Territorial nexus in land ceiling law: outside-State holdings may be counted without making the provision extraterritorial.

Section 6(3-A) of the Gujarat Agricultural Lands Ceiling Act, 1960 was analysed as a State law on agricultural land within Gujarat, not as extraterritorial legislation. The provision merely treated land held outside the State as a factor for computing the ceiling applicable to land held within Gujarat. Applying the real and sufficient territorial nexus test, the provision was found to remain within the State's legislative competence because the operative burden attached only to land in Gujarat. The challenge to invalidity on grounds of extraterritorial operation therefore failed, and the provision was upheld as valid.

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Issues: Whether Section 6(3-A) of the Gujarat Agricultural Lands Ceiling Act, 1960 was invalid as having extraterritorial operation and as being beyond the legislative competence of the State Legislature.

Analysis: The Act was enacted under the State's legislative field relating to land and acquisition of property. Section 6(3-A) did not legislate upon land outside Gujarat; it only took into account land held elsewhere as a relevant factor for determining the ceiling area of land that a person could hold within Gujarat. The governing test was whether there existed a real and sufficient territorial nexus between the subject matter and the State. As the ceiling operated only on agricultural land within Gujarat and the liability was directly connected with the person's holding in the State, the use of outside-State holdings for computation did not convert the law into extraterritorial legislation. The provision therefore remained within the permissible scope of the State's legislative power.

Conclusion: Section 6(3-A) was held valid and within the legislative competence of the State Legislature.

Final Conclusion: The challenge to the impugned provisions failed, and the appeals were dismissed with costs.

Ratio Decidendi: A State law fixing a ceiling on land within its territory does not become extraterritorial merely because, for the purpose of determining that ceiling, it takes into account land held by the same person outside the State, if the territorial nexus is real and sufficient.

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