CHAPTER VI

RYOTWARI SETTLEMENT

The Tamil Nadu agrarian situation should be examined first in its historical

perspective. In most countries, land ownership and the nature of rights and

obligations as between the members of the land-using rural community, are the

produce of a long evolution and are determined also by the geographical,

economic, social, cultural and political conditions. These are the local

circumstances so called which serve to make many common problems unique.

Thus the evolution of States and the origin of the proprietary class should be

considered at a backdrop to the projected study on land reforms 1.

Historical Origins

This period may be divided into two parts. The first deals with the

evolution of the zamindari, inamdari and other land systems. The second deals

with the co-existence of the ryotwari system with zamindari and other types, and

with their interaction in a semi-feudal setting resulting in new land tenures

evolving as in imitation of western models 2.

In the revenue administration of the old Hindu Rajas, the existence of an

intermediary class of proprietors between the crown and the common man for

revenue collection was unknown; this system had to await the advent of Mughal

rule. The Government undertook the responsibility of revenue collection directly,

through its village servants. The collection was effected by accepting a share of the

1
G. Venkataramani,Land Reforms Tamil Nadu, Sangam Publisher, Madras 1973, p.6.
2
Ibid. p.6.
177
produces as tax or by levying a money-rent without the intervention of middlemen,

farmers or Zamindars 3. The Muslims occupied the country as a Military Colony

and initially at any rate, made no attempt to dismiss the old officers who had

served under the Hindu Rajas and to replace them by their own staff. The Muslim

rulers, however, found the old revenue system inconvenient, as it necessitated

constant and close supervision and considerable local knowledge besides and

therefore, set up a class of intermediaries who were just revenue farmers. They

found that the Deshmukhs and Deshpandes had considerable experience of revenue

collection under the Hindu Rajas and wielded considerable local power and

influence. These, they made the new “revenue farmers” who as a result attained a

certain “fixity of office and independence”. This prepared the ground for their

becoming Zamindars and landed proprietors when the British arrived 4.

Ryotwari System

These arrangements formed a different type land system, known as the

ryotwari. The ryotwari arrangement covered two-thirds of the land system while

the non-ryotwari accounted for one-third of tenures. The system involved the

division of all arable lands, whether cultivated or waste, into blocks or lots, each

block being assessed as a fixed rate for a varying term of years (30 in Madras

Province) 5 and the collection of revenue from each title-holder known as the

pattadar according to the area of land assessed.

3
S.R. Sen, The Strategy of Agricultural Development, Asia Publishing House, Delhi, 1966, p.66
4
G. Venkataramani, Land Reforms Tamil Nadu, Sangam Publisher, Madras 1973, p.7.
5
Ibid, p.10
178
The Ryotwari System has three main features:

The ryot had the right to hold land and bequeath it only so long as he

paid the land revenue-his position being only that of an occupancy

tenant 6. The reduction in his status is seen as the direct result of

foreign occupation.

The system re-introduced the assessment of revenue from individual

ryots as an obligation to be discharged through the overlord.

It necessitated periodic revenue surveys (as a matter a fact every

thirty years).

The early ryotwari settlements suffered from innumerable defects. Highly

differentiated criteria, designed naturally so as to benefit the overload, were

employed to individual revenue assessments. Heavy obligations were imposed on

garden lands and there planted with special crop. Restrictions were placed on the

same of lands and re-assessments in subsequent surveys largely followed the first

valuation. From this beginning, the ryotwari become ramified into the system as

we know it today7.

Until Independence, then, and well after that in Tamil Nadu, intermediaries

and owners were bound to the political authority by two major types of tenure or

revenue obligation, the Zamindari and the ryotwari, and between these intervened

a series of other variations in tenures. These tenurial systems were self-

perpetuating served to impose and maintain a semi-feudal structure that and

survived into Independence. After the transfer of power and during the transition,

6
Ibid, p. 11.
7
M.B. Nanavathi and J.J. Anjaria, The Indian Rural Problem, Bombay, 1945, p. 102.
179
many holders consolidated their lands into large tracts or estates. They made sure

that they were not dislodged from the pedestal of high authority which they had

long enjoyed in relation to their vassals. Thus, in 1948, there were 5092 estates

extending over 11439.28 square miles 8. These estates included all Zamins, under-

tenure and inams in the State. Apart from these, there were 13,565 minor inamdari

villages. Many other intermediary systems also obtained in the State at the time of

Independence. These estates resisted the effort of the new Government to correct

the inequity of the existing land systems 9. As the estate-owners disposed of vast

tracts of land which they could not themselves cultivate, there was a certain

amount of neglect in their function. As they did not have to pay large amounts of

revenue, there was no incentive to increase productivity. On the other hand, there

was inefficient management of these lands with the result that the production of

essential commodities began to decline. In the event, the peasants and tenant

cultivators were the real sufferers as they had to pay their share of the produce to

their immediate masters irrespective of the size of the harvest. Feudalism had

reached the limits of its resilience and the situation was explosive on the eve of

Independence.

All through alien rule and for some years after the national Government

took over, the case of agricultural labourers was either not surveyed or taken

cognizance of or it was ignored. The land systems were such that they helped the

rich to become richer. The remnants of the systems survived into Independence,

with the result that the labourers had to work harder with little increase in their

8
G. Venkataramani, Land Reforms In Tamil Nadu, Sangam Publisher, Madras, 1973, p. 12.
9
Ibid, p.13.
180
wages. They even had to fight to be paid their wages. Agricultural labour had no

interest in increasing production at the ruling levels of wages 10.

In addition to the regular items of survey sanctioned by Government from

time to time, the four Survey and Land Records Ranges at Kakinada, Chitoor,

Coimbatore and Madurai continued to attend to the clearance of arrears under

stone maintenance 11. The cadastral survey, estate surveys, survey of towns and

Panchayats, road survey, boundary survey and miscellaneous 12. The work done

under these heads was as follows.

Cadastral survey

Ryotwari villages -- -- -- -- -- 2.73 square miles

Estate villages -- -- -- -- -- 8.77 square miles

Special cadastral survey of Municipal Towns -- 0.59 square miles

Street surveys in Municipal towns and Panchayat --

Board areas -- -- -- -- -- 55.64 miles

Board survey -- -- -- -- -- 194.02 miles

Boundary survey -- -- -- -- -- 0.81 miles

Clearance of arrears under stone maintenance -- Rs. 4,40,681.

Maps of 130 villages comprising 839.94 squares miles in extent were completed in

drawing while maps printed covered an areas of 649 square miles. The Town map
10
Manilal B. Nanavats & J.J. Anjaria, The Indian Society of Agricultural Economics, Bombay,
1960, p. 342.
11
Revenue Records and Registration 1948-49, Board of Revenue, Government of Madras, Madras,
1949, p. 6.
12
Ibid, p. 7.
181
of Madras with the new extensions, the revised map of Madurai, the map of

Guntur, the maps of 24 Districts in the Province and nineteen Taluk and five

Districts. Touring Maps were completed. Several maps were reprinted to replenish

the stock of saleable copies. The aggregate value of departmental maps published

during the year was Rs.91,884. The cost of work charged to other departments of

Government, local statutory and private bodies was Rs. 69,469. The amount

realized by the sale of maps to Government departments and private bodies was

Rs. 29,357. Copies of traverse and cadastral survey were also supplied to various

departments and the preparation of special sketches and maps required by the

Board of Revenue and Government was also attended to. The value of this work

was Rs. 29,011.

Eight Indian Administrative Service Officers and one Probationary Deputy

Collector were given training in survey and maintenance of Revenue Records and

Registration.

Rent and Rent-Paying Classes

The relation between land-lords and tenants is governed by the Madras

Estates Lands Act in respect of estates and inams coming within the purview of

that Act any by Malabar Tenancy Act in the case of Malabar.

Estates Land Act

The number of suits and applications under the Act received during the

Fasli was 84,776 (85,760). Of the total number of proceedings instituted during the

Fasli, that for recovery of rent was 5,894 or 7 per cent and of these only 2,005 or 2

per cent were for recovery by restraint and sale of moveable and holdings. Only
182
very few landholders preferred to recover their rents by means of filing suits and

applications. In 2,005 cases involving an area of 2,768.52 acres of ryots holdings

lands were brought to sale for arrears, totaling Rs. 1,28,778-8-11 of which a sum of

Rs.1.09,177-14-4 was realized. There was slight increase in the number of suits

during the Fasli compared with that receive in the previous Fasli. This increase

was due to the anxiety of the landholders to realize their rents before the

impending Zamindari Legislation.

After the formation of the District the question of survey and the

maintenance of the survey of records arose. The Government deputed an Assistant

Director of the Survey and Land Records Department for investigation. Based on

his recommendation, the Government ordered a survey of the whole District

especially in view of the fact that the previous survey was done some sixty years

back.

In the ryotwari area of Tamil Nadu, the land revenue assessment was fixed

and levied with reference to the intrinsic fertility of soil, taram, sort and location

of the land. A flat rate of Rs.2/- was being charged by the erstwhile Travancore

Government in the transferred territory of Kanya Kumari District. In order to

replace the flat levy of assessment by different rates of assessment with reference

to the nature of the soil, taram, sort and location of the land, the Tamil Nadu

Transferred Territory 13. (Ryotwari Settlement) Act, 1964 (Act 30/64) was passed.

For the purpose of effecting ryotwari settlement, re-survey was conducted

in the area and it was completed in 1967. A settlement notification, incorporating

13
Ryotwari Settlement Act, 1964 (Act. 30/64)
183
the principles set out in the settlement notification for Tirunelveli District, was

issued 14. Under this notification, the lands were classified as dry, wet and manavari

and the soils were divided into different classes and further into sorts. The rate of

assessment was set out for each sort of soil 15. The soil classification work was done

by the Settlement Inspectors on inspection of each land and over-checked by the

Settlement Deputy Tahsildar and thereafter by the Assistant Settlement Officer.

The wet lands were delimited with reference to the commandability of the

irrigation sources. Appropriate assessment rates were fixed taking into account the

taram, sort and classification of the soil. Ryotwari rates of assessment have been

brought into force in the transferred territory from Fasli 1380 onwards, after due

publicity, by means of notifications.

The villages in Kanya Kumari District were found to be un widely and

large and much difficulty was experienced in administering them. Seventeen

villages which were very large were split up into two villages in Kanya Kumari

District is now 81 as against 64 that existed previously.

In this area, there is a separate village service establishment comprising of

Village Officers in the cadre of Assistants and Junior Assistants. They maintain the

accounts in a separate office for each village. They are also liable to be transferred

to other villages.

In the transferred territory of Kanya Kumari District, there were some

special features of revenue payable by the ryots to the intermediaries mainly

connected with the temples and the family of Rajah of Travancore on certain items

14
G.O. Ms. NO. 297, Revenue dated 14 February, Government of Madras, Madras, 1966, p. 15.
15
Ibid, p. 16
184
of work connected with the religious services. In order to stop such payments, the

following enactments were passed and implemented in Kanya Kumari District and

Shencottah Taluk of Tirunelveli District.

The Tamil Nadu Transferred Territory Tiruppuvaram Payment (Abolition)

Act 32/64:Tiruppuvaram is an assignment of revenue or rent payable in money or

kind or in both in respect of any land or a portion of revenue made in favour of

religious, educational or charitable institutions or individuals 16. This Act sought to

abolish this right with effect from the appointed date viz., 1 March 1965 on

payment of tasdic allowance or compensation as the case may be. The work has

been completed.

The Tamil Nadu Transferred Territory Janmikanam Payment (Abolition

Act) 39/64: The traditional land owners by name Jenmies were collecting certain

amount called Jenmaikanam from Kudiyans. This Act was passed to extinguish

this right with effect from the appointed date viz. 16 March 1965 on payment of

compensation collectable from the Kudiyans. In all the 265 cases, compensation

and the tasdic allowance have been determined.

An appalling low standard of living and chronic deficit in food supply are

the two ugly repellent features of the economy of the Province of Tamil Nadu 17.

This is how B.S. Natarajan, Economic Adviser to the Government of Madras,

described the situation in the State. For an estimated population of 53:91 millions,

the national income of the State in 1949 was calculated at Rs. 1,370 crores, that is,

16
The Land Revenue Reforms Committee, Second Report, Government Press, Madras, 1951, p. 13.
17
. H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 174.
185
a per capita income of Rs. 254, which might well be an overestimate. Even this per

capita income may be compared with Rs. 4,668 in U.S.A., Rs. 2,355 in U.K., Rs.

2,868 in Canada, and Rs. 1,799 in Australia, i.e., 1/18 of U.S.A., 1/9 of U.K., less

than 1/11 of Canada and 1/7 of Australia 18.

With an area of 1,27,768 sq. miles, Madras State before the formation of

Andhra was one and one-third as big as England and Wales put together. The total

population according to the 1951 Census was 5,70,16,002 of which 4,48,32,268 or

80.4 per cent were rural 19. The total population in 1941 was 4,93,41,810 of which

4,14,76,927 were rural. The population thus increased by 14.4 per cent during the

last decade. During the three preceding decades between 1911 to 1941, the

population had increased by 18.96 per cent.

Urbanisation of the population has been quick though the predominant

section still remains in the villages. While in 1911 there were 36.51 million people

living in 53,835 villages, in 1941, 41.48 millions forming 84 per cent of the

population inhabited only 35,430 villages, thus showing a reduction of no less than

18, 405 Village. As against this fall in the number of villages, it is obvious that

there has been a growth in their size.

According to the Census of 1921. 71 per cent of the population was

occupied in agriculture. In 1931 it was estimated that 50 per cent or over were

actually employed in agriculture; and when the dependents were taken into

account, it was calculated that the figure would work up to 71 per cent. Only 13

18
Ibid, p. 175.
19
The Land Revenue Reforms Committee, Second Report, Government Press, Madras, 1951, p. 7.
186
per cent of the population was engaged in industrial pursuits in 1921 and this

stepped up by 3 per cent in 1931 20.

The figures for 1940 regarding the people engaged on land were estimated

as follows.

i. Absentee land-lords and Zamindars, owner cultivators actually

engaged in cultivation or supervising the same 5.488 millions.

ii. Tenant cultivators cultivating the land for the fixed amount of lease

or a proportion of the produce 1.742 millions.

iii. Working classes who do not own land but work as agricultural

labourers on casual or monthly or annual wages in cash or kind

5.509 millions 21.

The decreases in the number of cultivating owners and the increase in

agricultural landless labourers may be marked. The unrestricted right of transfer

and sale resulted in the transfer of the lands of small and uneconomic holders into

the hands of moneylenders and richer ryots. This was particularly marked in the

years after the economic slump of 1929 22. According to an enquiry in 1934, the

total ryotwari land that had changed hands from 1931 to 1934 in the province

(except for the West Coast Districts of Malabar and South Kanara) was roughly

10,351 thousand acres, of which about 20 per cent or 2,070 thousand acres, went to

20
H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 175.
21
M.N. Srinivas, India’s Villages, Asia Publishing House, Bombay, 1960, p. 46.
22
H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 177
187
non-agriculturists. The small and medium riot pattadars thus rendered land-less

swelled the army of agricultural labourers 23.

The dependence of the bulk of the population on agriculture reduced the

average size of the holding sub-division, unchecked by Government and

accelerated by the laws of inheritance, gathered momentum in due course and

reduced the land units to pitiably uneconomic sizes.

Before the recent abolition of the intermediary systems by the Congress

Government, Tamil Nadu manifested a bewildering variety of methods of holding

and cultivating land. The following were the main variety of tenures in the State.

! Perpetual free holds held under a title deed showing proprietorship as

against the Government and paying no land revenue.

! Enfranchised inams or grants of land or of the land revenue thereon,

showing proprietorship as against the Government and paying a quit-rent

fixed for ever, calculated at a favourable rate;

! Zamindaris or landed estates held under a sanad or a title deed showing

proprietorship as against Government and paying a land revenue or

peshkash fixed in perpetuity;

! Unsettled palaiyams or landed estates held without sanads, the land revenue

on which may be raised at the pleasure of the Government;

! Individual holdings held under what is termed ryotwari tenure without a

Sanad expressly declaring proprietorship and paying revenue subject to

23
Ibid, p. 178.
188
 additions and deductions in certain special circumstances and subject to

revision at intervals of 30 years.

! Inam holdings including jagirs or grants of land or land revenue held under

a tenure dependent on the fulfillment of certain conditions;

! Lands held on special conditions as

(a) On improvement leases called cowls 24

(b) Under the favorable rules for planting groves, etc;

! Lands held on leases other than cowls and lands held on licenses; and

! Lands alienated to local bodies and others for specific purposes.

Of these nine main varieties, the two most important are the ryotwari and

Zamindari tenures. Third in importance is the inam tenure.

About one-fifth of the Province was permanently settled under the Madras

Permanent Settlement Regulation of 1802. In 1352 Fasli the total zamindari area of

the State (cultivated cultivable and uncultivated) was 1,28,42,230 acres. When the

Madras estates Act, 1948, 25 was passed zamindari and inam tenurial systems were

prevalent over 26 per cent area of the State. In his forword to V.V.Sayana’s book,

referring to the Permanent Settlement in Madras, Sr.PattabhiSitaramayya says, “It

was a deliberate attempt by Lord Cornwallis to create a feudal system so as to

facilitate the rule of the country by foreigners and to create a hierarchy of social

and economic units easy to control”. 26

Pattabhi referred to the following passage in a dispatch by Lord Cornvallis

to the Board of Directors of the East Indian Company:

24
N. Ananda Padmanabhan, History of Land Revenue Settlement and Abolition of Intermediary
Tenures in Tamil Nadu, Government of Tamil Nadu, Madras, 1977, p. 106.
25
Abolition and Conversion into Ryotwari Act, 1948, p. 8.
26
H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 181.
189
 “Independent of all considerations, I can assure you that it will be of the

utmost importance for promoting the interests of the Company that a regular

gradation of rank may be supported which is nowhere necessary than in this

country for preserving order in civil society”. 27

As elsewhere, so in Madras, the worst type of peasant exploitation

prevailed in the zamindari areas. The overwhelming amount of the income from

the permanently settled estates was used for the luxuries and wasteful pursuits of

the land-lords-foreign travel, building palaces, and the like. Zamindars and their

agents drew the poorest peasants into expensive litigation for recovery of rents. No

records are available regarding the amounts appropriated by the Zamindars from

the tenants. A peep into the matter can, however, be had from the records

maintained about estates managed by the Court of Wards. Members of the family

of the estates of Vizianagaram, 28 for example, got in one year about Rs.4,38,720,

which was about four times the annual wages of the staff for the collection of

revenue, and two times the cost of the maintenance of irrigation work in the State

in a year. This was apart from Rs.30,000 given for expenditures on ceremonies and

entertainment of guests. And such extraordinary expenses as illness of the late

Maharaja, expenses on his funeral ceremonies and on the marriage to the eldest

daughter etc., were, of course, not included in the above amount.

At the time of the introduction of the Permanent Settlement in Madras

certain Complimentary Regulations were also passed to ensure that the rents which

the ryots had to pay to the zamindar should not be increased beyond the customary

rates. These, however, remained a dead letter. Rack-renting by the Zamindars

reached alarming proportions. The British rulers enacted the Madras Estates Land

27
Ibid, P. 182
28
Reddy, Ram, Sastry, Devi, Agricultural Economics Oxford and IBH Publishing New Delhi,
2010, p. 598.
190
Act of 1908 which accorded occupancy right to every zamindari ryot subject to the

payment of lawful rent. The Act, however, did nothing to reduce the enhanced

rents. Existing rents were presumed to be fair and equitable till the contrary was

proved. The illiterate and the backward tenants made no use of this provision of the

Act and the rents continued high. In the same year inam villages were also placed

on the same footing as zamindari estates and Estates Land Act was extended over

them 29.

Now we shall deal with the question of reforms in the ryotwari areas of

Madras. The total extent of ryotwari holdings during 1361 Fasli (revenue year

1951-52) was 2,86,66,333 acres as against 2,82,40,408 acres in the previous year,

thus showing an increase of 4,25,925 acres 30. The total assessment on ryotwari

holdings in 1361 Fasli was Rs.628.96 lakhs as against Rs. 617.04 lakhs in the

previous year. The total area cultivated in ryotwari holdings was 21.54 million

acres as against 21.02 million acres in the previous Fasli, showing a net increase of

5,22,015 acres.

The concentration of land into the hands of an upper stratum of the rural

classes would be apparent if it is borne in mind that landholders owning more than

18 to 20 acres (dry and wet together), corresponding to Rs. 100 of assessment,

constitute just 0.9 per cent of the total number (72.04 lakhs) of ryotwari

landholders and they have 12.8 per cent of the total extent of land (282 lakhs acres)

under ryotwari tenure 31.

The Ryotwari System, as originally received, sought to establish direct

links between the tiller or the ryot and the State without the interpolation of
29
P.R. Shanmugam., Land Reforms in Tamil Nadu, Technical Publication, Chennai, 1973, p. 26
30
V.M. Dandekar, Working of Bombay Tenancy Act, Report of Investigation, Golchat Institute of
Politics and Economics, Poona, 1948, p. 4.
31
H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 197.
191
intermediaries. But in course of time ryot actually came to mean the registered

holder, or the pattadar of a particular piece of land which he may cultivate or may

not cultivate.

1945-46

Assessment in
Number in Thousands
Lakhs of rupees

Ryotwari pattas Of Single Of Joint For Single For Joint

S. No.
Paying Pattas Pattas Pattas Pattas

1. Re. 1 and less 826 810 6.2 5.1

2. Re. 1 to Rs. 10 2,297 1,673 84.9 65.3
3. Rs. 10 to Rs. 30 314 508 90.0 72.0
4. Rs. 30 to Rs. 50 150 114 45.9 32.8
5. Rs. 50 to Rs. 100 83 59 47.7 25.6
6. Rs. 100 to Rs.250 32 14 43.4 17.7
7. Rs. 250 to Rs.500 7 2.4 22.1 6.6
8. Rs. 500 to Rs. 1,000 2.3 0.74 14.2 3.8
9. Above Rs. 1,000 1.35 0.54 15.9 2.6

10. Total for the State 4,012 3,177 370.4 231.5

1950-51

1. Re. 1 and less 852 759 6.3 5.9

2. Re. 1 to Rs. 10 2,188 1,763 82.5 70.2
3. Rs. 10 to Rs. 30 629 547 90.3 75.7
4. Rs. 30 to Rs. 50 151 115 46.1 33.4
5. Rs. 50 to Rs. 100 80 51 47.8 25.8
6. Rs. 100 to Rs. 250 32 16 41.6 17.3
7. Rs. 250 to Rs.500 7.4 2.7 22.0 7.2
8. Rs. 500 to Rs.1,000 2.5 0.83 15.3 5.1
9. Above Rs. 1,000. 0.79 0.17 13.8 2.8

10. Total for the State 3,943 3,255 365.7 243.4

192
 Actually share-cropping became the most marked feature under the

ryotwari system. A considerable section of the bigger ryots, whom we may well

call the occupancy right holder, went into jobs, professions and business in the

cities leaving the cultivation to the share-croppers. The ryot pattadar generally

gave out his land on annual lease and the real cultivator actually remained a tenant-

at-will. In a Memorandum submitted to the Congress Agrarian Reforms Committee

in 1948. 32 Shri O.P. Ramaswamy Reddiar, a former Chief Minister of Madras gave

the following table showing the percentage net share of tenant and landlord in

some Districts of Madras:

Percentage Share Percentage Share of

District
of Tenant Per acre Landlord Per acre

Chingleput : : 33 67
Thanjavur : : 16.1 83.9
East Godavari : : 40.1 59.9
Vizagapatam : : 44.4 55.6
North Arcot : : 23.1 76.9
Bellary : : 43.5 56.5
Tinnevelly : : 24.3 75.7
Coimbatore : : *7.6 92.4
SouthKanara : : 43.5 56.5

It is clear that the ryot land-lord got the lion’s share of the produce and the

tenant, naturally, lost all incentive for making improvements and for good

cultivation. Agriculture consequently declined in Madras. But it must, however, be

borne in mind that the overwhelming majority of ryot pattadars continued to be

owners of uneconomic plots. Shri Reddiar has given a table to show that 82 per

32
Sundararajan Iyangar, Land Tenures in the Madras Presidency, Modern Print, Madras, 1916, p. 42.
193
cent of the holdings in Madras were 5 acres and less out of which as much as 51

per cent were two acres and less. Seven per cent of the holdings were 5 to 10 acres

and 11 per cent were above 10 acres. 33 Shri Reddiar also showed that average

Cultivated area per head of agriculturist in Madras was 0.86 acre, with another

0.59 acre of cultivable waste.

According to the Report of Dr. B. V. NarayanaswamyNayudu,134 who

enquired into rural indebtedness in 1946, the aggregate rural debt of the State was

about Rs. 218 Crores as per details given below :

Class (1) Big land-holders Rs. 23,52,91,000

Class (2) Medium land-holders Rs. 89,30,59,000

Class (3) Small land-holders Rs. 84,18,23,000

Class (4) Tenants land-holders Rs. 15,19,45,000

Class (5) Landless land-holders Rs. 5,49,97,000

Total Rs. 2,17,71,15,000

The investigation of Dr. Narayanaswamy Nayudu was based on ‘random

sampling’ and ‘stratified random sampling’. He divided the agricultural population

in the following five classes:

! Big landholders holding 25 acres and above of land wet and dry ;

! Medium land-holders holding between 5 and 25 acres ;

! Small land-holders holding 5 acres and less;

! Tenants ; and

! Landless labourers.
33
N. Subrahmanian, History of Tamil Nadu, Koodal Publishers, Madurai, 1972, p.37
34
H.D. Malaviya, Land Reforms in India, Economic and Political Department, All India Congress
Committee, New Delhi, 1955, p. 200.
194
 The per capita debt for each class was estimated by Dr. Nayudu as follows :

Class 1939 1945 Difference Percentage fall or rise

Rs. Rs.
1 188.5 113.3 -75.2 -39.9
2 78.8 59.4 -19.4 -24.6
3 42.8 37.6 -5.2 -12.3
4 20.5 21.3 +0.8 +4.1
5 5.7 8.3 +2.6 +45.6

Nayudu concluded that “war-time effects have been most beneficial to

bigger than to medium landholders, while the small holders have actually suffered.

The debt of the landless labourers has increased more than that of the tenants. The

debt per head of the fourth class of tenants has risen by about 4 per cent clearly

showing that war years have hit relatively hard the tenants, as against the registered

holders. The case of the land-less labourers is even worse with a rise of 45.6 per

cent.”

Report of the Land Revenue and Land Tenure Committee

In short, the Ryotwari System as it had developed in Madras required

urgent reforms in order to arrest agricultural deterioration and to provide for a

healthy progressive rural society. And the problem was no easy one and needed

careful handling. Accordingly, the Government of Madras set up in May 1950 a

land Revenue Reforms Committee to go into the question and make

recommendations.2 It was asked to report, among other things, on the question

whether and in what manner the Government should interfere to fix maximum

holdings to form economic units of cultivation, eliminate non-cultivating and non-

195
resident pattadars, confer occupancy rights on the tenants and secure for them fair

rents and fixity of tenure. The Committee was asked particularly to take into

consideration the recommendation of the Congress Agrarian Reforms

Committee. 35

On the question of the rights of tenants in the ryotwari areas, the

Committee was of the opinion that the land-lord and Tenant system may be

allowed to continue, subject to the regulation of the system in respect of fair rents,

security of tenure, compensation for improvements, grounds for eviction and other

related matters. There is no need to confer occupancy right on tenant in ryotwari

areas. In future all leases should be for a minimum period of five years. In the case

of virgin land which is to be reclaimed, or which has been newly reclaimed,

however, the first lease should be for a minimum period of ten years. The tenant

should always have the option of terminating the lease by three months’ notice

expiring with a year of tenancy. 36

The following alone should constitute proper grounds for the landlord

terminating the lease during its currency:

Failure to pay rent within one month of the date stipulated in the lease-

deed;

Commission of any Act which is destructive or permanently injurious to the

land;

Use of the land for any purpose other than agriculture;

35
G. Venkataramani, Land Reform in Tamil Nadu, Sangam Publishers, Madras, 1973, p.63
36
Ibid.p. 64.
196
 Violation of any of the conditions of the lease-deed regarding the

restrictions on the nature of the crop to be grown and similar conditions

which are not repugnant to the statutory provisions governing tenancy;

Sub-letting of the land by the tenant;

The tenant being adjudged to be insolvent.

Dealing with the problem of redistribution of land and fixing a minimum

size of holdings, the Committee recommended: 37

“There is no need to fix any maximum limit, parse, in the case of existing

holdings, and expropriate the extents in excess of such maximum. In future no

person should be allowed to acquire agricultural lands if he already has a holding

carrying an assessment of Rs. 250, or so as to constitute, a holding carrying more

than Rs. 250 as assessment. In the case of joint families, separate allowance should

be made for such branch of the joint family subject, however, to an over-all limit of

holding, the assessment on which does not exceed Rs. 1,000.” 38

The recommendation of the Land Revenue Reforms Committee as also

those for the planning Commission on ‘Land Policy’ are these days under the

active consideration of the Government of Madras and it is expected that final

decisions would soon be taken on the question.

37
H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 202.
38
P.C. Joshi, Land Reform in India Allied Publishing, New Delhi, 1975, p. 72.
197
 Pending a final and comprehensive legislation, the Madras Government has

already passed the Bill. 39 The Bill provides that subject to payment of current rent

within a month of the commencement of the enactment, no cultivating tenant in

South Kanara District will be evicted from his holding for a period of one year

from the date on which the law comes into force. On January 9, 1954, the Madras

Assembly passed into law the Malabar Tenancy (Amendment) Bill as reported by

the Joint Select Committee of the State Legislature with some modifications.

The new Bill is the second amendment to the Malabar Tenancy Act of

1929, which was modified in February, 1951.

The amended Bill reduces the fair rents payable to land-lords by tenants of

pepper gardens, coconut gardens and wet-lands.

On the question of occupancy rights tenants in occupation for six years and

more are not liable to be evicted on the ground of land-lords’ needs. 40

Progress towards acquisition of Zamindaris and Inams

The first batch of estates was taken over by the Government on 7-9-1949. It

included the largest estates in the State. viz, Vizianagaram, Venkatagiri,

Sivaganga, Ramnad, Pithapuram and Bobbili.1 The irrigation works in the estates

taken over had been left without repairs for several decades and immediate

attention was paid to their improvement. As a result of the failure of North-West

Monsoon in 1949 and 1950 in many parts of the State, and the cyclone in 1949 in

39
The South Kanara Cultivating Tenants Protection Bill, The Madras Government Passed on
January 8, 1954.
40
Ibid, p. 204.
198
the northern District, 41 there was widespread failure of crops in most of the estates

taken over. The Government granted remission of land revenue in these estates on

the same liberal scale as in the ryotwari areas. Where rents were payable in kind it

was found that in spite of the rent reduction processdings, the commuted value of

the reduced grain rents was much above the ryotwari level and to afford further

relief to the ryots, the Government directed that land revenue collected under Sec.

23 of the Act in respect of any class of land shall be the highest ryotwari rate for

the same class of land in the District in which the estate in question is situated.

In respect of the estate actually taken over, the Government deposited with the

Estates Abolition Tribunal at Vizianagaram a sum of Rs.1,71,61,989 and with the

Estates Abolition Tribunal at Madurai, a sum of Rs. 1,05,72,235 as advance

compensation. These accounts included a sum of Rs. 48,66,681 which was towards

Government dues under Sec.41 and A of the Act. In addition, Rs. 6,40,709 and

Rs.3,11,945 were deposited with the Estates Abolition Tribunal at

Vizhianagaramand Madurai respectively towards interim payment under Sec.50 in

respect of Fasli 1359. 42

The number of inam villages in the State is 7,423. Of these 4,157 villages

were declared to be inam estates under Sec., 9 of the Act. Un till now 3,300 inam

estates have been taken over by the State.

The first towards the introduction of ryotwari settlement in estates taken

over by the Government is a regular and complete cadastral survey of the area

41
N. Ananda Padmanabhan, History of Land Revenue Settlement and Abolition of Intermediary
Tenures in Tamil Nadu, Government of Tamil Nadu, Madras, 1977, p. 39.
42
Ibid, p. 40.
199
concerned. Most of the estates are un surveyed, and even in cases where some sort

of survey was done previously, a resurvey or at least a supplemental survey, is

found necessary. For this purpose four survey Parties started working at Sivaganga,

Chottoor, Ramanathapuram and Vizianagaram. 43

Details of the area in square miles which had been already surveyed by

each party up to the end of May, 1951 are given below.

Survey Party I ... 476.61 sq. miles

Survey Party II ... 721.98 sq. miles

Survey Party III ... 176.48 sq. miles

Survey Party IV ... 70.80 sq. miles

As soon as an estate will be settled on ryotwari principles, 44 the

compensation payable to the landholder and other persons who have got a right or

interest in it will be determined and paid. As it will take 8 to 10 years for

completing these operations, provision has been made in the Act for the payment

of a portion of the compensation. This is done by making a rough estimate of the

compensation payable in respect of each estate and depositing half of the amount

with the Estates Abolition Tribunal concerned within six months of the notified

date. 45

Pending the final ryotwari settlement, the Government has to pay interim

compensation to the owners of estates taken over. The interim payment is equal to

the basic annual sum in respect of an estate. The basic annual sum is worked out as

43
J.H. Nelson, Madras District Manuel, Government of Tamil Nadu, 1868, Part V, pp. 39-41.
44
B.S. Baliga, Studies in Madras Administration, Government of Madras, Madras Vol. 1, 1949. p. 97.
45
Ibid.
200
follows: In the case of a zamindari estate, and a post-settlement under-tenure

estate, the basic annual sum will be roughly one-third of the gross annual ryotwari

demand, i.e., the sum-total of the assessments imposed as a result of the ryotwari

settlement of the estate less certain deductions. In the case of inam estates and pre-

settlement under tenure estates, the basic annual sum is the whole of the gross

Annual ryotwari demand less the quit-rent, jodi and kattubadi payable by

the inamdar or under tenure holder. What is adopted at present is cash payment of

compensation. It is proposed to pay a portion of the compensation also in lands.

The payment is made by general deposit and if needed by sale of securities. A

sinking fund from out of the net annual revenues from the estates taken over has

also been constituted for the purpose. The net additional land revenue from the

estates taken over is estimated to be roughly Rs. 30 lakhs. The total compensation

to be paid has been estimated at Rs. 15 ½ crores. 46

The effect of the amendment was to bring all inam villages within the scope

of the Madras Estates Lands Act. In the case, however, of inam villages which

became estates by virtue of this amending Act, the inamdars were given an

opportunity to prove that they possessed the kudivaram right in lands in such

villages by lodging applications before a special tribunal. 47

Meanwhile the Zamindari system in all its aspects came to be criticized,

discredited and condemned with more and more vehemence. In 1937 in

consequence of the agitation in the Legislature, the Congress Ministry appointed a

46
H.D. Malaviya, Land Reforms in India, Economic and Political Research Department, All India
Congress Committee, New Delhi, 1955, p. 237.
47
B.S. Baliga, Studies in Madras Administration, Government of Madras, Madras Vol. 1, 1949. p. 93.
201
Committee presided over by Sri T. Prakasam, the Revenue Minister, to enquire

into the whole question. On the basis of its recommendations the Estates Land

Reforms Bill of 1938 was drafted. But this Bill and a revised Bill prepared in 1939,

however, could achieve nothing as the congress Ministry soon afterwards resigned

Office. In 1940 the Adviser Government, which succeeded the Congress Ministry,

drew up a scheme for the conversion of Zamindari tenure into ryotwari by buying

out Zamindars and paying them compensation on the basis of net income. 48 In

1945 the Working Committee of the Congress issued a manifesto urging

comprehensive land reforms, including the abolition of the Zamindari system, and

the acquisition of estates by the payment of equitable compensation. Early in 1947

after the National Government came to power the legislature passed a resolution

accepting the general principle of the abolition of the Zamindari system. 49 In

pursuance of this resolution the Government as a first step passed an Act called the

Madras Estates Land (Reduction of Rent). Act XXX of 1947 for reducing the high

rents which prevailed in the estates. It provided for the reduction of rents payable

by the ryots in estates. Approximately to the level of the assessments imposed on

ryotwari lands in the neighbourhood. 50 The Government also brought forward a

Bill in the same year for abolishing all estates. The Zamindari system, they Stated,

had perpetuated an assessment which was not only high, but had also no relation to

the productive capacity of the land. It had led to loss of contact between the

Government and the actual cultivators. It had led to loss of contact between the

Government and the actual cultivators. It had acted as a brake on agricultural

48
S.Y. Krishnaswami, Monograph on Rural Problems in Madras, Madras, 1947. p. 43.
49
G.O. No. 114, Legal, dated 13th September 1947, p. 4.
50
G.O. No. 3, Legal, dated 7th January 1948, p. 11.
202
improvements. It had, because of its complexities, brought in an immense amount

of litigation in which the illiterate ryots had been placed at the mercy of the

unscrupulous agents of the Zamindars. It had rarely, if ever, resulted in

administration as efficient as that of the Government areas, and consequently it had

led to a great deal of discontent and agitation among the ryots. Indeed, the system

having outlived its usefulness had nothing to recommend its continuance. 51

The bill was passed into the Madras (Estates Abolition and Conversion in

to Ryotwari) Act XVI of 1948. It applies to all zamindaris, all unsettled palayams,

and all whole inam villages except those which became estates by virtue of Act

XVIII of 1936. When an estate is notified under the Act all the earlier enactments

relating to estates, except the Rent Reduction Act of 1947, cease to be applicable to

it; and the entire estate, including all communal lands and porambokes, waste

lands, pasture lands, lanka lands, forests, mines and minerals, quarries, rivers and

streams, tanks and irrigation works, fisheries and ferries stand transferred to the

Government and vest in them free of all encumbrances. The estate is then to be

surveyed and settled on ryotwari principles by Settlement Officers appointed under

a Director of Settlement who works under the Board of Revenue. The Settlement

Officer is to enquire and determine whether any inam village in his Jurisdiction is

an inam estate or not in order to find out whether it can be notified and taken over.

His decision is to be appealable to a tribunal constituted under the Act. He is also

to decide on application whether an under-tenure estate was created before or after

the principal estate was permanently settled so as to determine whether the

compensation is to be calculated adopting the basis applicable to zamin estates or

51
G.O. No. 114, Legal, dated 13th September 1947, p. 9.
203
the basis applicable to inam estates. The ryots are to be given ryotwari pattas for

their holdings with effect from the notified date and the landholders, Zamindars,

inamdars and under tenure holders are also to be given ryotwari pattas in respect

of their private lands as well as lands personally cultivated by them and satisfying

the other conditions laid down in the Act.

The compensation to be paid is roughly determined soon after the

notification of the estate and half this amount is deposited as advance

compensation to be adjusted against the final compensation determined after the

settlement operations in the estate are completed. Meanwhile, the landholder is to

be paid for every Fasli, till the final compensation is deposited, an interim payment

equal to half the basic annual sum roughly estimated. This interim payment is not

to be counted against the final compensation. 52 As to the method of calculating the

basic annual sum in the case of the Zamindari estates, the gross annual ryotwari

demand in respect of all lands for which persons other than the Zamindar are

entitled to ryotwari pattas under the Act and the average net annual miscellaneous

revenue from all other sources in the lands have to be computed; and one-third of

this figure has to be take to be the Zamindar’s share. This one-third portion is,

however, to be made subject to two deductions, a deduction of 5 per cent of the

gross annual ryotwari demand on account of establishment and another deduction

of three and one-third per cent on account of the maintenance of irrigation works

which is the zamindar’s responsibility. In calculating the basic annual sum for

inam estates the annual gross ryotwari demand and not any fraction of it is to be

taken as the starting point. From their figure three and one-third per cent is to be

52
J. H. Nelson, Manuel of the Madura, Districts Government of Madras, Madras, 1868, Part V, p. 12.
204
deducted on account of maintenance of irrigation works in the estate which the

landholder is obliged to maintain. Then the quit-rent or the jodi, etc., payable

annually to the Government by the landholder is also to be deducted. The balance

represents the basic annual sum for the inam estate. The compensation is to be the

basic annual sum multiplied by a figure which varies between 12 and 30. Where

the basic annual sum does not exceed Rs. 1,000 the multiplier is 30; over one lakh

of rupees the multiplier is12½. There are to be four intermediate stages 15, 17½, 20

and 25 depending on the annual basic sum. Payments are not to be made direct to

the landholders but are to be deposited with the two tribunals constituted under the

Act. Provision is also made for the appointment of more tribunals when

necessary. 53

These are, in the main, the provisions of the Madras Estates (Abolition and

Conversion into Ryotwari) Act. This Act Was amended by Act I of 1950 to

provide for the payment of a portion of the compensation without waiting for the

completion of the survey and settlement operations. Under the latter Act the

advance compensation is to be adjusted towards the compensation as finally

determined2. The Act also ensures the payment of a minimum sum of Rs. 12 ½

crores of rupees as compensation for all the Zamindari estates taken over by the

Government in the State of Madras as it was before the creation of the Andhra

State.3 The Madurai estates were, however, notified for acquisition under these

Acts only after 1951, the year with which this book closes.

53
G.O. No. 75, Legal, dated 18th April, 1960, p. 16.
205
 Turning to land tenures, besides the fixed rent and the sharing systems, the

District had formerly three kinds of tenures called the karei, the samibhogam and

the tunduvaram. Under the karei tenure all lands in a village, arable as well as

waste, were held in common by the tenants from a landlord, the arable lands being

periodically apportioned among themselves, the allotment of each tenant being

called garei and each tenant a gareikaran. This tenure was said to be almost dead

even in 1868. Under the samibhogam tenure which was in vogue mostly in inams,

the tenants cultivated the lands with the help of their own labour and stock and

paid a rent usually in money but sometimes in kind, in addition to a fee called

samibhogam, to the inamdar. The tenants regarded the lands as practically their

own and paid the samibhogam as a mere acknowledgment. The tenants’ share here

normally came to 45 per cent of the gross produce minus the samibhogam which

however varied from place to place. Under the tunduvaram, or bit of share tenure,

the tenants, as in the case of Sambhogam, paid a fee out of their kudivaram called

tunduvaram to the landlord in addition to the melvaram. The fee, however, varied

in proportion to the amount of the crop actually harvested, unlike the samibhogam

which was a fixed acknowledgment payable alike in good and bad seasons. The

tenants’ share or kudivaram here came to 45 per cent minus the tunduvaram which

amounted to about one-tenth or more for the kudivaram.

None of these peculiar kinds of tenures is mentioned. The existing tenures

are said to be either fixed rent tenure or the varam tenure. The fixed rent tenure is

the system by which lands are leased out by the land-lords for fixed rents to the

tenants. It is found principally in the best wet lands of the Palani Taluk, in the best

dry lands (the valuable black cotton lands) of the Tirumangalam Taluk and in the
206
garden lands elsewhere. The varam tenure is the system by which the land is leased

out by the land-lords to the tenants for a share of the produce. This is prevalent in

most parts of the District. On good lands irrigated by river-fed channels or tanks

the usual share taken by the landlord is two thirds of the gross produce. This is

specially so in the Periyar Project area, i.e., in the Periyakulam, Nilakottai,

Madurai and Melur Taluks. In these cases the tenant takes the straw and defrays all

the expenses of cultivation and the landlord pays the assessment. On inferior wet

lands the more common practice is to divide the produce equally between the

landlord and the tenant. In these cases also the tenant bears all cultivation expenses

and the landlord pays the assessment. Practice, however, varies in some degree

from village to village. There are some cases in which the landlord gets as much as

three-fourths of the produce or even more and pays only the assessment. Thus in

the Uthamapalaysm sub-Taluk, the landlord takes even four-fifths of the produce.

Generally however if he takes more than two-thirds he either defrays the expenses

of harvest or supplies the manure. If well water is baled to mature the crop, the

tenants’ share is raised to two-thirds or three-fifths, according to the quantity of

water baled. In the case of dry lands the tenant usually takes two-thirds of the

produce but sometimes half. Dry lands, however, are often, as has already been

Stated, leased for fixed rents. 54

A few other points of interest connected with the tenancy conditions of the

District may also be mentioned. In recent years there has been an appreciable

increase of absentee land-lords. The percentage of absentee land-lords of the

District is said to be 11; it is exceeded only in South Kanara where it is 34, in

54
J.H. Nelson, Manual of the Madurai District, Government of Madras, Madras, 1868, Part V, p.15.
207
Chingleput where it is 19, in Thanjavur where it is 18 and in Ramanathapuram

where it is 12. 55 The temples and charitable institutions of the District, instead of

settling the rents of their lands with their tenants by agreement, sell the right to

cultivate the lands by public auction. 56 Restrictions on cultivation are also

generally imposed in the leases; the tenants are not allowed to raise crops like

cholam and gingelly which sap the soil. Remissions are not usually granted to the

tenants; in a few cases however, they are granted for failure of crops. 57 Tenants are

specially required to effect improvements to the lands and allowed compensation

in some cases. Advances are made by tenants to the land-lords wherever there is a

keen competition for lands; in some cases such advances do not carry interest

while in others they carry a 3 per cent interest. The rates of interest on rent vary

from 10 to 15 per cent. In some cases, however, they go up to even 18 or 24 per

cent. In several cases, at the same time, interest is not charged by the land-lords.

Sub-letting is allowed in some cases; absentee land-lords prefer to lease out their

lands to substantial tenants who, in turn, sub-lease such lands to others. 58 Finally,

the tenants are in many cases, required to pen their sheep and goats on the lands of

the land-lords without any payment and, in a few cases, even required to place

themselves and their bullocks at the disposal of the lanlords. Since the accession of

the National Government Tenancy and other land reforms have been actively

considered. In 1946 the Government appointed a Special Officer and in 1950 a

Special Committee presided over by Sri M. V. Subramaniam, I.C.S., a Member of

55
G.No. 53, Revenue, dated 8th January 1951, pp. 25-26.
56
G.O. No. 1357, Revenue, dated 8th April, 1918, p. 106.
57
Report of the Special Officer on Land Tenures in the Ryotwari areas of Madras Province,
Madras, 1947, p. 67.
58
Ibid, p. 69.
208
the Board of Revenue, to consider and report on various tenancy as well as other

land revenue matters. 59 Their reports are now being considered and a Bill has

already been framed for fixing the tenants’ share. But as this book stops with 1951,

we shall not deal with it at length here.

The land revenue of the District in 1949-1950 amounted to Rs. 26,92,163.60

As for the machinery employed for collecting it and for administering all other

revenue matters, the District, as has already been seen, has had a Collector from

the very beginning. He was from the early days assisted by one or more sub-

collectors or Assistant Collectors. From 1859 61 he came to be assisted by Deputy

Collectors also. Prior to 1860 the District comprised the Taluks of Tadikkombu,

Nilakkottai, Madakkulam, Melur, Aiyampallee, Tenkarai and Tirumangalam. In

that year, in accordance with the scheme for the reorganization of the village

establishments submitted by Mr. Pelly and sanctioned by the Government, these

Taluks were renamed and rearranged as Dindigul (Comprising Tadikkombu and

Nilakkottai), Madurai, Melur, Palni, Periyakulam and Tirumangalam. In 1889, a

new Taluk, the Kodaikanal Taluk, was constituted. In 1910, as a result of the

transfer of the zamindaris of Ramanathapuram and Sivaganga to the new

Ramanathapuram District, another new Taluk, the NilakkottaiTaluk, was formed. It

is thus that the present Taluks of Dindigul, Palni, Kodaikanal, Nilakkottai,

Madurai, Melur, Tirumangalam and Periyakulam came into being. As for the

Revenue Divisions, they have naturally changed from time to time. At present

59
Report of the Special Officer on Land Tenures in the Ryotwari Areas of the Madras Province,
Madras, 1947, p. 28.
60
G.O. No 2325, Revenue, dated 6th September 1951, p. 76.
61
G.O. No 379, Revenue, dated 22th September 1859, p. 9.
209
these divisions consist of Dindigul, Madurai and Usilampatti. The Dindigul

division comprises the Taluks of Dindigul, palni, Kodaikanal and Nilakkottai; the

Madurai Division comprises the Taluks of Madurai and Melur and the Usilampatti

Division comprisesthe Taluks of Tirumangalam and Periyakulam.

The Revenue Divisions and the Taluks have been invariably under the

charge of Sub-Collectors or Deputy Collectors and Tahsildars respectively. The

Tahsildars have been having under them the usual revenue sub ordinates, the

Deputy Tahsildars and Revenue Inspectors. The village establishments have

always consisted of the village headmen (the Nattamaikarars), the Karnams and the

Kavalkarars. 62

Taking those that have been throughout under the Madras Government

first, excise was, until lately, the most important source of revenue; but to-day,

with the introduction of prohibition, it has dwindled into a very small sum. In

1945-1946, for instance, when prohibition had been suspended by the Adviser

Government, it amounted to no less than Rs. 15.89 crores in the State and Rs 62.07

lakhs in Madurai 63; but in 1952-53, the revenue became insufficient even to meet

the expenditure, there being a deficit of about 33.27 lakhs of rupees in the State.

This revenue was in pre-prohibition days derived from the manufacture and

sale of arrack and toddy, and from the sale of foreign liquors, opium, ganja and

bhang. 64 It is now derived chiefly from foreign liquor. Its history is now merely of

62
G.O. No 631, Revenue, dated 25th April 1860, p. 120.
63
Administration Report of the Excise Revenue, for 1945-49, Government of Madras, p. 19.
64
Administration Report of the Excise and Prohibition Department for 1952-53, Government of
Madras, p. 23.

210
antiquarian interest, but none the less it is interesting, and it has to be recounted in

as much as it affected the administration of the District for about a century.

The revenue of the Districts, including Madurai, was for the first time

regulated by Act III of 1864 as amended by Act V of 1879. The supply of liquor

was then regulated by the farming system. The farming system was replaced in

1874 by the “improved excise system” under which the monopoly of supply of

arrack and toddy in the District was given to a contractor subject to the condition

that he paid duty on every gallon of spirit issued, and guaranteed a minimum

revenue to the Government. It was however soon found that this system was

responsible for a serious growth of illegal practices. As all the shops were in the

hands of the manufacturer and as he had to pay duty only on the quantity issued to

the vendors, it mattered little to him if the shops sold illicit liquor. Further, the

renter failed to maintain the preventive staff required to put down the illicit

practices. The Government therefore appointed a Committee in 1884 to suggest

improvements and upon its recommendation passed Act I of 1886 65. The

“improved excise system” was now, in the case of arrack, replaced by the free

supply system which was one of free competition among the licensed distillers in

respect of manufacture and supply. This led to unhealthy competition and finally to

the danger of a monopoly. This system was therefore abandoned in 1900 and

replaced by the contract distillery system. Under this system the privilege of

manufacture and vend were entirely separated. The manufacturer was given the

privilege of supplying a fixed area at a definite rate per gallon, the Government

supervising the process and ensuring the quality of liquor. The liquor was issued

65
J.H. Nelson, Madras District Manual, Government of Madras, Madras, 1868, Part V, pp. 17-18.
211
from a central source of supply and the right of retail sale was disposed of by

auction. By this arrangement the prevention of illicit practices was left in the hands

of the Government. In the case of toddy, a fee was levied for the right of retail

vend and a tree tax was also levied upon every tree from which toddy was to be

drawn. As for foreign liquor, tavern licenses were granted for consumption on the

premises, the fees being determined by auction. But, wholesale licenses and retail

licenses for consumption off the premises, for refreshment rooms and bars were

granted on payment of fixed fees. The sale of opium was administered under India

Act I of 1878 and that of ganja under Madras Act I of 1886 and the right of retail

vend to the public was generally sold by auction. The arrack was supplied to the

vendors by the distilleries situated outside this District, toddy was drawn chiefly

from coconut trees, and also from Palmyra and sago palms. This was the position

till October 1947 when prohibition was introduced in the District. 66 The loss of

revenue caused by prohibition has been more than made up by the levy of new

taxes called commercial taxes. The credit for devising and introducing these new

taxes belongs to the First Congress Ministry presided over by Sri C.

Rajagopalachari. In 1939, the Madras General Sales Tax Act (Act IX of 1939), The

Madras Entertainments Tax (Act X of 1939). The Madras sales of motor spirit

Taxation Act (Act VI of 1939), (the Madras Tobacco (Taxation of Sales and

Licensing) Act (Act VI of 1939) were passed. The last of these Acts was

suspended in 1944 on account of the levy of central excise duty by the Government

of India and lump-sum compensation was given by that Government thereafter to

the Madras Government for the loss of the State revenue. In 1953 this Act was

66
D.N. Strathir, Excise and Temperance in Madras, Government of Madras, 1922, p. 27.
212
repealed and the State enacted the Madras Tobacco (Taxation of Sales and

Registration) Act 1953 (Act IV of 1953) 67. This Act came into force from 20th

April 1953. It enabled a tax to be levied on all varieties of cigarettes sold at the

retail point at more than three pies per cigarette on a graduated scale ranging from

10 per cent of the turnover to 30 Per cent of the turnover according to the rate of

the retail price of the cigarette and at thirty per cent of the turnover on cigars, and

cheroots sold at not less than two annas per cigar or cheroot and on pipe tobacco or

cigarettes tobacco. In 1955, the tax was extended to the sale of cigarettes at retail

point at not more than three pies per cigarette, at the rate of 3-1/8 per cent of the

turnover. The tax realized for the year 1953-1954 for the whole State was Rs.

30,21,662.

The General Sales Tax Act came into force on 1st October 1939. It was

levied on all businesses the turnover of which exceeded Rs. 10,000 thereby

exempting all small traders dealing in food Clothing, etc. To facilitate its levy and

to avoid detailed investigations into the exact turnovers in the case of smaller

business the amount of the tax was fixed at Rs. 5 per month when the turnover was

between Rs. 10,000 and Rs. 20,000. A tax at half a per cent was levied when the

turnover exceeded for. 20,000. Safeguards were provided in the Act to avoid the

taxation of both the seller and the buyer in respect of one and the same transaction

and also on both the purchases and sales of the same goods of the same dealer.

Exemptions were made in the case of certain articles like bullion and specie,

cotton, cotton yarn, and cloth woven on handlooms and sold by persons

exclusively dealing in such cloth. In the case of hides and skins provision was also

67
G.O.No.338, Revenue, Dated 12th February 1941, p. 84.
213
made to levy the tax at a single point in a series of sales by successive dealers. In

case of certain finished articles of industrial manufacture, a rebate of one-half of

the tax levied on sales of such articles for delivery outside the State was allowed.

The sale of electrical energy, motor spirit and manufactured tobacco was exempted

from the tax. 68 In 1940-1941, the rates of tax were reduced to Rs. 4 per month on

turnovers between Rs. 10,000 and Rs. 20,000 and at one-fourth per cent on

turnovers exceeding Rs. 20,000.3 In 1944, the rates of taxation were raised to Rs.

12 per mensem on turnovers between Rs. 10,000 and Rs. 15,000, Rs. 12 per

mensem on turnovers between Rs. 15,000 and Rs. 20,000 and 1 per cent on

turnovers exceeding Rs. 20,000. 69 In 1949, the slab rate system of taxation was

abolished except in the case of fruits and vegetable dealers and a tax of 3 pies per

rupee was levied in all cases in which the turnover was Rs. 10,000 or more. In

respect of certain luxury goods, an additional tax at the rate of 3 to 6 pies per every

rupee was also levied at the stage of sale by the first dealer. In 1949 the slab rate

system was made inapplicable to dealers in coconuts, canned, preserved, dried or

dehydrated vegetables and fruits. In the same year, the tax on food and drink sold

in hotels boarding houses and restaurants was raised to 4½ pies in the rupee when

the turnover was Rs. 25,000 or more: and the sale of cotton which had been

exempted from tax prior to 1st August 1949 now became liable to a tax at a single

point at the rate of half a per cent on the turnover. From 1950, by virtues of Article

286 (1) of the Constitution of India, sales for export outside the territory of India

were exempted from tax, while the taxes on other sales, including sales for export

68
G.O. No. 2528, Revenue, dated 5th November 1941, p. 16.
69
G.O. No. 69, Revenue, dated 28th November 1947, p. 12.
214
to the other States in India. Continued to be levied under the special permission of

the president. 70 The net result of all this brought no less than Rs. 16,48,25,763 to

the State in 1950-1951. Madurai contributing Rs. 1,08,56,398. 71 From 1954, the

levy of additional tax was extended to certain varieties of mill cloth, fine or

superfine, cotton cloth other than hand loom cloth, hosiery goods other than those

made wholly of cotton and medium cotton, mill cloth at the rate of1 anna 3 pies

and precious stones at the rate of 6 pies. From 1956, the sale of sugar was also

subjected to the additional tax at the rate of 1 anna in the rupee. A single point tax

of 6 pies was also levied on the sale of raw tobacco and certain varieties of

manufactured tobacco which were not subjected to tax under the Madras Tobacco

(Taxation of Sales and Registration) Act, 1953. From 1st April 1955 to onions,

potatoes, betel leaves and plantain leaves and to co-operative societies effecting

sales of palm gur and to sales effected by cottage industrial co-operative societies.

The Entertainments Tax Act came into force on 1st August 1993. 72 This Act

repealed a previous Act of 1926 (Act V of 1927) by which local bodies could levy

a tax on entertainments and provided compensation for such bodies. It authorized

the levy of a tax on a graduated scale according to the value of the payment made

for admission to any entertainment. When the payment was not more than 2 annas,

but less than 6 annas it was levied at 6 pies. In the case of higher payments, it rose

gradually from 1 anna in the case of payments between 6 annas and 12 annas to

Rs. 2 in the case of payments between Rs. 9 and Rs. 10. When the payment was

RS. 10 or more, it was Rs. 2 for the first 10 rupees and Rs. 2 for every 10 rupees or

70
G.O. 429, Revenue, dated 23rd February 1949, p. 25.
71
G.O. No. 2134, Revenue, dated 11th August 1951, p. 23.
72
G.O. 3075, Revenue, dated 11th August 1951, p. 16.
215
portion thereof in excess of the first 10 rupees. Provision was made in the Act for

compounding the tax for a fixed sum as well as payment of a fixed percentage of

the gross proceeds, when the proprietors applied for such lump sum payments.

Provision was also made for exempting entertainments the proceeds of which were

devoted to philanthropic, religious or charitable purposes; and entertainments

which were of an educational, cultural and scientific character. In 1945, the rates of

tax on payments for admission above 2 annas were increased by 50 per cent. 73

From 1947 the tax was levied at the following rates:-

Where the payment inclusive of the amount of the tax-

Rate of Tax

Is not more than 5 annas … … 1/5

Is more than 5 annas but is not

more than Rs. 1-8-0 … … … …
1/4

Is more than Rs. 1-8-0 … … 1/3

A concession was also given to cinematograph exhibitions for which the

tax was calculated at the above rates after excluding from such payments the

amount of the tax. In addition to the above tax, a show tax calculated at different

rates for Madras City, big municipalities, etc., was also levied in1949. The rate of

tax prescribed for dramatic and music performances, Indian-dances, exhibitions of

works of arts and manufactures is as follows:-

73
G.O. 20, Revenue, dated 6th January 1947, p. 3.
216
 Where the payment inclusive of the amount of tax is-

Rate of Tax

Not more than 3 rupees … … 1/8

More than 3 rupees but not more

than 5 rupees … … … … … 1/5

More than 5 rupees … … 1/3

All dramatic performances other than dance-dreams and all music and

dance performances and variety entertainments comprising dance and music and

other similar items conducted by approved registered Sabhas and similar

associations were exempted from entertainments tax. In 1948-1949, the tax yielded

Rs. 1,00,68,138 in the State, Madurai contributing Rs. 7,28,894. 74

The only other important source of revenue in the District is the income-tax

and this is collected by the Government of India. Income-tax was first imposed in

India in 1860 in order to meet the financial dislocation caused by the Mutiny. It

was levied at the rate of 4 per cent on all incomes of Rs. 500 and upwards. 75 Many

changes have been made in the system from time to time. According to the

schedule in force in 1954-55, the first Rs.4,200 are exempted. In the case of

incomes exceeding this amount, the tax is levied as follows: on the first Rs. 1,500,

nil; on the next Rs. 3,500 at 9 pies in the rupee; on the next Rs. 5,000 at 1 anna and

9 pies in the rupee; and on the balance at 4 annas in the rupee; a surcharge of one-

twentieth of the basic tax is also levied. On high incomes, i.e., over Rs. 25,000, a

super tax ranging from 3 annas to 8½ annas in the rupee with a surcharge of one-

74
G.O. 2356, Revenue, dated 7th September 1949, p. 18.
75
G.T. Bodg, The Madras Presidency, Madras,1931-1933, p. 58.
217
twentieth of the super tax is levied. Originally, the administration of the

department was vested in the State government and was carried on by the Board of

Revenue and the Collectors of the Districts, assisted first by the ordinary revenue

staff and later by Special Deputy Collectors, Tahsildars, Assistant Tahsildars and

Inspectors. In 1992, a Chief Commissioner who was a member of the board of

Revenue, four Assistant Commissioners, and many Assessors and Investigating

Officers called surveyors came to be appointed. Madurai was then placed under the

assistant Commissioner, Southern Range. Subsequently, as a result of the 1919

Reforms, the administration of the department was taken over by the Government

of India and their own officers. The District is now divided into two income-tax

Circles, the Dindigul Circle and the Madurai Circle. The Dindigul Circle comprises

the revenue Taluks of Palni, Kodaikanal, Dindigul, Periyakulsam and Nilakkottai;

the Madurai Circle comprises the revenue Taluks of Madurai, Melur and

Tirumangalam. Each circle is in charge of an Income-tax Officer. The number of

assesses in the District, in 1945-55, was 5,141 and the amount of demand was Rs.

1,33,24,7221. The trades, industries and other sources which contribute the tax in

the Dindigul Circle are the trade in grain, hill produce, hides and skins,

manufacture of tobacco products, motor transport business, textile mills, oil mills,

ginning factories and match factories. The main business which contribute tax in

the Madurai Circle are textile mills and transport companies.

Since 1953, the estate duty has been introduced in the District. In 1954-55,

the Income-Tax Department collected this duty from the estates of 24 deceased

persons amounting to Rs. 6,279.

218