Judgment

 SPECIAL LEAVE PETITION (C) No. 1480 OF 1990

Leave granted. Counsel for the respondents takes notice. This appeal is disposed of along with connected appeals which have been heard today.

WRIT PETITIONS Nos. 112 AND 413 OF 1988

2. In the writ petitions rule nisi has already been issued. Counsel for the respondents takes notice. These petitions are heard and disposed of along with the connected appeals which have been heard today.

CIVIL APPEALS Nos. 4287-4329/ 88, 6114/ 90,4310-16/88,2968/91,2222-23/91........ ./ 91, WRIT PETITIONS Nos. 11 2 AND 413 OF 1988

3. All these matters concern the question of the validity of the provisions of Section 3 of the Rajasthan Land Tax Act, 1985 (Rajasthan Act No. 6 of 1985) - hereinafter referred to as the Act - by which the State Legislature purported to levy a tax on every landholder on the annual value of the land held or used by him in so far as it concerns land containing minerals. Land, inter alia, has been defined to include "land held or used for excavating, extracting, removing or utilising any ore or mineral". The "annual value" of this category of land has been defined in Section 2(a) which, in so far as is relevant, read as follows:

"Annual value" means, in the case of land held or used in a year -

(i) for excavating, extracting, removing or utilising any ore or mineral, [and amount] equal to the amount of the annual dead rent or half of the amount of the royalty payable for the year with regard to such ore or mineral, whichever is higher."

We may mention that subsequently this provision has been amended to make the annual value equal to four times of the annual dead rent twice the amount of the royalty payable, whichever is higher. Reference may also be made to the definition of the expression "dead rent" in Section 2(d) of the Act as follows:

"dead rent" means the minimum guaranteed amount of royalty payable yearly by the lessee under the Mines and Minerals (Regulation and Development) Act, 1957 (Central Act 67 of 1957) and the rules made thereunder or under an agreement for a mining lease."

4. The question of validity of levies of this type has come up for consideration by a seven Judge Bench of this Court in India Cement Ltd. v. State of Tamil Nadu, (1990) 1 SCC 12 and by a three-Judge Bench in Orissa Cement Ltd. v. State of Orissa, (1991) 2 JT 439. Following the above two decisions, a Bench of this Court has also disposed of the challenge to a similar levy made by the Gujarat State in Writ Petitions Nos. 100-116 of 1991.

5. We do not think it is necessary to set out in detail the facts and the various contentions urged before us which are practically a repetition of the contentions urged in the earlier decisions above referred to. We may only mention that the levy in the present case is practically on all fours with the levy in Orissa Cement case (supra). It is sufficient to say that there are no distinguishing features and we are not persuaded that the earlier decision requires reconsideration as urged by Sri Tarkunde. For the reasons set out in India Cement and Orissa Cement cases (supra), we are of the opinion that the State Legislature did not have the competence to legislate for the levy of a tax on mineral bearing lands based on the royalty derived from the land.

6. Sri Tarkunde, learned Counsel appearing for the respondent, however, sought to put forward an alternative contention that, even if a tax based on the royalty amount is held to be not a tax within the competence of the State Government, it is possible to sever that portion of the legislation and uphold the validity of the rent of it. He pointed out that the tax is based on the annual value which, in turn, is based on the dead rent or royalty whichever is higher. He contended that, if the State Government had been aware of its limitation in enacting the legislation by reference to royalty, it would have based the levy on the "dead rent" which is an amount which has no reference to the exploitation of minerals from