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1978 DIGILAW 123 (GUJ)

SHANTILAL JADAVBHAI PATEL v. STATE

1978-10-11

N.H.BHATT

body1978
N. H. BHATT, J. ( 1 ) THESE ten petitions filed against the State of Gujarat and the District Development Officer Baroda in his capacity as the Competent Officer as per the Gujarat Minor Mineral Rules 1966 could be conveniently disposed of by one common judgment because the questions which are involved in these petitions are almost similar and the grievances of different petitioners in these petitions are also almost identical. A few facts are required to be stated at this stage in order to comprehend the controversy. ( 2 ) IN Taluka Sankheda of Baroda District through the sim of village Badarpur Orsang river flows. Obviously there is a river bed obtaining sand which is a minor mineral in terms of the Mines and Minerals (Regulation and Development) Act 1957 Different kinds of minerals both major and minor are the national properties which are to be utilised on welllaid lines so that there is proper development of minerals. The above mentioned Act is therefore intended to provide for the regulation of mines and the development of minerals. Under the Scheme of the Act Minor Minerals are entrusted to the care and control of the State Government who are empowered by sec. 15 of the Act to make rules in respect of Mines and Minerals. ( 3 ) UNDER the authority derived from the above sec. 15 of the Act the State of Gujarat has made Gujarat Mines and Minerals (Regulation and Development) Rules 1966 which are there in the present form after undergoing repeated amendments. The position of these rules at the relevant time will therefore be required to be seen in order to dispose of these petitions. ( 4 ) OUT of ten different petitioners in this group of 10 petitions the petitioner of the Special Civil Application No. 854 of 1975 is a man belonging to the Barber caste. The rest of the petitioners in those remaining petitions are said to be inter-related and they are even slid to be members of the one family. However all these petitioners had separately applied for quarry lease if the year 1970 and the Competent Officer the District Development Officer the Respondent NO. 2 in all these petitions had granted them quarry leases. the petition-wise details are given in Schedule-A annexed to this Judgment. However all these petitioners had separately applied for quarry lease if the year 1970 and the Competent Officer the District Development Officer the Respondent NO. 2 in all these petitions had granted them quarry leases. the petition-wise details are given in Schedule-A annexed to this Judgment. The schedule would show the dates of application for quarry lease dates on which quarry leases were granted dates on which they are renewed last and the dates on which the last renewal applications were made which applications were threatened to be rejected when the petitions had come to be filed. ( 5 ) ALL these leases were initially granted for one year and requisite lease agreements were also executed. They were then being renewed from year to year as per Rule 18 of the Gujarat Minor Mineral Rules which shall be referred to hereafter as the Rule for brevitys sake. There is no controversy about those leases of the petitioners being renewed year after year till we come to the year 1974. Before 90 days of the expiry of the period of the last renewal each of the petitioners had made an application for renewal. In the meantime the State Government the Respondent No. 1 in these petitions issued a letter which is at Annexure-A in all these petitions. It was addressed to the Respondent No. 2-the District Development Officer Baroda. The relevant portion reads as follows:"i am directed to refer to the correspondence resting with your letter No. Mineral 154 dated 12-2-1975 on the above subject and to state that the manner in which these leases were granted is not satisfactory. Now all the 11 leases in question have been ended therefore you are directed to renotify these areas and reinvite applications for the quarry leases. There are complaints that this Patel family is monopolising the area and that while finalising the fresh leases this aspect should be kept in mind". ( 6 ) THESE petitioners came to learn that such a directive was issued by the State Government to the Respondent No. 2 the competent officer and they therefore apprehended that these directives emanating from the State Government would be followed by the Respondent No. 2 and consequently the area under operation possessed by them on lease would be renotified for the purpose of inviting fresh applications for quarry leases. They therefore filed these petitions and prayed for a writ or direction setting aside the said order of the Government at Annexure-A This Court was pleased to issue a notice to the Government and to the Respond No. 2; but the Respondent No. 1 alone filed an affidavit on 13 June 1975. Henceforth I shall refer to this affidavit as the first affidavit. The affidavit proceeds to state that out of 10 different petitioners 8 parties are inter-related and one of them Shri Ramanbhai Rambhai Patel had been given two plots. The affidavit further proceeded to state that in the case of lease given to Shri Chhanabhai Jivabhai Patel there was one another claimant for the very block No. 4 and therefore the District Development Officer had no jurisdiction that it was found by the Government on inquiry that several aspects of the handling of the matter left an unsavoury impression and that it was noticed that not only the rejection of the application of Shri I. F. Qureshi was illegal under the Gujarat Minor Mineral Rules but also that the circumstances indicated that all parties had not been given an equal chance to obtain quarry leases in the area. The affidavit ultimately proceeds to state that the letter Ex. A was not a direction but was only an advice which it was open to the Respondent No. 2 to abide by or not. The affidavit then proceeds to state that the Government issued from time to time general instructions for the guidance of the subordinate officers who were empowered to implement the Gujarat Mines and Mineral Rules and that the advice in the form of Ex. A was in the general public interest. ( 7 ) THE abovementioned affidavit was followed by another affidavit dated 26th June 1975 by the Under Secretary of the Government in the Industries Mines and Powers Department. By that time the D. D O. had passed an order rejecting the applications of these petitioners for renewal on one or the other grounds as set out in those rejection orders which are Annexure-B in all the petitions. The petitioners came to know of the passing of these orders-Annexure B during the intervening period and so they amended the petitions and directed the challenge against that order Annexure-B also. The petitioners came to know of the passing of these orders-Annexure B during the intervening period and so they amended the petitions and directed the challenge against that order Annexure-B also. By the second affidavit dated 26th June 1975 the Under Secretary said that the District Development Officer had decided all the renewal applications for quarry leases in accordance with rules on 17 It was asserted that in the intervening period the D. D. O. in his own right had decided the renewel applications on their own merits irrespective of Annexure-A to the petition. The third affidavit after the admission of the matters was filed by the very officer and it is dated 16th. October 1976. ( 8 ) WITH respect to the Annexure-A the challenge was based on the ground that the State Government had no power to issue such a directive and that even if it had an uncalled for and unauthorised suggestion the suggestion of a supervisory body like the State Government would in the ordinary circumstances be taken by the subordinate officer to be a mandate and it is further contended that such a directive in the form of Annexure-A could not fall under Rule 41-A under which the State Government exercising powers of revision because such powers should not be exercised without affording a reasonable opportunity of audience to the other side likely to be affected. This directive is further assailed on the ground that it proceeds on an assumed notion of a policy against the monopoly. The eight out of the ten petitioners contended that the total area of these eight petitioners that was granted to them under different leases did not even exceed the total area which was permissible in respect of the joint operators. Those eight petitioners contended that such a directive emanating from the State Government was beyond the purview of the States powers under the Minor Mineral Rules and therefore also it was bad. Those eight petitioners contended that such a directive emanating from the State Government was beyond the purview of the States powers under the Minor Mineral Rules and therefore also it was bad. ( 9 ) THE challenge to the order Annexure-B stands on the grounds that the application could not be decided on factual data which was collected and acted upon ex-parte without affording any opportunity of audience to the persons likely to be affected that allegations in the orders of rejection of the renewal applications were factually incorrect and that various factual aspects were no grounds to reject the prayers for renewal forth with because such defects or defaults if any could be made basis for the further action only after the service of a notice calling upon concerned delinquent to make good those deficiencies. ( 10 ) THE petitions were very stoutly opposed by the Government through their Advocate Mr. Christy who firstly contended that it was perfectly open to these petitioners to have recourse to an appeal under Rule 38 of the Rules against the orders at Annexure-B and that the relations between the Government on one hand and the concerned petitioners on the other being only purely contractual no writ petition lay. The other incidental submissions were made which will be discussed at their proper places. ( 11 ) THE first question therefore that would fall to be decided is whether the leases granted are the outcome of the contract pure and simple or whether these leases are intrinsically interwoven with the statutory provisions and legal rights and liabilities. It is to be conceded forthwith that if the relations between the parties despite the State being one of the parties are purely contractual no writ petition would lie. However to me it appears crystal clear that looking to the paramount intention of the legislature to see that important public wealth is suitably dealt with and properly regulated a system has been evolved the resultant outcome of which does not fall exclusively within the realm of the contract but it necessarily partakes of the character of statutory rights and statutory liabilities. The Government therefore cannot get away from its statutory obligations by taking shelter beneath the plea of purely contractual relations. I shall instantaneously elaborate why I say so. The rules themselves lay down the procedure for getting the quarry lease. The Government therefore cannot get away from its statutory obligations by taking shelter beneath the plea of purely contractual relations. I shall instantaneously elaborate why I say so. The rules themselves lay down the procedure for getting the quarry lease. Rules themselves speak of the restriction on the grant of quarry leases. In order to have the lease a special procedure has been laid do in by the delegated legislature in Rules 7 8 9 and 10. Special duties to maintain register of applications and registers of quarry leases are also provided and Rules 15 and 16 lay down the restriction on the area of quarry leases. Rule 18 however in my view gives a clinching answer to the question posed by the State. The said Rule 18 in the initial stages read as follows:"18 Period of quarry lease. (1) The period for which a quarry lease may be granted shall not except with the approval of Government exceed 10 years. The lease shall be renewable at the option of the lessee for one period not exceeding the duration of the original lease. (2) At the time of the renewal of the lease the lessee shall be entitled to surrender any part of the area leased to him. (3) When a renewal is granted the terms and conditions of the renewal shall be the same as these in force at the time of the renewal. (4) An application for the renewal of a quarry lease shall be presented at least 90 days before the expiry of the lease to the competent officer and shall be accompanied by a treasury challan of rupees twenty five to be paid as renewal fee and credited under the budget head specified in Rule 7. Such application shall be presented in triplicate in Form F. (5) Notwithstanding anything contained in the foregoing provisions of this rule the Government may at any time by giving to the lessee six months notice in writing determine the lease if the area for which the lease has been granted or any part thereof is required by the Government for any public purpose and a declaration under the signature of the Director that the area of as the case may be the part of the area is so required shall as between the lessee and the Government be conclusive". Then the position of rules changed because of the amendment and Rule 18 came to have the following form: ( 12 ) EXCEPT in the case of ordinary sand kankar murram and gravel the Period for which a quarry lease may be granted shall not except with the approval of Government exceed ten years in respect of all minor minerals. The period for which a quarry lease may be granted for ordinary sand kankar murram and gravel shall not except with the prior approval of the Government exceed one year. The lease for all the minerals shall be renewable at the option of the lessor either for one period not exceeding the duration of the quarry lease or for one period not exceeding the duration of the quarry lease or for a smaller period as may be fixed by the Director. (B) Subject to the provision of sub-rule (4) the Director may direct the competent officer to grant to the holder of the quarry lease second and further renewals of the lease. (C) If a lease holder whose period of quarry lease or the period of its renewal is due to expire fails to inform the competent officer or as the case may be the Director to have a fresh lease or a further renewal ninety days before the date of of the lease or its renewal the competent officer or as the case may be the Director shall declare the area as available for regrant by a notification in the Official Gazettee. Such Notification shall not be issued thirty days before the date of expiry of the period of the quarry lease or the renewed quarry lease as the case may be. The competent officer shall consider the applications received for such lands after publication of the notification in the Official Gazette as provided in these rules. Any applications received before the date of publication of the notification in the Official Gazette shall be premature and shall not be entertained. (2) At the time of the renewal of the lease the lease shall be entitled to surrender any part of the area leased to him. (3) When a renewal is granted the terms and conditions of the renewal shall be the same as those in force at the time of the renewal. (2) At the time of the renewal of the lease the lease shall be entitled to surrender any part of the area leased to him. (3) When a renewal is granted the terms and conditions of the renewal shall be the same as those in force at the time of the renewal. (4) An application for the renewal of a quarry lease shall be presented at least 90 days before the expiry of the lease to the competent officer and shall be accompanied by a treasury challan of rupees twenty five to be paid as renewal fee and credited under the budget head specified in Rule 7. Such application shall be presented in triplicate in Form P. (5) Notwithstanding anything contained in the foregoing provisions of this rule the Government may at any time by giving to the lessee six months notice in writing determine the lease if the area for which the lease has been granted or any part thereof is required by the Government for any public purpose and a declaration under the signature of the Director that the area or as the case may be the part of the area is so required shall as between the lessee and the Government be conclusive. Rule 18: (A) (I) Except in the case of ordinary sand kankar murram and gravel the period for which a quarry lease may be granted shall not exceed ten years in respect of all minor minerals. (ii) The period for which a quarry lease may be granted for ordinary sand Kankar murram and gravel shall not exceed three years. (B) (I) The lease for all minerals specified in sub-clause (i) of clause (a) may be renewed by the competent officer for one or more periods and the period of renewal at one time shall not exceed ten years and the total period for which the lease may be renewed shall not exceed twenty years in the aggregate. (iii) The lease for all minerals specified in sub-clause (ii) of clause (a) may be renewed by the competent officer for one or more period and the period of renewal at one time shall not exceed three years and the total period for which such lease may be renewed shall not exceed twelve years in the aggregate. The third set quoted above represents the situation as was available on 6 July 1974 and thereafter. The third set quoted above represents the situation as was available on 6 July 1974 and thereafter. ( 13 ) EVEN a casual glance at the above quoted provisions of Rule 18 would show that the relation between the lessee on one hand and the Government on the other did not exclusively fall within the realm of a contract. But a special relationship with statutory hedges and restrictions is envisaged to be brought out with special rights and liabilities which are in many ways inconsistent with and at times different from contractual rights and liabilities. As for example Rule 18 (1) as was initially there conferred indefatigable right of renewal of the lease for one period not exceeding the duration of the original lease. The said right continued but its tone was lowered down by conferring jurisdiction to grant or not to grant the renewal. The change is obvious and the learned Advocate Mr. J. C. Patel for the petitioner did not therefore urge that in cases of renewal applications must be granted. All that he emphasised was that a lessee had a right to make a fresh application and the underlined policy of the rules even after the third stage was to encourage renewal rather than discourage it. Mr. Patels submissions are standing on a firm footing. When the legislature was making a provision for renewal not as a part of this contract alone but as a part of the statute also implicit there is the legislative policy to confer on a citizen even a statutory right to pray for renewal. When the statutory rule speaks of the possible renewal it cannot be urged as was done by Mr. Christy for the State that the prayer for renewal also was confined exclusively to the contract and not to the statute. What I endeavour to emphasise is that the provisions of Rule 18 as was on the statute book from time to time clearly show that the matter of renewal was not a sweet will of the competent authority but the legislature wanted it to be a statutory duty of his to be discharged not as a pure term of the contract which could be even flouted subject to the liability to pay damages but it was a duty to be discharged strictly in accordance with the legal provisions namely the rules. Were it is a matter of simple contract the accompaniment of a treasury challan of Rs. 25. 00 to be paid as a renewal fee would not have been there. All these circumstances very clearly show that the renewal is not a matter of pure contract which another contracting party despite the contract may not act upon. In other words while dealing with the question of an application for renewal the competent authority would be dealing with the matter not a purely contracting party but as a statutory authority bound to act strictly according to law within the straight jacket of the legal formalities and requirements. The first arguments therefore that no writ petition is competent is too lame to be seriously taken note of. ( 14 ) THE next question is whether the renewal is a matter of right. The matter should not detain us much because Mr. J. C. Patel himself said that the renewal did not follow as a matter of course. All that he emphasised was that as a citizen only Indian Citizens could be given leases and none others who was granted a lease because of his otherwise being eligible could legitimately expect that within the permissible limits of time and not exceeding the aggregate period provided by the rules his application for renewal would be considered in accordance with law and unless there are legal impediments it would be granted. In other words though he has no right to grant as such he has a right to have his application considered in the light of the circumstances of the case and in accordance with law. The underlying policy of the legislature seems to be that unless there is some public purpose calling for peremptory treatment or unless there is states need the renewal would ordinarily be granted subject to the limitation of area and time. In the case on hand the action of rejection of these applications for renewal smacks of patent mala fides as I would instantly show in the context of Ex. A which was couched in the language of dictation and mandate rather than of an advice and suggestion and in the context of the filing of these petitions challenging that Ex. A and in the context of the tenor of orders at Ex. A which was couched in the language of dictation and mandate rather than of an advice and suggestion and in the context of the filing of these petitions challenging that Ex. A and in the context of the tenor of orders at Ex. B. In the face of the peremptory language employed by the State in the directive Annexure-A the State came forth with an affidavit No. 2 that the competent Officer himself had bluntly told the Government as if it was none of the business of the Government to issue such a direction and that he would deal with the renewal applications on their own merits uninfluenced by the dictate or direction or advice contained in Ex. A. Curiously enough the Competent authority who is alleged to have adopted such a bold stance has not chosen to file any affidavit to speak of the working of his mind. It is only the State that states so in its affidavit. But in the facts and the circumstances of the case it is not possible for a Court of law to believe that the directives issued in the language of Annexure-A could have been ignored by the competent authority who strictly speaking could act only on its own and in accordance with the guidelines laid down by the statutory rules. For want of any affidavit emanating from the competent authority in any of these petitions I am not inclined to believe that the decision of the competent authority reflected in the impugned order Ex. B is its own independent act in any way uninfluenced by the directions given in the imperative language by the State in Annexure-A. ( 15 ) THE grounds that are put forth in the order Ex. B also show that they are put forth more as excuses rather than as reasons. All these grounds are factual. In some cases it is said that the applicant had not paid his dues under the existing lease in time or that in some cases the applicant had not kept and maintained proper boundary marks or that he had removed more sand than what was permissible in the carting permits. All these were the factual facets on which the competent authority can well be ill-informed or at any rate they were the facets on which other side can possibly have some different versions to be presented. All these were the factual facets on which the competent authority can well be ill-informed or at any rate they were the facets on which other side can possibly have some different versions to be presented. The petitions were already filed and the Respondent No. 2 was very much a party to those petitions. Ex. A was over his head and Ex. A was under the fire in these petitions. It is in these settings and backgrounds that the Respondent No. 2 picks up certain causes regarding which the party likely to be adversely effected can have something different to say. As a matter of fact in each of these petitions the petitioner concerned has asserted that factual data is absolutely ill-founded. As a matter of fact rules themselves provide that in case the lessees commit the breach of any of the conditions specified in various clauses of Rule 22 of the Rules the competent authority has to give a notice in writing to him asking him to remedy the breach within 60 days from the date of the notice and if the breach is not remedied within such period the competent officer under the rules can determine the lease. This is to be found in its clauses 3 in part IX of the model contract form appended to the rules in Form D. Reference to it is invited because even during the continuance of the lease the possibility of the other side having something different to say and the possibility of those breaches being made good was envisaged by the statutory authority namely the rule making authority. Can it be therefore envisaged that for the purpose of renewal of applicationsfor lease a different standard could be adopted by the statutory authority namely the competent officer ? In the facts and circumstances of these cases in particular the competent authority was expected to bring all these facets to the notice of the applicant and be sure whether those grounds existed or not. ( 16 ) MR. Christy however in this connection urged that principles of natural justice were not required to be complied with while granting the application though he was fair enough to concede that for the purpose of revocation of an existing lease they would come up as a matter of inevitability. ( 16 ) MR. Christy however in this connection urged that principles of natural justice were not required to be complied with while granting the application though he was fair enough to concede that for the purpose of revocation of an existing lease they would come up as a matter of inevitability. In support of this submission he cited the judgment of the Supreme Court in the case of Radhakrishna Agarwal v. State of Bihar A. I. R. 1977 S. C. at 1496. In that case the State Government leased out some forest land to appellants to collect and exploit sal seeds for 15 years on payment of royalty at a certain rate. The Supreme Court ultimately reached the following conclusions. (1)THE contracts did not contain any statutory terms or obligations and no statu tory power or obligation which could attract the application of Article 14 of the Constitution was involved. (2)IT was the contract and not the executive power regulated by the Constitution which governed the relations of the parties on the facts apparent in the instant ease. They involved questions of pure alleged breaches of contract No writ or order could issue under Art. 226 in such cases to compel the authorities in remedy a breach of contracts pure and simple. (iii) The limitation imposed by rules of Natural justice cannot operate upon powers which are governed by the terms of an agreement exclusively. The only question which normally arises in such cases is whether the action complained of is or is not in consonance with terms of the agreement. (Emphasis is supplied by me)I have shown above that the scheme of the Gujarat Minor Mineral Rules 1966 is distinct. The competent authorities created by these rules authorised to grant leases are not only contracting parties but the scheme of the rules amply shows they are at various stages of their functions and powers regulated by statutory provisions. In the facts and circumstances of the case it is therefore difficult to hold that the respondent No. 2 was at that time acting purely as a contracting party. In the facts and circumstances of the case it is therefore difficult to hold that the respondent No. 2 was at that time acting purely as a contracting party. It therefore follows that the principles of natural justice were required to be followed in this case particularly when the alleged factual grounds were brought to bear upon or attempted to be brought to bear on the mind of the competent authority while discharging the statutory function namely to grant the renewal or not grant renew as alleged. I reiterate that granting of a renewal of quarry lease under the Gujarat Mines and Mineral Rules is not a purely executive function authorised by law but it is an executive function at every material stage hedged by the provisions of law. It is not possible to severe these statutory strings from this executive act of granting or not granting lease. ( 17 ) MR. Christys last argument was that as there was an alternative equally efficacious remedy of an appeal under Rule 38 this Court should be disinclined to entertain this petition under Art. 226 of the constitution. The above discussion shows that those orders suffer from inherent lack of compliance with principles of natural justice and they therefore in the eyes of law are non est. When the said void orders are passed it is not obligatory for a citizen whose rights are affected to exhaust such an alternative remedy of an appeal. The principle on this score is too well laid to be called in question. ( 18 ) THE result is that the orders at Annexure-B annexed to these petitions are required to be set aside and they are hereby set aside. The respondent No. 2 is directed to deal with those applications in accordance with law after affording an adequate and reasonable opportunity to the concerned petitioners to have their say if some factual allegations are to be made the basis of the decision one way or the other. The rule is accordingly made absolute with no order as to costs. (Annexture not published.) .