Who is the OWNER of Leasehold (Exempted) Plantation Lands in Kerala?

Saji Koduvath, Advocate, Kottayam.

1. Introspection

It is held in Glen Leven Estate (P) Ltd. v. State of Kerala, 2022-4 Ker LT 121 –
            •➧The “vesting” in Government under Sec. 72, KLR Act, is a “legal fiction”.
            •➧The cultivating tenant has an “absolute right” to seek assignment. 
The Division Bench failed to consider
            •➧1. The right, title and interest of the land (above ceiling limit) ‘vest’ with the Government under Sec. 72. It is absolute. It is not a ‘fiction; but, it is real and actual.
            •➧2. The nature of this statutory ‘vesting in Govt’ (under Sec. 72) is further clear from – Sec. 72E (tenant has to pay rent) and Sec. 112(5A) (land-value need not be given to the land-owner or the tenant, in case of acquisition).
            •➧3. Sec. 72B(2) KLR Act spells-out that a cultivating tenant will get Purchase Certificate for the extent below the ‘ceiling limit’ alone. That is, the tenant has no “absolute rights” above the ceiling limit. (It is limited to the improvements made, in case of acquisition.)
            •➧4. Plantation-lands, usually, involve Hundreds or Thousands of Acres of “excess” land. The assignment-possible-land (within ceiling limit) may be miniscule (7.5 acres or 15 acres). Therefore, the analogy drawn by the Bench (tenant has a right seek assignment) is not apt at all.
            •➧5. The provisions of the KLR Act (in this regard) are legislated following Proviso to Article 31A(1) of the Constitution which says that the State need not pay compensation to the land owners (when land is acquired) above the ‘ceiling limit‘.

2. Who is the OWNER of Leasehold (Exempted) Plantation Lands in Kerala?

It is the Government

Reasons:

  • (i). Plantation (lease) lands Statutorily VEST in GOVT, under S. 72.
    • Sec. 72 of the Kerala Land Reforms Act, 1964, provides for absolute vesting (of lease-land) in Government.
    • Tenants of leasehold-exempted-plantation lands (above ceiling-limit) are entitled only to ‘fixity of tenure‘ by virtue of Chapter II, Sec. 13 (and they are not entitled for Purchase Certificate, over and above ‘ceiling limit’).
    • Note: ‘Tenure’ is derived from the Latin term, “tenere“;  means “to hold” or “to keep”.
  • (ii). Vesting’ in Govt. is ‘Vesting of Ownership
    • Sec. 72 speaks about ‘Vesting of landlord’s rights in Government’.
    • It pertains to –
      • all right, title and interest” of the landowners and intermediaries in respect of holdings held by cultivating tenants”.
  • (iii). Tenant has no “absolute rights”
    • Sec. 72B(2) KLR Act spells-out that a cultivating tenant will get Purchase Certificate for the extent below the ‘ceiling limit’ alone. That is, the tenant has no “absolute rights” above the ceiling limit. (It is limited to the improvements made, in case of acquisition, under Sec. 112(5A), as stated below.)
    • Plantation-lands, usually, involve Hundreds or Thousands of Acres of “excess” land (above ceiling limit). The assignment-possible-land (within ceiling limit) may be miniscule (7.5 acres or 15 acres).
    • Tenant to Pay Rent to the Govt.: Sec. 72E directs – such a cultivating tenant is liable to pay ‘Rent’ to the Government (obviously over and above ‘ceiling limit’). Sec. 72F(5) authorises Land Tribunal to fix the rent.
  • (iv). Government Need Not Pay ‘Land-Value‘, as such, if Acquired
    • Sec. 112(5A) provides that the Government need not pay ‘Land-Value‘, as such, to the tenant, or the former land owner, if such Lands (above ceiling limit) are Acquired. (It is for the reason that ownership of such plantation-land vest in Govt., absolutely.)
  • (v). Proviso to Article 31A(1) of the Constitution of India
    • The provisions of the KLR Act as regards ‘vesting’‘excess land’ etc. are legislated predicating upon Proviso to Article 31A(1) of the Constitution which states that the State need not pay compensation to the former land owners (when land is acquired) above the ‘ceiling limit‘.
Proviso to Article 31A(1) reads as under:
“Provided further that where any law makes any provision for the acquisition by the State of any estate and where any land comprised therein is held by a person under his personal cultivationit shall not be lawful for the State to acquire any portion of such land as is within the ceiling limit applicable to him under any law for the time being in force or any building or structure standing thereon or appurtenant thereto, unless the law relating to the acquisition of such land, building or structure, provides for payment of compensation at a rate which shall not be less than the market value thereof.”

3. Tenant cannot ‘Sell’ Plantation Land as his Absolute Property

  • A tenant who got ‘fixity’ over such land cannot ‘sell’ this land as his absolute (ownership) property.

4. ‘Exemption’ in Chapter III Cannot be Read Into Sec. 72B(2)

  • The provision of law for giving Purchase-Certificate under Sec. 72B specifies that the provisions of Sec. 82 (as to ceiling limit) shall apply for the calculation of the ceiling area (alone).
  • Sec. 72B(2) reads-
    • “(2) The provisions of Section 82 shall, so far as may beapply to the calculation of the ceiling area for the purposes of the proviso to Sub-section (1)”
  • The exemption provision in Sec. 81 (Chapter III), which excludes plantation lands from the ceiling limit, cannot be brought-forth or read-into Sec. 72B (provision for assignment of purchase-certificate) in Chapter II.
    • In other words, purchase-certificates cannot be given for land above ceiling-limit, rigging the exemption provisions (for plantations etc.).
  • Because,
    • Sec. 72B(1), in Chapter II shows – Sec. 72B(1) is an independent provision (though the Proviso says –  no cultivating tenant shall be entitled to assignment of the right, title and interest … (more than) … the ceiling area, mentioned in Sec. 82 in Chapter III)
    • When a provision in a latter Chapter of an Act (here, Sec. 82 that deals with extent of ceiling limit, in Chapter III) is referred to in an independent provision in an earlier Chapter (here, Sec. 72B, as regards issuing purchase certificate, in Chapter II), for a specific purpose (here, to state the limit in area alone), it cannot be said – the attributed colour or smell of the provision in the latter chapter (by virtue of other provisions, i.e., entire characteristics or attributions added to Sec. 82 by virtue of other provisions in Chapter III), would stand reflected on the earlier provision (here, Sec. 72B).
  • Further:
    • Chapter II of the KLR Act (dealing with ‘Tenancy’) is exclusive and exhaustive as to ‘fixity’, and ‘vesting’ of land in Government.
    • It is not stated anywhere in the Act – the right and title of the (leased-plantation) land legitimately vested in Government under Sec. 72, will be divested in any manner (in favour of the previous owner, or of the tenant or anybody else), in any circumstance.
    • Sec. 72E provides for collection of ‘rent‘ from the holders of the plantation and Sec. 72F(5) authorises the Land Tribunal to fix the rent. (It goes without saying saying that it is for the reason that the ownership of the land vests in Govt.)
    • Note: Proceedings initiated by Taluk Land Board under Chapter III (in respect of plantation) do not confer title.

5. What is the legal right attached to former ‘tenants’, after vesting the land with Govt. under Sec. 72?

  • It is not Tenancy – For no landlord-tenant relation with the Govt.
  • Not Grant or Licence/Permission – for Grant as well as Licence/Permission arise from a contract (express or implied).
  • Therefore, it can termed only as a “Legal Right conferred by Statute“, that is, the KLR Act.

6. What are the Stipulations attached to that “Legal Right conferred by Statute” to tenants (of Plantation land) having fixity?

  • 1. Liable to pay ‘Rent’ (under Sec. 72E).
  • 2. Subject to the condition – not to “convert” it for any other use, other than the specific plantation (Sec. 87).
  • 3. From Sec. 112(5A)(b) it is clear that the tenant will be entitled (on acquisition of the land) for the compensation for his homestead or hut, if any, and the value of his improvements (alone).

7. When Such a land (Vested In Govt. under S. 72) is Required for Govt. (Public Purpose), Should it be ‘Acquired’? Is the landowner Entitled for any Compensation? What is the Compensation Entitled to by the Tenant?

  • When Such a land (Vested In Govt. under S. 72) is Required for Govt. (Public Purpose), Should it be Acquired?
    • The ownership being vested in Govt. it need not be ‘strictly’ “acquired”. But no specific provision in Sec. 72 for ‘resuming’, if and when Govt. needs it. 
    • Sec. 112 (5A) of the KLR Act uses the term ‘acquisition’ itself (for the possessory rights remain with the tenant).
  • Is the landowner Entitled for any Compensation?
    • Sec. 112(5A) deals with the land acquired that has been vested in the Government under Section 72. From the sub section (5A) it is clear that the entire rights of the (former) landowner is vested with the Govt. and he cannot claim any right over the land (when it is acquired).
  • What is the Compensation Entitled to by the Tenant?
    • Sec. 112(5A)(a) says that the compensation for any building or other improvements belonged to such land owner and intermediaries shall be awarded (?) to the Government ; and
    • from Sec. 112(5A)(b) it is clear that the tenant will be entitled for the compensation for his homestead or hut, if any, and the value of his improvements (alone).

8. Apportionment of land value in cases of Acquisition

Sec. 112 of the KLR Act reads –

“112. Apportionment of land value in cases of acquisition  – (1) Where any land is acquired under the law for the time being in force providing for the compulsory acquisition of land for public purposes, the compensation awarded under such law in respect of the land acquired shall be apportioned among the landowner, intermediaries, cultivating tenant and the kudikidappukaran in the manner specified in this Section.
(2) The compensation for any building or other improvements shall be awarded to the person entitled to such building or other improvements.
(3) The kudikidappukaran shall be entitled to the value of the land occupied by his homestead or hut subject to a minimum of-
               three cents in a city or major municipality; or
               five cents in any other municipally; or
               ten cents in a panchayat area or township.
(4) The difference between the value of three cents or five cents or ten cents, as the case may be, and the value of the extent of the land occupied by the homestead or hut shall, notwithstanding anything contained in the Kerala Land Acquisition Act, 1961, be borne by the Government or the local authority or the company or other person on whose behalf the land is acquired.
(5) The balance remaining after deducting the compensation referred to in Sub-section (2) and the value of the land occupied by the homestead or hut shall he apportioned among the landowner, the intermediaries and the cultivating tenant in proportion to the profits derivable by them from the land acquired immediately before such acquisition .
Explanation. – “Profits derivable from the land” shall be deemed to be equal to (i) in the case of a landowner, the rent which he was entitled to get from the tenant holding immediately under him; (ii) in the case of an intermediary, the difference between the rent which he was entitled to get from his tenant and the rent for which he was liable to his landlord; and (iii) in the case of a cultivating tenant, the difference between the net income and the rent payable by him; and the rent payable by the cultivating tenant and the intermediary for the purposes of this Explanation shall be as calculated under the provisions of this Act.
(5A) Notwithstanding anything contained in Sub-sections (2) and (5), where there the right, title and interest of the landowner and the intermediaries in respect of the land acquired have vested in the Government under Section 72, –
               (a) the compensation for any building or other improvements belonging to such land owner and intermediaries shall be awarded to the Government ; and
               (b) the balance remaining after deducting the compensation referred to in clause (a) and the value of the land occupied by the homestead or hut, if any, shall be apportioned between the cultivating tenant and the Government in proportion to the profits derivable by them from the land.
Explanation. – “Profits derivable from the land” shall be deemed to be equal to- in the case of the cultivating tenant, the difference between the net income immediately before the acquisition and the rent which he was liable to pay immediately before the date on which the right, title and interest of the landowner and the intermediaries have vested in the Government; and
in the case of the Government, such rent.
(7) In this Section, “homestead” includes a dwelling house occupied by a person who is deemed to be a kudikidappukaran under Explanation IIA to clause (25) of Section 2.”

9.Glen Leven Estate (P) Ltd. v. State of Kerala2022-4 Ker LT 121 – Not Correctly decided

Following were the basic factual situation in Glen Leven Estate (P) Ltd. v. State of Kerala (supra)  –

  • The land was leased out by landlords.
  • The lease-rights came in the cultivating tenants by transfer.

Following were the rival claims raised by (i) the Govt. (ii) tenant and (iii) the landlord.

Contention of the Govt.

  • The Government contended that the tenant was a cultivating tenant and the land (absolutely) vested in the Govt. under Sec. 72 KLR Act.
    • Hence, tenant would be entitled to get compensation for the improvements (alone) to be determined under the Kerala Compensation for Tenants Improvements Act, 1958, in view of Section 20(1) of the KLR Act.

Contention of the Tenants

  • cultivating tenant has absolute right to seek assignment (subject to the payment of purchase price in contemplation of Sec. 72D). Therefore, vesting of rights in the Government under Sec. 72 is a legal fiction.

Claim of Land Owners

  • In view of Sec. 3(i)(viii), if the extent of the plantation is above 30 acres, and if the land was a plantation (put up by the land owner) when it was leased, the tenant will not be entitled for ‘fixity’; and the land will return to the land owner after the lease-period. Therefore, the land owners in one Writ Appeal claimed that the land involved therein was such a land entitled to by them (after the lease period).
  • Land owners also claimed that Sec. 72BB(1) gives them a right (i) to apply for assignment to the tenant and (ii) for the payment of the compensation due to him under Section 72A (as regards the property within ceiling limit).

10. The Division Bench Finding on Vesting Under Sec. 72

  • The contention of the Govt. that the land was (absolutely) vested upon it was rejected and held –
    • 1. the vesting in Govt. ‘is a legal fiction‘.
    • 2. cultivating tenant ‘has an absolute right to seek assignment‘ subject to the payment of purchase price.

11. The Division Bench observed as under –

  • “31. On an analysis of the provisions of Section 72(1) of the Act, 1963, it is clear that when the Government notified the said provision with effect from 01.01.1970, all right, title and interest of the landowners and intermediaries in respect of holdings held by cultivating tenants (including holders of kudiyirippus and holders karaimas) entitled to fixity of tenure under Section 13, and in respect of which certificates of purchase under sub-Section (2) of Section 59 have not been issued, vested in the Government.
  • 32. Therefore, it is clear from Section 72 that what is vested with the Government is the right, title and interest of the land owners and intermediaries in respect of the holdings held by the cultivating tenants. It is nothing but a legal fiction by which the interest held by a cultivating tenant in a property of a landlord or intermediary is protected from 01.01.1970.”
  • “34. On a conjoint reading of Sections 72 and 72A, it can be seen that vesting of rights in the Government contained under Section 72 is the rights held by the landlord and the intermediary in respect of holdings held by the cultivating tenants. However, the same will not, in any manner, interfere with the rights enjoyed by a cultivating tenant in contemplation of the provisions of the Act, 1963.”
  • “41. On an indepth analysis of the aforesaid provision, we find that when Section 72 came into force on 01.01.1970, the cultivating tenant is entitled for the assignment of the land for possession, subject to the liabilities fixed under Section 72 of the Act, 1963 to pay the purchase price. As per Section 72C, if no application is filed by the cultivating tenant, the Land Tribunal shall subject to the Rules made by the Government ensure that the assignment is granted to the cultivating tenant, assigning such title and interest to the cultivating tenant entitled thereto, which rights, title and interest are vested with the Government by virtue of the legal fiction created under Section 72 of the Act, 1963.
  • 42. Therefore, we have no doubt in our mind to hold that Section 72 of Act, 1963 would only deal with the right, title and interest of the land owners and intermediaries in respect of the holdings held by the cultivating tenants free from encumbrances created by the land owners and intermediaries. However, the legal provisions discussed above would make it clear that insofar as the cultivating tenant is concerned, an absolute right is vested with him to seek assignment subject to the payment of purchase price in contemplation of Section 72D of the Act, 1963.”

12. The following logic put forwarded by the Bench is inappropriate.  

  • “… insofar as the cultivating tenant is concerned, an absolute right is vested with him to seek assignment subject to the payment of purchase price in contemplation of Section 72D of the Act, 1963″.

Because–

  • Sec. 72B spells out that the Purchase-Certificate can be given within the ceiling limit alone.
  • Note: Plantation-lands, usually, involve Hundreds or Thousands of Acres of “excess” land. The assignment-possible-land (within ceiling limit) may be miniscule (7.5 acres or 15 acres). Therefore, the analogy drawn by the Bench (tenant has a right seek assignment) is not apt at all.

13. The Division Bench failed to consider the following as regards Vesting Under S. 72

  • 1. The vesting in Govt’ under Sec. 72 is absolute. It is further clear from Sec. 72E (tenant has to pay rent) and Sec. 112(5A) (land-value need not be given to the land-owner or the tenant, in case of acquisition).
    • The Division Bench went wrong in observing that it is “a legal fiction by which the interest held by a cultivating tenant in a property of a landlord or intermediary is protected from 01.01.1970“.
  • 2. Sec. 72B(2) KLR Act provides that a cultivating tenant will get Purchase Certificate for the extent below the ‘ceiling limit’ alone. That is, the tenant has no “absolute rights” above the ceiling limit.
    • Plantation-lands, usually, involve Hundreds or Thousands of Acres of “excess” land (land above ceiling limit). The assignment-possible-land (within ceiling limit) may be miniscule (7.5 acres or 15 acres).
    • Tenant has to Pay Rent to the Govt.: Sec. 72E directs – such a cultivating tenant is liable to pay ‘Rent’ to the Government (obviously over and above ‘ceiling limit’). Sec. 72F(5) authorises Land Tribunal to fix the rent.
  • 3. The provisions of the KLR Act as regards ‘vesting’‘excess land’ etc. are legislated following Proviso to Article 31A(1) of the Constitution which states that the State need not pay compensation to the land owners (when land is acquired) above the ‘ceiling limit‘.
    • When a landowner has no vested right over and above the ceiling limit, it is illogical and irrational to say that the tenant will have it.

14. The DB Avoided Consideration of Factual Matters u/S. 3(i)(viii) & 72BB

While considering the claims of landlord (basing on Sec. 3(i)(viii) and Sec. 72BB), the Bench avoided consideration of these matters (as they were absolutely factual in nature) observing as under:

  • “36. So also, sub-Section (1) of Section 72BB dealing with ‘the right of landlord to apply for assignment and compensation’ specifies that any landowner or intermediary, whose right, title and interest in respect of any holding have vested in the Government, may apply to the Land Tribunal for the assignment of such right, title and interest to the cultivating tenant and for the payment of the compensation due to him under Section 72A.”
  • “55. However, the landlords, who are the appellants in W.A. No. 500 of 2016, in their appeal have raised a claim against the cultivating tenant basically contending that the tenancy is exempted in view of Section 3(i)(viii) of Chapter II of the Act, 1963 and therefore, the lessee is not entitled to fixity of tenure. Other contentions are also raised. But, in our considered opinion, the dispute with regard to the apportionment of the claim for compensation by rival claimants is a matter for consideration by the competent authority, and also in contemplation of the provisions of Section 64 of the Act, 2013, and therefore, the said dispute, which are absolutely factual in nature depending on evidence, has to be decided by the statutory authority in accordance with law.”
  • The landlords argued that the land was a plantation (over 30 acres) when it was (originally) leased, and therefore, they are entitled to claim exemption and benefits in the light of the exemption under clause (viii)  of Section 3 (1) of the KLR Act. Since there would be no fixity of tenure, it being a plantation, there would not be vesting of rights of the land owner in the Government. Hence, there should be the apportionment of the compensation between the lessor and the lessee and it should be decided in the acquisition proceedings.
  • The single Judge dismissed the writ petition, ‘leaving open the liberty of the lessee as well as the landlords, to approach the civil court seeking relief against the Government, and also to resolve the inter se dispute by and between the tenant and the landlords’.

Epitome

When Land Reform Measures were implemented in the State of Kerala, it jaded and wearied small and moderate landlords and tenants, on the bedrock of “ceiling limit”. But, the Plantations were not “touched” taking “economy” into consideration. Still, the well-visioned legislators were particular to see that the ownership of this large extent of plantations (otherwise thick forest of the Western Ghats) was remained with the State. It was based on the principles in Article 31A(1) of the Constitution which says that the State need not pay compensation to the land owners (when land is acquired) above the ‘ceiling limit’.

Therefore, it can say definitely –

  • For (even) the landowner has no vested right on land beyond the ceiling limit, a tenant can never claim such a right; and, it is too illogical and irrational for the tenant to have such a right.
  • Interpretation of law, especially when Constitutional principles are involved, should subserve the interests of the nation and future generations, and not that of a few ones.

Conclusion

In short, the juridical status of the ‘plantation land’ (beyond the ceiling limit), vested in Govt. under Sec. 72, can be placed as under –

  • 1. Title and ownership of the same is vested with the Govt.
  • 2. Because of the Exemption (Sec. 81) and Fixity (Sec. 13) the tenant can continue the plantation activity therein.
  • 3. But the tenant has to pay the ‘Rent’ to the Govt. (Sec. 72E) fixed by the Land Tribunal (Sec. 72F).
  • 4. Because of the restrictions in Sec. 72B and 72C, a tenant cannot obtain Purchase Certificate (and become the land-owner) for more extent than the ceiling limit.

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