Civil Rule No. 2769 of 1998, WP(C) No. 165 of 2000, 4172 of 2002, 963 of 2003, 6853 of 2005 and 3652 of 2009. Case: Oil and Natural Gas Corporation and Anr. Vs State of Assam and Ors.. Guwahati High Court
| Case Number | Civil Rule No. 2769 of 1998, WP(C) No. 165 of 2000, 4172 of 2002, 963 of 2003, 6853 of 2005 and 3652 of 2009 |
| Counsel | For Appellant: Mr. G.N. Sahewalla, Sr. Advocate, Mr. A.M. Buzarbaruah and Mr. N.C. Nath, Advs. and For Respondents: Dr. B.P. Todi, Sr. Advocate and Mr. N. Rajkhowa, Adv. |
| Judges | Amitava Roy and P.K. Saikia, JJ. |
| Issue | Constitution of India - Articles 14, 31; Oil And Natural Gas Commission (transfer of Undertaking And Repeal) Act, 1993 - Section 3; West Bengal Rural Employment And Production Act, 1976 - Sections 4(1), 4(2) |
| Citation | 2013 (2) GLT 85 |
| Judgement Date | November 23, 2012 |
| Court | Guwahati High Court |
Judgment:
Amitava Roy, J.
1. The petitioners, Government owned Public Sector entities, seek defeasance of Sections 3-A and 25-B introduced by the Assam Land Revenue Reassessment (Amendment) Act, 1997 (for short, hereinafter referred to as 'the Act' 1997/1997 Act) as ultra vires the Constitution besides being infirm for lack of legislative competence. Reclassification of lands at their disposal in furtherance of their institutional pursuits and consequential enhancement in land revenue therefor has also been oppugned. The impugnments being common and the factual settings substantially identical with minor inconsequential divergences, this analogous adjudication is permissible. However, the imperative facts to sketch the backdrop as are unavoidable have been gleaned from the pleadings of WP (C) 6853/2005 and WP (C) 4172/2002. We have heard Mr. G.N. Sahewalla, Senior Advocate for the petitioner Oil & Natural Gas Corporation Ltd. (for short, ONGC/Corporation) and Mr. A.M. Buzar Baruah, Advocate for the petitioner Oil India Limited (for short, 'OIL/Company'). The respondents have been represented by Dr. B.P. Todi, Senior Advocate assisted by Mr. N. Rajkhowa, Advocate.
2. The Corporation in which in terms of Section 3 of the ONGC (Transfer of Undertaking & Repeal) Act, 1993 the assets of the erstwhile Oil and Natural Gas Commission did vest with effect from 1.2.1994, has introduced itself to be an organization engaged in exploration and production of hydrocarbons popularly known as Crude Oil and Natural Gas, its exploits being spread over the country as a whole and also beyond its territorial shores. According to it, the Crude Oil produced/extracted from Assam is sold to various refineries situated in the state for refining. However, the natural gas extracted is supplied to the Gas Authority of India Limited and other Public Sector organizations including the Assam State Electricity Board. It has averred that in connection with the related operations for the purpose of exploring and exploiting hydrocarbons, the lands required are being acquired under the provisions of the Land Acquisition Act, 1894 by paying due compensation thereunder and at times, land is also taken on long term lease. According to it, out of such stretches often only a small percentage thereof is actually used for the exploration and exploitation activities and the rest are utilized for providing roads, construction of office buildings, residential quarters and other civic amenities to its officers and staff. Some portions are also used for setting up schools, hospitals, parks and sports complex for being availed by the members of the public.
3. The Corporation has referred to a series of miscellaneous reclassification cases in connection with which notices had been issued by the Additional Deputy Commissioner, Sibsagar against which it had submitted written objections. The appeals filed against the orders rejecting its representations before the learned Assam Board of Revenue, Guwahati were also dismissed. In essence, vide orders passed in the reclassification cases the State authorities demanded payment of land revenue at the enhanced rate. That being aggrieved by such decisions which stood affirmed by the learned Assam Board of Revenue, Guwahati it had approached this Court, amongst others, with Civil Rule No. 2769/98, 3750/98 and WP (C) 165/2000 pertaining to various periods of demand has been mentioned. Tracing these demands for enhanced land revenue to the Assam Land Revenue Assessment Act, 1936 (for short, 'Act 1936/1936 Act') as well as Act 1997 (amending the 1936 Act), it has repudiated the same to be illegal and unauthorized in law.
4. Vis-à-vis Section 2(xv) of the Act 1936 defining 'industrial land', it has asserted that its activities do not tantamount to manufacture of any industrial product and, thus, the land at its disposal is not an industrial land. It has, thus, pleaded that payment of enhanced land revenue with reference to Sections 3-A and 25-B of the Act 1997 is wholly without jurisdiction. Reference has been made to the Oil Fields (Regulation & Development) Act, 1948 (for short, 'the 1948 Act/Act 1948') and the Petroleum & Natural Gas Rules, 1959 framed thereunder (for short, hereinafter referred to as 'the 1959 Rules/Rules 1959') which cover the entire field of Crude Oil and Natural Gas providing inter alia for grant of mining lease etc. in connection therewith and statutory payments like royalty, licence fee, dead rent, surface rental. That under such a mining lease as stipulated, no land revenue is payable has been emphasized. The petitioner has also alluded to the Oil Industry (Development) Act, 1974 (for short, 1974 Act) for development of oil industry. In this legislative setting, according to the petitioner, the State Government lacks in competence to enact any law in respect of Crude Oil and Natural Gas for the purpose of realizing any land revenue with regard thereto.
5. The petitioner has averred that in fact in order to facilitate the exploration and extraction of mineral oil it has been granted a mining lease and licence thereunder in respect of lands therefor at its disposal. It has pleaded that though the entire area covered by the mining lease does not produce Crude Oil and Natural Gas, under the 1959 Rules it is to pay dead rent therefor as well as royalty for the plots wherefrom such products are extracted. In addition thereto, surface rent is also payable. Further, surface compensation to the occupiers of the land at the time of entering the same pursuant to the petroleum exploration licence/mining lease under Rule 189/190 of the Rules framed under the Assam Land Revenue Regulation (for short, hereinafter referred to as 'the Regulation') is also to be paid. Apart from citing these factors against the legality of the demand for land revenue for the same plot(s), reliance has also been placed on Section 28 of the Regulation in endorsement of its assertion of exemption from such impost.
6. The petitioner OIL has treaded substantially on his beaten track. While contending that it is engaged in the business of exploration, extraction and transportation of mineral oil/crude oil at different cites in the country including the State of Assam and that such pursuits are regulated by the 1948 Act, the Petroleum Act, 1934 (for short, hereinafter referred to as 'the Act 1934/1934 Act') as well as the Rules framed thereunder including the 1959 Rules, it similarly has denounced the demand of land revenue in connection with the land at its disposal to cater to its aforementioned activities. According to it, it has been granted, under the 1959 Rules, petroleum mining lease in respect of lands in certain locations in connection with which it is to pay annual dead rent and surface rent in addition to royalty for every metric ton of petroleum extracted at a rate to be fixed by the Central Government from time to time. That under the mining lease it is liable to pay taxes, assessments and impositions in the nature of public demands except land revenue has been emphasized too. Besides impeaching Section 3-A and 25-B of the Act 1997 on various counts, it has highlighted as well that it is not engaged in the manufacture of any industrial product and, therefore, the lands at its disposal can by no means be construed to be industrial lands as defined under Section 2(v) of the Act 1936 for imposition of enhanced land revenue under Section 25-B. Endeavours of the State authorities pursuant to the impugned provisions of the Act 1997 to realize enhanced land revenue and the objections laid by it repudiating such law have also been referred to indicate exhaustion of steps by them for redress before turning to this Court.
7. As alluded to hereinabove, the pleaded facts in the other writ petitions more particularly relate to the aspect of reclassification of lands at the disposal of these two organizations as industrial sites and the consequential demand for land revenue at the enhanced rate under the Act 1997 and, thus dilation thereof is inessential. Additional pleadings have been brought on record by the petitioners to emphasise in particular the quantum of payment being made by them as royalty and otherwise under the mining leases in their bid to negate the justifiability for further realization by way of land revenue and, that too, at the enhanced rate.
8. The respondents in their affidavit while endorsing the validity of the impugned provisions and the demand for enhanced land revenue based thereon, have insisted that the Crude Oil and the Natural Gas explored and extracted from the field area are the raw materials for producing and manufacturing industrial products and, therefore, the land at the disposal of the petitioners are visibly industrial land within the definition of Section 2(xv) of the Act 1936 (check). According to the respondents, collection and assessment of land revenue is within the purview and competence of the State Legislature, the Entry relatable thereto being included in List II of Schedule 7 to the Constitution of India. They have contended that as oil and natural gas have acquired global importance in the industrialization of modern economies, the land utilized for oil exploration has been rightly construed to be an industrial site for which no separate notification under Section 3A is called for. They have asserted that the petitioners' perception of exemption from land revenue on the plea of payment of other levies for the same land under the mining leases is fallacious and untenable. That their challenge to the demand for land revenue is also frivolous in the face of their voluntary payment thereof till enhancement has been underlined. While admitting that the demand for the enhanced land revenue is as per Section 25-B of the 1997 Act classifying the land at the disposal of the petitioner to be industrial sites, the respondents have asserted the validity thereof.
9. Vis-à-vis OIL, the...
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