"The law under which advances can be made for the improvement of lands is Act XXVI of 1871 as amended by Act XXI of 1876. The object of the Act was to define the improvements for which advances could be made by Government, to provide for the security of a first charge on the land improved, and to lay down the conditions on which advances were to be made. It was hoped by the Government when the Act was passed that it would be largely used, and that the benefit to the country would be considerable.
This hope has not been realised. In section III, Chapter IV, of the second part of their Report, the Famine Commissioners write: 'the evidence we have received regarding the working of this Act renders , it unquestionable that it has failed to realise the intention of promoting improvements and that there is a very general reluctance to make use of its provisions. The sums which have been advanced under the Act are extremely small, and bear no proportion whatever. to the need which the country has of capital to carry out material improvements'. In accordance with the suggestions of the Famine Commissioners, the Government of India called for the opinions of the Local Governments on the working of the Act and the causes of its failure.
There was, in the replies received, an almost unanimous consensus of opinion that both the Act and the rules under it require simplification. It has accordingly been decided to bring forward a Bill to consolidate and amend the present law. For the somewhat complicated provisions of sections 6 to 13 of Act XXVI of 1871 the Bill proposes to adopt the simpler rule that advances may be made to any person^ who is entitled, under the law for the time being in force, to make improvements of his land. For the rest, everything which it is not absolutely necessary to provide for in the body of the law is left to rules to be framed by the Local Governments.
The objections sometimes taken to this method of legislation do not seem to apply in this case, as the only interests which can be affected by the rule are those of the Government and it may be presumed that sufficient care will be taken to guard them.
The local conditions and peculiarities of the several parts of India are so varied that it is only by leaving great discretion to the Local Governments that rules suitable to the working of an Act of this kind can be framed. If- this Bill is passed, the Legislature will have done all that it can to remove the obstacles alleged to stand in the way of the success of the measure. There is reason, however, to fear that the owners of land will not resort to Government for advances of this description to any large extent. It is impossible for the district officials to have any intimate knowledge of the character and means of each applicant; and, therefore, a certain amount of form, enquiry, and consequently, of delay and trouble, must precede the payment of money from the public treasury. It is possible that private companies may be established whose agents will be able to offer more facilities to applicants. It is' proposed, therefore, to take advantage of the present opportunity to provide encouragement to private enterprise in this field.
Provisions have accordingly been inserted in the Bill to enable the Government to authorise companies or associations of a private character to make advances for the improvement of land. A company or association so authorised will be bound to transact its business on principles and conditions laid down by the Government for its guidance and advances made in accordance .with those principles and conditions will be considered advances under the Act, and will be secured and recoverable in the same manner as if they were loans from the Government Treasury".
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