Can the Ownership of (Exempted) Plantation (Above Ceiling Limit) be Changed? Can Plantation be Fragmented?

Taken from: Exempted Plantation Land – In whom Ownership Vests

Saji Koduvath, Advocate, Kottayam.

Key Takeaways

Can Plantation be fragmented?
No.
Section 81 is a special provision to prevent fragmentation of plantation and to improve the economy of the state. Change the character of the plantation could be termed as ‘conversion’ and that will be against the provisions of the Act. (One Earth One Life v. State of Kerala, 2019-2 KHC(SN) 10; 2019-1 KLT 985)
Can Ownership of (Exempted) Plantation (Above Ceiling Limit) be Changed?
Yes; but, subject to the condition – use the land for the purpose for which exemption is granted.
Exemption granted under S.81(1)(a) is for the land and would continue to operate irrespective of change of ownership of the exempted land and the transferee would have to use the land for the purpose for which exemption is granted (R. V.  Devassia v. Sub Registrar, Idukki, 2015-1 ILR(Ker) 1047; 2015-1 KHC 805; 2015-2 KLJ 17).

Does the Plantation Exemption confer Unconditional Rights over the ‘LAND’?

No.

Is the Vesting in Govt. “Fictional” (and it is only for transferring land to the Tenant)?

  • Yes; as regards lands within the ceiling limit.
  • No; as regards lands above ceiling limit.

It is for the following reason –

  • Exemption is only a ‘Legal Advantage conferred by Statute’. It continues (only) as long as Plantation exists.
  • Because,
    • Under Sec. 2, clause (44), Plantation means any land used by a person principally for the cultivation of tea, coffee, cocoa, rubber, cardamom or cinnamon.
    • Section 87, Explanation II states that if a plantation for which exemption is given on recognition of a specific ‘plantation-crop’ is converted into any other ‘plantation-crop’ or the plantation activity is not continued, the exemption will be lost; and the land will be taken for considering the ceiling limit.

Sec. 87 reads as under:

  • “S. 87. Excess land obtained by gift, etc. to be surrendered – (1) Where any person acquires any land dafter the date notified under Section 83 by gift, purchase, mortgage with possession, lease, surrender or any other kind of transfer inter vivos or by bequest or inheritance or otherwise and in consequence thereof the total extent of land owned or held by such person exceeds the ceiling area, such excess shall be surrendered to such authority as may be prescribed.
  • Explanation 1 – Where any land is exempted by or under Section 81 and such exemption is in force on the date notified under Section 83, such land shall, with effect from the date on which it ceases to be exempted, be deemed to be land acquired after the date notified under Section 83.
  • Explanation II – Where, after the date notified under Section 83, any class of land specified in Schedule II has been converted intoany other class of land specified in that Schedule or any land exempt under Section 81 from the provisions of this Chapter is converted into any class of land not so exempt and in consequence thereof the total extent of land owned or held by a person exceeds the ceiling area, so much extent of land as is in excess of the ceiling area, shall be deemed to be land acquired after the said date.”
  • Note:
  • 1. The (main) section refers to lands in general (and not confined to Plantation). The Explanations refer to Plantation Lands.
  • 2. The expression “ceases to be exempted” in first Explanation denotes the following –
    • A Plantation land can be “ceases to be exempted” either ono “conversion” given in Explanation II or on legislation.
    • Therefore, if there is conversion as stated in Explanation II, it will be taken as land “exceeds the ceiling area“, and
    • “such excess” stands liable to be “surrendered” (automatically – without intervention of any authority).
  • 3. In case of conversion by a transfer/sale, the expression “person” denote the transferee. It is clear from the beginning words of this section – “Where any person acquires any land … by gift, purchase, … or any other kind of transfer …”
  • 4. The expression “shall be deemed to be land acquired after the said date” in the last limb of Explanation II (also) shows the nexus between the Explanations I and II. The result is that “such excess” stands liable to be “surrendered” (automatically – without intervention of any authority)

Read Blog: Glen Leven Estate v. State of Kerala: Not Correctly Decided?

Fragmentation of Plantation will be against the Provisions of the Act

Section 81 is a special provision to prevent fragmentation of plantation and to improve the economy of the state. Change the character of the plantation could be termed as ‘conversion’ and that will be against the provisions of the Act. (One Earth One Life v. State of Kerala, 2019-2 KHC(SN) 10; 2019-1 KLT 985).

No Total Prohibition in using Exempted Land for a Different Purpose

Explanation II does not make a total bar. It only causes to lose benefit of the exemption to a certain extent. That is, if a person converts any portion of his exempted land to any other class, that converted extent will be added to his account in determining his ceiling limit; and the Taluk Land Board can proceed upon that (excess) land. In short, the exemption will be lost for that portion. In this premises, in Wayanad Granites v. District Collector, 2023-4 KLT 874, it is held that ‘fragmentation is per se not illegal’. similarly, in District Collector v. Sajith Lal, 2023-4 KLJ 851, it is held that ‘there is no embargo under law in using any exempted land for non-exempted purposes as well’.

In Mathew K.T. v. State of Kerala, 19 April, 2024, in the light of earlier decisions, observed that there is no total prohibition in using an exempted land for a different purpose under the Kerala Land Reforms Act. The impediment or restriction is (only) the following –

  • If a portion of the exempted land is utilised for any other purpose, that would fall within his ceiling area and the authorities may be able to initiate ceiling proceedings.

The Full Bench decision, Mathew K. Jacob v. District Environmental Impact Assessment Authority [AIR 2019 Ker. 67, affirmed by the Supreme Court in K.H. Nazar v. Mathew K. Jacob, 2020-14 SCC 126] held as under:

  • “We however add that any class of land earlier exempted in the ceiling case can be converted into any class of land not liable to be exempted under Explanation II to Section 87 of the Act. The consequence is that the benefit of the exemption would be lost and the extent added to the account of the assessee or the declarant in determination of his ceiling area. That is a matter to be dealt with by the Taluk Land Board with the assessee or the declarant and other interested parties on the party array and we desist from elaborating further.”

In District Collector v. Sajith Lal (2023-4 KLJ 851; 2023 KLT OnLine 1225) it is held as under:

  • “5. There is no embargo under law in using any exempted land for non- exempted purposes as well. If the land is used for non-exempted purposes, the holder of the land will lose the qualification for exemption, thus giving authority to the Land Board to initiate ceiling proceedings.” (Quoted in: Mathew K.T v. State of Kerala, 19 April, 2024)

No Embargo to Transfer (Exempted) Plantation Land (Above Ceiling Limit)

In R. V.  Devassia v. Sub Registrar, Idukki, 2015-1 ILR(Ker) 1047; 2015-1 KHC 805; 2015-2 KLJ 17, it is held as under:

  • “9. On promulgation of the KLR Act in the State, the entire landed property in the State is subjected to State control as envisaged under the provisions of the KLR Act. No piece of the land escapes the clutches of the KLR Act including exempted land for ceiling purposes. The ceiling proceedings is a continuing proceedings and can be reopened in any of the circumstances, if so warranted, as contemplated under Section 87 of the KLR Act. Exemption granted from ceiling is the qualification to use the land in a particular manner, which means a burden is imposed on the land. The moment the qualification for exemption is vanished by conversion of the land, the protection from ceiling will also be extinguished to bring the land within the fold of the ceiling area. The exemption is in the nature of a burden on the land to use the land for the purpose for which exemption is granted. The eminent domain power of the State can be exercised for acquiring land without consent and also to regulate the use of land in public interest. The eminent domain is power inherent in any Sovereign State. This burden would bind the holder of the land as on 01/01/1970 and the successor-in-interest. The Division Bench of this Court in the State Human Rights Protection Centre, Thrissur and another v. State of Kerala and others [2009 (3) ILR 695] held that exemption granted under S.81(1)(a) is for the land and would continue to operate irrespective of change of ownership of the exempted land and the transferee would have to use the land for the purpose for which exemption is granted.”

In Everest Stone Crusher and Granites v. District Collector, Kannur, 2020-6 KHC 289, it is observed as under:

  • “16. In Devassia R.V. this Court noticed that, the provisions of the Kerala Land Reforms Act do not place any embargo on transfer. The transfer of registry is for fiscal purposes. The power of the competent authority to reopen the ceiling proceedings to include the land exempted for the purpose of ceiling is not lost on account of effecting mutation. Therefore, the Revenue Officials cannot refuse to effect mutation of the property purchased by the transferee.”

Tenant/Owner cannot ‘Sell’ Plantation Land (above ceiling limit) as his absolute property

  • An owner, or a tenant who got ‘fixity’ over such land, cannot ‘sell’ this land as his absolute (ownership) property.

Effect of Fragmentation for Non-exempted Category

The decision in One Earth One Life v. State of Kerala, 2019-2 KHC(SN) 10; 2019-1 KLT 985, arose from the Writ Petition filed for a declaration that the fragmentation and sale of a Rubber Plantation for non-plantation purposes was illegal as it defeated the purpose of the Kerala Land Reforms Act. When the matter was placed before the Taluk Land Board under Sec 87, KLR Act, it found that there was no change in classification of the land and therefore dropped the proceedings. The Court held as under:

  • “34. Section 81 of the KLR Act is in pith and substance a special provision, with its main objective of giving exemption to certain lands including the lands maintained as plantations is to prevent fragmentation of the land and to keep it as plantation itself to improve the economy of the state for welfare of people as a whole while the Act creates a regime, the State is under an obligation to safeguard, the intended purpose of the provisions of the Act in its spirit. ….. …… It could be gathered from the records that the proposal to transfer 1.03 acres of land to each workers in discharge of their service or retrenchment benefits will definitely divide the plantation into separate slots and that would definitely change the character/nature of the plantation, which could be termed as ‘conversion’ and that will be against the provisions of the Act.”

Can a Tenant of Plantation Transfer his Rights, Fragmenting the Plantation

Possession is a heritable and transferable right. [See: Nallammal Vs. Ayisha Beevi, 2017-5 Mad LJ 864; Phirayalal Kapur Vs. Jia Rani, AIR 1973 Delhi 186].

Therefore, a tenant of plantation having rights of fixity (Sec. 13) may have the right to transfer it to another. In any case, the change of character or nature of the plantation by fragmentation being amount to ‘conversion’ that will be against the provisions of the Act, as pointed out in One Earth One Life v. State of Kerala, 2019-2 KHC(SN) 10; 2019-1 KLT 985.

Sec. 120A, KLR Act is Relevant

Fragmentation of plantation land amounts to ‘conversion’. It will be against the provisions of the Act. Section 120A, KLR Act is relevant in this regard. It reads as under:

  • 120A.  Registering officer not to register in certain cases. – Notwithstanding anything contained in the Registration Act, 1908 (Central Act 16 of 1908), where the District Collector or any other officer authorised by the Government in this behalf informs the registering officer in writing that there are reasonable grounds to believe that any document relating to transfer of land which may be presented before him for registration is intended to defeat the provisions of this Act, such registering officer shall not register such document until the District Collector or the officer so authorised, as the case may be, informs the registering officer that the transfer is not intended to defeat the provisions of this Act. [Inserted by Act 17 of 1972.]

End Notes

Relevant provisions of KLR Act, in a Nutshell

Section Provisions in a Nutshell
Chap. II 
3(1)		Exemptions – (i) Nothing in this Chapter shall apply to – (viii) Tenancies of plantations exceeding 30 acres.
“Provided that the provisions of this chapter, other than sections 53 to 72S, shall apply to tenancies in respect of agricultural lands which are treated as plantations under sub clause (c) of clause (44) of Section 2”.
7 EPersons acquired lands (before 2005 amendment in KLR Act) for consideration below 1 Hec. 61 Are 87 Sq.m. (4 acre) will be deemed to be tenants .
13Fixity: “Every tenant, shall have fixity of tenure in respect of his holding.”
59Deposit of purchase price and issue of certificate – to cultivating tenant.
72Sec. 72 provides for automatic vesting of lease-properties held by cultivating tenants in Govt.  ILR 2010(2) Ker. 845. 
72(1) says: Holdings upon which tenanat entilted fixity under sec. 13 vest in govt.
72(4) – says: Landowner entitled to resume land shall apply within the time fixed. Otherwise vest in govt.
Rule 5 of the Vesting & Assignment Rules provides – LT may suo moto – notwithstanding no application – assign to cultivating tenant. (See  S.72C also). 
72BCultivating-tenant “shall be entitled to assignment” of land vested in Govt. under Sec. 72 –within ceiling area and get purchase certificate (through LT) (2 years from 1-1-1970). Effect of non-filing (See Balanoor Plantations case. 2018(3) KLT 283.)
72ESuch tenant is liable to pay rent to the Government.
72CProvides for suo moto action by LT. (No time limit,)
72KLT shall issue purchase certificate.  It shall be conclusive proof of assignment.
74Prohibition of future tenancies.
Chap. III 
81		Exemption from ceiling and excess for Govt. lands, private forests, plantations, industrial or commercial undertaking etc.
Proviso – There will be exemption (as plantation, land given to educational institution, trust etc.) on Government lands, given under grant, lease etc.
See: HMT (Machine Tools) Limited v. Taluk Land Board, 2009 (3) KLJ 110; MT Joseph v.  State of Kerala, AIR 1974 Ker 28.
82Ceiling area – 5/10 standard acres.
83No person can hold or possess excess of ceiling area. (Holding is by tenant.)  It is a total bar. (Note:  plantations, industrial area etc. are exempted.)
Apply to tenant also. 1980 KLT 259 (Gopalan Nair Vs. State), 1976 KLT 306  (Thomas Mariamma Vs. TLB), Raghunath Laxman Wani v. The State of Maharashtra (AIR 1971 SC 2137)
The policy of the Act – no person –“be permitted to hold any land in excess of the ceiling area.” Raghunath Laxman Wani v. State of Maharashtra, 1971-3 SCC 391, Bhikoba Shankar Dhumal v. Mohan Lal Punchand Tatbed, 1982-1 SCC 680, State of U.P v. Civil Judge, Nainital, AIR 1987 SC 16, State Vs. Puliyangattu, 2008(1) KLJ 571.
84Certain transfers – void.
85(1)Surrender excess.
85(2)Owners and Tenants (in excess of the ceiling area) should furnish ceiling return to Land Board before March31, 1971, before the Land Board (including lands exempted under S. 81).
Effect of non-filing: See – Balanoor Plantations case – 2018(3) KLT 283.State of Kerala Vs. Varkey Mathew, AIR 1996 SC 1009
85(3)Excess shall be surrendered.
85(5)Land Board shall determine – extend to be surrendered
85(7)Whereon a person fails to file statement under 85(2), LB shall intimate TLB  –  TLB shall determine land to be surrendered.
Effect of non-filing: See – Balanur Plantations case (With respect to Sec. 72B application) – 2018(3) KLT 283. Statute prescribes liability on the person who owes or hold the land in excess of the ceiling limit to file statement:  State of Kerala Vs. Varkey Mathew, AIR 1996 SC 1009.
[TLB not to do, suo motu, without direction from LB. 1980 KLT 120, referred to in 2019(1) KLT 985.]
85AFile ceiling return within March  2, 1973 before Land Board..
86(1)On determination of the extent to be surrendered under S. 85- Excess vests in Govt. and Taluk Land Board shall issue an order accordingly.
86(3)Where any person fails to surrender as demanded, the TLB may order an officer to take possession
86(4)Where any land, vests in the Govt, under s. 86(1) (including that of cultivating tenant) the ownership of such land shall vest in the Govt.
86(6)Nothing applies to property of Govt. under KLC Act.
87
Exp. II		If a person converts any portion of exempted land for any other class, that converted extent will be added to his account in determining his ceiling limit. That is, the exemption will be lost for the portion that exceeds the ceiling limit. (Mathew K Jacob v. District Environmental Impact Assessment Authority, 2018-4 KLT 913)

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