1. Gwyer, C.J.:—I have had an opportunity of reading the judgment which is about to be delivered by my brother Varadachariar and I concur both in its reasoning and its conclusions. In these circumstances I do not think it necessary to deliver a separate judgment of my own.

2. Varadachariar, J.:—The question for decision in this appeal is whether a law (Act No. X of 1938) enacted by the Punjab Legislature in the form of an amendment to an earlier Act (the Punjab Alienation of Land Act, 1900—Central Act No. XIII of 1900) is inoperative to any, and if so to what, extent. The provision mainly discussed is that directed by the later Act to be inserted as s. 13-A in the earlier Act. Some of the other provisions in the Act of 1938 are only ancillary to or consequential upon this main provision. The High Court held this provision to be inoperative to the extent described in its judgment, on the ground that it contravened s. 298 (1) of the Constitution Act. Hence this appeal by the Punjab Government which got itself impleaded as a party defendant even when the litigation was pending in the trial court.

3. The Punjab Alienation of Land Act (Central Act No. XIII of 1900) was (in the words of the Joint Select Committee, para. 368 of their Report “designed to protect the cultivator against the moneylender”; but the Act goes much farther. Section 4 empowers the Provincial Government to determine by notification “what bodies of persons in any district or group of districts are to be deemed to be agricultural tribes or groups of agricultural tribes” for the purposes of the Act. Section 2 (3) of the Act defines “land” for the purpose of the Act; and s. 3 in effect declares that no permanent alienation of land by a member of an agricultural tribe shall take effect as such unless the alienee also is a member of the same tribe or of a tribe in the same group, except when sanction is given thereto by the Deputy Commissioner. Subsection (3) of s. 3 leaves it to the discretion of the Deputy Commissioner to grant or refuse sanction, and one of the provisos to s.s. (2) declares that sanction may be given even after the act of alienation has otherwise been completed. There are two exceptions to the prohibition enacted in the section, namely, (a) the sale of a right of occupancy by a tenant to his landlord, and (b) a gift made in good faith for a religious or charitable purpose whether inter viros or by will. Sections 6 to 13 contain certain provisions in respect of temporary alienations of land (such as mortgages and leases) by a member of an agricultural tribe, and s. 14 provides that any permanent alienation which under s. 3 is not to take effect as such until the sanction of the Deputy Commissioner is given thereto shall, until sanction is given or if sanction has been refused, take effect as a usufructuary mortgage in the form permitted by s. 6, for such term not exceeding 20 years and on such conditions as the Deputy Commissioner considers to be reasonable. Section 21 excludes the jurisdiction of civil courts in very comprehensive terms and s. 20 provides that no legal practitioner shall appear on behalf of any party interested in any proceedings before a Revenue Officer under the Act. The Act was in the first instance made applicable to all the territories for the time being administered by the Lieutenant-Governor of the Punjab; but s. 24 empowers the Provincial Government, by notification in the Official Gazette, to exempt any district or part of a district or any person or class of persons from the operation of the Act or of any of the provisions thereof.

4. A practice has long been common in this country for intending alienees of land to take the document of transfer in the names of their friends or relatives, sometimes with a view to defeat the claims of creditors, sometimes with a view to avoid claims by other members of their own family, and sometimes to escape restrictions imposed upon them by Government Servants Conduct Rule, etc. In the Punjab, a practice seems to have grown up after the enactment of the Alienation of Land Act, 1900, for transferees from members of agricultural tribes to take documents in the names of friends belonging to the same tribe or a tribe in the same group as the alienor, though the transfer was meant for the benefit of one who was not such a member. In many cases it may reasonably be presumed that this was done with a view to avoid rights under the transfer being cut down in the manner provided for in s. 14 of the Act. A notion has sometimes prevailed in this country that all benami transactions must be regarded as reprehensible and improper, if not illegal; but as late as in 1915 Sir George Farwell, delivering the judgment of the Judicial Committee in Bilas Kunwar v. Desraj, spoke of them as, “quite unobjectionable” and as having their analogues in the English law; and Mr. Ameer Ali, delivering the judgment of the Committee in Gur Narayan v. Sheo Lal Singh, observed that “there is nothing inherently wrong in it, and it accords, within its legitimate scope, with the ideas and habits of the people”. As indicated by the qualifying words” within its legitimate scope”, Their Lordships’ observations were clearly not meant to countenance transactions entered into for fraudulent or illegal purposes.

5. In view of the scheme and the policy of the Alienation Act, questions seem to have been raised before the courts in the Punjab as to the effects of benami transfers of the kind above indicated. It may be useful to refer to a few reported decisions as indicating the types of questions raised. In Jahan Khan v. Dalla Ram, Haidar v. Fatteh Khan and Ladha Singh v. Ahmad Yar, the Punjab Chief Court overruled the contention that a mortgage by an agriculturist to another agriculturist would be invalid if it had been made on the footing that the mortgagee should pay off a debt due from the mortgagor to a non-agriculturist. Nevertheless, in Wasinda Ram v. Bahadur Khan, a Tahsildar Magistrate thought fit to frame a charge under s. 417 of the Penal Code against a non-agriculturist creditor for having brought about a mortgage of the above kind; but the High Court quashed the charge on revision. In Shamas-ud-din v. Allah Dad Khan the High Court held that as between the vendor and the ostensible vendee, the latter was entitled to recover possession of the property, whatever the legal position as between the ostensible vendee and the alleged non-agriculturist beneficiary might be. In Qadir Baksh v. Hakam, the High Court overruled a contention advanced by the ostensible mortgagee that in a proceeding between himself and the non-agriculturist beneficiary the latter could not pleaded the true facts and defeat a claim put forward by the former in his own right. The last of the above decisions was given in 1932 by a Full Bench of five Judges of the Lahore High Court, and the impugned Act was passed in 1938 to deal with the situation created by that decision. The mortgage transaction out of which this litigation has arisen was one of those entered into during the interval, on July 4, 1933, presumably on the strength of the High Court's decision. I may add that in Bahadur v. Mohammad Din, a learned Judge of the same High Court held that when a non-agriculturist took a sale pretending to be an agriculturist, the transaction was not void ab initio, since the defect could be remedied by the Deputy Commissioner's sanction, and in any event the permanent alienation would at least have effect as a usufructuary mortgage under s. 14. He further held that in such cases the vendee was entitled to be reimbursed under s. 65 of the Contract Act.

6. The impugned Act is in form an addition of a few sections to the Alienation Act of 1900. Its principal provision is that contained in s. 5, which directs the following to be read as s. 13-A or the principal Act;

“When a sale, exchange, gift, will, mortgage, lease or farm purports to be made either before or after the commencement of the Punjab Alienation of Land (Second Amendment) Act, 1938, by a member of an agricultural tribe to a member of the same agricultural tribe or of a tribe in the same group, but the effect of the transaction is to pass the beneficial interest to a person who is not a member of the same tribe or of a tribe in the same group, the transaction shall be void for all purposes, and the alienor shall be entitled to possession of the land so alineated, notwithstanding the fact that he may have himself intended to evade the provisions of this Act.”

7. Then follow consequential provisions enabling the Deputy Commissioner to eject persons in occupation of land under such alienations and allowing the order of the Deputy Commissioner to be set aside on appeal or revision by the higher revenue authorities. Except for a limited measure of compensation for the value of improvements effected by a bona fide transferee for value, the Act makes no provision for refund or re-imbursement either in favour of the ostensible alienee or of the beneficiary or even bona fide transferees for value from them, and not even in cases where the transaction thus avoided has been completed many years before the enactment of the measure. The new law is thus much more drastic than the principal Act of 1900; but I refrain from dealing with the arguments urged at the Bar in condemnation or justification of it, because the Court is only concerned with its legality and not with its reasonableness or with the policy underlying it. The difference, as will be presently seen, has some bearing on the discussion even of the question of the extent of the operation of the enactment.

8. Section 298 (1) of the Constitution Act provides that—

“no subject of His Majesty domiciled in India shall on grounds only of religion, place of birth, descent, colour or any of them be ineligible for office under the Crown in India, or be prohibiting on any such grounds from acquiring, holding or disposing of property or carrying on any occupation, trade, business or profession in British India.”

9. It was urged on behalf of the plaintiffs-respondents that the Act of 1900 and the impugned Act of 1938 must be held to be inoperative in so far as they prohibit persons from acquiring or holding property on grounds of descent only; no question arises in this case of any disability founded on religion, place of birth or colour. The appellant contended that there is nothing in the Acts contravening s. 298 (1). Alternatively, it was argued on his behalf that the operation of all provisions in these Acts was saved by s.s. (2) of s. 298. It will thus be necessary to consider the precise effect of this subsection also.

10. To follow the argument based on s.s. (1) of s. 298, it will be necessary to take note of the tenor of the notifications issued by the Punjab Government under s. 4 of the Act of 1900, because the persons or groups of persons against whom the restrictions or disabilities imposed by the main Act and by the impugned Act operate and the grounds on which the disabilities rest can be determined only by reference to the terms of these notifications. Several notifications seem to have been issued from time to time; but, for the purposes of the present Judgment, it will be sufficient to take one of the earliest of these notifications, No. 63, dated April 18, 1904, as typical (see pp. 67-68 of the 5th Edition of Sir Shadi Lal's Commentaries on the Act). Without attempting to be exhaustive, it may be generally said that a person will not be included in an agricultural tribe within the meaning of the Act unless (1) he is descended from members of a particular tribe, and unless (2) he resides or holds property in a particular place. I leave alone for the moment the further limitation in the Acts requiring alienor and alienee not merely to be members of agricultural tribes, but to be members of the same tribe or of a tribe in the same group. As the notifications require the co-existence of both the qualifications as to descent and residence (or possession of property) before a person can claim to fall within the terms of the notifications, the non-fulfilment of either condition will effectually exclude him. To put the matter in the form of illustrations: A may, as regards his descent, satisfy the condition of descent from a particular community; but he may fail to sati fy the condition as to residence or the holding of property in a particular place. B may hold property or reside in the prescribed place; out not being descended from a member of the community specified in the notification, he may not satisfy the requisite conditions. C may fail in respect of both qualifications. The Acts in question impose certain disabilities on these three classes of persons. In the first of the illustrations above given, it cannot be said that the prohibition of acquisition or holding of property by such a person is on the ground of descent, and in the third it cannot be said to be on the ground of descent alone; but in the second, it is clearly on the ground of descent alone. Subject to the other arguments to be presently noticed, it seems to me to be reasonably clear that the impugned Act contravenes s. 298 (1) of the Constitution Act, so far as it makes it impossible for persons standing in the same position as B in the illustrations given above to acquire or hold any interest in land (of the kind included in the definition in the principal Act) as beneficiaries under a benami transfer in favour of a qualified transferee, while the Act of 1900 makes it impossible for such persons to acquire a permanent interest in such land by a direct transfer to themselves. It has not been contended by the Advocate-General of the Punjab that such is not the effect of the enactments in question; but he contends—

(1) that the provision in the impugned Act which is numbered as s. 13-A of the principal Act is not in terms discriminatory, and

(2) that the discrimination, if any, is not based on descent alone, because the prohibition is based on the benami character of the transaction.

It is not easy to follow these arguments.

11. The provision in s. 13-A is clearly discriminatory, because it draws a distinction between transactions in which the beneficial interest belongs to an agriculturist and those in which it belongs to a non-agriculturist; and it declares the latter void. But this discrimination will not by itself amount to a contravention of s. 298 (1) of the Constitution Act, and the question will still remain whether it is discrimination on the ground of descent and of descent alone. The answer to this must be found in the terms of the notifications under s. 4, which this section incorporates when it uses the expressions “member of an agricultural tribe” and “a person not a member of the same tribe or of a tribe in the same group”. That is why I have analysed the notifications and discussed their effect in the last preceding paragraph. The objection under s. 298 (1) cannot be obviated merely by relegating the offending provision to a statutory notification instead of embodying it directly in the statute itself. As regards the second of the arguments above set out, I must state that it is not and it cannot be the contention of the Advocate-General that all benami transactions are as such avoided by the Act, that is, even if they be in favour of persons falling under paragrap (c) of s.s, (1) of s. 3 of the principal Act. If a benami sale of land for the benefit of a member of a notified agricultural tribe is good, but a similar transfer is bad if made for the benefit of one like B in the illustrations given in the preceding paragraph, that is, one who does not fall within the notification because he is not descended from a member of an agricultural tribe, it is clearly a case of discrimination on the ground of descent alone. It was pointed out that under the Act benami transfers for the benefit even of persons like A and C in the above illustrations are void; but this will not help the appellant, because though even these are cases of discrimination, the discrimination is not on the ground of descent alone and the case will not therefore to that extent fall under s. 298 (1). In considering this question, it ought not to be forgotten that qualifications as to residence in a particular place or the ownership of property there can at any time be acquired by act of parties; but qualification or disqualification based on descent is not one that parties can by any act of theirs obtain or escape from. Hence, I take it, is the importance attached to it in s. 298 (1). One of the other grounds specified there, namely, religion, is no doubt sometimes changeable at the will of parties; but it is hardly to be expected that parties will change their religion merely to obtain a qualification or escape from a disqualification for the purposes mentioned in the section, and certainly the law will not drive them to do so.

12. It has next been suggested that the discrimination, if any, is based on the character of the land, that is, on its being land as defined in the principal Act. I find it difficult to follow this argument as well. To take illustrations similar, to those given above, if in respect of land of that kind, the law declares that the alienation will be good if in favour of a member of a notified agricultural tribe, but bad if made in favour of one who is not a member of such a tribe, it is difficult to see how the discrimination is one based on the character of the land or that it is not one based on the status of the transferee. It has been said that it may be a matter of policy or public interest in certain parts of the country that certain kinds of lands should be secured to certain classes of people and be prevented from going into the hands of other classes of people. It is in recognition of this need that Parliament has taken care to enact the saving provision contained in s.s. (2) of s. 298. But this will not justify the view that this is not a discrimination prohibited by s.s. (1) of the section; otherwise the saving clause would not have been necessary. As will be presently seen, the appellant in this case finds that the saving under s.s. (2) does not go the whole length required to sustain his contention, and he is therefore obliged to attempt to take the case out of s.s. (1) itself; but, for the reasons above given, I am unable to accede to this contention. It is true that a saving clause cannot be used to extend the scope of the prohibition contained in the main or enacting clause, because a saving clause may often be added by way of abundant caution. But if, as I have endeavoured to show, the language of s.s. (1) of s. 298 clearly covers one class of alienees on whom disabilities have been imposed by the impugned Act, it is not without significance to note that (as explained in the Joint Select Committee's Report, para. 369) s.s. (2) was inserted to save “legislation such as the Punjab Land Alienation Act” from being invalidated by reason of the declaration in subsection (1). This confirms me in the view that such legislation clearly contravenes s.s. (1) of s. 298 to the extent that I have above indicated; but to a certain extent its operation is nevertheless saved by s.s. (2).

13. It is perhaps desirable to observe in passing that a prohibition of the kind so far discussed is entirely different from restrictions arising out of the nature of the “legal interest” possessed by an alienor. To take a familiar instance, it is well established in this country that an office like that of a trustee of a religious institution or the office of a religious service holder (with the emoluments attached thereto) is not alienable at all, but some decisions have recognised that by the custom of particular institutions even such offices may be alienated within a very limited circle, e.g., members of the family or persons in the line of descent. It has also been held that religious offices may be delegated to proxies if they belong to the same religion. In such cases, the question is not one of placing a discriminatory restriction on the alienation of an interest which is ordinarily alienable but of permitting alienation within limits of what is normally inalienable. Again when lands were held on service tenures or under special state grants, the condition of service or the terms of the grant limited the nature of the legal interest possessed by the holders and (as in the case of the Watandars Act referred to by my brother) the Legislature has sometimes continued some of these limitations, even when the tenure was placed on a statutory basis.

14. The contention that the discrimination in the Punjab Acts is based on the character of the “land” has another aspect which requires to be further considered. It was not clear to me whether the Advocate-General was prepared to go so far as to maintain that even a discrimination on the ground of descent would not offend s. 298 (1), unless the prohibition in respect of acquiring, holding or disposing of property was absolute in extent, that is, it placed it beyond the man's power to acquire an inch of land any where in British India. An illustration with reference to eligibility for office, which is another of the subjects dealt with in the same sub-section, will perhaps help to throw light on this point. Can it reasonably be maintained that persons of a particular religion, colour or descent can without offending the section be declared ineligible for 95 per cent, of the offices under the Crown in India To my mind such a contention seems scarcely permissible. If so, why should the position be different in respect of the acquisition or holding of property Even if one had better avoid extreme positions at either cud and deal with what may be called substantial freedom or substantial disqualification in respect of acquisition, holding or disposing of property, I have little hesitation in coming to the conclusion that the prohibitions enacted by the Acts of 1900 and 1938 are quite substantial in extent. An examination of the definition of “land” in s. 2 (3) of the principal Act of 1900 is sufficient to establish this. Broadly speaking, that definition takes in all land in the Province, except buildings and building sites in a town or village and except perhaps forests. I leave mining land out of account, because I do not know how much of that kind of land exists in the Punjab, but I do know that it is not the kind of land which Indians ordinarily desire to possess. All land falling within this wide definition is placed beyond possibility of acquisition by persons not belonging to the notified tribes, except of course with the sanction of the Deputy Commissioner. There can be little doubt that the disability imposed upon this class of people by the legislation under consideration is very substantial and covers nearly all kinds of property (other than house property) which Indian ordinarily desire to hold or acquire.

15. A doubt was raised in the course of the argument whether, having regard to the nature of a beneficiary's interest under the Indian law, the deprivation of his rights by the impugned Act can be said to amount to a prohibition from acquiring or holding property, within the meaning of s. 298 (1). An examination of the provisions of the Indian Trusts Act will show that this doubt is baseless. It is true that the India) law does not recognise an equitable ownership in the sense known to the English law, because we here do not, as in England, have two kinds of law or jurisdiction, viz., common law and equity; but on an analysis of the legal incidents involved, it will be found that for all practical purposes there is little or no difference between a beneficiary under the English law and a beneficiary under the Indian Trusts Act, so far as the substance of their rights is concerned. I may first point out that so far as rights and privileges are concerned, there is little or no difference between a beneficiary under an express trust and a beneficiary under a resulting or constructive trust, if we leave alone questions arising under the Indian Limitation Act. Section 82 of the Indian Trust Act, which deals with benami transfers, occurs in the chapter beginning with s. 80, which provides that an obligation in the nature of a trust is created in certain specified cases; and s. 82 enacts that the transferee must hold the property for the benefit of the person paying or providing the consideration. Section 95 reaffirms the provision implied in s. 80. In the case of express trusts, the Act describes the beneficiary's rights against the trustee as “beneficial interest or interest of the beneficiary”. Under s. 55, the beneficiary has, subject to the provisions of the instrument of trust, a right to the rent and profits of the trust property and under s. 56 the beneficiary, if there is only one and he is competent to contract, may require the trustee to hand over possession of the trust property to himself. This is almost a matter of course where, as in benami transactions, the holder of the legal title is only a bare trustee. Under s. 58, the beneficiary, if competent to’ contract, may transfer his interest, and under s. 69, every person to whom a beneficiary transfers his interest has the rights of the beneficiary in respect of such interest at the date of the transfer. Section 8 no doubt departs from the English law in declaring that a “merely beneficial interest under a subsisting trust” cannot be made the subject-matter of another trust. This exceptional provision can have no significance for the present purpose. The theory that there can be no trust upon a trust (similar to the earlier English doctrine that there cannot be a use upon a use) is based upon the circumstance that so long as the original trust subsists, the title to the trust property continues to vest in the trustee under the trust, and that in such cases the second trustee is not in a position to convey a title to the second beneficiary. There can in my opinion be no doubt that a prohibition against a person acquiring or holding property as a beneficiary offends s. 298 (1) of the Constitution Act quite as much as a prohibition against his obtaining a transfer of the legal title; but all possible doubts on this score must disappear when one considers the combined effect of the Act of 1900 and the amendment of 1938, because under the former he cannot acquire a legal interest permanently and under the latter he cannot acquire a beneficial interest either.

16. It will be convenient at this stage to refer to one argument of the learned Advocate-General, only in order to state that it is unnecessary for the purposes of this case to express any opinion upon it. He contended that, even if it should be assumed that the provisions of the Act of 1900 offended in any measure the principle of s. 298 (1) of the Constitution Act, it would not be reasonable to hold that this declaration by Parliament in 1935 affected the validity of the Provincial Act passed nearly thirty-five years before. On behalf of the respondents, it was urged that the effect of ss. (1) was thenceforward to remove even such disabilities as had been imposed by earlier legislation. This question was raised by the Advocate-General to serve two purposes; (1) to make up for the gap, in the saving of the operation of such enactments, arising from the fact that ss. (2) is limited to laws prohibiting sale or mortgage of agricultural land, and (2) to use it as a step towards the argument that even Act No. X of 1938 should be regarded not as a new enactment passed subsequently to the Constitution Act, but only as an amendment to and therefore standing on the same footing as the principal Act of 1900 and, as such, not affected by the declaration in ss. (1). The first of the above aspects assumes importance by reason of the fact that while the Act of 1900 makes provision against all permanent alienations (which will include those by way of gift, bequest, exchange, etc.) and a variety of temporary alienations including leases, ss. (2) of s. 298 saves the operation of such laws so far as they prohibit “the sale or mortgage of agricultural land”. Whatever be the reason that led Parliament thus to limit the scope of the saving clause, this difference in language has made it possible for the critics of the Punjab Acts to contend that the prohibitions enacted in the Act of 1900, so far as they relate to land not falling within the category of “agricultural land” and so far as they relate to alienations other than sales and mortgages, are not saved in their operation, if they contravene ss. (1) of s. 298. It is unnecessary to express any opinion on this question in the present case, because the transaction which forms the subject-matter of this litigation is a mortgage of agricultural land and is thus saved in terms by ss. (2) of s. 298. Respondents’ counsel endeavoured to maintain that while ss. (1) removes disabilities imposed even by earlier enactments, ss. (2) saves only laws made after the Constitution Act comes into effect. I see no sufficient warrant or justification for making this differentiation between subsections (1) and (2).

17. The second of the appellant's contentions above noted, namely, that if the disabilities created by the Act of 1900 are not removed by ss. (1) the provisions of the Act of 1938 must also be held to be unaffected by ss. (1) is obviously untenable. The Act of 1938 was passed after the Constitution Act had come into force, and would be hit by s. 298 (1) even if it should be held that that subsection had no retrospective operation. The mere fact that the Legislature directed the Act of 1938 to be treated as an amendment to the Act of 1900, or that in many respects it adopted the frame-work of the older Act, cannot place the later enactment, for the present purpose, on the same footing as the earlier enactment.

Further, whatever the form or the underlying policy, the Act of 1938 deals with a class of cases not provided for in the Act of 1900 and makes provisions substantially different in nature and effect from those contained in the earlier enactment. If for the reasons already stated it offends in any degree the declaration contained in ss. (1) of s. 298, it must to that extent be held inoperative, save in so far as its operation may be saved by ss. (2).

18. It remains to consider the scope and effect of ss. (2) of s. 298. As already stated, it only saves laws prohibiting sales and mortgages, and even that only so far as such transactions relate to agricultural land. The other kinds of alienations prohibited by the combined operation of the Act of 1900 and the impugned Act will fall outside the scope of the saving clause. In the judgment of this Court in Megh Raj v. Allah Rakhia, the question has been discussed how far the definition of “land” contained in the Act of 1900 includes property which cannot be comprised in the ordinary connotation of the expression “agricultural land”. The question arose there on account of the doubt as to whether certain provincial legislation related to a matter specified in the Provincial List or to a matter falling within the Concurrent List. The question does not arise under the same circumstances in the present case; but as ss. (2) of s. 298 is limited in terms to “agricultural land”, the same question may become material in cases of the present kind. The transaction involved in this suit is however one by way of mortgage and also relates to agricultural land these questions need not therefore be further discussed in the present case.

19. It is however material to note that s. 298 (2) purports to save the operation of any law which prohibits the sale or mortgage of agricultural land, etc. What the impugned Act purports to do is not merely to prohibit such transactions being entered into after the date of the Act, but to vacate or nullify even titles or rights acquired before the passing of the Act; and as already stated, the suit transaction is one of 1933, i.e., five years before the passing of the Act. As held by the High Court, the word “prohibit” can only mean the forbidding of a transaction, and such a direction is appropriate only in respect of transactions to take place subsequently to the date of the direction. The word cannot include an attempt to reopen or set aside transactions already completed, or to vacate titles already acquired. The High Court was therefore justified in holding that the benefit of ss. (2) of s. 298 cannot be claimed for the impugned enactment so far as it purports to avoid transactions entered into or titles acquired before the impugned Act became law. It seems to have been contended before the High Court, on behalf of the Punjab Government, that the provisions in the impugned Act in so far as they relate to prior transactions are only in the nature of retrospective legislation and as such within the competence of the Provincial Legislature. This contention was rightly not pressed before us, for the obvious reason that the question for consideration here is not the extent to which an admitted power can be exercised by the Legislature, but the extent to which legislation which would be inoperative as contravening s.s. (1) of s. 298 is saved by ss. (2), and the answer to this question must turn only on the interpretation of s.s.. (2).

20. In the view above indicated, the language in which the conclusion of the High Court has been stated as also the form of the decree passed in the case will require modification. Dalip Singh J., in his judgment, with which the other two learned Judges concurred, said: “The Act is valid only qua sales or mortgages effected after the commencement of the Act and qua such transactions is valid only with respect to agricultural land. It would not be valid qua exchanges, gifts, wills, leases and farms whether before or after the commencement of the Act”. Words to the like effect will also be found in the penultimate paragraph of the judgment. If I may make a verbal correction, the question is not exactly one as to the validity or invalidity of the Act, but whether the prohibitions contained in it are operative or inoperative in certain cases. That is why ss. (2) of s. 298 saves the operation of such laws (see also the language of s. III (1), which says that a British subject domiciled in the United Kingdom shall be exempt from the operation of certain kinds of laws that may be passed by the Federal or Provincial Legislature). The terms in which the conclusion has been stated by the High Court fail to take note of the fact that ss. (I) of s. 298 of the Constitution Act can be invoked only in cases where the disability is imposed on the ground of descent alone. To revert for a moment to the illustrations given in an earlier part of this judgment, a person may be descended from a community classified as agricultural, but he may not satisfy the notifications under s. 4 of the principal Act, because he may not reside or hold property in a particular place. Again the disqualification may arise in certain cases, because, a person neither fulfils the requirement of descent no; the requirement as to residence or possession of property in the locality. In these two cases it cannot be said that the Act of 1900 or the impugned Act prohibits the acquisition of the holding of property by such a person on the ground of descent alone: and if s.s. (1) of s. 298 cannot be invoked in such cases, it is immaterial whether the case is saved by s.s. (2) or not, because except under s.s. (1) there can be no exclusion of the operation of the law according to its tenor. The conclusion above extracted from the judgment of the High Court as to the circumstances in which the provisions of the impugned Act will he inoperative must accordingly be limited to cases where the beneficiaries under the benami transactions fall outside the terms of the notifications under s. 4 of the principal Act only on the ground that they are not descended from members belonging to the specified tribes. In this view, the decree dismissing the appeal to the High Court cannot stand. The trial court decreed the plaintiff's suit on the strength of its findings on the preliminary issues framed by it. As the allegations of fact made in the pleadings were not gone into, the attention of the courts has not been directed to the question of the ground on which Gopal Das, the alleged beneficiary under the suit mortgage, was said to be a non-agriculturist. Without an investigation of this question, in the light of the observations above made, it cannot be finally decided whether or not the suit transaction is void under the Act of 1938. The decree of the High Court must be set aside and the case sent back to the High Court with a direction that proper issues are to be framed in the case in the light of the observations contained in this judgment, and the ease remitted to the trial court for further trial and decision.

21. The only point which has so far been dealt with in all the courts is the constitutional question. As neither party has wholly succeeded on that question, the parties should bear the costs respectively incurred by them up to this date, in all the courts.

22. Beaumont, J.:—This appeal raises a question as to the validity of the Punjab Alienation of Land (Second Amendment) “Act, 1938 (Punjab Act No. X of 1938) (hereinafter referred to as the impugned Act) which came into force on the 1st June, 1939.

23. The facts giving rise to the case are not in dispute [After stating the facts of the case as set out on pp. 69-70, supra, the learned Judge continued:—]

24. In order to appreciate the provisions and effect of the impugned Act, it is necessary to consider the terms of the Punjab Alienation of Land Act, 1900 (hereinafter referred to as the principal Act), to which the impugned Act was an amendment.

25. By s. 2 (3) of the principal Act, “land” is defined as meaning land which is not occupied as the site of any building in a town or village and is occupied or let for agricultural purposes or for purposes subservient to agriculture or for pasture, and as including certain interests which it is not necessary to specify. “Permanent alienation” is defined as including sales, exchanges, gifts wills and grants of occupancy rights. Subsection (1) of s. 3 provides that a person who desires to make a permanent alienation of his land shall be at liberty to make such alienation where the alienor is not a member of an agricultural tribe; or the alienor is a member of an agricultural tribe and the alienee is a member of the same tribe or of a tribe in the same group. Subsection (2) provides that except in the cases provided for in ss. (1) a permanent alienation of land shall not take effect as such unless and until sanction is given by Deputy Commissioner. Section 4 provides that the Provincial Government shall by notification in the Official Gazette determine what bodies of persons in any district or group of districts are to be deemed to be agricultural tribes or groups of agricultural tribes for the purposes of the Act. Section 6 provides that a mortgage by a member of an agricultural tribe to a mortgagee not a member of the same tribe, or of a tribe in the same group, shall be made in one of the forms specified. Section 9 enables a Deputy Commissioner to revise a mortgage not made in the permitted form, so as to bring it into accordance with such form. Section 14 provides that any permanent alienation which under s. 3 is not to take effect until a sanction by the Deputy Commissioner is given thereto, shall, until such sanction is given or if such sanction is refused, take effect as a usufructuary mortgage in form (a) permitted by s. 6 for such term not exceeding twenty years and on such conditions as the Deputy Commissioner considers reasonable. Section 24 enables the Provincial Government by notification in the Official Gazette to exempt any district or part of district or any person or class of persons from the operation of the Act or any of the provisions thereof.

26. By a notification dated the 18th April, 1904. the then Government of the Punjab, under the powers conferred by s. 4 of the principal Act, and with the previous sanction of the Governor-General in Council determined that for the purpose of the said Act in each district of the Punjab mentioned in column 1 of the Schedule annexed to the notification, all persons, either holding land or ordinarily residing in such district and belonging to any one of the tribes mentioned opposite the name of such district in column 2, should be deemed to be an agricultural tribe within that district, and that all the agricultural tribes within any one district should be deemed to be a group of agricultural tribes. The original list has been modified from time to time by subsequent notifications and it is only necessary to observe that the tribes included as agricultural tribes embrace all communities, Muslims, Hindus, Sikhs and Indian Christians.

27. After the passing of the principal Act a practice grew up under which a member of an agricultural tribe used to transfer his land to another member of the same tribe, as benamidar for a person who was not a member of an agricultural tribe, and the High Court of Lahore had held that this practice was not illegal.

28.The impugned Act was directed to this practice and inserted in the principal Act s. 13-A, under which the present difficulty arises, and which is in the following terms:—

“13-A.(1) When a sale, exchange, gift, will, mortgage, lease or farm purports to be made either before or after the commencement of the Punjab Alienation of Land (Second Amendment) Act, 1938, by a member of an agricultural tribe to a member of the same agricultural tribe or of a tribe in the same group, but the effect of the transaction is to pass the beneficial interest to a person who is not a member of the same tribe or of a tribe in the same group, the transaction shall be void for all purposes, and the alienor shall be entitled to possession of the land so alienated, notwithstanding the fact that he may have himself intended to evade the provisions of this Act.

Explanation.—Any alienation made in consequence of a transaction rendered void by this subsection shall also be deemed void for all purposes.”

29. The argument of the plaintiffs-respondents is that the impugned Act is invalid, first because it extends the operation of the principal Act which deprived certain classes of His Majesty's subjects of the right to acquire land on the ground only of descent, and secondly because it destroys the beneficial title of persons not members of an agricultural tribe, their non-membership being based solely on lack of a particular descent.

30. The validity of the principal Act, which was passed long before the coming into operation of the Government of India Act, is not directly raised in this appeal, but in considering the first ground urged against the impugned Act, it is necessary to see how far the principal Act would have come within the mischief aimed at by s. 298 (1), if it had been passed after that section came into operation.

31. Section 298 (1) is in the following terms:—

“No subject of His Majesty domiciled in India shall on grounds only of religion place of birth, descent, colour or any of them be ineligible for office under the Crown in India, or be prohibited on any such grounds from acquiring, holding or disposing of property or carrying on any occupation, trade, business or profession in British India.” I feel no doubt that the word “only” which occurs in the first paragraph of the section is incorporated into the second paragraph by the use of the word “such”, and that to attract the operation of the second paragraph the prohibition must be based only on the grounds specified. The section therefore confers upon all subjects of His Majesty domiciled in India the right not to be rendered ineligible for office under the Crown in India, and not to be prohibited from acquiring, holding or disposing of property on grounds only of religion, place of birth, descent and colour. For the purposes of the present appeal, descent is the only relevant consideration. It is argued by the respondents that inasmuch as nobody who does not claim a particular descent can be a member of an agricultural tribe, and therefore eligible to acquire a permanent interest in agricultural land in the Punjab, the effect of the Act is to prohibit all the other inhabitants of British India from acquiring such land, and this argument found favour in the High Court. The conclusion seems to me a startling one. It is one thing for s. 298 to recognize the fundamental right of His Majesty's Indian subjects not to be prohibited from holding land on the ground only of descent; it is quite another thing to affirm that each one of His Majesty's Indian subjects has a fundamental right to acquire any piece of land to which he may take a fancy and which the owner is, willing to transfer to him, but which Government thinks should be held by someone of different descent.

32. The policy of the principal Act appears to be to ensure that agricultural land in the Punjab shall not be allowed to pass permanently out of the hands of the agricultural classes, in whom it was vested at the date of the Act, without the sanction of Government; a policy which has appealed to many Governments besides that of the Punjab, and which has been applied in countries other than India. It is true that descent has been made an element in determining the persons who fall within the description of agricultural tribes, but the prohibition against alienation would seem to be based quite as much on the character of the land and the occupation of the holder, as on his descent. In every Province in India the population is divided into different communities, who profess different religions, and some legislation must inevitably take account of these distinctions. This position was well known to Parliament when the Government of India Act was passed, and to my mind s. 298 (1) was deliberately confined to cases in which there was no other ground for discrimination except one or more of those specified in the section. To construe the section as avoiding an Act one effect of which is to discriminate on the ground of descent, though that appears from the terms of the Act itself not to have been the only ground on which the discrimination was based, seems to me to impose a very serious and possibly dangerous limitation on the powers of Provincial Legislatures which the language of the section does not warrant. To illustrate my meaning I should say that an Act like the Bombay Hereditary Offices Act, 1874, under which watan property, that is property held as remuneration for the performance of the duty appertaining to an hereditary office, cannot be alienated beyond the life of the walandar to a person not a watandar of the same watan, would not come within the mischief aimed at by s. 298 (1). The Act undoubtedly has the effect of prohibiting anyone not of a particular descent from acquiring watan property much of which had been granted originally without any restriction on alienation, but the real purpose of the Act is not to discriminate against all those not of watan descent, but to endow an office, and to secure that the holder of the office has the means to carry out the duty appertaining to it.

33. In my judgment therefore the principal Act is not open to criticism on the basis that it involves a prohibition against the acquiring or holding of land on the ground of descent only, and the impugned Act cannot be impeached merely on the ground that it fortifies the provisions of the principal Act. If this view is right it is not necessary to consider the effect of ss (2) of s. 298.

34. I have noticed, however, that the impugned Act is also impeached on the ground that, taken by itself, it comes within the mischief of s. 298 (1) because it destroys the beneficial title of persons who are not members of an agricultural tribe. It is to be noticed that s. 13-A is not in terms discriminatory. It purports to render void all transactions in which the beneficial owner is not a member of the same tribe or of a tribe in the same group as the benamidar, and it is quite impartial as to the community or religion of the beneficial owner. Equitable estates in land, such as are familiar in English law, are not recognized in India, and the only actual interest in property which is affected by the impugned Act is the title of the benamidar, whose descent is not in question. It is however true that under s. 56 of the Trusts Act the beneficial owner can call upon the benamidar to transfer the property to him, and this right to acquire property is destroyed by the Act. But as the learned Advocate-General pointed out, the beneficial onwer struck at by s. 13-A may come within one of three classes. First, he may be a member of an agricultural tribe, but may not hold land in the district. Secondly, he may be a member of an agricultural tribe, but may not be a resident in the district. And thirdly, he may not be a member of an agricultural tribe. It is only in relation to the third class that the element of descent is introduced. Although I would not deny that an Act of the Legislature may be void in so far as it comes within the mischief of s. 298 (1), but valid in other respects, I find a difficulty in holding that an Act which in terms make void the title of all beneficial owners under benami transactions of a particular character, can be said to be based only on the ground of descent, when the title of some of such beneficial owners has nothing to do with descent.

35. I would however rest my judgment that s. 13-A of the impugned Act is not ultra vires the Punjab Legislative Assembly on the wider ground that in applying the terms of s. 298 (1) it is necessary for the Court to consider the scope and object of the Act which is impugned, so as to determine the ground upon which such Act is based. If the only basis of the Act is discrimination on one or more of the grounds specified in s. 298 (1), then the Act is bad; but if the true basis of the Act is something different, the Act is not invalidated because one of its effects may be to invoke such discrimination. In my opinion, in the present case the true object of the impugned Act is to avoid a method of evading the principal Act, which itself is unobjectionable, and although some of the rights avoided by the Act may be vested in persons whose only disqualification is lack of a particular descent, such lack of descent is not the only, or even the primary, ground on which the rights are avoided.

36. I regret therefore that I am unable to agree with the Judgment of my brother Varadachariar.

37. I would allow the appeal and dismiss the plaintiff's suit with costs throughout.

38. Gwyer, C.J.:—In accordance with the opinion of the majority of the Court, the decree of the High Court is set aside and the case sent back to the High Court with a direction that proper issues are to be framed in the case in the light of the observations contained in the judgment of Varadachariar, J. and the case remitted to the trial Court for further trial and decision. We think that in all the circumstances of the case the parties should bear their own costs both in the Courts below and in this Court.