16. whether the principle of imposing a limit on holdings should receive retrospective effect and be applied to existing holdings raises wider issues than the limits proposed for future acquisition and for resumption for personal cultivation. The central question involved is whether, in the event of a limit being imposed, lands in excess of the limit can be acquired
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for consideration which falls short of fair compensation, that is, their market value at the time of acquisition. Merits of the proposal apart, we are advised that such a course would not be consistent with the provisions of the Constitution. We would suggest that the problem needs to be considered in terms somewhat different from those in which proposals axe commonly made.
17. The problem of land held by substantial owners falls into two distinct part , namely, (i) land now under the cultivation of tenants-at-will, and (ii) land under the direct management of owners. Keeping in view the limit for resumption of personal cultivation, we suggest that for areas in excess of this limit the general policy should be to enable the tenants to become owners. To achieve this object , the following measures have to be taken simultaneously. First, tenants have to be given security of tenure which could well extend to the conferment of occupancy rights. Secondly, it would be necessary to determine the principles on which (a) the price of land should be fixed and (b) payment should be made by the tenant. Depending again upon the local conditions, the most convenient course might be to fix the price of land as a multiple of its rental value, and payment might be made in instalments spread over a period. We suggest that there is advantage in the Government establishing direct contact with tenants upon whom these rights are conferred and collecting land revenue from them rather than through owners, the price of land being recovered along with the land revenue. Payment of compensation to owners of land can be made in bonds much in the manner already adopted or proposed for intermediary rights.
18. Where land is managed directly by substantial owners and there are no tenants in occupation, public interest requires the acceptance of two broad principles :
(i) There should be an absolute limit to the amount of land which any individual may hold. This Emit should be fixed by each State, having regard to its own agrarian history and its present problems. The census of land holding and cultivation, which it is proposed to hold during 1953, Will give the data relevant to this decision.
(ii) The cultivation and management of land held by an individual owner should conform to standard of efficiency to be determined by law.
It is suggested that each State should enact suitable land management legislation. Under this legislation standards of cultivation and management should be laid down. Specific obligations should be prescribed, for instance, in respect of sale of surplus produce to the Government, production and sale of improved seed, wages and conditions of living and employment for agricultural workers, investment in farm improvements, etc. The legislation should also provide for suitable machinery for enforcing the various obligations. The legislation could be applied, in the first instance, to these holdings which exceed,a limit to be prescribed, which may be equal to or larger than the limit for resumption for personal cultivation, and future acquisition, depending upon the conditions in a State.
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19. As a practical approach to the problem of large individual holdings, it would be best to divide substantial farms which are directly managed by their owners into two groups, namely, those which are so efficiently managed that their break-up would lead to a fan in production, and those which do not meet this test. For the latter category, the land management legislation should give to the appropriate authority the right to take over for the purpose of management the entire farm or such portion of it as might be in excess of the limit for resumption of personal cultivation and, secondly, the right to arrange for cultivation of lands so taken over. For the cultivation of such lands, preference could be given to co-operative groups and to workers on the lands which pass into the control of the land management authority. The proposals made above would provide for a large measure of redistribution of land belonging to substantial owners. In the legislation a date might be indicated with effect from which the law would be enforced in respect of farms in excess of the prescribed limit. Generally speaking, in order to set up the machinery for land management and to undertake the necessary survey before the law can be enforced effectively, a period of about two to three years might be necessary.
SMALL AND MIDDLE OWNERS 20. The expressions `small' and `middle' owners cannot be defined precisely but, for most purposes, it might be sufficient to consider owners of land not exceeding a family holding as small owners and those holding land in excess of one family holding but less than the limit for resumption of personal cultivation (which may be three times the family holding) as middle owners. In the case of small and middle owners, the social considerations which apply are of a different order from those relevant to the circumstances of the larger owners. The general aim of policy should be to encourage and assist these owners to develop their production and to persuade them to organise their activities, as far as a possible, on co-operative lines. Small owners include many who have uneconomic holdings which are also seriously fragmented. The experience of consolidation of holdings in Punjab, Madhya Pradesh and Bombay has established the value of this measure for small holders. We suggest that since the idea of consolidation of holdings is well understood by the peasants and they are prepared to meet a large part of the cost, in all States programmes for the consolidation of holdings should be expanded and pursued with vigour. The second important measure which has been taken in some States for the benefit of small holders relates to the fixation of a minimum holding below which subdivision is not permitted. There has been no investigation yet into the practical working of measures for the prevention of sub-division below a minimum such as have been taken in Bombay and Uttar Pradesh. It is, therefore, difficult to say to what extent they have proved immediately beneficial. They are, however, sound in conception and, while they need to be observed more closely in practice, we think that they could be extended.
21. The suggestions is sometimes made that in the event of redistribution of land belonging to substantial owners, those who have uneconomic holdings should receive additional land in order that their may become economic. The effect of the proposals that we have made earlier in respect of lands of substantial owners will be to confer rights which will develop into ownership mainly on those tenants and workers who are already engaged in the cultivation of lands in excess of the limit for resumption for purpose of cultivation. In the ordinary
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course, therefore, there may not be much land available for the purpose of enlarging the holdings of uneconomic owners. The problem of uneconomic holdings has certain wider aspects to which we shall refer later. The solution lies more in the direction of evolving a suitable system of co-operative management of the land of a village and the organisation of co-operative farming groups rather than in attempting too many little adjustments in the holdings of individual owners or cultivators of small plots.
22. Lands belonging to small and middle owners may be divided into two categories, namely, those under direct cultivation, and those leased to tenants-at-will. The problems which the former present are those of finance, technical assistance and organisation of co-opera- tive activity. As regards the latter, two considerations are important. In the first place, any measures which are taken to protect the tenants of small and middle owners should be simple to administer and, as far as possible, the problems which they raise should be solved at the village level by the people themselves. Secondly, care should be taken to ensure that measures for the protection of small and middle owners do not operate seriously to reduce the movement of the people from rural areas into other occupations, whether in towns or in villages. The pressure on land is already heavy and is growing. Voluntary movement of villagers into other vocations has considerable advantage for the development of rural economic life, especially in conditions in which those who go out of the village for work retain their village roots, and are encouraged to maintain an active sense of obligation towards the village community of which they continue to be members. There is little to be gained by treating the leasing of land by small and middle owners as examples of absenteeism to be dealt with along the same lines as lands belonging to substantial owners which are cultivated by tenants-at-will. At the same time, steps have to be taken to afford adequate protection to the tenants of small and middle owners.
TENANTS-AT-WILL 23. The central question to be considered in respect of tenants- at-will who are engaged in the cultivation of lands belonging to small and middle owners relates to the terms on which the latter may resume land for personal cultivation. A distinction may be made between those small and middle owners who cultivate themselves and those who do not. Land could only be resumed for cultivation by an owner himself or by the members of his family. We suggest that resumption should be permitted on this ground for the number of family holdings not exceeding three which can, be cultivated by the adult. workers belonging to an owner's family with the assistance of agricultural labour to the extent customary among those who cultivate their own lands. A period may be prescribed-five years for instance-during which an owner may resume for personal cultivation. If he fails to do so during this period, the tenant should have the right to buy the land he cultivates on terms similar to those suggested earlier for the tenants of the larger landholders.
24. The rights of tenants who cultivate the lands of small and middle owners need to the defined. The two principal questions to be considered relate to the period of tenancy and the rent which the tenant may have to pay. We suggest that the tenancy should ordinarily be for
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five to ten years and should be renewable, resumption being permitted, as suggested earlier, if the owner himself wishes to cultivate. As regards the determination of rent, in recent years in various States, rents have been steadily reduced., In Bombay the rent of agricultural land was reduced to one-third of the produce (or its value) for unirrigated lands and to one fourth of the produce for irrigated lands. In the Punjab, rent has been reduced from one-half to one- third of the produce for lands cultivated by owners whose holdings exceed the limit prescribed for resumption of personal cultivation. The determination of rent has to be regarded essentially as a question for consideration in the light of local conditions. The essential principle would appear to be that the rent of land should be so fixed that, having regard to his expenses of cultivation and other risks, a fair wage remains for the cultivator. While it is difficult to suggest a generally applicable maximum rate of rent, over the greater part of We country, a rate of rent exceeding one-fourth or one-fifth of the produce could well be regarded as requiring special justification.
LANDLESS WORKERS 25. Schemes of land distribution are likely to confer somewhat restricted benefits on agricultural workers other than tenants. This is because in any scheme of distribution or resttlement the first claim will be that of tenants already working on lands which may be taken over from the larger owners. In view of this difficulty, the contribution which the movement for making gifts of land, which has been initiated by Acharya Vinoba Bhave, has special value , for , it gives to the landless worker an opportunity not otherwise easily available to him.
26. It would be difficult to maintain a system in which, because of accidents of birth or circumstance, certain individuals are denied the opportunity of rising in the social scale by becoming cultivators and owners of land. It is, therefore, necessary to consider the problem in terms of institutional changes which would create conditions of equality for all sections of the rural population. The essence of these changes lies in working out a co-operative system or management in which the land and other resources of a village can be managed and developed so as to increase and diversify production and to provide employment to all those who are able and willing to work. The growth of industrialisation and of tertiary services is essential if any scheme of agricultural reorganisation is to succeed. Given this condition, whether the rural economy will expand and its techniques develop rapidly enough will depend largely upon the manner in which it is reorganised.
CO-OPERATIVE FARMING 27. Small and uneconomic holdings are at We root of many of the difficulties in the way of agricultural development. With the growing pressure on land, their number is increasing. Where agriculture does not requite much investment, natural conditions are favourable and the cultivators are skillful and industrious, it is possible that the average yield on small farms may be higher than the average for many of the larger farms. The problem in India is to secure a large increase in production over the entire area now under cultivation. This calls for the
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application on a wide scale of scientific knowledge and increased capital investment in various forms. These conditions are easier to secure where land is worked and managed in fairly large units than in the form of petty and fragmented holdings. In a farm of substantial size it is possible to eliminate several wasteful operations and to ensure better planning of the use of land, including selection of crops, rotation, soil conservation, development of irrigation and introduction of improved techniques. Economies which cannot be availed of by small farms are available to large ones. By its very nature a larger unit of operation and management can secure more credit and finance and can apply these to greater advantage, can diversify its economy and can make a relatively greater contribution to the solution of the country's food problem.
28. For these reasons it is important that small and middle farmers, in particular, should be encouraged and assisted to group themselves voluntarily into co-operative farming societies. These societies may be formed on conditions such as the following :-
(i) The area under a co-operative farming society should not be less than a prescribed minimum. This could be fixed according to circumstances, as, say, four to six times the family holding in an area. It is perhaps not necessary to prescribe a maximum for a co- operative farming society ;
(ii) Preference should be given to co-operative farming societies in the matter of supplies, finance, technical assistance and marketing ;
(iii) In undertaking consolidation proceedings, preference might be given to villages in which co- operative farming societies are formed ;
(iv) Preference should be given to co-operative farming societies in leasing agricultural waste lands belonging to the Government or taken over from private owners with a view to development. Suitable assistance in bringing such lands under cultivation should also be given ;
(v) It could be provided that so long as a co- operative farming society continues, no adverse tenancy rights would accrue against those of its members who might not engage in personal cultivation. The object of this concession is not to affect in any way the rights of existing tenants (as they should enter the co- operative farming society as members) but to encourage individual small and middle owners to join together to form co-operatives.
A widespread extension of the practice of co-operation in non- farm as well as farm operations will be a major determining factor in achieving the rapid re-organisation of the village economy.
CO-OPERATIVE VILLAGE MANAGEMENT 29. While the extension of co-operative farming and co-operative activities generally will do much to develop the social and economic life of the village and, in particular, will benefit small and middle landholder, the scope of rural organisation has to be conceived in wider terms. We have referred already to the fact that without a basic reconstruction of the village economy
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it is not possible to create conditions of equality of opportunity for the landless agricultural workers. Even after the problems relating to lands belonging to substantial owners have been dealt with, there remains considerable disparity of interest between the small and middle owner, the tenant and the landless worker. Concessions to one section at the expense of another may certainly benefit a few, but intrinsically the measures which may be taken may not promote sufficiently the rapid increase of agricultural production or the diversification of rural economic life or the growth of greater local employment. The possibility of achieving greater social justice through regulation of contractual terms between different constituent elements in the village is soon exhausted. Apart from sharpening the conflict of interests within the rural community, proposals for further regulation become in effect proposals for sharing poverty. While We objective of family holdings with increasing emphasis (in co- operative methods of organisation may represent the most practical method of translating into practical action the principal of `land for the tiller', the effective fulfilment of this very principle requires that there should be a more comprehensive goal towards which the rural economy should be developed.
30. For several reasons it has become imperative that at the village level there should be an organisation deriving its authority from the village community and charged with the main responsibility for undertaking programmes of village development. In an earlier chapter we have suggested how these functions may be taken over by the village panchayat and how the panchayat may be strengthened for the purpose. In relation to land policy the role of the village panchayat becomes an extremely important one, because there are certain problems which none but the panchayat can deal with. These may be briefly mentioned :