Madhava Rao, J.
1. These writ petitions are taken up together for hearing as the question involved in all these writ petitions is in respect of issue of a writ of Mandamus restraining the respondents from levying and collecting the tax under the Andhra pradesh, Nonagricultural Land Assessment Act (Act XIV of 1963),
2. In these writ petitions the legislative competence to make amendment to S. 2(d) of the said Act and also the definition of the term industry (Industrial purpose ?) under this section are challenged. To have a clear idea of the several points raised, we will narrate the facts of writ petition 3494 of 1978.
3. The petitioners-Associated cement companies Limited Mancherial, are the owners of 338 acres 22 guntas of alnd on which the cement plant for the manufacture of cement is erected. It is stated that only on 32 acres 18 guntas the machinery is set up where the manufacturing process takes place and in the said are the company has constructed certain buildings where the staff of the company work in connection with the manufacture. The company has also constructed certain houses to accommodate its staff and workers and the area covering these residential quarters is about 173 acres 5 guntas leaving a vacant site of 121 acres 14 guntas as waste land with shrubs thereon. It is further stated that the company has taken on lease 1900 acres of land for the purpose of carrying on mining operations i.e. for extraction of lime stone as lime stone is the raw material for the manufacture of cement. Under the Andhra Pradesh Non-Agricultural lands assessment Act, 1963 (Act XIV of 1963), tax was levied on the lands used for non-agricultural purposes. The same was challenged by filing a writ petition in this Court and several other writ petitions followed. The main attack was on the validity of the Act and the state Government has no power to collect tax on the land actually used as commercial, industrial or for residential purposes and no tax can be levied on the land which is not used at all in the sense it has been kept waste. It was sought to be contended that a distinction should be made between the land used for industrial commerical and residential purposes in order to levy tax and on that levy cannot be made for the land used for extraction of minerals like mining operations etc. This batch of writ petitions viz., Writ petition 290 of 1965 etc. Were disposed of by a Division Bench of this Court by its judgment dated 22nd April 1970 holding:
'..........It is therefore cleraly wrong to class lands containing mines and from which ore is extracted with the aid of power as lands used for industrial purpose when the activity in that land does not involve any process of manufacture with the aid of power'.
Thus it was made clear that it was not open to the Government to levy tax on the area used for mining operations.
4. In view of the aforesaid judgment, the state legislature has amended the said Act which is known as the andhra pradesh Non-Agricultural). Lands Assessment (Amendment) Act 1974. The Act received the assent of the Government on 22nd August. 1974 and was published in the Gazette on 23rd August 1974. To the definition clause of industrial purpose under S. 2 (d) of the Act. The following para was added:
'.............. and includes a purpose connected with an excavation underground or otherwise, where any operation for the purpose of searching for or obtaining a mineral has been or is being carried on'.
The petitioner states that this amendment evidently is made to bring mining operation within the definition of the term industry and according to him the state legislature has no power to do so.
5. The learned counsel for the petitioner Mr. K. Srinivasa Murthy submitted that it is open to the parliament to take over the control of the mines and mineral development he referred to item 54, List I of the seventh sch. To the Constitution. He submitted that in pursuance of the said power the Mines and Minerals (regulation and Development) Act 1957 is enacted S. 2 of the said enactment states the intention of the Government of India to take under its control the regulation of mines have been taken over by the Government of India and it is not open to the state Government in purported exercised of power under the Act to levy tax on areas used for mining operations Therefore if the intention of hte Amendment Act 1974 is to enable the state Government to levy tax on lands used for mining operations to that extent, it must be held to be ultra vires of the state legislature.
6. On the other hand. The learned Government pleader submitted that item 54, List I of the seventh sch. To the Constitution which relates to the regulation of mines and development of minerals has nothing to do with the provision of the amendment Act 1974 by virtue of S. 2 of the Mines and minerals (regulation and Development) Act, only regulation of mines and development of minerals have been covered but the subject of the amendment Act 1974 falls within Entry 45 of the said (or second) List of the Constitution. Thus the said legislation in intra vires of the state legislature.
7. To examine the rival contentions it will be useful to refer to the items under the schedule referred to by the counsel.
8. Item 54 of List -I of the seventh sch to the Constitution. Reads as under:
'Regulation of mines and mineral development to the extent to which such regulation and development under the control of the Union is declared by parliament by law to be expedient in public interest'. By virtue of this Item 54, the Mines and Minerals (Regulation and development ) Act, 1957 is enacted. The scheme of the Act is given in S. 2 wherein it is declared that it is expedient in public interest that the Union should take under its control the regulation of mines and development of minerals to the extent hereafter provided S. 3 defines minerals Mineral oils mining lease mining operations minor minerals prescribed prospecting licence prospecting operations: and mines and owners S. 4 provides for prospecting and mining operations licence S. 4-A provides for termination of a mining lease. There is however no provision under the Mines and Minerals (Regulation and Development) Act vesting the land containing m,ines or minerals in the central Government by divesting the state Government nor is there provision leaving a cess or tax on the use of land for mining industrial or other non-agricultural purposes. It is to be noted that item 54 speaks only of mines and mineral development and not with regard to land. Therefore, evidently there is no provision under which any tax on land could be levied under the Mines and minerals (regulation and Development) Act, at his juncture, we will refer to item 45, list II of thw seventh sch. To the Constitution, which reads as under: 'Land revenue including the assessment and collection of revenue the maintenance of land records surevey for revenue purposes and records of rights and alienation of revenues'.
The state legislature is competent to legislate in respect to land which is also evident from item 18 List II of the seventh sch. To the Constitution which reads as under:-
'Land that is to say rights in or over land. Land tenures including the relation of landlord and tenant and the collection of rents transfer and alienation of agricultural land land improvement and agricultural loans colonization'.
Tax to be collected on land is also a subject which falls under Item 49 list II of the seventhsch. To the Constitution which reads as under:
'Taxes on lands and buildings'.
9. If items 18, 45 and 49 are taken into consideration it becomes evident that the state legislature is competent to legislate in respect of land the rights in or over the land, its tenure with regard to land revenue including assessment. Collection of revenue including assessement. Collection of revenue and also with regard to levy of tax on land. This power is exclusively vested in the state legislature to levy tax on the state legislature to levy tax on land. This power is exclusively vested in the state legislature to levy tax on the land which inlcudes agricultural land and non-agricultural land. Therefore the point for consideration is when the Union Government has not chosen to take over or to levy any cess or tax on lands containing mines and minerals, why can't the state legislature in respect of assessment on land. In view of the clear legal position extracted above the state legislature was competent to make the amendment we are therefore of the view that the state legislature was quite competent to bring in the amendment to S. 2 oil the said Act.
10. The learned counsel for the petitioners next submitted that the assessment on the land was really tax on the minerals rights and not tax on the land. Under the guise of collecting tax, as if on non-agricultural land. Tax is really being imposed on the mineral and the same is being collected. When the tax is already being paid for the excavation of the minerals, the question of its again being paid on the mineral does not arise at all. Such an argument in a slightly different form was urged before the Supreme Court in H.R. Murthy v. Collector of Chittoor : [1964]6SCR666 . The point raised before the Supreme Court was that the land cess was really a tax on mineral rights falling within Entry 50 of the state List, which reads; 'tax on mineral rights subject to any limitation imposed by parliament by law relating to mineral development' and that the central acts under which also taxes and fees might be levied brought into play the last portion of this entry and that as a result the power to impose this tax was not avaliable after the central acts of 1948 and 1957 came into force. In this connection the advocate for the appellant therein pointed out that as the impugned land cess was payable only in the event of the lessee 'winning' the mineral and so paying the royalty and and not when no minerals were extracted it was in effect a tax on the minerals won and therefore on mineral rights. However the Supreme Court observed (para 10)
'We are unable to accept this argument. When a question arises as to the precise head of legislative power under which a taxing statute has been passed, the subject for enquiry is what in truth and substance is the nature of the tax No doubt in a sense but in a very remote sense. It has relationship to mining as also to the mineral won from the mine under a contract by which royalty is payable on the quantity of mineral extracted. But that does not stamp it as a tax on either the extraction of the mineral or on the mineral right It is unnecessary for the purpose of this case to examine the question as to what exactly is a tax on mineral rights'.
11. Therefore the Supreme Court negatived the contention that the levy of tax on land was in effect a tax on the minerals won and, therefore on mineral rights.
12. The learned counsel for the petitioners further submitted that by virtue of item 54, List I of the seventh sch. To the Constitution, under the Mines and Minerals (Regulation and Development) Act 1957 the land comes under the control of the central Government. In our view, this submission is devoid of merit. The very Act itself clearly points out that an application for licence is to be filed before the state Government under section 9 thereof. Section 10 of the said Act provides that an application for a prospecting licence or a mining lease in respect of any land in which minerals vest in the Government shall be made to the state Government concerned in the prescribed from and shall be accompanied by the prescribed fee. Sub-sec. (3) of S. 10, provides that on receipt of an application under this section the state Government may having regard to the provisions of this Act and any rules made thereunder grant or refuse to grant the license or lease. Therefore it becomes clear that minerals vest in the Government and as corollary land also vests in the persons or in the state Government as the case may be therefore, under the Mines and Minerals (regulation and Development) Act it cannot ipso facto be said that the lands covered by mines vest in the central Government and therefore the state Government has no power to legislate in respect of land and impose tax.
13. The learned counsel for the petitioners next submitted that to the extent of land over which mining operations are carried on levy can be imposed and not to the extent of land which is kept vacant as waste i.e. in which mining operations are not being carried on. In the affidavit filed in support of the writ petition, it is stated by the petitioner that only an extent of 46 acres is at present being used for the manufacture of cement and as such out of 1900 acres levy was to be imposed only to the extent indicated above. The extent indicated above. The extent disclosed by the petitioner in the affidavit is not accepted in the counter. Thus there is a dispute about the extent of the land put to use as non-agricultural, when the land is not put to a non-agricultural purpose and it is a waste land then the question of imposing tax on it treating it as non-agricultural land does not arise. Assessment has to be made only on the land which is put to use as non-agricultural land. Thus, there is a dispute with regard to the actual extent of the land used as non-agricultural land and that question cannot be decided in these proceedings. However the demand notice is for the entire extent of 1900 acres, in the counter, it is admitted that only 242 acres of land is used for mining operations it is made clear that when 1900 acres of land is granted for mining purposes, at this stage, the question of leaving certain portion for the purpose of searching for minerals does not arise (sic) only mining operations will be carried on. Therefore on the basis that searching operations are being carried on no assessment could be made. In respect of the land on which the mining operations are being carried on levy can be imposed. On the basis that operation for the purpose of searching and obtaining minerals is being carried on on the entire 1900 acres of land the assessment is made with regard to the entire 1900 acres of land, therefore such assessment is vitiated. Under the andhra Pradesh Non-agricultural Lands Assessment Act, there can be imposition of assessment on the use of the land as non-agricultural and no other cess can be imposed and collected on the land thereunder.
14. Therefore, we hereby quash the demand notice to the extent indicated above. The assessing authority would now re-assess the land in the light of the observations made above and issue fresh notice to the petitioner.
15. In the result the writ petitions are allowed in part, as indicated above there will be no order as to costs Advocate's fee Rs. 100/- in each.
W. Ps. Nos 5540 and 5541 of 1980.
16. These two writ petitions are taken up for hearing together. The point raised in these writ petitions is whether the petitioner is liable for the payment of the assessment imposed on him. It is not in dispute that the petitioner has taken godowns on lease along with the adjacent land for a period of 99 years from the andhra pradesh state warehousing corporation. The petitioner submitted that no notice was issued to him at the time of the assessment of the tax. So far as the position of law is concerned, if the land is owned by the state or the central Government the lessee is liable to pay the assessment but if the owner of the land is not the state or the central Government the owner has to pay the assessment. In the instant case it is not clear as to who is the owner of the land. Therefore this fact needs to be ascertained. It is a question of fact. Keeping all these facts in view and also the complaint of the petitioner that there is no notice issued to him regarding the assessment in all fairness, we are of the opinion that the petitioner must be given a chance to be heard in the matter. There is a remedy by way of an appeal under S. 5 of the Andhra pradesh Non-agricultural Lands Assessment Act 1963. We, therefore direct the petitioner to file an appeal against the demand notice issued to him within one month from to-day.
17. With this direction, the writ petitions are disposed of. There will be no order as to costs. Advocate's fee Rs. 100/- in each.
18. However, the stay granted by this Court will continue till the disposal of the appeal before the appellate authority.
W. Ps. 1795, 2026,2459, 3185/80 and 2688/91.
19. We have already dealt with the competency of the state legislature to bring in the amendment to S. 2 (1) (d) of the Andhra pradesh Non-agricultural lands Assessment Act. The constitutional validity of the Act has already been upheld by the judgment of the division Bench of this Court in writ petition 290 of 1965 and batch dated 22nd April , 1970.
20. Therefore these writ petitions are dismissed. There will be no order as to costs. Advocate's fee Rs. 100/- in each.
W. Ps 3071 and 3072 of 1980.
21. Apart from the other questions raised, the main point on which we want to dispose of these writ petitions is that one demand notice was issued for the assessment relating to several years the learned counsel for the petitioner submitted that there is no separate assessment made for each year but only a single demand notice is issued. In will not be proper for us to accede to this submission because if there are separate assessments. The demand notice is likely to be proper. But there is no counter filed in these cases.
22. In the circumstances, we are of view that the petitioner must be permitted to file an appeal against the demand notice before the appellate authority within one month from to-day. It is open to the petitioner to raise all the grounds advanced before us, before the appellate authority.
23. However, the recovery of the amount in pursuance of the impugned demand notice is stayed until the disposal of the appeal.
24. The writ petitions are disposed of accordingly. No orders as to costs Advocate's fee Rs. 100/- in each.
W.P. Nos. 4595 and 5862 of 1978.
25. The learned counsel for the petitioner challenge the demand notice on several grounds in these writ petitions we are of the view that against the issue of the demand notice an appeal lies under S. 5 of the Act. It is open to the petitioner to file an appeal with in one month from today. He can raise all the grounds in the appeal.
26. Pending appeal the petitioner is directed to pay the tax at the previous rate.
27. The writ petitions are disposed of accordingly. There will be no order as to costs. Advocate's fee Rs. 100/- in each.
28. Order accordingly.