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In the High Court of Andhra Pradesh at Hyderabad
KONDAIAH AND A.D.V. REDDY, JJ.
M/s. The Krishnappa Asbestos and Barytes (P) Ltd. - Appellant
Versus
The State of A.P. and others - Respondent
A. No. 382 of 1968
Decided on : 26-10-1971
DISTRICT BOARDS ACT - SECTIONS 74-B, 78, 92, 221, 222 - REVENUE RECOVERY ACT, SECTION 5 - TAXATION RULES, RULES 1, 3, 4, 32, 33 - LAND CESS - ASSESSMENT - RECOVERY - LIMITATION - DISTRICT COLLECTOR'S AUTHORITY - INTERPRETATION.
Fact of the Case:
Plaintiff, a private limited company, had obtained a transfer of mining leases from A. Krishnappa & Sons, mining lessees, and was carrying on mining in barytes and asbestos on the fields specified in the plaint schedule. The Government surface rents in respect of the various areas occupied and cesses thereon as well as royalty for the minerals mined and exported from the lands were being paid by the plaintiff. The Government demanded a sum of Rs. 28,088-26 p. towards the arrears of cesses on royalties as well as surface rents and cesses thereon for the entire leased areas after deducting the amounts actually paid by the plaintiff for the period commencing from 1-4-1952 and ending with September 30, 1959. The plaintiff challenged the demand in a writ petition, which was allowed by a single judge of the High Court. The Government made separate assessments for each year commencing from 1-4-52 to 30-6-59 demanding a total sum of Rs. 28,088-26 p. A consolidated demand notice dated April 28, 1964 demanding a sum of Rs. 20,311-93 p. as balance of arrears due from the plaintiff for the period commencing from April 1, 1952 to September, 1963 was issued by the District Collector, Cuddapah. The plaintiff filed a suit for recovery of Rs. 39,272-32 p. being the amount collected illegally and under coercion.
Finding of the Court:
1. The District Collector is empowered to make assessment and collect land cess under the Madras District Boards Act and the Taxation Rules. 2. The assessments made by the District Collector for each year separately are valid and in accordance with the observations made by the High Court in the writ petition. 3. The land cess, surface rent or royalties, if any, paid according to the demand, must be held to be arrears of revenue which can be recovered in accordance with the provisions of the Revenue Recovery Act. 4. There is no period of limitation prescribed under the Madras District Boards Act compelling the District Collector to make the assessment of land cess for any particular year either within the close of that year or any other period. 5. The State of Andhra Pradesh through the District Collector is empowered to make the assessment in respect of the land cess or surface rent within 30 years as provided under the new Limitation Act from the year in respect of which the assessment is sought to be made.
Issues: 1. Whether the demands raised against the plaintiff appellant in respect of surface rents, cesses and royalties were illegal and without jurisdiction and barred by limitation as contended by the appellant, or not, as urged by the respondents. 2. Whether the amount sought to be recovered from the appellant had been collected illegally and under coercion. 3. Whether the amount so collected had not become an arrear of land revenue and hence, the demands as well as the recovery proceedings were illegal and without jurisdiction.
Ratio Decidendi: 1. The District Collector is responsible for the assessment and collection of land cess under the Madras District Boards Act and the Taxation Rules. 2. The assessments made by the District Collector for each year separately are valid and in accordance with the observations made by the High Court in the writ petition. 3. The land cess, surface rent or royalties, if any, paid according to the demand, must be held to be arrears of revenue which can be recovered in accordance with the provisions of the Revenue Recovery Act. 4. There is no period of limitation prescribed under the Madras District Boards Act compelling the District Collector to make the assessment of land cess for any particular year either within the close of that year or any other period. 5. The State of Andhra Pradesh through the District Collector is empowered to make the assessment in respect of the land cess or surface rent within 30 years as provided under the new Limitation Act from the year in respect of which the assessment is sought to be made. 6. Section 222 of the Madras District Boards Act, which prescribes a limitation of three years for suits, prosecutions, and distraint in respect of any sum due to a district board under the Act, does not apply to the present case as the land cess in question is not due to the district board.
Final Decision: The appeal was dismissed with costs.
JUDGMENT :
KONDAIAH, J.
1. Plaintiff in O.S. No. 34 of 1965 on the file of the Court of the Sub-Ordinate Judge, Cuddapah is the appellant. The suit is for recovery of a sum of Rs. 39,272-32 p. from the State of Andhra Pradesh, the District Collector, Cuddapah, the Chairman, Zilla Parishad, Cuddapah, the President of the Panchayat Samithi, Pulivendla and the Presidents of the gram Panchaynts of Gunakanapalli, Lingala, Brahmanapalli, Gondipalli, Ippatla, Vemula, Ramanuthalapalli and Lopatnuthala defendants 1 to 12 respectively. The plaintiff, a private limited company, had obtained a transfer from A. Krishnappa & Sons, mining lessees, of mining leases with the approval of the State Government in the year 1947 and was carrying on mining in barytes and asbestos on the fields specified in the plaint schedule. The Government surface rents in respect of the various areas occupied and cesses thereon as well as royalty for the minerals mined and exported from the lands were being paid by the plaintiff. According to the plaintiff, on December 29, 1959, a sum of Rs. 28,088-26 p. was demanded by the Tahsildar, Pulivendla towards the arrears of cesses on royalties as well as surface rents and cesses thereon for the entire leased areas after deducting the amounts actually paid by the plaintiff for the period commencing, from 1-4-1952 and ending with September 30, 1959. The Government, on the representation of the plaintiff, clarified the position to the effect that rent should be collected from the lessee only in respect of the actual area used for mining in the land granted under the lease. The plaintiff sought to quash the aforesaid demand in Writ petition No. 249 of 1960 on the ground that the demand was illegal and without jurisdiction. A learned single Judge of this Court, Jaganmohan Reddy, J. (as he then was), by his order dated 22-8-1962, issued a writ of Mandamus restraining the State of Andhra Pradesh from collecting from the plaintiff-petitioner the amount mentioned in the demand notice issued by the Tahsildar, holding that no single demand is permissible for a period covering more than one year and there should be year-war assessments. However, the learned judge observed that it was open to the authorities “to issue the necessary demands and to make yearly assessments calling upon the petitioner to pay the amounts subject to any representation the petitioner may make in this regard”. Pending the Writ Petition, the Plaintiff had deposited a sum of Rs. 10,000/- on 7-7-62 which was drawn by the Collector on August 22/62. Therefore, separate assessments were made on December 12, 1962 for each year commencing from 1-4-52 to 30-6-59 demanding a total sum of Rs. 28,088-26 p. A consolidated demand notice dated April 28, 1964 demanding a sum of Rs. 20,311-93 p. as balance of arrears due from the plaintiff for the period commencing from April 1, 1952 to September, 1963 was issued by the District Collector, Cuddapah. Therein a total sum of Rs. 48,400-19 p. was shown to be due and a sum of Rs. 28,088-26 p. was shown as already recovered and hence, the balance of Rs. 20,3.11.93 p. was demanded. A sum of Rs. 9,187.87 p. included in the balance demand of Rs. 20,311.93 p. was stated to be payable as Royalty and hence, the recovery of Rs. 11,184-06 only which was due towards cesses on royalty, was alleged to be illegal. Hence the suit for the recovery of Rs. 28,088 26 p. plus Rs. 11,184.06 p. which comes to Rs. 39,272-32 p.
2. Defendants 3 to 12 remained ex parte. They did not file any written statements. The written statement filed on behalf of the State of Andhra Pradesh, the 1st defendant was adopted by the District Collector of Cuddapah, the 2nd defendant. The sum and substance of the defence of the contesting defendants is that the demands for the payment of surface rent, cesses and royalties are valid and justified and the dues have been validly recovered and, that any arrears of such dues could be collected under the Madras Revenue Recovery
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