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Madhya Pradesh High Court · body

2006 DIGILAW 186 (MP)

TARAMATL AGRAWAL v. STATE OF M. P.

2006-02-02

ABHAY M.NAIK

body2006
( 1 ) THIS petition relates to refusal of renewal of lease for major minerals for a period of 20 years prayed for by the petitioner, in respect of mining lease granted to her. ( 2 ) BRIEF facts relevant to the petition are that the petitioner is engaged in the business of mines and minerals. She was granted a mining lease by the Government of Madhya pradesh for extraction of dolomite and soap stone as major minerals over an area of 4. 178 Hectares situated in village Keolari, tahsil Gotegaon. District Narsinghpur for a period of 5 years from 3-12-1984 to 2-12-1989. It is contended by the petitioner that during the continuation of the mining lease, she established her own industry for manufacturing of marble chips, dolomite powder, marble sheets, tile size minor and finished marble in the name of M/s. Tara Minerals. According to the petitioner, the minerals extracted from the subject mine were being used in her own aforesaid industry. The petitioner applied for renewal of mining lease on 21-11-1989 under Rule 24-A of Mineral concession Rules 1960, for a period of 20 years. It is stated that the State Government vide order dated 21-2-1992, contained in annexure-'d' granted renewal of the said lease merely for a period of 5 years. This order is under challenge on the ground that the same is non-speaking and contrary to rule 26 of Mineral Concession Rules, 1960. A revision petition preferred against the said order was also dismissed on 11 -4-1994 vide annexure-'f'. ( 3 ) RESPONDENTS submitted its return and denied the claim of the petitioner. It is stated in the return that the grant of renewal is a discretion which has been rightly exercised by the authorities. It is further stated that no renewal could be made for a period of 20 years and the impugned orders do not call for any interference. ( 4 ) SHRI R. S. Jaiswal, learned senior counsel made a submission that the impugned order contained in Annexure-'d' is illegal being in contravention of Rule 24-B and Rule 26 of the Mineral Concession rules, 1960. He further submitted that the rejection of renewal is without giving the petitioner an opportunity of being heard and is violative of Rule 26 (supra ). ( 5 ) SHRI P. N. Dubey, learned Dy. He further submitted that the rejection of renewal is without giving the petitioner an opportunity of being heard and is violative of Rule 26 (supra ). ( 5 ) SHRI P. N. Dubey, learned Dy. Advocate General contended that the application for renewal contained in Annexure-'c' was for a period of 20 years, which itself was bad in law. He submitted that no industry was established at the time of grant of mining lease and subsequent establishment of an industry and subsequent consumption of major minerals extracted from the subject mine in the industry owned by the petitioner herself, will not enable the petitioner to avail Rule 24-B of the Mineral Concession Rules 1960. According to the learned dy. Advocate General, the renewal could have been at the most for a period of 10 years. However, he urged that the power of renewal being a matter of discretion was rightly exercised and the impugned orders contained in Annexures 'd' and 'f' do not call for any interference under Articles 226 and 227 of the Constitution of India. Additionally, he stated that the petition is liable to be dismissed in view of the provisions of the M. P. Minor Mineral Rules, 1961. ( 6 ) SHRI R. S. Jaiswal, learned senior counsel in reply stated that the M. P. Minor mineral Rules, 1961 are not applicable in the present case because the mining lease relates to major minerals. ( 7 ) THUS, the following submissions have been made by the learned senior counsel for the petitioner. (i) In view of sub-section (2) of Section 8 of Mines and Minerals (Regulation and Development) Act 1957, the mining lease ought to have been renewed for two periods each not exceeding 10 years. Accordingly, the renewal ought to have been made for a period of 20 years. (ii) The application of the petitioner submitted for renewal of mining lease under rule 24-A of the Mineral Concessions Rules 1960, ought to have been granted for 10 years because Rule 24-B of the said rules makes it obligatory when a person is holding mining lease for a mineral which is used in his own industry. According to the learned senior counsel, the lessee alone has an option to apply for a lesser period and the authorities could not have curtailed the period of renewal for a period lesser than 10 years without consent of the lessee. According to the learned senior counsel, the lessee alone has an option to apply for a lesser period and the authorities could not have curtailed the period of renewal for a period lesser than 10 years without consent of the lessee. (iii) The impugned order granting renewal, merely for a period of 5 years is arbitrary and illegal. (iv) No opportunity of hearing was granted while passing the impugned order contained in Annexure-'d', in contravention of Rule 26 (1) of the said rules. A renewal for a lesser period than the one for which prayer has been made, amounts to refusal to grant and opportunity of hearing ought to have been given in view of Rule 26 of the said Rules. This having not been done, the impugned orders are bad in law and are liable to be quashed. ( 8 ) I considered the submissions of the rival parties and perused the record in the light of provisions governing the rights of the petitioner and the powers of the respondent State. ( 9 ) AS regards applicability of M. P. Minor mineral Rules 1961, it is suffice to say that the lease in question relates to major minerals Division Bench of this Court in the case of Ram Das Agrawal v. State of Madhya pradesh, reported as AIR 1996 MP 96 has held in paragraph 9 of the judgment that the M. P. Minor Mineral Rules, 1961 framed by the State Government are not for regulating the grant of mining leases in respect of major minerals. In view of this binding authority the submissions made by the learned Deputy Advocate General relating to provisions of M. P. Minor Mineral Rules, 1961 are not liable to be considered in the present case. ( 10 ) THIS Court is now required to examine the various provisions of law referred to by the respective counsel. Section 8 of the mines and Minerals (Regulation and Development) Act, 1957 reads as under : "8. Period for which mining leases may be granted or renewed : (1) The period for which a mining lease may be granted shall not exceed twenty years. Section 8 of the mines and Minerals (Regulation and Development) Act, 1957 reads as under : "8. Period for which mining leases may be granted or renewed : (1) The period for which a mining lease may be granted shall not exceed twenty years. (2) A mining lease may be renewed for two periods each not exceeding ten years : provided that no mining lease granted in respect of a mineral specified in the First schedule shall be renewed except with the previous approval of the Central Government ). (3) Notwithstanding anything contained in sub-section (2), if the Central Government is of opinion that in the interest of mineral development it is necessary so to do, it may, for reasons to be recorded, authorise the renewal of a mining lease for a further period or periods not exceeding in each case the period for which the mining lease was originally granted. " Rules 24-A and 24-B of the Mineral Concession Rules, 1960 are reproduced below 24a. Renewal of mining lease : (1) An application for the renewal of mining lease shall be made to the State Government in form-J, at least twelve months before the date on which the lease is due to expire, through such officer or authority as the State government may specify in this behalf. (2) An application for the first renewal of a mining lease granted in respect of a mineral specified in the First Schedule to the act, may, subject to the provisions of subsection (2) of Section 8 and with the previous approval of the Central Government, be granted by the State Government. (3) An application for the first renewal of a mining lase granted in respect of a mineral which is not specified in the first Schedule of the Act may, subject to the provisions of sub-section (2) of Section 8, be granted by the State Government. (4) An application for the renewal of a mining lease shall be disposed of within a period of six months from the date of its receipt. (5) If an application is not disposed of within the period specified in sub-rule (-4)it shall be deemed to have been refused. (4) An application for the renewal of a mining lease shall be disposed of within a period of six months from the date of its receipt. (5) If an application is not disposed of within the period specified in sub-rule (-4)it shall be deemed to have been refused. (6) If an application for first renewal of mining lease made within the time referred to in sub-rule (1) is not disposed of by the state Government before the date of expiry of the lease, the period of that lease shall be deemed to have been extended by a further period of one year or end with the date of receipt of the orders of the State Government thereon, whichever is shorter. (7) The second or subsequent renewal of a mining lease in respect of any mineral, shall be granted by the State Government only with the prior approval of the Central government and be subject to the provisions of sub-section (3) of Section 8. 24b. Renewal of mining lease in favour of a person using the mineral in his own industry : Every person who is holding mining lease for a mineral which is used in his own industry shall be entitled for the renewal of his mining lease for a period of ten years unless he applies for a lesser period. " rule 26 of the said Rules is also being invoked by the learned Senior Counsel for the petitioner, so the same is also reproduced below : "26. Refusal of application for grant and renewal of mining lease : (1) The State government may, (after giving an opportunity of being heard and) for reasons to be recorded in writing and communicated to the applicant, refuse to grant or renew a mining lease over the whole or part of the area applied for. (No. 1922)/63-MII, dated 18-7-63 ). (2) An application for the grant or renewal of a mining lease made under Rule 22 or Rule 24-A, as the case may be, shall not be refused by the State Government only on the ground that Form I or Form J, as the case may be, is not complete in all material particulars or is not accompanied by the documents referred to in sub-clause (d), (e), (f), (g) and (h) or clause (i) of sub-rule (3) of rule 22. (3) Where it appears that the application is not complete in all material particulars or is not accompanie by the required documents, the State Government shall by notice, require the applicant to supply the omission or, as the case may be furnish the document, without delay and in any case not later than thirty days from the date of receipt of the said notice by the applicant. " ( 11 ) SUB-SECTION (2) of Section 8 of Mines and Minerals (Regulation and Development)Act, 1957, provides for a maximum period of renewal at one instance which is 10 years. So, the authorities can be said to be within their rights to curtail the period of renewal unless the same is prohibited by any express provision of law. Learned senior counsel for the petitioner tried to invoke Rule 24-B for this purpose which contemplates that use of mineral extracted by the lessee from her mine in her own industry shall make her entitled to renewal of her mining lease for a period of ten years unless she applies for a lesser period. It is an admitted fact in the present case that at the time of grant of mining lease to the petitioner, no industry belonging to the petitioner was in existence. It has been subsequently established. Thus, it cannot be said that the petitioner has used the minerals extracted from the subject mine in her own industry. On the contrary the interpretation suggested by the learned Sr. Counsel for the petitioner will make the lessee entitled for the renewal of his mining lease for a period of 10 years even if he uses the mineral in his own industry even for few days. This cannot be the intention of the legislature while providing a right to the lessee to have renewal for a period of 10 years. Thus, the petitioner cannot take benefit of rule 24-B of the Mineral Concession Rule 1960 and the authorities are found to have a power to grant renewal merely for a period of 5 years by making curtailment in the period as prayed for. However, the question which now crops up is about the manner of exercise of this power. ( 12 ) AS regards objection mentioned at no. However, the question which now crops up is about the manner of exercise of this power. ( 12 ) AS regards objection mentioned at no. 3 and 4, sub-rule (1) of Rule 26 is quite clear which empowers the State Government to refuse to grant or renew a mining lease after grant of an opportunity of hearing and reasons to be given in writing for refusal and their communication to the applicant. This sub-rule makes it obligatory on the part of the State Government (i) to give an opportunity of hearing; (ii) to record reasons in writing and (iii) to communicate such written reasons to the person applying for renewal of lease. Application for renewal is contained in Annexure-'c, whereby the renewal was sought for a period of 20 years. Under sub-rule (2) of Section 8 of the Mines and Minerals (Regulation and Development)Act, 1957 a mining lease may be renewed for two periods each not exceeding ten years. The impugned order contained in Annexure-'d' no where reveals that the petitioner was given an opportunity of hearing before refusing the renewal or the proposed period of 10 years. No reason has been assigned for making curtailment in the period of renewal. Obviously, the petitioner had not prayed for renewal for a period of 5 years. On the contrary, she has expressly applied for a period of renewal of 20 years. Thus, in any case, if the authority wanted to reduce the period of renewal to 5 years, an opportunity of hearing ought to have been granted, in view of Rule 26 of the Mineral Concession Rules, 1960. Moreover, reasons in writing were also liable to be recorded by the state Government. A perusal of the impugned order marked as Annexure 'd' clearly goes to show that no reason has been recorded for making curtailment in the period of renewal of lease to 5 years. The impugned order is also further found in contravention of sub-rule (1) of Rule 26 of the said rules, since, no written reasons for refusing the period of renewal of lease are found to have been communicated to the petitioner. ( 13 ) IN the result, the petition is partly allowed in as much as the power of the State government to renew a lease for a period of merely 5 years is upheld. ( 13 ) IN the result, the petition is partly allowed in as much as the power of the State government to renew a lease for a period of merely 5 years is upheld. However, the same having been not exercised in accordance with Rule 26 of Mineral Concession Rules. 1960, the impugned orders contained in annexures-'d' and 'e' are hereby set aside. The respondents are directed to decide the application for renewal afresh after giving an opportunity of hearing to the petitioner in accordance with the aforesaid Rule 26 and to pass a reasoned order and communicate the same to the petitioner in accordance with law. No order as to costs. Petition partly allowed. .