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1999 DIGILAW 748 (PAT)

Satya Murmu v. State Of Bihar

1999-08-10

B.P.SINGH, INDU PRABHA SINGH

body1999
Judgment 1. This appeal is directed against the order of a learned Single Judge of this Court dated 8-3-1999 in C.W.J.C. No. 1054 of 1999, whereby he allowed the writ petition preferred by respondent No. 4 herein, and directed the respondent to make a fresh settlement in accordance with the directions contained in the order, while setting aside the settlement made in favour of the appellant herein. The question which arises for consideration in this appeal is about the manner in which the settlement of sand Ghats is to made under the provisions of the Bihar Minor Mineral concession Rules, 1972, since a special procedure has been prescribed for settlement of such sand Ghats. 2. The facts of the case may be briefly noticed. The appellant herein, who was respondent No. 4 in the writ petition, claims to be the Secretary of a Co-operative Society, known as Karmoi Labour Co-operative Society Limited. His case was that by application dated 8-11-1998 he had applied for settlement of the sand Ghats in question for the year 1999 in favour of the Co-operative Society. It is not disputed that an application was made on a plain paper and was not accompanied by a fee of Rs. 2.000.00 and the relevant documents, affidavits, etc. which are required to be filed along with the application under Rule 9 of the Rules. While the application of the appellant was pending, a public notice was published in the daily newspaper Aaj on 1-12-1998 for settlement of all the sand Ghats in the district of Dumka. At serial No. 14 of the notice the sand Ghats of Barakar river falling in the district of Dumka were mentioned. By the said notice, all concerned were informed that the sand Ghats mentioned therein were to be settled oh the basis of public auctions to be held on December 15, 18 and 21, 1998, The writ petitioner, who is respondent No. 4 in this appeal, deposited the security amount of Rs. 40,000.00 on 14-12-1998 in response to the said public notice. The auction was held on 21-12-1998 and he was the highest bidder bidding an amount of Rs. 4,20,000.00 for the settlement of the Ghats in question. 40,000.00 on 14-12-1998 in response to the said public notice. The auction was held on 21-12-1998 and he was the highest bidder bidding an amount of Rs. 4,20,000.00 for the settlement of the Ghats in question. The appellant herein did not participate in the auction, but after the auction was held the Society expressed its willingness to take settlement of the Ghats in question, and offered an amount slightly higher than that offered by respondent No. 4. For the earlier year i.e. for the year 1998 the disputed Ghats were settled for Rs. 3,01,000.00 and, therefore, the offers made by the appellant as well as respondent No. 4 were more than twenty per cent higher than the amount for which the Ghats were settled in the preceding year. It is not disputed that respondent No. 4 also deposited Rs. 2,12.000.00 , as required in the notice. However, he was not granted permission to operate the Ghats, and no agreement was executed in his favour. On 24-12-1998 the District Mining Officer, Dumka, addressed, a letter to the appellant as well as respondent No. 4 intimating them that a fresh auction for the settlement of the disputed Ghats would be held on 29-12-1998. Both the tenderers were asked to take part in the auction failing which an ex-parte decision would be taken. Unfortunately, the appellant did not appear on 29-12-1998 to take part in the public auction and, therefore, there was no fresh bid on 29-12-1998. According to the appellant, it was entitled to the settlement of Ghats under Rule 11-C of the Rules, since it had offered a sum of Rs. 4,20,000.00 for the settlement which was slightly higher than the bid made by the petitioner in the auction held on 21-12-1998. Ultimately, respondent-authorities decided to settle the sand Ghats in question for the year 1999 in favour of the appellant and it was informed accordingly by letter dated 31-12-1998. The appellant-Society deposited a total sum of Rs. l,52,500.00 and thereafter on 1-1-1999, it was delivered possession of the sand Ghats by the Inspector of Mines with permission to operate the Ghats. 3. Respondent No. 4 aggrieved by the settlement of the Ghats made in favour of the appellant herein filed a writ petition before this Court and ultimately, the writ petition was allowed by the impugned order dated 8th March, 1999. 4. 3. Respondent No. 4 aggrieved by the settlement of the Ghats made in favour of the appellant herein filed a writ petition before this Court and ultimately, the writ petition was allowed by the impugned order dated 8th March, 1999. 4. The moot question which arises for consideration in this appeal is whether a Co-operative Society answering the description under Rule 11-C of the Rules is entitled to settlement of sand Ghats without taking part in the public auction. It also arises for consideration as to whether a public auction having been held for settlement of Ghats, a Co-operative Society by involving the provision of Rule 11-C can claim settlement of the said Ghats by offering to pay 20 per cent more royalty than what was paid in the preceding year. 5. Under the Bihar Minor Mineral Concession Rules, 1972 , rules have been framed for the manner in which the mining leases are to be granted in respect of minor minerals. Sand is one such minor mineral. Under Rule 9 of the Rules, as amended, except for Granite the Collector is authorised to grant mining lease in respect of other minor Minerals Rule 9 provides that every application for mining lease shall be made in Form-A and shall be accompanied by a fee of Rs. 2,000.00 and the details of the land in respect of which the mining lease is applied for. It also requires that the application shall be accompanied by valid clearance certificate of payment of mining dues, such as royalty, dead rent, etc. Some other documents which have been mentioned in Rule 9 have also to be filed along with the application for grant of mining lease. The application for grant of mining lease is required to be disposed of within 120 days from the date of its receipt, as provided in Rule 11, and if it is not so disposed of, it shall be deemed to have been refused. It is not in dispute that before the amendment of Rule 11, the procedure prescribed under the rules was applicable to the grant of mining leases in respect of minor mineral-sand. However, Rule 11 of 11-F were incorporated by amendment of the rules with effect from 14-1-1995. It would be necessary to notice some of the amended rules. 11A. It is not in dispute that before the amendment of Rule 11, the procedure prescribed under the rules was applicable to the grant of mining leases in respect of minor mineral-sand. However, Rule 11 of 11-F were incorporated by amendment of the rules with effect from 14-1-1995. It would be necessary to notice some of the amended rules. 11A. Notwithstanding anything contained in these rules, the settlement of sand as minor mineral will be done by public auction by the Collector to the highest bidder on annual basis. Before the auction, the bidders shall produce royalty clearance certificate required under Rule 9(4) or an affidavit to the effect that he is/was not a lessee or permit-holder and that he does not owe any mining dues Explanation-Existing leases shall not be renewed nor fresh lease/ permits for sand shall be granted. Provided that in isolated and far flung areas of sand deposits which reasonably and conveniently cannot be settled by auction shall be identified by the Collector and on their being approved as such by the Commissioner, the competent officer may issue permits for removal of sand from such areas for such period not exceeding one year in respect of any one individual permit-holder. Provided further that such isolated and far flung areas can also be settled through public auction as and when so declared-by the Commissioner. Rule 11-B provides for deposit of security by the settlee of sand. It further provides that where the settlement is made by public auction, a deed shall ordinarily be executed in Form O or in a Form as near thereto as circumstances of each case may require. Rule 11-C is material which provides as follows: 11-C. However, the Collector may give preference to Co-operative Society, duly registered under Bihar and Orissa Co-operative Societies Act, 1935, having its members among those persons who; (i) Usually work as labourers in the Panchayat or Panchayats in which such sand deposits occur; (ii) are residents of the Panchayat or Panchayats for which the Society is formed; (iii) do not own more than five acres of agricultural of homestead land; Provided that the Society undertakes in writing to deposit an amount which is 20% higher than the amount realised as royalty from the same area in the calendar year immediately preceding. 6. 6. Rule 11-D provides that every such settlement shall be valid only for the calendar year in which it is so made irrespective of the date on which such settlee comes in its possession and in no case shall such settlement or possession continue in the succeeding calendar year. Under Rule 11-E after such settlement is made and deposit of 25 per cent of the settlement amount within seven days, the settlee may be put in possession of the area by the Collector. Rule 11-F provides for the manner in which the settlee is required to pay the balance amount. 7. As noticed earlier Rule 11 A to 11-F are special provisions relating to settlement of sand as minor mineral and do not apply to other minerals. Rule 12 (1), however, is significant and is reproduced below for the sake of convenience: 12. Preferential right f or obtaining mining leases.-(1) In granting the mining lease, the Collector shall give preference to Government Departments, Public Sector Undertakings of the State of Central Governments, local body, and Co-operative Society where the lease is required for work directly concerned with the Department, undertaking or body, if they fulfil the conditions required for the grant of mining lease. However, the Collector may give preference to such Co-operative Society all the members/share-holders of which belong to Scheduled Tribes or Scheduled Castes and which has duly been registered under Bihar and Orissa Co-operative Societies Act, 1935. 8. Rule 11-A begins with a non-obstante clause and provides that notwithstanding anything contained in the rules, the settlement of sand as minor mineral will be done by public action by the Collector to the highest bidder on annual basis. It is well-settled that a non-obstante clause is appended to a section in the beginning with a view to give the enacting part of the section, in case of conflict, an overriding effect over the provision of the Act mentioned in the non-obstante clause. Ordinarily, there is a close proximation between the non-obstante clause and the enacting part of the section, and the non-obstante clause may throw some light as to the scope and ambit of the enacted part in case of ambiguity, but where the enacting part is clear, its scope cannot be cut down by reason of non-obstante clause. Ordinarily, there is a close proximation between the non-obstante clause and the enacting part of the section, and the non-obstante clause may throw some light as to the scope and ambit of the enacted part in case of ambiguity, but where the enacting part is clear, its scope cannot be cut down by reason of non-obstante clause. Keeping in view the well-settled position in law, we may examine Rule 11-A. The Rule provides for the settlement of sand as minor mineral. The enacting part of Rule 11-A provides that the settlement of sand as minor mineral will be done by public auction by the Collector to the highest bidder on annual basis. There is no ambiguity. This has to be done notwithstanding anything contained in the rules, meaning thereby, the Bihar Minor Mineral Concession Rules, 1972. It is, therefore, apparent that in regard to the settlement of sand as minor mineral the procedure to be followed is one envisaged under Rule 11-A read in the light of other provisions made with regard to settlement of sand Ghats, namely, Rule 11-B to 11-F. It is not as if every other provision of the rules is to be ignored as inapplicable. Only those provisions which provide for any other manner of settlement will riot apply in the case of settlement of sand as minor mineral. Apparently, therefore, Rule 9, which provides for grant of mining lease by the Collector on application being made in the prescribed form accompanied by the necessary documents, will not apply to the grant of settlement of sand as minor mineral. In sum and substance, though the rules apply in respect of all minor minerals, so far as the procedure for settlement of sand as minor mineral is concerned, the special provisions made in Rule 11-A to 11-F shall apply i.e. the settlement has to be done by public auction by the Collector on annual basis. 9. The proviso to Rule 11-A provides that anything contained in Sec. 11-A shall not prevent the Collector from exercising his power under Rule 9 in cases covered by Rule 12 (i) hereinafter. This takes us to a consideration of Rule 12. 9. The proviso to Rule 11-A provides that anything contained in Sec. 11-A shall not prevent the Collector from exercising his power under Rule 9 in cases covered by Rule 12 (i) hereinafter. This takes us to a consideration of Rule 12. Rule 12 confers a preferential right for obtaining mining leases in favour Of Government Departments, Public Sector Undertakings of the State or Central Governments, local body and Cooperative Society, where the lease is required for work directly concerned with the Department, undertaking or body, if they fulfil the conditions required for the grant of mining lease. By an amendment made in October 1989, a Co-operative Society was included in rule 12 (1). By the same amendment, the Collector was authorised to give preference also to such Co-operative Society all the members/share-holders of which belong to Scheduled Tribes or Scheduled Castes and which has been duly registered under Bihar and Orissa Co-operative Societies Act, 1935. It cannot be disputed that Rule 12 (1) takes out from the ambit of Rule 11-A a mining lease granted to the Department, Undertaking or body mentioned therein which includes a Co-operative Society, but the condition is that the lease must be required by them for work directly concerned with the Department, Undertakings or body. The Collector may give preference also to such Co-operative Society whose members belong to Scheduled Tribes or Scheduled Castes, and in case of such Society it is not necessary that the lease is required for work directly by the said Co-operative Society. 10. The appellant-Society is not a Society covered by Rule 12(1) of the rules, nor is there anything to show that it is a Society all the members of which belong to Scheduled Tribes or Scheduled Castes. Consequently, it is not entitled to preferential right under Rule 12. It is not disputed before us that so far as the Co-operative Society of the description mentioned in Rule 12 is concerned, it has preferential right to obtain mining lease without taking part in public auction, one thing be, however, noticeable in Rule 12. While in the case of lease to be granted to a Government Department, Public Sector Undertakings, local body and Co-operative Society, which requires the lease for work directly concerned with the Department, Undertaking or body, the Collector is bound to give them preference, which is manifest from the use of the words shall give preference. While in the case of lease to be granted to a Government Department, Public Sector Undertakings, local body and Co-operative Society, which requires the lease for work directly concerned with the Department, Undertaking or body, the Collector is bound to give them preference, which is manifest from the use of the words shall give preference. In the case of Co-operative Society, all the members of which belong to Scheduled Tribes or Scheduled Castes, the Collector has a discretion to give preference, because the words used are the Collector may give preference to such Co-operative Society. The appellant-Society is not a Society which can claim preferential right under Rule 12 and, therefore, it is futile to contend that on the application made by the Society, which could be under no other provision except Rule 9, it was entitled for grant of mining lease. Except in cases covered by Rule 12, in all other cases the procedure to be followed is the one prescribed under Rule 11-A. 11. The question then arises as to how Rule 11-C has to be worked. Under Rule 11-C, the Collector may give preference to a duly-registered Co-operative Society having as its members those persons who usually work as labourers in the Panchayat or Panchayats in which such sand deposits occur, are residents of the Panchayat or Panchayats for which the Society is formed; and do not own more than five acres of agricultural or homestead land. There is also a proviso providing that such Society should give an undertaking in writing to deposit an amount which is 20% higher than the amount realised as royalty from the same area in the calendar year immediately preceding. The use of the Word royalty in the proviso has to be read with the definition of royalty under SCHEDULE H, Item 4, which provides that the royalty shall be paid on ordinary sand for construction at the rate of Rs. 6.00 per cubic metre, and in the alternative the royalty shall be deemed to be the amount of auction. This means that for the purpose of proviso to Rule 11-C, the Co-operative Society is required to give an undertaking in writing to deposit the amount which is 20 per cent higher than the amount for which the sand Ghat was settled in the preceding year. 12. This means that for the purpose of proviso to Rule 11-C, the Co-operative Society is required to give an undertaking in writing to deposit the amount which is 20 per cent higher than the amount for which the sand Ghat was settled in the preceding year. 12. Counsel for the appellant submitted that Rule 11-C is a special provision which gives a preferential treatment to a Co-operative Society which answers the description of a Co-operative Society as given in that rule and, therefore, it overrides Rule 11-A. It was, therefore, submitted that a Co-operative Society entitled to preference under Rule 11-C is not required to take part in the public auction, and if it is willing to pay 20 per cent more than the amount for which the sand Ghat was settled in the previous year, the Collector is bound to make a settlement in its favour. On the other hand, Counsel for respondent No. 4 contends that this, argument overlooks the fact that there may not be only one Co-operative Society claiming the settlement. There may be several Co-operative Societies who may claim settlement on preferential basis and, therefore, Some fair procedure has to be followed in the matter of grant of settlement to be made in favour of Co-operative Society. 13. Rule 11-A provides that the settlement of sand as minor mineral shall be done by public auction on annual basis. This is notwithstanding anything contained in the rules. The only one exception is made in favour of Departments, Undertakings or bodies mentioned in Rule 12 which has been given preference in the matter of grant of mining lease for all minerals including sand. We are, therefore, of the view that a Co-operative Society, such as the appellant, cannot claim a settlement under Rule 12 (1) and it can claim a preferential treatment only under Rule 11-C. As we read Rule 1-A and 11-C together, it appears to us that in case where the Collector decides to grant settlement of sand as minor mineral by public auction, he must issue a notice and invite all interested parties to take part in the public auction. Under Rule 11-A, if a Co-operative Society intends to take part in the public auction, there is nothing to prevent it from doing so as long as it does not claim a preferential treatment. Under Rule 11-A, if a Co-operative Society intends to take part in the public auction, there is nothing to prevent it from doing so as long as it does not claim a preferential treatment. It, therefore, follows that if a sand Ghat is to be settled by public auction individuals as well Co-operative Societies can take part in the auction and depending upon the bids made by them the Collector may make a settlement in favour of anyone of them. Under Rule 11-A if a Co-operative Society makes the highest bid, it will not be compelled to give an undertaking to deposit an amount which is 20 per cent higher than the amount realised as royalty from the concerned area in the calendar year immediately preceding. So far as Rule 11-C is concerned, if the Collector decides to give preference to Co-operative Societies answering the description as contained in Rule 11-C, it may invite the Co-operative Societies to attend the auction to be held on a given date, which shall be confined to the Co-operative Societies which are interested in taking the settlement. In such an auction only the Co-operative Societies may be invited to take part and as amongst them the one that makes the highest bid will be entitled to the settlement provided it has undertaken in writing to deposit an amount which is 20 per cent higher than the amount realised as royalty from the same area in the calendar year immediately preceding. The preference shown it favour of Co-operative Society under Rule 11-C is conditional and any Co-operative Society which takes part in an auction held by the Collector under Rule 11-C has to furnish an undertaking before hand, as required by the proviso to Rule 11-C. As distinguished from cases covered by first part of Rule 12(1), the Collector is not obliged to give preference to a Co-operative Society under Rule 11-C. The words used are however, the Collector may give preference to such Co-operative Society. Reading the rules harmoniously, we are of the view that the Collector is required to make settlement of sand as minor mineral by public auction. He may decide to hold public auction in which everyone who is eligible shall be permitted to take part. Reading the rules harmoniously, we are of the view that the Collector is required to make settlement of sand as minor mineral by public auction. He may decide to hold public auction in which everyone who is eligible shall be permitted to take part. In case he decides to give preference to Co-operative Societies, he may hold an auction in which Co-operative Societies which are registered and found eligible may be allowed to participate subject to an undertaking being given by them that they shall deposit an amount which is 20 per cent higher than the amount realised as royalty from the same area in the calendar year immediately proceeding. In such auction more than one Co-operative Society may take part and the Collector may thereafter make a settlement of the sand Ghat for an amount which in any case must be 20 per cent higher than the amount realised as royalty from the same area in the calendar year immediately preceding. 14. It is also possible to conceive that the Collector may issue a notice inviting all to take part in the public auction, and the same notice may as well state that in case the settlement is not made in favour of an individual, it may be made in favour of Co-operative Society subject to its undertaking as contained in proviso to Rule 11-C. In such a case if the Collector is satisfied that the highest bid is not 20 per cent more than the amount fetched in the preceding year, he may as well decide to make settlement with the Co-operative Society which is willing to give the undertaking in writing, as required by proviso to Rule 11-C. 15. Rule 11-A, which requires that settlement of sand as minor mineral shall be done by public auction, is intended to fetch the highest amount which the Government can get for settlement of sand. The highest bidder does have a claim to get the settlement. At the same time a Co-operative Society under Rule 11-C may claim a preferential treatment, but even in the matter of grant of preference all Co-operative Societies must be similarly treated. It is, therefore, of utmost importance that while holding an auction, whether for all, or limited to Co-operative Societies, the notice must inform all those eligible to take part in the auction to be held on the date specified. 16. It is, therefore, of utmost importance that while holding an auction, whether for all, or limited to Co-operative Societies, the notice must inform all those eligible to take part in the auction to be held on the date specified. 16. In the instant case for instance, the notice was for holding a public auction under Rule 11-A. In that public auction, it was open to the appellant-Society to make a bid and stake its claim for settlement. The appellant-Society did not do so and instead offered to take the settlement by offering Rs. 5,000.00 more than the highest bidder. In the absence of notice to other, Co-operative Societies, a settlement under Rule 11-C could not be made in favour of the appellant-Society, because if a proper notice was published it may be that more Co-operative Societies may have taken part in the auction and may have offered more than what the appellant-society offered. We are, therefore, of the view that where the settlement is sought to be done by public auction or where a preference is sought to be given to the Co-operative Society under Rule 11-C, a proper notice must first be issued making it clear as to whether public auction is being held under Rule 11-A or whether the settlement is sought to be made under Rule 11-C or both. If this procedure is followed, all concerned may take part in the auction, and no one can complain of arbitrary action against the concerned authority. The preference, if shown in favour of a Co-operative Society, without notice to other Co-operative Societies which may be interested in taking settlement, would be in breach of Article 14 of the Constitution of India, and such a procedure cannot be approved by this Court. 17. There is one more reason why a proper notice should be given about the holding of public auction under Rule 11-A or grant of preference to a Co-operative Society under Rule 11-C. The Co-operative Society must also be eligible for taking part in the auction. If the Co-operative Society is a defaulter in the matter of payment of royalty, it may not be eligible to take part in the auction. Similarly, it may riot be allowed to take part in the auction if it is not a registered Co-operative Society or a Society of which registration has been cancelled. If the Co-operative Society is a defaulter in the matter of payment of royalty, it may not be eligible to take part in the auction. Similarly, it may riot be allowed to take part in the auction if it is not a registered Co-operative Society or a Society of which registration has been cancelled. If proper notice is given and every bidder has knowledge about other bidders, they can take an objection as to the eligibility of a person or a Co-operative Society for grant of settlement. In the instant case, Counsel for respondent No. 4 submitted that after his client had made the highest bid, a Co-operative Society suddenly came into the picture, and on the basis of Rule 11-C claimed settlement. Respondent No. 4 had no opportunity to object as to the eligibility of the appellant-Society, because there was nothing to show that the Society was eligible in all respects to take settlement of sand as minor mineral. Thus, on a reading of Rule 11-A to 11-F we have reached the following conclusions: (i) Under Rule 11-A if the Collector decides to grant settlement of sand as minor mineral by public auction, he may permit individuals as well as the Co-operatives and others to take part in the public auction, and thereafter grant the settlement in accordance with the rules. If a Co-operative Society takes part in the public auction held under Rule 11-A, it would not be required to comply with the proviso to Rule 11-C. (ii) If the Collector decides to give preference to Co-operative Societies in the matter of settlement of sand, he may give public notice of his intention to do so, so that all eligible Co-operative Societies which may be interested in taking the settlement may take part in the auction to be held for this purpose. However, while granting preference to Co-operative Societies under Rule 11-C, the Collector must see to it that the amount offered by the Co-operative Society is 20 per cent higher than the amount realised as royalty from the area in the calendar year immediately preceding. The holding of an auction even when the Collector decides to give preference to Co-operative Societies is essential, because in the matter of grant of preference the principles enshrined in Article 14 of the Constitution apply. The holding of an auction even when the Collector decides to give preference to Co-operative Societies is essential, because in the matter of grant of preference the principles enshrined in Article 14 of the Constitution apply. (iii) To those categories described in Rule 12(1), a mining lease may be granted without their taking part in a public auction. Rule 12 applies to grant of mining lease in respect of all minor minerals, including sand and proviso to Rule 11-A excludes from this operation the grant of mining lease on preferential basis, as envisaged under Rule 12(1). (iv) It is open to the Collector to hold a public auction under Rule 11-A in which no preferential treatment shall be given to any Cooperative Society. It is equally open to him to give preference to Co-operative Societies under Rule 11-C, subject to the conditions laid down in Rule 11-C, If he so decides, it is also open to him to give public notice to the effect that the settlement may be made in favour of a Co-operative Society under Rule 11-C, and in case no Co-operative Society is willing to take settlement under Rule 11-C, there shall be an auction under Rule 11-A or vice-versa. Such a composite notice is no excluded on a fair reading of Rules 11-A to 11-F. 18. Counsel for respondent No. 4 submitted before us that the learned Judge has, in effect, held that under Rule 11-C the Co-operative Societies do not get any benefit. It was, therefore, submitted that Rule 11-C should not be interpreted in such a manner that the very purpose of the rule is defeated. It is well-settled that if a law gives preferential treatment to a particular class, the rule must be so construed as to make the benefit available to that class, and the benefit sought to be conferred should not be curtailed by giving to the law a restricted meaning. However, if the benefit sought to be conferred is itself limited, it is not the duty of the Court to extend the benefit sought to conferred by the law, so as to make the provision more beneficial than what the framers of the law intended to confer. However, if the benefit sought to be conferred is itself limited, it is not the duty of the Court to extend the benefit sought to conferred by the law, so as to make the provision more beneficial than what the framers of the law intended to confer. It is true that under Rule 11-C if a Co-operative Society claims a preference, it has to give an undertaking that it will deposit an amount which is 20 per cent higher than the amount realised as royalty from the same area in the calendar year immediately preceding. It is not as if the provision of Rule 11-C does not confer any benefit upon the Co-operative Society. It may be that in a public auction the highest bid may be much more than the amount which the Co-operative Society is required to undertake to deposit under proviso to Rule 11-C, and in such a case a real benefit accrues to a Co-operative Society. It may be that the settlement may have been made in the proceeding year for a very large amount, and it may not be commercially viable to take the settlement by paying 20 per cent more than what was realised in the preceding year. In such a situation, the Co-operative Society may choose not to claim any preference under Rule 11-C and may rest content by taking part in public auction held under Rule 11-A. 19. In the instant case, as we have notice earlier, a notice was issued for holding a public auction under Rule 11-A. There was no notice to Co-operative Societies that a settlement may be made in favour of a Cooperative Society under Rule 11-C. In the absence of such a notice, the appellant-Society could not be permitted to claim preference under Rule 11-C. If at all, it could take part in the public auction held under Rule 11-A. In case it was decided to give preference to Co-operative Societies, it was incumbent upon the Collector to issue a fresh notice intimating that an auction will be held under Rule 11-C giving preference to Cooperative Societies so that all eligible Co-operative Societies could take part in the auction. 20. We are, therefore, of the view that the learned Judge was right in holding that the settlement made in favour of the appellant-Society was not in accordance with law, and deserved to be set aside. 21. 20. We are, therefore, of the view that the learned Judge was right in holding that the settlement made in favour of the appellant-Society was not in accordance with law, and deserved to be set aside. 21. This appeal is, therefore, dismissed. 22. While disposing of the writ petition the learned Judge had directed the District Mining Officer to make settlement of the dispute Ghats by holding a fresh public auction after issuing a public notice of holding public auction for settlement of the disputed Ghats within a week from the date of receipt/production of a copy of the order. It was also directed that the date of public auction will be so fixed that the settlement is make by March 31, 1999 and the period of settlement shall end on 31st December, 1999. Till then the appellant was permitted to operate the Ghats. We are informed that pursuant to the order of this Court, a public notice was given for settlement of sand Ghats under Rule 11-A on 17-3-1999 and auction was also held on 19-3-1999. Counsel for respondent No. 4 herein states that he was again the highest bidder in the said auction, but in view of the order of stay of this Court in this Appeal, no settlement has been made till today. 23. Since we have dismissed this appeal, the stay order is also vacated, and it will be open to the respondents to make settlement on the basis of public auction held by them, so that the period of settlement expires on 31-12-1999. The settlement should be made within a period of one week from the date on which a copy of this order is produced before respondent No. 3. For the delay in making the settlement proportionate deduction in the bid amount shall be granted by the authorities.