Raiyati lands in Sambalpur district were freely transferable to certain classes of persons as referred to in the first proviso to Section 46 (1) of Tenancy Act, and the transfer so effected was voidable if not avoided within the prescribed period of limitation.

Judgement

G. K. MISRA, C. J. :- This appeal is confined to Khunti No. 6 in Village Patrapalli in Sambalpur district, in which the disputed lands of about 10.39 acres are situated. They were acquired on 15-11-1951. They have been recorded as Gounti Raiyati lands. The arbitrator granted compensation at 500 times the deduced rent under Section 7 (1) (e) second proviso, of the Orissa Development of Industries, Irrigation, Agriculture, Capital Construction, and Resettlement of Displaced Persons (Land Acquisition) Act, 1948 (Orissa Act 18 of 1948) - (hereinafter to be referred to as the Act). The correctness of some of the decisions of this Court was challenged while the case was heard by one of us. Some of those decisions are conflicting. To resolve this conflict, the matter has been referred to the Full Bench.

2. Mr. Patnaik for the appellant contends that raiyati lands in Sambalpur district cannot be said to be saleable under the Central Provinces Tenancy Act, 1898 (herein after to be referred to as the Tenancy Act) and as such the second proviso to Section 7 (1) (e) of the Act does not apply and the appellant is entitled to compensation on the market value of the land under the first proviso - which would be 16 times the net yield.

3. To appreciate the aforesaid contention, Section 7 (1) of the Act - which prescribes the method of determining compensation - may, so far as material, be quoted :-

"7 (1) Where any land has been acquired under this Act, there shall be paid compensation, the amount of which shall be determined in the manner and in accordance with the principles hereinafter set out, that it so say -

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(e) The Arbitrator in making his Award, shall have due regard to the provisions of sub-section (1) of Sec. 23 of the Land Acquisition Act, 1894.

Provided that the market value referred to in the first clause of sub-section (1) of Section 23 of the Act shall be deemed to be the market value of such land on the date of publication of the notice under Section 3 or as the case may be, the preliminary notification under sub-section (1) of Section 4 of the Land Acquisition Act, 1894, referred to under sub-section (2) of Section 3 or on the first day of September, 1939, with an addition of 50 per cent. whichever is less :

Provided further that where under any law or custom having the force of law, the lands are not saleable, the market value of such lands shall be such multiple as may be prescribed of the deduced rent to be calculated in the prescribed manner, with addition of 50 per cent."

In AIR 1955 Orissa 97 (State of Orissa v. Bharat Chandra) a Division Bench of this Court struck down the first proviso to Section 7 (1) (e) as unconstitutional. The whole of the first proviso is not unconstitutional. Only the last sentence of the proviso to the effect "market value......on the first day of September 1939 with addition of 50 per cent whichever is less" was unconstitutional. By giving the 1939 price the market value of the land which was the just equivalent was not given and so, on the authority of AIR 1954 SC 170 (State of West Bengal v. Mrs. Bela Banerjee) it was observed, by inadvertence, that the whole of the first proviso was unconstitutional. A similar erroneous observation was made in (1961) 27 Cut LT 126 (Banamali Babu v. State of Orissa).

4. The disputed lands have been recorded as "Gounti Rayati" lands. Gounti raiyati means raiyati lands held by the Gounti during his tenure of office. Gounti raiyati lands are therefore raiyati lands.

5. The second proviso to Section 7 (1) (e) of the Act prescribes that if the lands are not saleable, then the market value shall be determined as laid down therein. If the lands cannot be described to be not saleable, then the market value would be determined in accordance with the first proviso.

6. The question for consideration is whether raiyati lands in Sambalpur district were not saleable prior to the coming into force of the Central Province Tenancy (Orissa Amendment of C. P. Act 11