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2007 DIGILAW 1636 (PAT)

Idio Construction (India) Ltd. v. State Of Bihar

2007-10-05

NAVANITI PRASAD SINGH

body2007
Judgment 1. A supplementary affidavit has been filed today on behalf of petitioner making certain additional prayer. The same is considered and will form part of the records of these proceedings. 2. The petitioner has filed this writ application against Annexure-1 being an order issued from the District Mining Office, Lakhisarai as contained in Memo No. 326 dated 14.6.2007. By the said annexure, the petitioner-Company has been directed not to mine, despatch and sell minor mineral, the Company having a lease for major mineral. It was required to stop mining minor mineral and the transport challans issued by the Mining Department were being cancelled. 3. State has appeared and filed its counter affidavit and rejoinder thereto has been filed. There have been several intervention applications challenging the authority of the so-called Chairman-cum-Man-aging Director of the Company to file the writ application but I do not intend to go into this aspect as the question of who is in the management and control of the Company is not a subject matter that can be decided in these proceedings. The interveners have liberty to take appropriate steps in this matter as envisaged in the Indian Companies Act, 1956. This view, I am taking, because there is no dispute that it is the Company which is incorporated in terms of the Indian Companies Act, 1956 that holds the lease. Lease is not in name of any individual but a corporate entity. 4. With the consent of parties, this writ application has been heard and is being disposed of at the stage of admission itself. 5. The basic facts are not in dispute. The petitioner-company had applied for mining lease for major mineral that is silica stones in the shape of quartz and quartzite. They were granted this lease for a period of thirty years in the district of Lakhisarai. The lease in question, which was ultimately granted, has not been annexed but the same is not disputed. What is annexed instant is the recommendation with regard to the grant of lease and the various terms and conditions thereof which are also not in dispute. The lease in question, which was ultimately granted, has not been annexed but the same is not disputed. What is annexed instant is the recommendation with regard to the grant of lease and the various terms and conditions thereof which are also not in dispute. One of the terms was, as is apparent from the letter from the State Mines Department to the Collector, Lakhisarai with regard to grant of lease to the petitioner, that if in course of mining mineral, the lessee finds that the mineral being one is of an inferior quality then he will have to produce a test certificate in this regard and only then could he be permitted to remove the same. Here, it will be seen that this clause that is Clause XIV (b) contemplates of inferior quality of the mineral. The case of the petitioner is that the moment they started their mining activity they found that the quartz quartzite (silica stones) which they were able to mine was an inferior quality and, as such, they send it for analysis. The analysis reports are annexed as Annexure-6 series. The said report clearly certifies that the said minerals were fit for use as building materialf The lessee, accordingly, moved the district authorities who got the matter enquired. As per reports, it is suggested that at present the substantial quantity of mineral being-mined by the petitioner-Company was the inferior grade quartz quartzite (silica stone) It appears that the Collector then made a recommendation to the State Government in terms of Clause XIV(b) as referred to above for grant of permission to the petitioner to deal with minor mineral. The State Government considered the same at different levels and ultimately, in principle, the Secretary of Department of Mines and Geology agreed to accord the permission (Annexure-13) but it appears that as at that time in the year 2005, State was under the Presidents rule, no order was finally passed and/or communicated to the petitioner as the matter had to be referred to the Governor. It seems thereafter nothing happended. 6. On behalf of the State, the allegation is that having taken lease for major mineral what in fact was being mined and despatched was minor mineral. This gains significance because the royalty payable in respect of major mineral is Rs. 28.00 per tonne whereas that of minor mineral is about Rs. 44.00. It seems thereafter nothing happended. 6. On behalf of the State, the allegation is that having taken lease for major mineral what in fact was being mined and despatched was minor mineral. This gains significance because the royalty payable in respect of major mineral is Rs. 28.00 per tonne whereas that of minor mineral is about Rs. 44.00. Thus, there being substantial difference, the problem arises. 7. In view of the aforesaid facts, the petitioner asserts that in order to mine major mineral, he has to remove minor mineral at the first instance. The same cannot be prevented by the State. 8. The Mines and Minerals (Development and Regulation) Act, 1957 defines what is a minor mineral. Section 3(e) of the Act defines minor mineral and is quoted hereunder: "minor minerals" means building stones, gravel, ordinary clay, ordinary sand other than sand used for prescribed purposes, and any other mineral which the Central Government may, by notification in the Official Gazette, declare to be minor mineral." 9. What is not minor mineral is major mineral under the Act. A reference to the said definition of minor mineral would show that minor mineral is no special type of mineral but it is the usage to which such mineral is put which decides whether it is major or minor. Chemically and geologically they may be the same but if its end use is of a particular nature as contemplated in terms of Sec. 3(e) above, it would become a minor mineral. Here, quartz quartzite (silica stone) undoubtedly is a major mineral where it is certified to be low grade then its only use can be as building stones, gravel or stone chips or in road. The moment that is so, it becomes a minor mineral. Admittedly, the petitioner has no licence to mine minor mineral. 10. Learned Advocate General has referred to R. 27(1)(a) of the Mineral Concession Rules, 1960 to submit that the moment the lessee discovers any mineral not specified in the lease he shall report the matter to the State Government and shall not mine the same till he has obtained a lease for such mineral. His submission is that the petitioner had a lease for mining major mineral and, as such, the moment he got a certification that if was in fact a minor mineral, the petitioner-lessee had to obtain a fresh lease. His submission is that the petitioner had a lease for mining major mineral and, as such, the moment he got a certification that if was in fact a minor mineral, the petitioner-lessee had to obtain a fresh lease. In my view, the submission of the learned Advocate General cannot be accepted. What Sec. 27(1)(a)(b)(c) contemplates is lease for mining a particular mineral and in fact mining another. Here, this is not the case. The mineral remains the same. It is quartz quartzite (silica stone). There is no different mineral that is found, a case contemplated by the above provision is where there is a lease, for example for bauxite and what is found there is coal then the two are distinct minerals. The second cannot be mined without a fresh lease in that regard. Here, in that regard, the mineral is the same. 11. Alternatively, the learned Advocate General has submitted that in terms of R. 27(1)(o), the petitioner, on discovery of minor mineral in a lease for major mineral, was bound to obtain permission from the State Government before he could deal with minor mineral. In my view, the submission is well-founded. It is because of this that Mr. Giri, learned Senior Counsel appearing for the petitioner has filed a supplementary affidavit praying for a direction to the State Government to grant requisite permission. Mr. Giri submits that a reference to Annexure-13 being the office notings of the Department of Mines and Geology, Government of Bihar would clearly show that in fact as far back as in 2005, the Secretary of the said Department has approved grant of permission but the same could not fructify because the matter was to be referred to the Governor as the State was under Presidents rule but could not be referred and the matter then went into hibernation. Whatever it be, the fact remains that till date, petitioner has not been granted permission as contemplated under sub-rule (o) of R. 27(1). Mr. Giri, learned Senior Counsel appearing for the petitioner submits that once the Secretary, Department of Mines and Geology, Government of Bihar took a decision to accord permission, which should be taken that the requisite permission in terms of R. 27(1)(o) was granted. I am afraid, this argument cannot be accepted for it is well settled that an order which remains in the files is not an order that creates a right. I am afraid, this argument cannot be accepted for it is well settled that an order which remains in the files is not an order that creates a right. Before a right can be created in a person, the order must be communicated to him. This has been well established by various decisions of this Court and the Apex Court in such matters. Here, it is only a recommendation which never was communicated to the petitioner, which remained in Government files. As such, this cannot create any right in favour of the petitioner. In this connection, I may also refer to various other documents annexed to the writ application to which Mr. Giri drew attention of this Court wherein in case of such other lessees, the Government has granted the requisite permission and communicated the same. This argument itself shows that communication of the decision of the Government to the concerned person or at least the decision travelling out of the Government files is necessary to make such a decision a binding decision, for a decision which remains in Government files can always be altered at any point of time and, thus, does not attain a finality. 12. In that view of the matter, I am afraid, the impugned Annexure-1 cannot be interfered in any manner. It is legal and in consonance with the statutory provisions as referred to above. 13. Mr. Giri submits that in order to mine major minerals, it is first necessary to extract minor mineral and, therefore, necessary permission has to be granted. In this regard, I can only say that it is for the petitioner to move the Government and seek the permission. The Government must expeditiously decide the issue. It cannot leave the matter as it has already been left dormant for over two years. Government must realise that if permission was granted then by now in the last two years, substantial amount of royalty would have been collected because, as indicated above, the royalty of minor mineral is twice that of major mineral. The inaction on part of Government has itself led to substantial loss to Government and petitioner has managed to take advantage and remove minor mineral in the shape of major mineral, thus, avoiding payment of royalty. It is the Government to be blamed for such action and/ or inaction. The inaction on part of Government has itself led to substantial loss to Government and petitioner has managed to take advantage and remove minor mineral in the shape of major mineral, thus, avoiding payment of royalty. It is the Government to be blamed for such action and/ or inaction. This matter as to the past conduct is not for adjudication of this Court. 14. In that view of the matter, I find no merit in this application. It is dismissed accordingly with the observations as made above. 15. I may clarify that this writ application is limited for the purposes of the rights of party with regard to minor mineral as found in the leased area.