Covenanted Contractual Levies Cannot Be Undone By Govt Through Any Unilaterally Made Notification: Punjab & Haryana High Court

In the case of Sushil Kumar V. State of Punjab & Ors. (CWP No. 7803 of 2020) judge bench of the Punjab and Haryana High Court including Justices Sureshwar Thakur and N.S. Shekhawat observed that the statutory provisions of the Northern India Canal, and Drainage Act, 1873 pertain only to occupiers of the apposite land using water for cultivating crops. Hence, cannot apply to industrial units and in order to increase the contractual levies a fresh contract with the petitioners-industrial units is required.


The challenged notification, as carried in the writ petitions (above), is drafted by the competent authority using the power(s) provided by Section 75 read with Section 36 of the Northern India Canal and Drainage Act, 1873 (for short ‘the Act’). The writ petitioners are clearly not using canal water to irrigate their crops, but are instead engaged in industrial activity. The contested notification(s) raise the levies, qua the user(s) of canal water by each industrial unit, rather than the previously covenanted appropriate levies, and, as become conveyed in the appropriately written contracts amongst the concerned, for the relevant purpose.


A reading of the above-extracted clauses reveals (a) that Section 36 of the Act permits the State Government to collect a water cess on landowners who utilise canal water for irrigation purposes, and also authorises the competent body to decide the rates of the water cess from time to time. Furthermore, Section 36 of the Act requires the State Government to use the water cess received for the maintenance and development of irrigation infrastructure. Furthermore, Section 36 of the Act speaks about the competent authority’s competence to prescribe and decide whether or what classes of people are regarded to be occupiers for the purposes of Section 36 of the Act in accordance with the applicable rules. As a result, the above statutory provisions apply only to users, and the consequent imposition of levies/cess(s) by the competent authority on the occupiers of the appropriate land, who make their use for cultivating crops thereon, conspicuously given the second segment of Section 36 of the Act, ending with the phrase “cultivating occupancy,” and thus the entire mandate, as carried thereins, applies only to users of canal water by the persons.

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Judgement Reviewed By Nitika Dheer


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