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Supreme Court asks Kerala HC to decide on Constitutional validity of Kerala Grants and Leases (Modification of Rights) Act, 1980
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Supreme Court asks Kerala HC to decide on Constitutional validity of Kerala Grants and Leases (Modification of Rights) Act, 1980

Murali Krishnan

The Supreme Court has directed the Kerala High Court to decide the Constitutional validity of the Kerala Grants and Leases (Modification of Rights) Act, 1980.

The order was passed by a Bench of Justices Rohinton Nariman and Sanjay Kishan Kaul in an appeal filed by State of Kerala against a judgment of the Division bench of the Kerala High Court in a case relating to collection of Seigniorage by the State for felling timber in leased lands.

Tata Tea Ltd. had filed a writ petition in Kerala High Court in 2005, contending that it is not liable to pay Seigniorage on timber. A single judge had allowed the petition and ruled in favour of Tata Tea.

A Division bench of the High Court had affirmed the order passed by the single judge. The State had then appealed to the Supreme Court against the same.

The Supreme Court after hearing the parties noted that the case raises a number of issues which were not adverted to by the High Court.

The Court noted the following issues in its order:

  • Whether the Kerala Grants and Leases (Modification of Rights) Act, 1980 is constitutionally valid?
  • True meaning of the expression “Seigniorage”; whether this expression is different from Kuttikanam”?
  • Whether the Kerala Grants and Leases (Modification of Rights) Act, 1980 would apply to the lands in question?
  • Whether Seigniorage can be levied on the trees planted by Tata Tea?

It then proceeded to remand the mater back to the High Court to decide the afore-mentioned issues.

“We are of the view that the issues adverted to need to be authoritatively decided as a result of which we set-aside the judgment of the Division Bench and remand the matter to a Division Bench of the High Court.”

Read the order below.

State-of-kerala-v-Tata-tea-order.pdf
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