 50% The  land  shall  be  

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agricultural  purpose

urban  and  rural  areas

15  years

considered  under  old  tenure  after  sale/transfer  or  change  of  purpose.

2. The procedure of  converting the land of new  tenure  into  old  tenure  for  the  purpose  of   agricultural to agricultural (for the purpose of   Sr.No. 1 & B(1) of the aforesaid para No.1).

(A) If  such  lands  of  New  Tenure  and  Restricted  tenure under Tenancy Act have been in continuous   possession for 15 year or more than it since its grant   to  the  last  date  of  every  month,  are  liable  to  be   converted  into  old  tenure  for  agricultural  purpose,   after  eliminating  the  entry  “New  &  Impartible   Tenure” and noting “liable for premium only for non- agricultural purpose” on its place, the Mamalatdar of   concerned Taluka on his own motion shall issue such  orders within 15 days and shall have to inform the   concerned holder in writing.   At the same time, it   shall be the responsibility of the Mamalatdar to get   the mutation entry of the said order entered into the  Right of Record and to get it certified as per rules.

(B) In the cases also wherein, the land is required   to  be  converted  from  agricultural  to  agricultural   purpose into old tenure by recovering 50% premium  or 20 times amount of assessment, the Mamalatdar   shall  have to issue orders as stated above in  2(A)   after recovering the premium.  In the case wherein  50% premium is required to be recovered in Urban  Area  for  agricultural  to  agricultural  purpose,  the  procedure  as  mentioned  in  paragraph  No.3  shall   have to be adopted.

(C) It shall be the responsibility of the Prant Officer   to see that the entry of such orders and its mutation   entry  are  made  in  record  without  fail.   The  Prant   Officer  shall  have to forward the certificate  to the   effect  that  any  such  entry  is  not  remained  to  be  entered in the record to the Collector  till  the date   25th of every month. (D) On finalization of the certified mutation entry   as per the aforesaid Sr.No.2 (A),  the details to the  

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effect  that  “liable  for  premium  only  for  non- agricultural  purpose”  shall  have  to  be  mentioned  certainly  in  bold  letters  in  column  of  tenure  and   other rights of Village Form No.7/12.

(E) If  breach of  tenure is committed in the land,   the procedure for breach of tenure shall be initiated   towards such land instead of  converting them into   old tenure.

(F) Moreover  at  the  time  of  granting  such  permission  if  there  is  any  encumbrance  upon  the  land,  then  the  abovementioned  concerned  officer   shall  have to  issue orders  accordingly  by  granting   permission  of  transfer  in  old  tenure  including   encumbrance.

(G) In the context of lacuna in respect of the order   issued  for  converting  the  land  of  new  tenure  including Tenancy Act into old tenure for agricultural   purpose  or  the  mutation  in  that  regard,  the  competent  authorities  shall  have  to  conduct  the   revision proceedings as per the standing instructions   issued by the Government.

(H) The above mentioned procedure shall have to  be reviewed in the meeting of Revenue officers held   by the Collector every month.

(I) In  the  case  of  breach  of  tenure,  for  this   purpose, 15 (fifteen) years shall have to be reckoned   from the date of order of regnant issued lastly.

3. Procedure  of  converting from New Tenure to   Old Tenure for Non-agricultural purpose.

(A) On receipt of application in prescribed form as  per Appendix –I by Collector, application shall have  to be forwarded to Mamlatdar office within 7 days   (Seven) for scrutiny as per check list.  On receipt of   such application after scrutiny, Mamlatdar shall have   to  submit  the  report  to  Prant  officer  within  20  (twenty) days after making all types of scrutiny and  site  inspection  and  the  Prant  officer  shall  have  to   forward  the  report  to  Collector  after  verification   within 10 days.

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(B) After  receiving  report  of  Mamlatdar  through   Prant Officer, after verifying all record, Collector shall   have to take decision within 30 (thirty) days and the   said decision shall have to be informed to concerned   person.  The calculation of the amount of premium  shall  have  to  be  made  as  per  the  rate  of  Jantri   prevailing on the date of decision.

(C) If premium is to be paid as per decision of the   Collector,  then  on  getting  such  information  the  concerned person shall have to pay the amount of   premium within 21 (twenty one) days.

(D) After depositing amount of such premium, the   Collector  shall  have  to  pass  order  in  this  regards   within 3 (three) days.

(E) If amount of premium is not paid within twenty   one days,  then assuming that concerned person is   not  interested  in  getting  permission  and  chapter   should  be  filed.   However,  in  some  cases,  if   concerned person submits an application then and if   Collector considers the reasons just, then as per the   merits of the case, by the reasons to be recorded in   writing,  instead  of  21  (twenty  one)  days,  the  Collector  can  extend  till  one  year  from  date  of   intimation of decision.  But if during this period there  is change in price of Jantri then premium shall have   to  be  recovered  accordingly.   After  one  year   applicant shall have to submit an application afresh.

(F) When the permission is required to be granted  to the charitable institutes for non-agricultural   purpose  after  recovery,  such  institution  is   required to have been registered under Public   Trust  Act.   In  this  regard  Certificate  of   registration  before  Competent  Authority/Charity  Commissioner  shall  have  to   be produced with file and audited accounts of   last three years.  If the purpose of applicant’s   institution is only for “No profit No loss” basis,   for charitable activities like Charitable hospital,   dispensary, cattle house, Library, Elder house,   Orphan House etc. then such institution shall   have to be considered as Charitable Institution.

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(G) The check list regarding chapters to be given  for prior permission at the Collector level and   departmental level shall  have to be prepared  as per Schedule-2 of herewith.  The Collector   can  call  for  check  list  and  necessary  information if he deems fit.

4. Delegation of Powers:-

(A) Now premium is required to be recovered on   the basis of Jantri,  all  powers of all area of district   shall be vested with Collector.

(B) Instead  of  forwarding  of  the  present  the  chapter regarding valuation of more than Rs.50/- lacs  to Government, the chapters regarding valuation of   more than Rs.1 crore shall have to be forwarded to   Government for prior permission.

(C) As per above 4(B), the permission shall have to   be  granted  by  making  verification  of  record  at   department level entirely in respect of  the chapter   received  by  the  department  and  by  obtaining  the   consent of the government.

5. Regarding considering rates of Jantri:

(A) When  sale  is  required  to  be  made  from  agriculture to agriculture purpose, the valuation shall   be  made  by  considering  rate  of  agriculture  Jantri   prevailing in Urban and Rural area.

(B) In rural area, when the land is used for non- agriculture  purpose,  valuation  shall  be  made  by   considering rates of Jantri for that purpose.

(C) In  urban  area,  for  non-agriculture  purpose,   valuation  shall  be  made after  considering  rates  of   Janri of developed land.

(D) When  non-agriculture  use  is  made  for   educational,  social,  charity  or  other  purpose,  then  valuation shall be made in rural area, by considering   rate  of  Jantri  for  residential  purpose  and  in  Urban  

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area,  by  considering  rate  of  Jantri  of  the  development land.

(E) The  Collector  shall  have  to  consider  rate  of   Jantri  which  are  applicable  to  zone,  ward  or  block   where the land is situated.  The rate of Jantri of other   zone, ward or block shall not be considered. (F) When  “rate  of  developed  land”  is  not   mentioned in  Jantri  of  the area,  valuation  shall  be  made  by  considering  the  purpose  and  rate  of   prevailing Jantri of the said area.

6. Procedure for disposal of pending chapters:-

(a) In  the  pending  chapters  in  respect  of  fixing   premium  at  district  level  and  state  level,  in  all   chapters wherein the decision is required to be taken  after 1/4/2008, the calculation of the premium shall   be made on the basis of the rate as per Jantri.

(b) The chapters  which  have not  been placed in   the  District  Valuation  Committee,  such  chapters   pending at District level, shall not be placed in the   District  Valuation  Committee,  but  their  valuation  shall  be  made  as  per  Jantri.   The  chapters  which   have  been  sent  to  the  Deputy  Town  Planner  for   valuation, shall be called back and calculation of the  premium shall be made on the basis of rate as per   Jantri.  

(c) The chapters decided by the District Valuation  Committee,  shall  also  be  disposed  again  at  the   Collector level by deciding the premium on the basis   of the rate of Jantri.

(d) The chapters pending at the state level, shall   not  be  sent  back  to  the  district  or  shall  not  be  produced in the Valuation Committee of State level,   but permission shall  be given by taking consent of   the Government and considering the rate of Jantri.

(e) The  pending  chapters  which  have  been  valuated in the office of the Chief Town Planner and  which  have  not  been  valuated,  shall  be  received  back  and  permission  shall  be  given  after  taking  

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consent of the Government and applying the price of   Jantri.

(f) The chapters sent back from the state level to   the  district  level  for  compliance,  shall  not  be sent   back in the department, but as per above instruction,   the Collector shall have to dispose the chapters by   deciding the price on the basis of Jantri.

(g) In  the  cases  where  the  chapters  have  been  received at the State level and necessity arises for   compliance on the basis of the record, the chapters   of  the  amount  upto  Rs.1/-  (one)  crore,  shall  be   disposed in accordance with rules by returning the  chapter and by making complete verification at the  Collector level as per the check list and by returning   the chapters be returned.

(h) In  the  chapters  remained  pending  at  the  district and the state level also, in all cases wherein   the permission order is required to be issued after 1- 04-2008 also, the orders shall have to be issued by   deciding the premium as per Jantri.

7. In  the cases of  land allotted under gifting  of   land (bhoo-dan) and under The Gujarat Agriculture   Land  Ceiling  Act,  1960,  any  provision  of  this   resolution shall not be applied.

8. On implementation of the aforesaid procedure,   the resolutions/circulars mentioned in appendix-3 in   toto  and  the  resolutions/circulars  mentioned  in   appendix-4 partly are superseded only for the part in   mentioned in column-4 of the Appendix-4.

In  this  manner,  on  account  of  superseding  the   resolution entirely or partly, the orders issued before  01/04/2008  shall  not  be  affected  under  the  provisions/instructions of these resolutions/circulars.

9. On  the  basis  of  the  policy  framed  vide  resolution  dtd.  20/12/2006  of  the  department  for   bringing in force the procedure of valuation based on   new  Jantri  with  effect  from  dtd.  01/04/2008,  this   issue  with  the  concurrence  of  finance  department   

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vide their note dtd. 15/05/2008 and 27/06/2008 on  this department file of even number.

By order and in the name of Governor of Gujarat,

[Anish Mankad] Joint Secretary, Revenue Department,

State of Gujarat.”

The consequent  requirements under  Section 43 read  with aforesaid resolution dated 4.7.2008

6. As  we  have  noted  earlier  the  Tenancy  Act  was  

passed as a part of the agrarian reform.  The Act as such does  

not  permit  transfer  of  agricultural  land  for  non-agricultural  

purpose, and the same is barred under Section 63 of the Act.  

That  section  permits  such  a  transfer  only  in  certain  

contingencies as provided under that Section.  Section 43 with  

which  we  are  concerned  in  the  present  matter  and  which  

appears  in  Part  III  of  Chapter  III  of  the  Act.   Chapter  III  

provides  for  Special  rights  and  privileges  of  tenants,  and  

contains  provisions  for  distribution  of  land  for  personal  

cultivation.   Part  III,  thereof,  provides  for  restrictions  upon  

holding of land in excess of ceiling area.  Section 43 has to be  

seen in this context.   

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7. The principal part of Section 43 lays down that the  

land  which  is  purchased  by  a  tenant  under  the  various  

Sections referred to in Section 43 shall not be transferred in  

any manner except as permitted in Section 43.  The original  

Section 43 did not contain any such exception.  The Gujarat  

(Amendment) Act No. XVI of 1960 introduced the words “on  

payment of such amount as the State Government may by  

general  or  special  order  determine”  in  Section  43.   The  

constitutionality  of  the section was examined by a Division  

Bench of the Gujarat High Court in Shashikant Mohanlal Vs.  

State of Gujarat  reported in  AIR 1970 Gujarat 204.  The  

Court held that the State is theoretically the owner of all the  

land, and occupants hold these lands under the State.  It was  

argued before the said Division Bench that this section does  

not lay down any guidelines.  However, the High Court held  

that the amount as introduced under the Amendment was the  

charge  which  the  State  was  seeking,  for  permitting  the  

transfer  since  the  occupancy  right  as  such  was  not  

transferable as of right.

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8. The validity of the above amendment of 1960 came  

up for consideration before the Supreme Court in the case of  

Patel Ambalal Gokalbhai Vs. State of Gujarat reported in  

1982 (3) SCC 316. This Court held that the Amendment was  

protected  under  the  9th Schedule  to  the  Constitution,  and  

therefore  immune  from  any  challenge.   Subsequently,  by  

Amendment Act No. XXX of 1977, the words “in consideration  

of  payment  of  such  amount…”  came  to  be  substituted  in  

place of the words “on payment of such amount…” Thus, the  

section now permits such a transfer by the tenant after the  

appropriate amount as determined by the State Government  

by a general or special order is paid by way of consideration,  

and  only  after  a  previous  sanction  is  obtained  from  the  

Collector  for  effecting  the  transfer.   Thus,  the  State  

Government has to lay down by general or special order the  

payment which is required to be made for such a transfer.  If  

the agriculturist is seeking such a transfer, he has to make  

the  necessary  payment,  and the transfer  will  be  permitted  

only after a prior sanction is obtained from the Collector.  The  

transfer is however not by way of a right.

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9. As  far  as  the  determination  of  this  amount  is  

concerned,  the  same  was  earlier  entrusted  to  the  District  

Level  Committee  or  the  State  Level  Committee  as  per  the  

Government  Resolution  dated  15.1.1998.   However,  the  

Government found that much time used to be consumed for  

determination  of  this  price  at  different  stages.   Besides,  

uniformity had to be brought in with respect to determination  

of  valuation  in  particular  areas.   Therefore,  the  State  

Government  decided  to  adopt  the  approach  of  valuation  

based on Jantri, i.e. the list of rates containing the minimum  

valuation  of  land  as  per  the  Government  Resolution  dated  

20.12.2006.  It is for this purpose that the aforesaid resolution  

dated 4.7.2008 was passed.  As can be seen from paragraph 4  

of  this  Resolution,  now  the  premium  is  required  to  be  

recovered  on  the  basis  of  the  Jantri,  and  all  the  powers  

concerning the transfers in the entire District are vested in  

the Collector.  The Jantri contains the rates which are fixed for  

the purpose of  valuation of  the land for  levying the stamp  

duty under the Bombay Stamp Act.  Those rates in the Jantri  

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are incorporated by virtue of this Resolution for the purpose of  

permitting these transfers.

Submissions of the appellants

10. The Resolution provides that the transfer shall  be  

permissible only after 15 years of possession of the land by  

the tenant.  The main grievance of the appellants is that for  

transfer of such lands in the entire State (except Kutch) from  

agricultural  to  non-agricultural  purposes,  the  premium  

payable  shall  be  80 per  cent  of  the  price  received by  the  

agriculturists  as  determined  as  per  the  Jantri  rates.   Thus,  

whatever  may be the price  mentioned in  the  document  of  

transfer,  the valuation of  the land will  be done as  per  the  

rates in the Jantri,  and 80 per cent of such amount will  be  

payable  to  the  State  for  permitting  such  a  transfer.   The  

contention of the appellants is  that the requirement of the  

payment  of  consideration  at  such  a  high  rate  amounts  

practically to expropriation, and is violative of Article 300A of  

the Constitution of India, which lays down that no person shall  

be deprived of his property save by authority of law.  Such  

high premium is arbitrary, unreasonable and unconscionable.  

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It is also pointed out that the applications for transfer are not  

decided quickly enough.  They are kept pending for a long  

time, whereby, the agriculturists seeking to transfer the land  

suffers.  

11. If we take two of the twelve cases which are before  

us,  we can see the submissions advanced on behalf of  the  

appellants in a factual matrix.  In Civil Appeal No.4129/2012  

the  appellant  Savitaben  represented  by  Mr.  Ahmedi  is  an  

agriculturist in Surat.  She made an application for conversion  

for non-agricultural purpose on 16.4.2003.  She is having a  

land  admeasuring  about  4,875  sq.  mts.  at  plot  No.  65  in  

revenue  survey  no.  90.   Another  application  in  the  same  

survey no. was decided on 4.7.2005 at the rate of premium of  

Rs. 700 per sq. mts.  The above referred Resolution came to  

be passed on 4.7.2008.  Her application though made earlier,  

was not decided until then.  It was decided thereafter, and she  

was asked to pay the premium at the rate of Rs.12000 sq. mts  

by order dated 7.8.2008 passed by the Collector on the basis  

of circle rates.  The case of one Kashiben, represented by Mr.  

Bharat Patel, is similar.  She is the appellant in Civil Appeal  

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No.4130/2012, and is having her property at Vadodara.  It is  

her  submission  that  because  of  the  application  of  this  

Resolution,  exorbitant  amount  is  being  sought.   The  

application is not being decided in reasonable time.  The land  

is  being  wasted  and  is  being  used  by  other  people  for  

dumping garbage.

12. It was submitted on behalf of most of the appellants  

that the land was in the possession and cultivation of their  

family from their forefather’s time, and they had a stake in  

the land.  It was submitted by them that they had paid the  

price to purchase the land under Section 32G of the Tenancy  

Act.  The land having been purchased for a price, it is not a  

largess given by the State.  Reliance was placed on paragraph  

43  and  44  of  the  judgment  in  Nagesh  Bisto  Desai  Vs.  

Khando  Tirmal  Desai  reported  in  AIR  1982  SC  887  to  

submit  that  the  purpose  of  prior  permission  was  only  to  

protect the tenant from selling the land at a throw away price,  

and not for the State to profiteer. It was then submitted that  

the  amount  to  be  charged  under  Section  43  was  at  the  

highest in the nature of a fee and not a tax and, therefore, it  

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has to be proportionate.  The Jantri rates were being applied  

in an arbitrary manner, and the premium at 80 per cent was  

unconscionable.   (It  must  however  be  noted  that  it  was  

pointed  out  on  behalf  of  the  Government  that  after  the  

judgment of the High Court, the premium has been reduced to  

40 per cent.)  It was also submitted that Rule 25C of the rules  

framed under the Act gives guidelines, and when read with  

that Rule,  Government cannot charge any dis-proportionate  

amount under Section 43 of the Act.  

13. It  was  submitted  that  it  is  the  date  of  the  

application which should be considered as the material date  

for deciding the valuation of the property, and not the date of  

the decision on the application by the Collector. Besides, the  

decision  on  the  application  cannot  be  indefinitely  delayed.  

Reliance  was  placed  on  paragraph  8,  11  and  12  of  the  

judgment  of  this  Court  in  Union  of  India  Vs.  Mahajan  

Industries Ltd. reported in 2005 (10) SCC 203  to submit  

that date of application is the material  date.  Reliance was  

also placed on the judgment of this Court in State of Gujarat  

Vs.  Patel  Raghav Natha  reported in  1969 (2) SCC 187  

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(para  11  and  12)  to  submit  that  the  decisions  in  revenue  

matters must be taken within reasonable time.  In the facts of  

that case it was held that it must be arrived at within 90 days.

14. On  the  concept  of  reasonableness,  reliance  was  

placed on paragraph 38 of the judgment in K.B. Nagur, M.D.  

(Ayurvedic) Vs. Union of India reported in  2012 (4) SCC  

483.  It was held therein that when no specific time limit is  

provided for  taking the decision,  the concept of reasonable  

time  comes  in.   It  was  submitted  that  good  governance  

required a timely decision and for that judgment of this Court  

reported in  Delhi Airtech Services Pvt. Ltd. Vs. State of  

Uttar Pradesh reported in  2011 (9) SCC 354  relied upon.  

(It  was  also  submitted  that  Section  43  should  be  read  

alongwith  Section  69  of  the  Act.)   The  period  for  decision  

making should at the highest be 90 days from the date of  

application.

Reply on behalf of the respondents

15. Mr. Nariman, learned senior counsel appearing for  

the respondents submitted that essentially the amount which  

was being charged under Section 43 (as it stands now) was by  

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way  of  consideration  for  the  permission  to  transfer  the  

agricultural  land for non agricultural purpose.   This amount  

which was being charged was a premium to be paid to the  

State, and this is because the land theoretically belongs to the  

State, and all the cultivators are holding the land under the  

State.  The kind of authority which the tenant acquired after  

making the necessary payment for purchase of the land under  

the statute was to cultivate the land himself.  The land was  

not to be put to non agricultural use, or else the tenant would  

lose the land under the provision of the statute, and it would  

be given to those who needed it for personal cultivation.  In  

his  submission,  the  premium  was  therefore  justified.   He  

informed us that after  the impugned judgment of the High  

Court, the premium has been brought down to 40%.  In his  

submission, the Jantri rate had to be applied on the date of  

sanction as  the  Section provided for  a  prior  sanction.   He,  

however,  accepted that  the  decision on  the application  for  

conversion  to  non-agricultural  purpose  has  to  be  in  

reasonable time.   

Consideration of the submissions

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16. We may at this stage refer to the judgment of the  

Division  Bench  of  the  Gujarat  High  Court  in  Shashikant  

Mohanlal (Supra) by P.N.Bhagwati, CJ as he then was in the  

High Court.  With respect to this co-relation between Sections  

32 to 32R of this statute and Section 43, the Division Bench  

observed as follows:-

“7. The Act as originally enacted in 1948 was   intended to regulate the relationship of landlord and   tenant with a view to giving protection to the tenant   against  exploitation by the landlord but  in  1956 a   major amendment was made in the Act introducing a   radical measure of agrarian reform. The Legislature   decided that the tiller of the soil should be brought   into  direct  contact  with  the  State  and  the  intermediary landlord should be eliminated and with   that  end  in  view,  the  Legislature  introduced  a   fasciculus of sections from Section 32 to S. 32-R and   S. 43.  These  sections  came  into  force  on  13th   December  1956  and  they  provided  for  the  tenant   becoming deemed purchaser of the land held by him   as  tenant.  Section 32 said  that  on  1st  April  1957  every  tenant  shall,  subject  to  certain  exceptions   which are not material for the purpose of the present   petitions,  be deemed to have purchased from him  landlord,  free  from  all  encumbrances  subsisting   thereon on the said day, land held by him as tenant   provided he was cultivating the same personally. If   the landlord bona fide required the land either for   cultivating  personality  or  for  any  non-agricultural   purpose, he could after giving notice and making an   application for possession as provided in Section 31,  sub-section (2), terminate the tenancy of the tenant   subject to the conditions set out in Sections 31-A to   31-D but if he did not take steps for terminating the   

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land within [five years] from the date of the coming into   force of this Act and the holder shall be deemed to be an   occupant within the meaning of the Code in respect of such   land and shall primarily be liable to pay land revenue to the   State Government in accordance with the provisions of the   Code and the rules made thereunder; all the provisions of   the  Code  and  rules  relating  to  unalienated  land  shall,   subject to the provisions of this Act, apply to the said land:

Provided that in respect of the watan land which has not   been assigned towards the emoluments of  the officiator,   occupancy price equal to six times of the amount of the full   assessment of such land shall be paid by the older of the   land for its regrant:

Provided  further  that  if  the  holder  fails  to  pay  the   occupancy  price  within  the  period  of  [five  years]  as   provided  in  this  section,  he  shall  be  deemed  to  be   unauthorisedly occupying the land and shall be liable to be   summarily ejected in accordance with the provisions of the   Code. (2) The occupancy  of  the  land regranted under  sub-section (1) shall not be transferable or partible   by metes and bounds without the previous sanction  of  the  Collector  and  except  on  payment  of  such  amount as the State Government may by general or   special order determine. (3) Nothing in [sub-sections (1) and (2)] shall apply to any   land-

(a)  the  commutation  settlement  in  respect  of  which   provides expressly that the land appertaining to the watan   shall  be  alienable  without  the  sanction  of  the  State   Government; or

(b) which has been validly alienated with the sanction of   the State Government under section 5 of the Watan Act. Explanation-For the purpose of this section the expression   “holder” shall include- (i) all  persons  who  on  the  appointed  day  are  the   

watandars  of  the  same watan  to  which  the  land   appertained, and

(ii) in the case of a watan the commutation settlement   in respect of which permits the transfer of the land   

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appertaining  thereto,  a  person  in  whom  the   ownership of such land for the time being vests.

(emphasis supplied)

19. This Section 4 came up for consideration before a  

bench of three Judges of this Court in  Nagesh Bisto Desai  

(supra), and in paragraph 43 this Court approved the scheme  

of  the  Section  under  which  the  transfer  is  subject  to  the  

sanction  of  the  Collector,  and  on  payment  of  requisite  

amount.  This paragraph reads as follows:-

43. It  still  remains  to  ascertain  the  impact  of   Sub-section (2) of Section 4 of Act No. 60 of 1950 and   Sub-section (3) of Section 7 of Act No. 22 of 1955, and   the  question  is  whether  the  occupancy  of  the  land   regranted  under  Sub-section  (1)  of  Section  4  of  the   former Act and Sub-section (2) of Section 7 of the latter   Act  is  still  impressed  with  the  character  of  being   impartible property. All that these provisions lay down  is that the occupancy of the land regranted under Sub- section (1) of Section 4 of the former Act shall not be   transferable or partible by metes and bounds without   the previous sanction of the Collector  and except on   payment  of  such  amount  as  the  State  Government   may, by general or special order, determine. It is quite   plain  upon  the  terms  of  these  provisions  that  they   impose restrictions in the matter of making alienations.   On regrant of the land, the holder is deemed to be an   occupant and therefore the holding changes its intrinsic   character and becomes Ryotwari and is like any other   property  which  is  capable  of  being  transferred  or   partitioned by metes and bounds subject, of course, to   the sanction of  the Collector  and on payment of  the   requisite amount.

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20. These two judgments answer the submission of the  

appellants that the amount which is being charged is not a tax  

but  a  fee.   It  is  neither.   It  is  a  premium for  granting the  

sanction.   This  is  because under this  welfare statute these  

lands have been permitted to be purchased by the tenants at  

a  much  lesser  price.   As  held  in  Shashikant  Mohanlal  

(supra),  the  tenant  is  supposed  to  cultivate  the  land  

personally.  It is not to be used for non agricultural purpose.  A  

benefit  is  acquired by the tenant under the scheme of  the  

statute, and therefore, he must suffer the restrictions which  

are also imposed under the same statute. The idea in insisting  

upon  the  premium is  also  to  make  such  transfers  to  non-

agricultural purpose unattractive.  The intention of the statute  

is reflected in Section 43, and if that is the intention of the  

Legislature there is no reason why the Courts should depart  

therefrom while interpreting the provision.

21. It  was submitted by the appellants that assuming  

that the valuation of the land is permitted to be done as per  

the Jantri rates, it must be so done on the basis of the rates as  

prevalent  on  the  date  of  the  application.   The  resultant  

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injustice  was  highlighted  in  the  case  of  Savitaben  in  Civil  

Appeal No. 4129/2012.  The fact however, remains that the  

Section speaks of previous sanction. As noted earlier, Section  

4(2) of the Bombay Paragana and Kulkarni Watans (Abolition)  

Act, 1950 also speaks about the previous sanction.  Thus, this  

is the theme which runs through all such welfare agricultural  

enactments, and a similar provision in the said Act has been  

left undisturbed by the bench of three Judges of this Court.  

Therefore, the Jantri rate to be applied will be on the date of  

the  sanction  by  the  Collector,  and  not  on  the  date  of  the  

application made by the party.

22. Rule 25C of  the Rules framed under the Bombay  

Tenancy and Agricultural Lands Act, 1948, was relied upon by  

the appellants.  It speaks about the circumstances in which,  

and conditions subject to which sanction shall be given by the  

Collector under Section 43 for transfer.  The rule was relied  

upon by  the  appellants  to  submit  that  Government  cannot  

charge any disproportionate amount under Section 43.  The  

rule however,  does not  create any such restrictions on the  

provisions under Section 43. In fact, the rule makes it clear  

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that  transfer  of  an  agricultural  land  for  non-agricultural  

purpose is not easy.  It is only sub-clause (e) thereof under  

which such a transferor will have to make his case which is  

when a transfer is sought for a bonafide purpose.  Even so,  

this does not absolve one from taking any prior sanction.  It  

will only mean that if the application is bonafide, normally the  

transfer will be sanctioned, because as such there is no right  

to insist on a transfer for non-agricultural purpose.   

23. As far as the levy of the 80 per cent of the amount  

is  concerned,  it  was  submitted  that  it  was  unconscionable,  

and it  would mean expropriation,  and will  be hit  by Article  

300A of the Constitution.  Once we see the scheme of these  

provisions,  in  our  view,  no  such  submission  can  be  

entertained.  In any case Mr. Nariman has pointed out that  

after  the  impugned  judgment,  the  State  Government  has  

reduced  the  levy  to  40  per  cent  which  is  obviously  quite  

reasonable.   

24. The last point which requires consideration is with  

respect  to  the  period  for  considering  the  application,  and  

granting the sanction.  There is some merit in the submission  

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of the appellants in this behalf.  Such application cannot be  

kept pending indefinitely, and therefore we would expect the  

Collector to decide such applications as far as possible within  

90 days from the receipt of the application, on the lines of the  

judgment of this Court in Patel Raghav Natha (supra).  In  

the event the application is not being decided within 90 days,  

we  expect  the  Collector  to  record  the  reasons  why  the  

decision is getting belated.

25. For the reasons stated above we do not find any  

reason to interfere in the impugned judgment rendered by the  

Division  Bench,  approving  the  decisions  rendered  by  the  

Single Judges in the Writ Petitions.  All appeals are, therefore,  

dismissed with no order as to costs.

…………………………..J.  [  Surinder Singh Nijjar  

]

……..……………………..J.  [  H.L. Gokhale  ]

New Delhi Dated : February 25, 2014    

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