Broomfield, J.
1. The main appeal No. 155 of 1930 is an appeal by the Ahmedabad Ginning and Manufacturing Company Limited, commonly known as the Madhubhai Mills, against a decree of the First Class Subordinate Judge at Ahmedabad' dismissing a suit for refund of Rs. 15,581-5-7 alleged to have been illegally recovered as non-agricultural assessment on lands belonging to the company for the years 1925-26 to 1927-28, and for an injunction against the recovery of this assessment in future.
2. The question involved is whether Government had the right to levy non-agricultural assessment at the rate of Rs. 200 per acre on these lands which were appropriated to non-agricultural purposes with the permission of Government on payment of fine.
3. The plaintiff company owned seven survey numbers in Sherkotda, a suburb of Ahmedabad, which were originally assessed as agricultural lands. At various times between 1863 to 1894 these survey numbers or portions of them were permitted to be applied to non-agricultural usage, that is, the company was allowed to erect mill buildings on them. Fines of varying: amounts were imposed ranging from 30 to 133 times the agricultural assessment. The learned Counsel for the appellants has prepared a statement from the evidence on the record giving details of the various plots with the date-of conversion to non-agricultural purposes, etc. This statement is appended at the end of this judgment. It may be mentioned that the total area of the lands in question amounts to about twenty-five acres and the charges levied by Government for putting the lands to non-agricultural use amounted in: all to Rs. 20,512.
4. We have no information about the case mentioned first in the statement It is not known whether Government levied a fine, or, if so, what the fine was. The law in force at that time was Regulation XVII of 1827. Section 2 of that Regulation provided that all land was liable to pay revenue according to its kind, unless specially exempted. Under Section 4 it is provided that if the right of assessment is unlimited, the Collector shall fix it under the control of Government; where there is a limit, it must not be exceeded, and the right of Government to institute, at any time when it may appear expedient, new and specific rules regarding assessment was not to be affected. The next two cases in the statement were governed by Act I of 1865, Section 35 of which provided as follows :-
It is hereby declared that an occupant of any Government land is entitled, in virtue of his occupancy, to erect farm buildings, etc., for the better cultivation of the land. But if an occupant wishes to appropriate the land in his occupancy to any purpose unconnected with agriculture, so as to destroy or injure it for cultivation, he shall first obtain the Collector's permission, which shall be given on payment of a fine fixed according to such rules as may from time to time be prescribed under the orders of the Governor-in-Council, and on entering into a written agreement to pay, in addition to such fine, the annual assessment which may have been fixed on such land at the settlement then current, and which shall remain liable to revision at any future settlement of the District.
In the case of appropriation of land for purposes unconnected with agriculture, therefore, the Collector had power to levy a fine, and the agricultural assessment was to continue for the period of the current settlement. That meant in effect in this particular case thirty years from 1860, which was the date of the first revenue settlement in Ahmedabad. After that the as sessment was liable to revision, and this did not mean merely revision on an agricultural basis : see Mahmadbhai Dosubhai v. The Secretary of State manufac for India I.L.R. (1917) 42 Bom. 126 : 20 Bom. L.R. 22.
5. All the remaining cases in the statement were after the introduction of the Bombay Land Revenue Code, Bombay Act V of 1879; five of them during the currency of the settlement of 1860, and the rest after the first 0F state revision settlement which was introduced with effect from the revenue year 1889-90. Section 65 of the Act and rRule 56, 67 and 68 provided for the levy of fines and the imposition of altered assessment in cases where the lands were converted to non-agricultural usage. The rules made under the Code in 1881 were amended in 1905, after which date altered assessment only was leviable, and fines only in exceptional cases : see Rules 71 to 75 of the amended rules of 1881, and Rules 99 to 102 of the rules of 1921 now in force. At the material time, however, that is to say, when the lands with which we are concerned were allowed to be converted for building purposes, the Bombay Land Revenue Code allowed both the imposition of fine and the levy of altered assessment. Under the Regulation of 1827 and the Act of 1865 there was no provision for altered assessment, the agricultural assessment being continued for the period of thirty years' guarantee, that is until 1890. After the introduction of the Bombay Land Revenue Code altered assessment was leviable, as I have said, in addition to fine, but in fact the assessment on these lands was not altered, and the old agricultural assessment continued to be levied until the introduction of the first revision settlement of 1889-90. At that time the lands were remeasured and reassessed by the survey officer. Apparently, so far as the entries in the Settlement Record Village Form No. I go, this was done on an agricultural basis-the assessments were imposed on the various plots of lands as though they were cultivable Jirayat or dry crop lands.
6. In March, 1924, the Collector of Ahmedabad wrote to the plaintiff calling for plans of the buildings standing on these survey numbers, and stating that the buildings had been erected without permission. This letter was apparently written under a misapprehension. Correspondence ensued, and on May 4, 1927, the Commissioner made an order, directing the Collector to take steps to revise the non-agricultural assessment for these lands under Sections 48 and 52 of the Bombay Land Revenue Code. In consequence of this order, the Collector on June 17, 1927, made a demand for payment of altered assessment at the rate of Rs. 200 an acre, from the revenue year 1919-20 to date. The demand was made according to the standard rate fixed by the rules then in force for agricultural lands converted to non-agricultural usage : Chapter 14 of the rules of 1921. On an appeal to the Commissioner, that officer directed that the revised assessment should only be levied from the date on which the old guaranteed period expired and the new settlement was introduced. I should mention that the second revision settlement came into force in October, 1926, but the lands in suit were excluded from this settlement which was confined to agricultural lands. The amount demanded by the Collector was paid under protest, and the plaintiff filed the Suit from which this appeal arises.
7. The first argument of the learned Counsel for the appellant is that there was an implied agreement on the part of Government that the assessment would not be altered. He says that when Government accepted a heavy fine from the plaintiff for the conversion of the lands to building purposes they of State waived the right to levy an altered assessment, otherwise the altered assessment would have been levied at once, or, at any rate, when the original period of guarantee came to an end. It is not open to Government, according to the learned Counsel, now that fines have been abolished in ordinary cases, and altered assessment levied instead, to levy an altered assessment in addition to the fine already recovered. There is nothing on record to show why the assessments were not put on a non-agricultural basis at the first revision settlement, in the case of the lands converted before the Land Revenue Code came into force, nor why, in the case of lands converted after that, the assessment was not altered either at once or at the first revision. On the other hand, there is nothing on the record to suggest that there was any guarantee given to the plaintiff, that the assessment would not be revised. The Regulation of 1827, the Act of 1865 and the Bombay Land Revenue Code all reserved the powers of revising assessments after the period of guarantee, if any. I need only on this point refer to Section 45 of the Code which lays down that all land, whether applied to agricultural or other purposes, and wherever situate, is liable to the payment of land revenue to Government according to the rules, except such as may be wholly exempted under the provisions of any special contract with Government or any law for the time being in force.
8. In Shapurji Jivanji v. The Collector of Bombay I.L.R. (1885) 9 Bom. 483, it was held that strict proof must be given of any right set up in derogation of the inherent right of the Sovereign to assess the land at his discretion. Mr. Justice Scott cited an observation of Lord Stowell in The Rebeckah (1799) 1 Rob. 227, that 'the prerogatives and rights and emoluments of the Crown being conferred upon it for great purposes, and for the public use, it shall not be intended that such prerogatives, rights, and emoluments are diminished by any grant, beyond what such grant by necessary and unavoidable construction can take away. (p. 230).' (p. 490). In Vinayak v. Collector of Bombay I.L.R. (1901) 26 Bom. 339 : 3 Bom. L.R. 910. Mr. Justice Chandavarkar said (p. 350) :-.when a person acquires a land' from the Crown, he acquires it subject to the paramount right of the Crown to assess it for the purposes of revenue from time to time, according to the exigencies of administration, unless by the grant the Crown has exempted the land from the liability. If it is not so exempted, the liability remains.
These were both cases under a special Act, Bombay City Land Revenue Act (Act II of 1876), but the observations I have cited have a general application. It would, in my opinion, be obviously opposed to principle to imply, from the mere circumstance that the non-agricultural assessment has not been previously levied, any limitation on the prerogative of the Crown to assess the land to land revenue, and to revise the assessment periodically according to law.
9. This part of the appellant's case has, I think, no force in it; nor is there any force in the alternative argument put forward by the learned Counsel for the appellant, that the assessment of these lands must be presumed to have been guaranteed for ninety-nine years or at least for fifty years. The basis of this argument is Rule 25 of the Bombay Land Revenue Rules of 1881, Rule 56 of the same rules as amended in 1905, and Section 102 of the Bombay Land Revenue Code. Rule 25 provided :
Occupancies of building sites shall ordinarily be disposed of for. ninety-nine years, subject to an annual ground-rent.
It would appear from the other provisions in the rule that it was intended to apply to sites in hill stations and in the residential parts of large cities. There may be a question, therefore, whether this rule could have any application to the lands in suit. However that may be, there was no disposal for ninety-nine years in any of these cases. If the ordinary rule had been applied, there might have been a guarantee for ninety-nine years. But in the absence of any sanad or agreement or general or special orders applicable to these lands, one cannot infer any such guarantee. Similar considerations will apply to Section 102 of the Code, which provides that after the assessments have been fixed by the Officer in charge of the Survey, the Governor in Council may declare the assessments fixed for a term of years not exceeding thirty, in the case of lands used for the purposes of agriculture alone, and not exceeding ninety-nine in the case of all other lands. It does not appear that there was at any time any declaration in respect of the suit lands. As for Rule 56, the amendment prescribing fifty years as a normal period of guarantee in the case of lands converted to non-agricultural usage was only made in 1905. It was not retrospective. The rule in force at the material time said nothing about fifty years.
But though it is impossible to imply either an agreement that the agricultural assessment would be maintained in perpetuity or a guarantee for any period longer than thirty years at the most, that does not dispose of the case. The question still remains whether the Collector had power to impose this new assessment under the Bombay Land Revenue Code and the rules thereunder. The rules under which the assessment was actually levied are rules passed with reference to Section 48 of the Code. It is conceded that it must be leviable, if at all, either under that section or under Section 52. I will deal with the latter section first, because the learned Judge seems to have considered that to be the main foundation of the Collector's order. Section 52 is as follows :
On all lands which are not wholly exempt from the payment of land revenue, and on which the assessment has not been fixed under the provisions of Section 102 or 106, the assessment of the amount to be paid as land revenue shall, subject to rules made in this behalf under Section 214, be fixed at the discretion of the Collector, for such period as he may be authorised to prescribe, and the amounts due according to such assessment shall be levied on all such lands.
If these lands can be assessed under this section, it is clear that the matter is left to the Collector's discretion, no rules having been made under Section 52, and there would be nothing to prevent him from imposing the standard rates leyiable under Section 48 or any other rates.
10. But Section 52 only applies where no assessments have been fixed under Section 102 or 106. These sections are as follows :
102. The assessment fixed by the officer in charge of a survey shall not be levied without the sanction of Government. It shall be lawful for the Governor in Council to declare such assessments, with any modifications which he may deem necessary, fixed for a term of years not exceeding thirty in the case of lands used for the purposes of agriculture alone, and not exceeding ninety-nine in the case of all other lands.
106. It shall be lawful for the Governor in Council to direct, at any time, a fresh revenue survey or any operation subsidiary thereto, but no enhancement of assessment shall take effect till the expiration of the period previously fixed under the provisions of Section 102.
It would seem that the former section would ordinarily apply to an original survey, and the latter section to a revision survey. The orders of the survey officer in 1889-90, when he re-measured and re-assessed the suit lands, may be said to have been passed either under Section 102 or Section 106, inasmuch as there had been a previous settlement. But it is quite clear at any rate that they were passed under one section or the other. The learned Government Pleader tries to get out of the difficulty by saying that the assessments fixed at the first revision settlement were only guaranteed for thirty years, and therefore in 1927 there was no assessment fixed under Section 102 or Section 106 in respect of the suit lands which, as I have said, were excluded in the second revision settlement, But the assessments fixed at a survey settlement do not cease to be operative at the expiry of the period of guarantee unless and until they are revised. The assessments fixed by the survey officer in 1889-90 were still in force in 1927 so far as the suit lands were concerned. Therefore the Collector had no power to act under Section 52.
Section 48 is in these terms :
(1), The land revenue leviable on any land under the provisions of this Act shall be assessed, or shall be deemed to have been assessed, as the case may be, with reference to the use of the land-
(a) for the purpose of agriculture,
(b) for the purpose of building, and
(c) for a purpose other than agriculture or building.
(2) Where land assessed for use for any purpose is used for any other purpose, the assessment fixed under the provisions of this Act upon such land shall, notwithstanding that the term for which such assessment may have been fixed has not expired, be liable to be altered and fixed at a different rate by such authority and subject to such rules as the Governor in Council may prescribe in this behalf.
The present section was substituted for the original one which was rather differently worded by an amending Act in 1913. But the power of Government to levy altered assessment in 1927 must obviously depend on the law as it stood at that date. In order to ascertain whether the Collector had power to alter the assessments under Clause (2), we have first to apply Clause (1) and see whether the lands with which we have to deal are to be deemed to have been assessed for the purpose of agriculture, or for the purpose of building. It is only if they are deemed to have been assessed for the purpose of agriculture that the assessment would be liable to be altered by reason of change of use.
11. In this connection it appears that we have to make a distinction between the lands which were converted to a non-agricultural use before the assessments were fixed in 1889-90 and those which were converted after that. In the former case, the lands were admittedly used for building purposes when the assessments were fixed. According to Clause (1) of Section 48, therefore, they are to be deemed to have been assessed with reference to the use, that is for the purpose of building, and they were not liable to altered assessment in 1927, there having been no subsequent change of use. I mean of course they were not liable to have the assessment altered by an order of the Collector under Section 48(2). The assessment presumably might have been revised if the lands had been included in the second revision settlement, or may be revised still if a fresh survey should be directed. That is a matter which does not concern us in this case. On the other hand, as regards the lands which were converted after the year 1889-90, Clause (2) of Section 48 seems clearly to apply. They were agricultural lands when the assessment was fixed and were assessed with reference to that use. The use was subsequently changed and therefore the assessments fixed under the Act by the survey officer were and are liable to be altered by the Collector.
12. The learned Government Pleader's argument in this connection is that Clause (1) makes a distinction between assessments which are actually made and assessments which are to be deemed to have been made with reference to the use of the land, and he says that Clause (2) only refers to the first kind of assessments. I cannot accept this view. Possibly there may be some ambiguity about Clause (1). It clearly means that assessments are to be made in future and shall be deemed to have been made in the past with reference to the use of the land. It may also mean that whether assessments are actually fixed with reference to the use of the land or not, they shall be deemed to have been so fixed. But in any case Clause (1) lays down the conditions for the operation of Clause (2). I cannot agree that it deals with two categories of cases, only one of which is dealt with by Clause (2) and the other not at all.
13. Mr. Thakor for the appellant argues that Clause (2) of Section 48 does not apply even to lands converted after the first revision settlement. He says that when the Collector levied a fine and did not alter the assessment, the land must be deemed to have been at that time, that is at the date of the Collector's order, assessed for building purposes so that there was no change of use after the lands were assessed. In my opinion that is not a tenable view. If the Collector fixed the assessment it would not be an assessment fixed under Section 102 or Section 106, so that in that case Section 52 might be applied. But as a matter of fact the Collector did not fix any assessment at all. The assessment as fixed by the survey officer remained in force.
14. The appeal succeeds therefore as regards all the lands converted before the assessment fixed at the first revision settlement came into force and fails as regards the others. That is as regards the main question of liability to altered assessment.
15. But the appellant challenges the right of Government to recover altered assessment retrospectively in respect of any of the lands. The Collector's order fixing the new assessments was passed in June, 1927. They have been recovered for the years 1925-26, 1926-27 and 1927-28. It is contended, and I think rightly, that there is no right of recovery for the first two years. As I have said already in another connection, the assessments fixed at the first revision continued in force until revised, that is until June, 1927. No. authority has been referred to in support of the Collector's power to levy revised assessments retrospectively. On the other hand Shapurji Jivanji v. The Collector of Bombay (1) is against it.
16. The plaintiff, therefore, is entitled to the refund of the whole amount recovered in respect of the years 1925-26 and 1926-27, and to the refund of the amount recovered for 1927-28 in respect of the lands converted on February 2, 1863, February 14, 1877, August 17, 1877,....1883, March 14, 1883, November 29, 1886, April 4, 1887, and May 27, 1888, that is the first eight plots in the appended statement A. He is also entitled to interest on this amount at six per cent.
17. Appeal No. 156 of 1930 is a companion appeal raising the same questions. The plaintiff in this case is the Maneklal Harilal Spinning and ., Ahmedabad, The suit was to recover Rs. 5,010 levied by way of non-agricultural assessment for the years 1925-26, 1926-27 and' 1927-28. The appended statement B gives the details of the plots in question. The first three of them were converted to building purpose prior to the first revision settlement and the last three afterwards. For reasons already given the plaintiff is entitled to the refund of the whole amount recovered for the years 1925-26 and 1926-27 and to the refund of the amount levied, for 1927-28 in respect of the lands converted on April 6, 1889, April 6, 1889, and April 20, 1889, that is the first three plots in statement B.
18. As regards the prayers for injunction, plaintiff in each case is entitled to-the injunction prayed for in respect of the plots for which the assessment is ordered to be refunded for the year 1927-28. The injunction will be only against recovering the altered assessment by the Collector under Section 48 or Section 52.
19. Decrees to be drawn up in accordance with these findings in substitution for the decrees of the trial Court.
20. The plaintiff in each case will get two-thirds of his costs from Government in both Courts.
Tyabji, J.
21. I agree. It is argued that under the Bombay Land Revenue Code, 1879, Section 48, Sub-section (2), the assessment must be deemed to continue to be agricultural assessment. Mr. Thakor contended that this argument was not open to the defendant as he had in his written statements pleaded that the assessment had been altered from agricultural to building assessment. It is true that in paragraph 7 of the written statement in suit No. 1358 of 1928 out of which Appeal No. 155 arises, it is stated that altered assessment was levied under Rule 56 of the Land Revenue Rules of 1881. Similarly in the other suit, it is stated in paragraph 3 that no agreement showing the period of guarantee of altered assessment was made, and altered assessment equal to agricultural assessment only was being levied up to 1925-26; and in paragraph 5 that on those portions of the land on which permission to erect building was, granted in 1891, altered assessment equal to agricultural assessment was levied under the rules in addition to fines. But these averments imply that the revision of the assessment was on the basis of the land being used for building purposes, and that the assessment was altered from agricultural assessment to building assessment, although the amount of the building assessment was allowed to stand at the same figure at which the agricultural assessment had stood. Mr. Thakor's contention therefore cannot be upheld.